He writes,

The President is attempting to claim credit for [health care] savings that (a) do not yet exist, (b) are not backed up by any specific changes in industry practices or government policies, and (c) are related to him only in that the groups announced they were adopting his quantitative goal. For all three of these reasons, the President’s claim that these savings will materialize is wildly unrealistic, and it is absurd to attach a per-family savings number to it. This is like the Mayor claiming credit for the 40 additional wins now, and telling fans that he will be responsible for the team winning the pennant. No one should take these claims seriously.

The serious issue in health care is that we cannot all have unlimited access to medical services without having to pay for them. Obama the wonk recognizes this. But Obama the politician knows that you cannot sell health care reform by telling people it means getting fewer medical procedures. So he offers lollipops instead.

As Hennessey points out, the whole point of today’s announcement is to show political muscle, so that the Republicans just roll over. I see conservatives and Republicans as in an impossible position (even before all the health care lobbyists lined up on Obama’s side). Imagine you are a parent, and you have been having an issue with your kid about junk food and snacking between meals. Next thing you know, your mother is over for a visit, offering the kid a lollipop. At this point, you can forget the anti-junk-food campaign. You have nothing but down side if you try to get between your kid and grandma’s lollipop.

Obama’s health care plan is positioned like grandma’s lollipop. You cannot stop it. You’ll just have to deal with the consequences down the road.

By the way, if you think I’m the only economist who is cynical about the political process, read William L. Davis and Bob Figgins in Econ Journal Watch.