Socialist medicine
Socialist medicine takes a beating by Don Boudreaux and commenters at Cafe Hayek.
Then Kurt Loder has a go at Michael Moore’s Sicko on MTV.com. This is my favorite part, and Loder really gets the economics right:
“When governments attempt to regulate the balance between a limited supply of health care and an unlimited demand for it they’re inevitably forced to ration treatment. This is certainly the situation in Britain. Writing in the Chicago Tribune this week, Helen Evans, a 20-year veteran of the country’s National Health Service and now the director of a London-based group called Nurses for Reform, said that nearly 1 million Britons are currently on waiting lists for medical care — and another 200,000 are waiting to get on waiting lists. Evans also says the NHS cancels about 100,000 operations each year because of shortages of various sorts. Last March, the BBC reported on the results of a Healthcare Commission poll of 128,000 NHS workers: two thirds of them said they “would not be happy” to be patients in their own hospitals.”
In summary, you get a massive tax increase for declining quality in health care and you may have to wait a year or two to get it. And you might die while you’re waiting. Why anyone, let alone everyone would want to be forced into such a system is beyond me.
Someone I know recently got open heart surgery in Trinidad. Trinidad is a third world country, but everyone has health insurance paid for by the government. If he was an American, the guy would’ve died. In Trinidad he works his tail off as a cab driver and makes around $17 US a day. How is it that Trinidad can afford universal health coverage and we can’t? We’re so much richer than Trinidad it’s not even funny, and yet people here die because they have no health insurance. Also, how can you justify FOR PROFIT health care? That’s what we have, and it’s immoral. People profit from sickness. It’s not a matter of if, but when, the system will change.
Joshua,
First of all, saying that health insurance is paid for by the government ducks the fact that the government gets its money from taxes. It’s not “free.”
People die in Canada and England because they are on waiting lists for care. When prices are not used to ration care, then some other rationing mechanism comes into play. You ask me how it’s moral to die because you can’t afford something–I wonder, how is it moral to die because a government bureaucrat tells you that you have to wait two years before a routine surgery can be performed?
I justify for profit-health care the way I justify all voluntary profit-making opportunities–people have a natural right to exchange goods and services. In the case of health care, patients pay money to receive health treatment from doctors. You call it “profiting from sickness” but doctors don’t make money by giving people diseases. They make money by healing the sick. So I call it “profiting from healing.”
People pay money for health care because they believe the care they are receiving is worth more than the money they are giving up in order to get the health care. That is the nature of exchange. Do you believe that all voluntary exchange is immoral, or is it only immoral when you are receiving health care? What about food? Food is necessary to sustain life. Is it immoral to profit by selling an apple? Do you realize that all human action is taken because people want to better themselves? Because people are in some way in pain or uneasy about their current situation. People take actions to improve their situation, and that means that ALL profits are earned because of some unhappiness, unease, or situation that could be improved. By your logic, all profit is immoral.
Now, let’s take a look at socialist medicine and see how moral it is. In such a system, the money for health care is paid for entirely through taxation, meaning that you earn money at a job, which the government then confiscates from you by force. Then the government uses that money to create a health care system which you may or may not want to use.
You may prefer to use health care from a different source–a private doctor instead of the government doctor. But you do not have a choice. You must accept what the government provides for you, regardless of the quality. If you are told to wait in line two years for your treatment, then you have no recourse. In fact, the only people who are not forced to use the government-provided health care are those that are rich enough to fly to other countries to pay for private medicine and doctors.
I haven’t seen Sicko but I plan to.
The government gets most of its money by fiat- by simply printing it. Also, it’s a matter of allocation. We could have less war and more health care. Also, you say that prices are used to ration care. Well, in the current system the prices are determined in a complex way by the health insurance companies. There’s no free market creating a price point. It’s rationing, just by insurance companies.
Although doctors don’t actually give people diseases (at least I don’t think they do- from a strictly profit motive angle, it would be in their interest) , they don’t necessarily have an incentive to heal them either. If you have a customer, you want him to come back. Once a doctor has healed a patient, that patient doesn’t come back. If you look at our current health system, it’s based on getting people to take a drug for the rest of their lives. Look at AIDS, for example. No cure, but if you take the expensive meds for the rest of your life, you can live with it.
Also, in a real market economy there is competition to keep prices down. In health care, there’s not much competition. There’s a lot more grocery stores selling lots more different brands of apples than there are hospitals offering neurosurgery. Plenty of of places have just one hospital. There’s not much overlap even in big cities.
The government already has to be in health care in a big way just to regulate it and keep it safe. You can’t get surgery at CostCo.
In Trinidad, there is private health insurance and there are private doctors for those that want to pay for that.
I don’t think profit is immoral. I’m a capitalist. However, I’m a realist as well. Get real. Health care is a different sort of commodity. Even the big capitalists realize that we’re not competitive as a country anymore because too much of the price of a product goes into paying for private health care for the workers.
JB,
Thanks for commenting.
A few things come to mind. First is that many of the problems you describe are caused by government involvement in the first place. These include problems with regulation, which force insurance prices up, and the cartelization of doctors, which creates a shortage.
In other words, health care has not behaved like a free market, precisely because it is not a free market. Since you admit that many of the problems that plague health care are created by the government, I wonder why you have so much faith in the ability of further government involvement to solve the problems.
You say “health care is a different sort of commodity.” What about health care makes it unique so that the laws of economics don’t apply?
As for doctors not healing people on purpose…Well if doctors had a cure for AIDS I think they would be prescribing it. I don’t know about you but if I had AIDS and there was a cure, I would want the cure and I would find a doctor that would give it to me. I haven’t seen any evidence that indicates that doctors purposely give patients sub-optimal treatment in order to keep them around as customers, although I understand there is an incentive there.
There are, however, other incentives at play and doctors will also be motivated for reputation reasons and moral reasons. Reputation incentives figure into the bottom line in the long run, but not nearly as much as they would in a completely free market. Again, this is a problem of too much government involvement as opposed to too little.