President Trump’s politics are often labeled as “populist.” Three recent executive actions show he’s delivering on the promise of that label.
Populist politics invariably involve some version of the slogan “the people vs. the powerful.” Whether from the left or the right, populist policies try to help ordinary people to make their own way or to get a better deal by restricting powerful people or entities from exerting market or monopoly power. Trump’s latest orders and proposed regulations do exactly that.
The first removes the exclusive power of the government over the operation of apprenticeship programs. The proposed rule instead allows industry associations and others to devise and run their own apprenticeship programs without federal or state direction. This should dramatically increase the number of such programs, as entities that have an interest in training workers can do so quickly and design curricula that meet their specific needs.
These new, flexible apprenticeships should be a boon to less-educated workers, who were Trump’s primary backers in 2016. These people today either enroll in costly college courses to obtain training — often dropping out before completion, saddled with student debt — or join ineffective, federally run job-training programs. Trump’s approach removes the powerful middleman that blocks these people’s opportunity to rise.
The second action is a proposed regulation that allows employers to offer employees health reimbursement accounts, which workers could then use to purchase their own health insurance plans. Most people get their health insurance straight from employers, but they often pay more than they want, since employers have to provide the same plan to all employees by law. This regulation removes the powerful employer from the role as purchaser of everyone’s insurance policy, giving people the power to choose a plan that provides the products they want at a price they can afford.
This regulation could expand health insurance coverage at a much lower cost than the subsidized plans available on the Obamacare exchange. Chris Pope, a senior fellow at the Manhattan Institute, notes that many small employers do not offer health insurance at all. The proposed regulation allows HRA funds to be used for recently deregulated short-term health plans, which typically offer premiums much lower than those available on the exchanges because they are exempt from Obamacare regulations. Pope argues this could offer small employers — even those that don’t offer health plans — a cheaper option for employee care, which could increase health coverage. Again, this gives people power to improve their well-being by disempowering powerful middlemen.
The third action is an executive order requiring hospitals to publicly disclose the prices they charge for services. Advocates contend this will empower consumers to make more-informed choices when they select which hospitals they will go to for treatment. Once more, people are empowered at the expense of access-controlling entities.
Many people have criticized the measure, arguing that patients tend not to use price information when choosing medical care because of concerns over quality or time pressures. Someone going to the emergency room, for example, won’t have time to choose cheaper care, and others will be prevented from doing so because hospital admitting privileges would require them to use an unfamiliar doctor for a preferred procedure.
But that ignores how insurers and other hospitals can use the disclosed information to lower medical costs. Hospitals often secretly negotiate different prices for the same procedure with different insurers. Insurers would be able to gain access to these prices under the order, which in turn means they could use the fact that a competitor obtains a lower price to bargain their own prices down. Other hospitals could compete for insurer favor by undercutting another hospital’s price, too. Employers could also get into the mix, studying which insurers seem to strike better deals and favoring those who can deliver more for less. The overall effect is uncertain, but the likely outcome would be lower prices for people and less profit for the powerful.
Left-wing populists such as Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.) have been campaigning on a “people vs. the powerful” theme all year. Trump’s alternative offers people real power without hobbling them with higher taxes. He should make measures such as these a more prominent feature of his reelection campaign and recapture the populist mantle from his Democratic competition.