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What if I presented you with the following data on health care costs in the US (these are roughly 2009 dollars)?

1972: $54 billion

1980: $116 billion (doubling in less than a decade!)

1990: $200 billion

2000: apx $320 billion

You’d likely point to the 6-fold real increase in “costs” and say, “yep, that’s a major problem.” I don’t want to get into whether or not that is a problem right now, or whether it is correct to call these expenditures “costs” I want to raise quite a different issue. What issue?

Well, the data from above represents (roughly) the total spending on pollution control (public and private) in the United States since 1972. Direct pollution control spending now takes up about 2% of GDP, far larger than at any point in our history. And the increasing cost of pollution control is making it harder and harder for ordinary Americans, whose wages have stagnated since 1980 while the richest Americans have seen their incomes explode, to secure the pollution control that they want. For some families, they are having to face the hard choice to consume more pollution control, or other basic necessities. Therefore, it is imperative that Congress steps in and does something before the nation is bankrupted, and 50 cents on every dollar is “taken up” by pollution control.

Of course, all I did was replace “health care” with pollution control from the way the health care issue is typically presented. Yes, health care does “take up” a far larger share of our expenditures now, so perhaps that is a justification as to why that is different? If we want to take up that route, then as compared to 1900, “non-necessities, where I include health care in necessities” have increased from being only 27% of our spending to over 47% of our spending.

Ironically, one thing I agree with from the health reform perspective is that it is very likely that health spending can be reduced considerably and we would not expect to see much of a decline (if any) in measured health outcomes (see here for an example). But then how come these very same “reformers” refuse to make the same observation when it comes to public education, public environmental spending, regulatory expenditures, and the like? They may dance around and conjure up some explanation, but it does not rescue them from the utter inconsistency of these views. So what is it going to be? I’ll jump in bed with ya on health reform if we reform all of the other “costly” spending items too.

One Response to “Is Spending Bad or Good?”

  1. Rod says:

    I don’t know if you know about the Marcellus Shale gas deposits in Pennsylvania, New York and Ohio, but there is a gold rush going on up there, and it just might make a lot of people rich and prosperous. The fly in the ointment is the chorus of environmental activists who worry that groundwater will become contaminated by the gas wells themselves or by the chemicals used to aid the “fracking” process that releases the gas from the shale.

    Most of these environmental concerns arise from superstition, not science. One of my friends is a fisherman who enjoys fly fishing in the Wellsboro area, and he does not want the evil oil companies to pollute “his” stream. Well, there’s zero chance of that. The Marcellus shale is a whole mile or more underground, while the aquifers are only a thousand feet down at the most. Fracking the rock 4,000 feet below the aquifer will not do anything to pollute the water. At any rate, that’s not enough for the environmental crowd, especially those environmentalists who are also commies.

    The Marcellus shale threatens the whole renewable energy business. There may be 80 years’ of worldwide gas supplies down there, and all that cheap gas will compete with the more-expensive windmills and solar panels. Why, we may be able to heat our homes for cheap again! Hooray!

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