Subsidiarity and the Single Payer, Part Two: A Response to David W. Cooney

May 10, 2017

I have been honored by a response written by David W. Cooney of Practical Distributism [1] to my article, Subsidiarity and the Single Payer [2], which appeared on these pages on April 1, 2017. In his article he concludes, contrary to my position, that “Single Payer is clearly a violation of the principle of subsidiarity and Catholic Social Teaching.” [3]

Now it really seems that we are in no immediate danger of having a single-payer system enacted, the latest congressional trends appearing to move in the direction of less overall insurance protection for the American population rather than more. Still, this is an important discussion to be having. As political winds change, and as the private health insurance system demonstrates ever more conclusively its unsustainability in the ensuing years, a single-payer health system may well become a serious proposal. So it would be a good idea to decide now if Catholicism really prohibits its advocacy because of the principle of subsidiarity.

In Subsidiarity and the Single Payer I conclude that subsidiarity allows for a single-payer system. Mr. Cooney, in his article entitled Subsidiarity vs. Single Payer, reaches the opposite conclusion. We might get some distance toward deciding who’s right about this by subjecting Mr. Cooney’s objections to some scrutiny.

Mr. Cooney opens by setting forth what he perceives as the critical positions I must demonstrate if I am to make my case:

“His argument seems to depend on two points which I think are incorrect. The first is that the question of subsidiarity ‘does not turn on jurisdiction, but on competence. Subsidiarity is not federalism.’ The second is the fact that some health care services are very expensive, and the fact that health insurers in the United States lack the power to contain those costs, means that the highest level of government has the right and responsibility, according to the principles of subsidiarity, to step in to assist paying for all health care services. This response is an explanation of why I believe he is wrong on both points.”

He is right that I hold that subsidiarity does not turn on jurisdiction, but on competence, and that subsidiarity is not federalism. I hold that because it is true, as is evidenced by the classic statement of the principle by Pope Pius XI in Quadragesimo anno:

“When we speak of the reform of institutions, the State comes chiefly to mind, not as if universal well-being were to be expected from its activity, but because things have come to such a pass through the evil of what we have termed ‘individualism’ that, following upon the overthrow and near extinction of that rich social life which was once highly developed through associations of various kinds, there remain virtually only individuals and the State. This is to the great harm of the State itself; for, with a structure of social governance lost, and with the taking over of all the burdens which the wrecked associations once bore. [sic] the State has been overwhelmed and crushed by almost infinite tasks and duties.

“As history abundantly proves, it is true that on account of changed conditions many things which were done by small associations in former times cannot be done now save by large associations. Still, that most weighty principle, which cannot be set aside or changed, remains fixed and unshaken in social philosophy: Just as it is gravely wrong to take from individuals what they can accomplish by their own initiative and industry and give it to the community, so also it is an injustice and at the same time a grave evil and disturbance of right order to assign to a greater and higher association what lesser and subordinate organizations can do. For every social activity ought of its very nature to furnish help to the members of the body social, and never destroy and absorb them.

“The supreme authority of the State ought, therefore, to let subordinate groups handle matters and concerns of lesser importance, which would otherwise dissipate its efforts greatly. Thereby the State will more freely, powerfully, and effectively do all those things that belong to it alone because it alone can do them: directing, watching, urging, restraining, as occasion requires and necessity demands. Therefore, those in power should be sure that the more perfectly a graduated order is kept among the various associations, in observance of the principle of ‘subsidiary function,’ the stronger social authority and effectiveness will be [sic] the happier and more prosperous the condition of the State.” (Secs. 78-80) [4] 

Three points can be derived. The first is that the subsidiarity principle is nowhere articulated to set standards for the relations between governments in a federal system. The principle’s focus is, rather on the relationship between the State and “subordinate groups,” that is, groups that are part of the private sector.

The second point is that the lines between what ought to be done by larger versus smaller associations, or vice versa, are not fixed, but due to “changed conditions many things which were done by small associations in former times cannot be done now save by large associations.” Historical circumstances play a role in determining whether a large or a small association should perform any given function.

The third point is that whether a function should be handled by the State or the private sector, a large association or a smaller one does indeed turn on competence. As Pope Pius XI articulated the principle of subsidiarity, “it is an injustice and at the same time a grave evil and disturbance of right order to assign to a greater and higher association what lesser and subordinate organizations can do.” (Emphasis added.) The evil is in assigning to the higher association what the lesser organization can do, not what it cannot. Mr. Cooney isn’t certain if I mean “ability” here, so let me assure him that I do. But willingness to perform would also be included. Simply because a lesser organization is able to perform a function does not foreclose a higher association from doing so if the lesser organization refuses to act.

I sense that he feels that I am overthrowing the natural order of things by this pragmatic approach to determining what functions should be performed by whom. I, on the other hand, cannot fathom what sense there is in a doctrine that would hold that an association that cannot perform a function very well should still be made to do so, just in order to prevent the higher order association from doing it, as if such a happening would be an evil in itself. Fortunately, there is nothing about the subsidiarity principle that would compel me to adopt such an impetus to absurd outcomes. 

But Mr. Cooney invokes the family to show that competence for subsidiarity purposes should not be understood in the ability sense, but in the sense that certain entities have certain roles given to them by nature, and those roles ought not to be usurped on that ground alone. He says this:

“Subsidiarity is based on human nature and the natural and moral laws. This is what determines who has the natural role for given responsibilities, and those who have a role have a natural jurisdiction, which we could also call competence, to fulfill it. Following the principles of subsidiarity, we understand that the higher orders of society have the function and responsibility to provide assistance (subsidium) to the lower orders when needed. This is why the state has no right to usurp a parent’s role in educating children, but does have the right to assist (but not to compel) parents with the education of their children. The Church teaches that ‘it is an injustice and at the same time a grave evil and disturbance of right order to assign to a greater and higher association what lesser and subordinate organizations can do.’ One can use subsidiarity to determine what roles are proper to the different levels of society. In other words, competence in the sense sense [sic] of Catholic Social Teaching is not incompatible with jurisdiction, and we can discuss jurisdiction and authority without resorting to, or resulting in, federalism.”

Of course, the family is a natural, organic entity, with functions originating not in conscious human political arrangements, but in nature. As Pope Leo XIII put it in Rerum Novarum, “inasmuch as the domestic household is antecedent, as well in idea as in fact, to the gathering of men into a community, the family must necessarily have rights and duties which are prior to those of the community, and founded more immediately in nature.” (Sec. 13) [5] The family precedes the State, and we should not allow the State to enter into the life of the family and supplant the parental role.

Except there are times when we allow the State to do exactly that. If the children in a family are being severely abused in some manner, the State intervenes when it is discovered, and this often results in the termination of parental rights. This is certainly not the ideal outcome for a family, but it is sometimes a necessary one. And when parental rights are terminated, pending adoption by a willing family, the children are under the guardianship of the State. And, during that time, the parental role is indeed taken over by the State.

Now if this is the case with an association that God has created, how much more those associations that derive from human ingenuity? God made the family. But if the family does not function in the manner that it is supposed to do, the State may legitimately intervene for the safety of the family members. Human beings constructed the federal system of the United States. That system, as worthy as it is, is not more sacrosanct than the family. If the State can intervene and reassign functions when the family does not perform in accordance with God’s assignments, it certainly may do so when political and private sector entities devised by human ingenuity fail to function in a manner conducive to human flourishing.

Therefore, Mr. Cooney does not accomplish what he hopes by introducing the family into the discussion. The family certainly has a set of natural, God given functions. But that doesn’t spare it from State intrusion, even to the point of usurping the parental role when circumstances require it. States of the United States and local governments cannot claim the same natural underpinnings as the family.  Contrary to Mr. Cooney’s claim, then, one must indeed resort to federalism in order to claim that healthcare should be a state or local matter rather than a federal one. And federalism is not a part of Catholic doctrine. The United States could reconfigure itself into a single government, and so long as that government did not unwarrantably intrude into the family or private associations, the principle of subsidiarity would not be violated.

Competence may not be incompatible with jurisdiction, as Mr. Cooney points out. But the subsidiarity principle is not a question of jurisdiction, but of competence.

Of course, the fact that subsidiarity isn’t federalism doesn’t excuse giving the federal government any function at all. As Mr. Cooney points out,

“Just because a condition is common across the country does not make it the responsibility of the federal government. If the assistance can be rendered community by community by more local social institutions or governments, then the federal government would be violating the principle of subsidiarity if it took over the role of rendering that assistance. The federal government could only justify stepping in where those more local institutions didn’t already exist or lacked the resources to address the issue. ‘In light of the principle of subsidiarity, however, this institutional substitution must not continue any longer than is absolutely necessary, since justification for such intervention is found only in the exceptional nature of the situation.’ In other words, part of that assistance would be to help establish the more local institution and help it to arrange acquiring the necessary resources on its own so that the assistance being given will become unnecessary. In addition, the principle of subsidiarity means that the federal government cannot step in where the more local institutions exist and have the ability to deal with the issue at the local level.”

Now Mr. Cooney keeps importing federalist ideas into the subsidiarity principle, speaking as he does of local governments. As I’ve mentioned, subsidiarity does not require countries to have a federal system. Still we should address whether state or local governments can operate a single-payer system as well as the federal government. This is because of the fact that federal, state, and local governments quite arguably stand in a relation to each other of greater to lesser associations, apart from questions of federalism.

The question at hand, then, is whether a lesser or lower association can operate a single-payer system as well as the federal government. To answer that question we really should first understand what a single-payer system is.

“A single payer refers to a system in which one entity (usually the government) pays all the medical bills for a specific population. And usually (though, again, not always) that entity sets the prices for medical procedures.

“A single-payer system is not the same thing as socialized medicine. In a truly socialized medicine system, the government not only pays the bills but also owns the health care facilities and employs the professionals who work there.

“The Veterans Health Administration is an example of a socialized health system run by the government. The VA owns the hospitals and clinics and pays the doctors, nurses and other health providers.

“Medicare, on the other hand, is a single-payer system in which the federal government pays the bills for those who qualify, but hospitals and other providers remain private.” [6]

The single payer, then, performs two basic functions: (1) funding of healthcare, and (2) negotiating the cost of healthcare. Let’s consider if any organizations within the United States, governmental or otherwise, can perform these functions as well as the federal government.

When it comes to funding, nobody does it better than the federal government. Mr. Cooney says that we should change things so that state or local governments could better afford it. Of course, if the state or local governments funded the healthcare system it would still be government funding. But the federal government has an advantage over even local and state governments: it can issue its own fiat currency.

Now, certainly, all due caution is necessary in issuing fiat currency. We don’t want to go the way of the Weimar Republic, and create uncontrollable inflation. But a fiat currency has this advantage: the money supply can grow in relation to the economic activity of the nation, i.e., it can grow according the nation’s actual wealth. For this reason, there is more flexibility in the federal government to allow for an unbalanced budget. Even if more taxes went to state and local governments, those governments would not be able to duplicate that ability.

But it is the very fact that a single payer program has to be paid for with taxes that makes the federal government the proper residence for the single payer. If states operated their own single payer systems, then it would behoove them to operate them as inexpensively as possible, so that they would be able to collect less in the way of taxes. Lower tax rates are one way that states try to lure businesses to locate within their borders. So the states would be in competition with one another to offer the medical care that was least expensive to the state, which would very likely have an unfortunate impact on the quality of care. However much the subsidiarity principle applies to intergovernmental relations in a federal system, it certainly does not require that the system deliver lesser quality care just so the system can be run locally.

Another problem that would arise with states or localities running a single-payer system would be the unequal means that would be at their disposal. There are rich and poor states; there are rich and poor counties. Obviously, the kind of healthcare that states or localities will be able to fund will vary according to wealth, leaving poorer areas at a disadvantage. But the whole idea of having a single payer system in the first place is to help those with smaller incomes. The rich can afford healthcare on their own. We can break the nation up into states, counties, townships, and, eventually, individuals. The smaller the units we use, the more the purpose of single-payer, which is to give people access to healthcare they otherwise could not afford, is defeated.

Here it might be argued that the federal government could perform its proper subsidiary role by taking money from rich localities to help out poor ones. But that would be a required answer only if there was something inherent in the nature of a state or locality that makes either of them the proper place to handle healthcare on a governmental level. Not everything should be handled locally. Few would argue that national defense should be left to the states, for example. It is insufficient to simply assert that localities or states are the proper places to administer governmental healthcare systems without explaining why that should be so. It’s not as if they are like families, with natural, God-given features. It did not come down from Mt. Sinai that national defense should be handled by the federal government and healthcare by the state or local. What is of that status is the principle that higher associations should not usurp what lower associations can do. And if the subsidiary principle has any application at all to intergovernmental relations in a federal system, then, for states or localities to be the proper places for the administration of a single-payer system, it must be the case that they can do it as well as the federal government. But they surely cannot, as has been shown.

So to demand that the states or localities fund the system, with the federal government keeping watch over the inevitable inequalities, is more in the nature of adding epicycles to the system than keeping to the principle of subsidiarity. And while violating Occam’s razor may not be a sin, it is prudent to avoid it.

What has been said about the ability of governmental entities and their abilities in being funding sources applies with more force to private organizations which do not have the power to tax. It is healthy to wince at the use of government force, but it is not something to be wholly avoided, “for he beareth not the sword in vain.” (Romans 13:4) The ability to compel payment into the system makes the State a more reliable funding source than any private organization that must rely on voluntary donations.

When it comes to the function of negotiating the cost of healthcare, the case for the federal government becomes overwhelming. Medical costs have been rising faster than the rate of inflation for years. [7] It is apparent that the medical insurance industry is too weak a negotiator to keep provider costs down. What the single-payer system can do is require all providers to negotiate with, essentially, one customer, creating a monopsony. This will have a downward pressure on prices as surely as a monopoly medical provider would create an upward pressure.

To accomplish this, there must be one negotiator for the entire country. We already know that the many private health insurers are unable to keep prices down. It is doubtful that fifty or more governmental entities negotiating separately would be able to do as well as one negotiator for the entire country. It would not be as difficult for a provider to leave a state if it didn’t like what it was being offered then for it to leave the country. It is beyond reasonable doubt that a single negotiator for the entire country would be more effective than a number of them. And that function would best be served by either the federal government, or by a corporation federally created for the purpose.

Funding and negotiation are the only two things necessary for a single-payer system to operate. Much regulation and control could be left at the state level, such as the licensing of physicians, or the chartering of hospitals. Localities could erect hospitals or other healthcare centers. Private entities could do the same. It cannot be emphasized too much that single-payer health coverage is not socialized medicine. Not one health provider need be a federal employee under a single-payer system, and not one hospital need be a federal institution. The only functions that would be federal would be in the two areas where the federal government, or an entity created by the federal government, would have abilities decidedly superior to what could be produced at the state level, locally, or privately.

But Mr. Cooney suggests that we could avoid this tragedy if we decided to change the way medical services were paid for. His suggestion is this:

“Our current model of providing and paying for health care is not the only possible one. To take just one example, subscription based medical providers have proven to make general and preventive care very affordable for the average family. For poor families who cannot afford the subscription, the costs are low enough that religious and other more local organizations or government can render the assistance of paying for their subscriptions. If we implemented this type of system as a standard, medical insurance would only be needed for emergencies and long term conditions and for particularly expensive procedures. This would lower the overall costs of insurance making it more affordable for families and making local institutions more capable of assisting those who cannot afford insurance. Subscription based medical services is only one of many ways that the means of acquiring health care services and lowering their costs could be addressed.”

Of course, whether religious or other local organizations or governments could chip in would depend upon the cost of the subscriptions. Prices can range from $1,200.00 to $20,000.00 per year. [8] Whether they would chip in even if they could would depend upon their own priorities. No one can guarantee that their contributions would be sufficient. One thing is for certain, and that is that the medical providers will require a profit, and so the costs of participation in the plan will have to be higher than the value of the total services rendered to the plan participants. And since the elderly and sick would use more of the plan than others, the young and healthy, who would be sharing in those costs if they joined the plan, would be incentivized to avoid participation and pay for their healthcare as need arose. Moreover, as Mr. Cooney himself points out, the subscription wouldn’t cover everything. One would still need insurance to cover catastrophic care, which would create even more people who couldn’t afford a total health package, and the need for even more of the private philanthropy that Mr. Cooney hopes for. But, as the parable of the Rich Man and Lazarus informs us, private philanthropy is not always to be counted on.

With a single-payer system, on the other hand, the poor wouldn’t have to rely on the rich being in a beneficent mood. They could know that whatever their medical needs were, it would be taken care of. People would pay for it according to their means, and there would be no discrimination based on what those means were. Society as a whole would benefit, because the single payer, which would also be the single negotiator, would keep medical costs down better than would be the case under any other arrangement.

Yes, there are plans other than single-payer that could be operated on a local, state, or private level. Some already are. But none of them guarantee universal coverage the way single-payer does. Mr. Cooney’s best subsidiarity based argument would be to show that some local plan would actually work better than a single-payer system, because that’s what the principle of subsidiarity is about: what can be done on a lower level as well as a higher level should be done on the lower level. But the principle does not require us to accept something not as good simply because it operates under the auspices of a lower association.

Now what this means, of course, is that the argument about whether to adopt a single-payer system has to be based on the merits of single-payer versus other options. It is inadmissible to simply raise the issue of subsidiarity, and argue on the incorrect basis that subsidiarity is a jurisdictional question rather than one of competence. If single-payer is the best health system for human flourishing, there is nothing in Catholic social teaching that forbids it. The law was made for humanity, not humanity for the law.


--Jack Quirk