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Voting sucks.

OK, now that I got that off my chest, here is today’s post. A bright student of mine was telling me why he believes as a normative matter that “we” should have health reform:

The whole debate about health care centers around whether or not you consider health care to be a privilege (something you earn and buy as a commodity) or whether you think universal care is something that a society should provide for its members if possible. It is my opinion that this is a case in which we as a society should be willing to accept a loss in efficiency for a gain in equality. … But I think this is a case where we should be willing to sacrifice efficiency for equality – and we are not that efficient anyway in our current “system”.

He raises very many interesting points, but I’ve dealt with all of them at various points on this site. Indeed, almost all of us want health reform – but that does not mean universal health care or health insurance. Today I want to focus on one simple idea – that in government, and for people who think government is the solution to all of our problems, the word tradeoff simply does not exist. It cannot. Let’s see why.

Implicit in the arguments that “we have a duty” to make sure the sick and infirm are not dying in the streets is that we are so damn rich that it would be a moral outrage to allow that to happen while other families have 6 cars and 12 televisions and take quarterly sojourns to the beaches of Hawaii. I agree! I happen to think that people care enough that the poor and infirm would be taken care of without government in the way. But suppose I am wrong.

If people truly cared about the poor and the permanently infirm being taken care of, I would not be as ascerbic as I am. I don’t believe for a second that the majority of people who argue for health reform really give a damn about the poor or infirm – it just makes them feel good to say it, or be more acceptable in the company of others. Why do I say this so strongly? Because providing even a very generous level of support to the poor and the infirm is so easily within our reach that it is laughable to suggest otherwise. Instead, “we” use the poor and infirm as pawns in a corporatist game, in a middle-class entitlement game, special-interest game, political-nanny-statism game, and no one is willing to admit it.

Look at it this way. You want to argue that the world’s richest economy could easily sacrifice a little income to make sure people do not die (early, unnaturally, due to the poverty that used to kill people) because of income or for the seriously infirm to go without care. I agree. If you add up all of the annual expenditures by local governments, state governments, and the federal government in the United States, you would get a figure around $6 trillion. That would make the US government the world’s single largest economy, and by a factor of 20%.

For a federal government to spend $3.5 trillion per year and still find itself with this health care crisis is so much more inexcusable than arguing that “society is so rich that we should trade off some efficiency for some equity.” What the heck are we doing with $3.5 trillion (or $6 trillion if you add all levels of government)? The US government (all levels) has 20% more resources itself than the next largest economy in the world does yet it cannot take care of health care for the poor and chronically infirm? Where on the list of priorities must this really be? Is it ahead of mohair subsidies, sugar subsidies, windmill subsidies, funding for education schools, and so on? What kind of bizarre world am I living in? And I am being asked to sacrifice a little more just to see that we’ll get it right this time?

Or think of it this way. Some very serious and intelligent people believe that we could fund very important and basic functions of the federal government for $1 trillion per year. Suppose we cut the federal budget in half as well. That would still leave us with $1 trillion to dedicate to health care for the poor and the infirm. There is no conceivable way that this number would exceed 60 million Americans, that is explicitly exaggerated to make my point. How much money would be available to take care of the health care for 60 million people if $1 trillion in funds were dedicated to them? How about $16,667 per person. That means for a poor family of 4, the federal government would have almost $67,000 per year to help out with health care expenses. For a poor family of 8, there would be $133,000 of funds. Even with the world’s least efficient health care system, that is far beyond the level of support that we would need to provide world class care to all of the poor and infirm.

So be proud of yourselves for voting for Team Nike or Team Reebok today. Swill back the cool refreshing elixir of campaign and political success, and enjoy the moment of smugness that comes with the “now our guys will come in and clean some house” moment of an electoral victory, or the delight you take in the Team Reebok concession speeches and the political commentary about the party being in shambles and suffering from a leadership and confidence crisis. And remember that both Team Nike and Team Reebok have been and continue to be the “board of directors” of the richest “country” in human history, and cannot even scratch the surface of a problem that they blithely exclaim is the most serious one facing our country. Show me a real company that would still exist with that kind of track record? Show me a real company that would get a single soul to show up for its annual picnic on the first Tuesday of November and I will show you a dystopian novel written by the most miserable person who ever lived.

Voting sucks.

Update: “next” was omitted to 3rd paragraph from end in original post, and has since been corrected.

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33 Responses to “The Political Economy of Health Care”

  1. BJS says:

    I have very mixed feelings about healthcare and how it should be run. I strongly agree with your student that sacrificing efficiency for equality in this instance is okay, but I agree that the gov’t is as inefficient as it gets.

    I am confused about a few things though, you say you believe that people care enough abour the poor to take care of them without the gov’t (is there any statistical proof that would suggest this to be true? I personally wouldn’t mind paying a little more to help poor people with health care bills, but I probably wouldn’t go out of my way to donate this money…does that make me irrational?) Then right afterwards you say that people who argue for healthcare reform don’t give a damn about poor people?! Are you arguing that people who don’t argue for healthcare reform would help the poor but people who do won’t?…..

    Anyways, back to my point, what should someone like be believe in?
    1) I don’t want any one to be unable to afford their healthcare bills.
    2) I don’t want the gov’t to waste my money.
    3) I don’t believe people will take care of the poor’s health without the gov’t.

  2. jb says:

    FYI Question 4 on Mass. ballot today (non-binding):

    “to support legislation that would establish health care as a human right regardless of age, state of health or employment status, by creating a single-payer health insurance system like Medicare that is comprehensive, cost-effective, and publicly provided to all residents of Massachusetts”

    OMG! Who’d a thunk, we have had the solution before us all along, Medicare is apparently comprehensive and cost-effective!!

  3. Tracy W says:

    I’m puzzled. How can the US government at all levels have more money to spend than the total US economy? (On an ongoing basis, I’m cool conceptually with it having more assets than US gdp or being able to borrow more than total US gdp [note: cool conceptually as in the concept doesn't make my head ache, not cool as in think that would be an excellent thing to do]).

  4. david s says:

    The American Health Care System, which has always been a public/private venture, operates under the dictum: “Pay more, get less.”

    We’re a few years into the Romneycare experiment here in Massachusetts and there is no sign that the cost curve is bending.
    This election, and the one that will follow, will feature no challenges to our absurd attitudes towards medical care. Maybe there should be more Phys. Ed. and Economics classes at the High School level so that the next generation will have a more realistic attitude towards health.

    Voting does suck, but the alternatives suck more.

  5. [...] Rizzo over at Unbroken Windows hits a home run with this post on health care (HT: Arnold Kling at EconLog). Rizzo writes: For a federal government to spend $3.5 trillion per [...]

  6. JPIrving says:

    For real.

    Government spending per capita in the U.S. is about even with Sweden as it stands today, yet the U.S. doesnt come close to providing the range of services that Sweden or other better run states do. Either a Swedish level of spending just isnt quite enough, or government in the U.S. is tragically wasteful and run by lazy, evil people.

  7. [...] wintercow20 says it way better than I can: And remember that both Team Nike and Team Reebok have been and continue to be the “board of directors” of the richest “country” in human history, and cannot even scratch the surface of a problem that they blithely exclaim is the most serious one facing our country. Show me a real company that would still exist with that kind of track record? Show me a real company that would get a single soul to show up for its annual picnic on the first Tuesday of November and I will show you a dystopian novel written by the most miserable person who ever lived. [...]

  8. Rick Stewart says:

    The idea that ‘poor’ people in the United States can’t afford health care is a myth easily busted by arithmetic. I am 59 years old, I buy an individual Blue Cross/Blue Shield policy with post-tax money. $5,000 annual deductible, it pays 100% after that, any doctor, anywhere in the world, $2 million maximum lifetime benefit. Cost $288/month or $3,456 per year. This is the equivalent of only 477 hrs of work at minimum wage of $7.25, or one 10 hour shift per weekend, 48 weeks per year.

    I fully agree that ‘poor’ people don’t WANT to spend $3,456/year on health insurance (neither do I). But to claim they can’t afford to do so – that’s complete nonsense.

  9. WhiskeyJim says:

    Your last point regarding the health care fiasco is the most prescient in your argument to me. ‘Fixing’ the health care problem is incredibly easy; some simple reforms that nurture a free market would send current costs plummeting.

    If the government then insisted on subsidizing individuals (as opposed to institutions) then those individuals could purchase policies on the open market. As an example, people use government issued food stamps to purchase food without destroying the food industry. But everyone still eats.

    That we can not extricate the government from health care is surreal. We are now living in 1984.

  10. [...] more here: The Political Economy of Health Care | The Unbroken Window Tags: curious-task, men-how, really-know No Responses to “The Political Economy [...]

  11. [...] from: The Political Economy of Health Care | The Unbroken Window Tags: curious-task, men-how, really-know No Responses to “The Political Economy [...]

  12. Harry says:

    Holy cow, wintercow!

    I read your post and thought as I was reading it as a really good one for the archives, full of facts which would have taken me who knows how long to assemble, and followed by solid analysis leading any of us to answer the next question. A piece to go into one of your ten future book files.

    This is a record since I have followed theunbrokenwindow, which began in the Spring before the 2009 USGA Women’s Open. Speedmaster has yet to make a terse pertinent comment.

    Clearly this is an indicator of how Perfesser Rizzo gets minds working. Great job, Mike.

  13. Harry says:

    By the way, I disagree that voting sucks, but I am sure if you were allowed to revise and extend your comments you might convince me that your comment should not have been interpreted literally.

    Fradulent voting is reprehensible. Motor Voter, which registers anyone is reprehensible. Voting in alphabetical order for dead people before the polls open is reprehensible. The people who commit these crimes call their deeds shenanigans, and they go unpunished because some, by no means all, are the ones who get to write the law.

    Voting is also sometimes unpleasant because we are presented often with bad choices. Hey, I voted for Arlen Specter, and I realize that if you are from New York, it has been tough on all sides, not just Upstate. Imagine the dilemma of choosing between Charlie Rangel and Adam Clayton Powell III?

    Think about it, Wintercow: at least you live in Rochester, and not Syracuse, where the decision could have been tougher.

  14. [...] The Political Economy of Health Care | The Unbroken Window How much money would be available to take care of the health care for 60 million people if $1 trillion in funds were dedicated to them? How about $16,667 per person. That means for a poor family of 4, the federal government would have almost $67,000 per year to help out with health care expenses. For a poor family of 8, there would be $133,000 of funds. Even with the world’s least efficient health care system, that is far beyond the level of support that we would need to provide world class care to all of the poor and infirm. (tags: politics economics healthcare) [...]

  15. Brandon says:

    Wow, great post! Very eloquent and thought-provoking. Now, if politicians (or constituents for that matter) just understood that — or maybe just half of that — we would be much better off. I will be printing this out for future reference.

  16. Michael Smith says:

    The author wrote:

    “Implicit in the arguments that ‘we have a duty’ to make sure the sick and infirm are not dying in the streets is that we are so damn rich that it would be a moral outrage to allow that to happen while other families have 6 cars and 12 televisions and take quarterly sojourns to the beaches of Hawaii. I agree!”

    But why? Why does one man’s need give him a moral claim to another man’s property?

    Why am I born with a duty to help the stupid, the irrational, the foolish, the ignorant, the lazy, the incompetent, the drug abuser, the alcoholic, the school-drop-out, the criminal, the gang bangers, the pushers, the pimps, the prostitutes — and, yes, the just plain unlucky that suffer a disaster of some sort — in short, why am I born with a duty to help anyone who engages in any of these behaviors that can result in one being too “needy” to pay one’s own doctor bills?

    Why does being an utter failure in life entitle one to live at the expense of any man who puts forth the conscientious effort to insure that he pulls his own weight and is not a burden to anyone else?

    Why does the decision to work hard and become prosperous automatically make one responsible for the actions and inactions of other individuals — individuals over which one has no control or influence of any sort?

    Why does a *failure* to produce and earn a value — such as the money to pay one’s doctor bills — entitle the non-producer, non-earner to that value — while producing and earning the value obligates you to surrender it to the non-producing, non-earner?

    No one’s ever provided a rational justification for this nonsense. It rests solely on the fact that people are morally intimidated and terrified of being branded “selfish”. But the fact is every human being is born with the right to be selfish — with the unalienable right to exist for their own sake and work in the pursuit of their own happiness, by means of their own honest effort, with no obligation to others except to respect that they have the same, identical rights.

    Justice demands that the earned be granted and the unearned withheld — that individuals be held responsible for the consequences of their own actions and not punished for the actions of others. Withholding the earned and granting the unearned — punishing one man for another man’s actions — these are the very definition of *injustice*. And nothing can justify an injustice.

    Yet injustice is precisely what is demanded by this vicious notion that we have a duty to help the needy. It’s way past time to stop saying “I agree” every time someone invokes this trash and instead denounce it for the vicious nonsense it is.

    Man is not born a slave in a free society.

  17. my own man says:

    first of all, we must come to grips with the difference between health insurance “reform”, and the legislation ramrodded through congress by the left. Reform is not the goal of “Obummercare”; destroying the private health insurance industry is.

    How so? Eliminating the pre-existing condition exclusion, while setting the “penalty/tax” for not carrying insurance at a max 2% of AGI gives a substantial portion of the citizenry a solid economic reason to drop their insurance coverage until needed; pay premiums while under treatment, then drop it again when treatment is done. Hardly a workable business model (just ask the folks in MA how Mitteycare is working out).

    No, Obummercare is a blatant attempt to exert gov’t control over another 16-17% of GDP, to complement the 28% of GDP already under Fed control.

    Hayek stated that an economy that is at least 51% controlled by goverment can be considered socialist. With Obummercare, and counting state and local government, we are very close to the 51% threshold.

    Will the US pull back, or become the “Eurozone West”?

  18. jack jackson says:

    3 Points come to mind…

    1/ Rights are something you’re born with (from God or “natural”) When you have to forcibly take another person’s property for a “right,” it’s no longer a right… however “benevolent” you can justify that taking. It’s something else. It’s disingenuous to confuse such concepts… and ultimately, dangerous.

    2/ If Healthcare is a “right” … then certainly, food is too. No? It’s MUCH more vital to life. You see the slippery slope here when you cede government in this way. You make IT the most important power (Godlike), instead of giving that (choices/ freedom) to citizens, and LIMITING government. Our founders (philosophically / revolutionarily) based their new government upon this bedrock principle to ensure freedom & maximize liberty. The road to hell… IS paved with good intentions.

    3/ Marvin Olasky, in his book ‘The Tragedy of American Compassion’ argued that when government usurps personal & private charity, we move toward losing true caring… our souls, if you will. (You can see it in Europe) “Olasky argues that indiscriminate government handouts of aid do not better the individual; instead, they merely foster further moral laxity and irresponsibility.” They also corrupt government, which is (almost) corrupt by definition. http://www.thefreemanonline.org/columns/book-review-the-tragedy-of-american-compassion-by-marvin-olasky/

  19. Hungry Hank says:

    BJS (response #1) hits the nail on the head with everything he says. Our government has a track record that is muddled with such utter incompetence that it would make any sensible person weary of a solution to our health care problems that involves an expanded role for government. With that said, I don’t buy for a second that the solution to the problem is to end all regulation, let free markets rip, and leave health care support to charitable contributions by the affluent. Considering everything you preach in class about how self interested and generally individualistic people tend to be, do you really think enough people are going to charitably contribute enough money to adequately “take care of” the sick and chronically ill who cannot afford care? Like BJS said, “is there any statistical proof to suggest this would be true”? How many charitable health care donations occurred before 1965 (when medicare and medicaid were implemented)? I don’t know the answer to that question, so I could be wrong, but I would certainly guess that this type of massive charity has not been prevalent in the in the past, so what makes you think it would happen now? Maybe your basic thought process behind this revolves around the idea that if the government got out of the way altogether and stopped taxing people so heavily in all areas, they would have more money and possibly more altruistic spirit, ultimately making these sorts of transfers/charitable contributions more realistic. It’s possible, but I am still skeptical of that. If enough people really cared about providing support for those who cannot afford health care, our current health care system would be much different. Politicians are mostly self interested, and if voters truly wanted a better and more equitable health care system, you’d see many more politicians standing on a hill for a profound change in health care policy.

    So if what I am saying is true – that people will not make the necessary charitable contributions on their own to take care of the sick and chronically ill lower income folks – (and i’m not guaranteing that it is, i’m just putting forward my best guess), then one could ask the question, “is it fair/right for any government to force its citizens to make contributions that they might not have made otherwise?” This is a debate for another day, but my answer, at least with regards to health care would be an emphatic YES.

    It is my opinion that it is a societal duty, no matter how we go about achieving it, to make it possible for the poor, sick, and chronically ill to afford/attain needed care – given that it is so within our reach to do so. (And yes, Rizzo and Rick Stewart, basic arithmetic shows that most poor people can technically “afford” health care. But this doesn’t mean that health care isn’t much more costly for the poor than it is for wealthier individuals. Remember, cost is about tradeoffs – and paying at least $2,500 for a basic health plan out of a 25,000 dollar income requires making much more significant and important tradeoffs than would be required of a person who makes $50,000 – to the point where it is often simply not worth it for a poor person to purchase insurance, especially considering that no one knows when they are going to get sick and therefore if the purchase of health insurance is even necessary).
    Anyways, the point is that most sensible people can agree on the fact that our current “system” (if you can even call it that) is an embaressment and needs to be improved. But I just don’t agree that the best way to improve our health system is to take government/regulation out of the equation. Other countries have proven that notion to be false. For example, France and Germany have health care systems that consistently place atop the world rankings by most major organizations. Why do they consistently rank so high?- Because everyone there can get quality care (not just those who can afford it), waiting times are no longer than they are here, doctors are just as competent as they are here, and they do it all for half the cost per capita! Those are just the facts – and both of those systems among the many other successful European systems are heavily regulated (not to say these systems don’t also have flaws). They are able to be successful because people and governments in those countries really care about having quality and equitable health care – it is of the highest priority over there. You can’t say the same about people and politicians in the U.S.A. If people here really did care about having quality health care for all, our system would be much different than it is now – as our system reflects the values and beliefs of our society and culture. This is why I am very skeptical that people would ever make the necessary charitable contributions toward medical care for those who need it if government was kept out of the picture.
    Anyway, believe me, I hate politicians/politics just as much as you do – and constant government failures continue to disappoint me. It really is disgraceful that our government would be the largest economy in the world, and still finds itself with a health care crisis – that is what makes this issue so upsetting. So maybe i’m being overly optimistic, naive and unrealistic for thinking our government could ever get health care policy “right”. But the truth is that it is so within our reach to have a quality and equitable health system. Is government the answer to all of our problems? Absolutely not. But just because our government has been inept in the past doesn’t mean there is no place for government in health care.

  20. Harry says:

    Holy cow, wintercow. Holsteinholycow. Are some of these comments from students in your Hayek seminar?

    Hungry Hank, it is true that our government has mismanaged and bungled often in trying to cure the world’s ills. But that does not mean that if we get a better team in, they will solve the problem.

    As long as I can remember, federal and in particular presidential elections have been fought over how well or how poorly the so-called economy went or is doing.

    This whole concept is rooted in the idea that someone in Washington, usually the President, has these levers and buttons he can push or pull, like the captain of a ship. Often the debate is about how well the president wields the controls, or whether congress or other groups of wise men could do a better job. Or maybe we need a better control panel, powered by ten to the tenth terabytes of memory, and a bigger fiber optic pipe.

    Our elected officials fall into this trap often, overestimating their power. Not their political power, but their power to understand.

    Thus, when one president blames his predecessor for screwing something up in the economy, he assumes that whatever was bad was somehow under his predecessor’s control. Implicitly he assumes responsibility for fixing the problem.

    Now it is true that whenever any government proceeds along this premise, it almost always fails to deliver, and often makes things worse.

    In today’s Wall Street Journal an author referred to Milton Friedman’s story about the man in the shower trying to adjust the temperature, which describes how our government, in particular the Federal Reserve, tries to keep the water temperature just right. Since it is prone to respond to the wrong signals, it often overshoots.

    To extend this analogy, someone else is in the shower, not the Federal Reserve chairman, but you or me. Someone else gets scalded or chilled.

    So we all, as Dirty Harry said, need to know our limitations.

  21. Han says:

    @ Michael Smith (Response 16):
    I think your argument confuses moral duty with legal duty. A moral duty does not necessarily create a corresponding moral right to anything since all of our natural rights are vicarious gifts from God (see e.g. Declaration of Independence ) and not a result of some creature having moral duties. Take, for example, the case of the blind man stepping into the street in front of a bus. The able bodied passerby who can easily and at no risk prevent this blind man’s imminent death certainly has no legal duty to secure the blind man’s right to life, but he is certainly a moral failure if he chooses not to do so.
    The real flaw with the moral duty argument for socialized medicine is that it utterly misunderstands charity. The moral duty in this case is charity. Charity stems from a realization that everything one has, even stuff one earns, is ultimately a gift from God, and therefore in recognition of this truth comprehends a moral duty to give what one has received from God to those in more distressing circumstances. The problem with trying to take the charitable impulse and transform it into a government programme is that the government must get the money by coercive means (i.e. taxes), thereby transforming charity into theft. This is what socialized medicine is–it is a taking of other peoples’ money to buy the feeling of being charitable. It is not that we do not have a moral duty to the poor, but rather that such duty cannot be fulfilled by stealing from other people. The one who does the stealing has no virtue because he gave what was not his to give, the one who was stolen from has no virtue because his “gift” was not given freely, and all we are left with is a situation of profound moral delusion in which immorality reigns but the participants of the system believe themselves to be pious. Furthermore, this sort of situation actually kills off true charity, not only because it deprives persons of the ability to give, but because when the government does all the giving, people think that providing for the poor is the government’s problem rather than a concern of theirs. Socialism turns once-free citizens into moral infants who think only of themselves as individuals because civil society was replaced by government.
    Perhaps there may be some level of government involvement in the provision of medicine that is appropriate. After all, we are all coerced to pay to secure the life, liberty and property of others by virtue of our tax dollars going to support the military, the police, firefighters, and the courts. It is one thing, however, to argue that allowing people to die in the streets in the name of individual liberty is a sign of decadence, and quite another to suggest that the alternative is an all encompassing system of government provided health care to cover everything from annual physicals to prescription impotence drugs.

  22. epignosis says:

    We wish for a perfect world where no need is unfulfilled. Health care, sustenance, shelter, security. Heck, even a little entertainment and leisure would be nice. Problem is, as Paul Simon says, “the nearer your destination, the more you’re slip sliding away”. Mankind cannot craft a solution to our problems because ‘the problem is us’, so to speak. All such designs to eliminate need would also necessarily diminish adversity.
    Think of the mechanic who stands or crawls under my hot, greasy, dirty automobile. He doesn’t do that because he likes finely tuned race engines, or has a perverse desire to bang his knuckles on stubborn rusty bolts. Rather, he needs money – fiat currency to exchange for those necessities of life that were mentioned above. If he doesn’t rouse himself from slumber and march off to work, well, no paycheck. Then adversity descends upon him full force, and I’m not just talking about his wife.
    The more adversity that your grand design eliminates, the larger is the component of society that surrenders in the face of adversity.
    Why work hard (or improve productivity or efficiency) to contribute to the great storehouse, when you can take from the storehouse without working. Mankind cannot nullify the judgment pronounced long ago – ‘by the sweat of thy brow…’.

  23. jb says:

    Han (#21)
    Well said: “It is not that we do not have a moral duty to the poor, but rather that such duty cannot be fulfilled by stealing from other people. The one who does the stealing has no virtue because he gave what was not his to give, the one who was stolen from has no virtue because his “gift” was not given freely, and all we are left with is a situation of profound moral delusion in which immorality reigns but the participants of the system believe themselves to be pious.”

    Two wrongs indeed do not make (or in this case cannot fulfill) a “right.”

  24. Oeberon says:

    Hungry Hank wrote:

    “…it is often simply not worth it for a poor person to purchase insurance, especially considering that no one knows when they are going to get sick and therefore if the purchase of health insurance is even necessary.”

    That is the entire point of ‘insurance’. You never know when you are going to need the services of a doctor or hospital. A person is certainly free to forgo the expense of purchasing insurance. There are no laws requiring…scratch that. ZerOCare took care of that.

    What we call ‘health insurance’ today is nothing more than a pre-payment scheme with someone else footing the bill. Imagine if car insurance were required to pay out in the same manner as health insurance. Every oil change, every additive and fluid, every tire rotation or change, every light bulb, every windshield wiper must be paid for by your “insurance”. Not only would premiums skyrocket, but the abuse and fraud would be rampant! An owner of a 1990 sub-compact convinces his mechanic (doctor) that his car NEEDS synthetic oil instead of the much cheaper conventional oil. He pays the same co-payment regardless of the oil used so he has no incentive to use only what’s necessary.

    The same holds true for health insurance. The way it is used now, the “insured” have no incentive to use only what they need. People run to the doctor and demand a pill for every little sniffle. And because of government requirements that they pay, the insurance companies have no choice but to start raising their premiums.

    Yes, the above analogy is crude. That in no way makes it any less accurate. The point is, insurance is supposed to guard against catastrophic occurrences not pay for every little ‘oil change’. People should have to pay out of pocket for things like checkups, one-time or short-term prescriptions (like antibiotics). Insurance should only be used for long-term or maintenance prescriptions, emergency room visits (for the true emergency), hospital stays, medically necessary surgeries and the like.

    When the individual is responsible for payment, health care is used much more judiciously. He will shop around for a doctor he is truly comfortable with and whose rates he can afford not just the most convenient one his insurance company allows. He will weigh whether a visit to the doctor is necessary for a head cold or a hang nail. That is when we will have true health /insurance/.

    When doctors are able to choose their patients and set their own rates instead of insurance companies, and now the federal government, making those decisions for them, they will begin to compete with each other. As a result fees for office visits and tests will drop. Innovation in new procedures, tests, machines and other medical products will increase in an effort to lower costs and increase efficiency.

    None of this can happen without the free market and far less government interference. The federal government has no business coming into the relationship between me and my doctor anyway.

  25. Albert Vest says:

    Completely agree with Oeberon’s observation about health “insurance.”

    Those pushing for national care often say health care should be “a right, not a privilege.” Well, I remember learning that distinction in school. In driver’s ed class specifically. Driving on public roads was explained as a “privilege, not a right” for safety reasons — this was reflected in our having to earn our drivers’ licenses. If it were a right, we could just go buy a car with our own money and start driving. Since it requires a license (or learners permit), and proof of insurance – since it affects others with risk and liability – driving is a privilege.

    Several administrations back, maybe even before Nixon’s HMO act, we let health care pass from the “right” category into the “privilege” category – you couldn’t just buy your care as needed, you had to have “insurance,” usually connected to having a Job. (This btw doesn’t give the worker more job security, but rather reduced his leverage to negotiate or do something entrepreneurial, due to the need to keep the insurance, especially if he has a family.)

    When someone tells me they want to make health care a right, not a privilege, I’ll say “me too” – and then explain that I’d do it by undoing the damage of the “health care reforms” of these past few decades!

  26. harry says:

    Right on, Albert Vest!

    Sheesh, I cannot remember Nixon’s HMO act, but I do remember his comment, after trashing Bretton Woods and instituting price controls, that we are all Keyneseans now. Even when you are poor and young you remember when the government trashes the few nickels you have.

    Can the commentators above expand their intellectual horizon? There is much here on this site to think of.

    Has anyone wondered about the allusion to the Unbroken Window? What is a negative railroad? Should we pass a law to blot out the sun?

    Have you ever wondered about what is unseen? This is not a trick question.

  27. [...] Wintercow20 at The unbroken Window [...]

  28. Harry says:

    So where the hell are the rest of you in the next question Wintercow asks? I am not talking about jb.

    Get off your lazy intellectual asses. Learn how to think and write. Be worthy of this great blog. Are you so weak?

  29. [...] Wintercow20 writes, The US government (all levels) has 20% more resources itself than the largest economy in the world does yet it cannot take care of health care for the poor and chronically infirm? Where on the list of priorities must this really be? Is it ahead of mohair subsidies, sugar subsidies, windmill subsidies, funding for education schools, and so on? What kind of bizarre world am I living in? And I am being asked to sacrifice a little more just to see that we’ll get it right this time? [...]

  30. [...] via The Political Economy of Health Care | The Unbroken Window. [...]

  31. [...] I pointed it out here. Here is another lovely illustration. I apologize for excerpting the entire post. [...]

  32. [...] and other planner friendly methods of producing transportation services. In reading this, remember this big fact. Remember it again and again and again. Here is an illustration of what is going on in Oregon: [...]

  33. [...] Wintercow20 writes, The US government (all levels) has 20% more resources itself than the largest economy in the world does yet it cannot take care of health care for the poor and chronically infirm? Where on the list of priorities must this really be? Is it ahead of mohair subsidies, sugar subsidies, windmill subsidies, funding for education schools, and so on? What kind of bizarre world am I living in? And I am being asked to sacrifice a little more just to see that we’ll get it right this time? [...]

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