Obviously there is a lot of talk in the media about health care coverage for every American; with the basic premise being “health insurance” for everyone. Is health insurance for everyone really the solution though? Knowing people who have personally experienced the horrors of universal coverage as residents of countries with such coverage, and being an advocate for free-market solutions, I can’t put my support behind that as the answer. I also cannot support a governmental “competitor” in the market. This will eventually lead to universal care as any “competitor” that can subsidize its losses with tax dollars can undercut everyone until they put them right out of business, thus resulting in a single-payer system. What if the solution to affordable health care was really the complete opposite direction we are all looking now? What if the solution to affordable health care for everyone, was insurance for no one?
I can almost hear the sound of people scratching their heads as they wonder how no insurance is a solution so allow me to explain. Rather than explore the history of how we came to our current state of health care and insurance (there are already plenty of people who have done that, just google it if you’re curious), We’re going to look at some of the possible outcomes if we fundamentally changed the way we deal with health insurance and health care.
First, a dramatic dose of deregulation would need to occur that would no longer require businesses to provide health insurance for employees (including governmental employees) who work over 40 hours a week (this varies state to state with some states requiring as little as 20 hrs). This would result in tremendous savings for businesses who would then be able to expand, hire more employees, and pay higher wages. We could probably put a significant dent in our currently growing unemployment numbers, as new businesses are started with the cost of starting a business being significantly lower than what it currently is.
You’re probably still wondering what lowering costs for businesses by eliminating health insurance has to do with keeping health care affordable. This is the part that health insurance companies aren’t going to like very much because their profits will drop significantly with so few people being covered. Because health insurance companies will no longer have their tens of millions of “guaranteed” customers who work over 40 hours a week, they will be forced to lower their prices to a level at which people can afford insurance, though many may still choose not to purchase it as the lower number of insured people would also likely affect the affordability of doctors offices and hospitals (a catastrophic health insurance may be all that many families need).
Because doctors offices and hospitals would not be able to count on the “guaranteed” insured either, they would be forced to lower their prices to a level the market can support as well. So, instead of a doctors visit costing $100-$150, it would be nearer to the cost of a higher end co-pay. Instead of an aspirin costing $50 during a hospital stay, it might only cost 50-cents. In order to make this workable though, there would also need to be a significant amount of tort reform to keep fraudulent lawsuits out of courtrooms and malpractice insurance prices affordable for those in the health care industry.
The problem with the current plans that are being presented is that they try to control the cost of insurance instead of allowing the market to control the cost of care. Affordable health insurance isn’t really the answer (though I think this would bring that about as well). Unless we deregulate and allow the market to control the cost of health services, we will continue to see prices rise uncontrollably.
(I would be most appreciative of any feedback on this proposed solution be it positive or negative. I know we will likely never see this because there is too powerful of an insurance lobby in Washington and “less is more” is not the way government operates these days.)
After attending a Mark Schauer event hosted by Spring Arbor University today, I was able to press Mark Schauer (Democratic Congressman from Michigans 7th District) for an answer concerning him signing onto HR 1207. Congressman Schauer stated that while he has not become an official cosponsor as of yet, he will be tossing his hat into the ring shortly as soon as he finalizes some things with his staff. He also added that we as tax payers have a right to know what is happening with “our money.” While I am far from agreeing with Congressman Schauer on many things, a good deed cannot go unnoticed or unrewarded… Congressman Schauer - Good Job!
With all of the blaming of our current economic failures on capitalism and the free market (a false blame of course), this quote from Peter Schiff at the 2009 Henry Hazlitt Memorial Lecture is priceless…
“President Bush in one of his speeches said that, ‘Wall Street got drunk’ and he was right, they were drunk. So was main street, the whole country was drunk. But what he doesn’t point out is, ‘Where’d they get the alcohol?’ ‘Why were they drunk?’ Obviously Greenspan poured the alcohol. The Fed got everybody drunk. The government helped out with their moral hazards; the tax codes and all the incentives and disincentives they put in — all the various ways that they interfered with the free market, and removed the necessary balances that would have existed and would have kept all this from happening.”
If you’ve been around my blog for any length of time, you know I’m a fan of Peter Schiff. He’s got a very common sense approach to economics and he can put things in terms that most people can understand. It’s hard to laugh about such an economic catastrophe, but Peter does an excellent job leading us down the road of how we got here, and how it should have surprised no one, plus he does it in a humorous way. Remember, he’s the guy who was trying to warn people this was coming well before it got here. Meanwhile everyone was laughing at him. The full video is about an hour and 20 minutes long, but it is well worth the watch. Especially if you really want to see just how deep the rabbit hole goes.
Today President-Elect Barack Obama introduced his economic team and talked a little about a coming stimulus package. Unofficial figures put the proposed plan somewhere between $500 billion and $1 trillion dollars. Obama says that the economists agree that a new stimulus package is necessary to turn the economy around. I’d like to know who the economists are that he’s talking to. It’s amazing that all of the economists agree. It sounds to me like he’s going to the sources who will give him the answers he wants to hear instead of getting the opinion of people who have a different point of view. That’s a pretty good recipe for failure.
It didn’t take long for President-Elect Barack Obama to begin making decisions that will surely be detrimental to our economy in the long run with his announcement that we will have another “stimulus package”, as well as additional “loans” to the floundering auto industry. In all fairness, I’m sure that John McCain would be making similar decisions, which would also be detrimental to the future of our republic.
Let’s take a look at the absurdity of “stimulus checks”, which are nothing more than tax dollars (or in this case printed and/or borrowed money) handed out to tax payers and large portions of the population that pay no taxes. First, the government is bankrupt… we have no money. So, the government takes money that is non-existent (they print it which causes inflation, or borrow it which creates debt) and they give it to the citizens to spend to spur the economy. In other words, for immediate gratification we either further destroy the dollar through inflation and erode the prosperity of future generations, or we enslave future generations to the debtors of our own creation, again eliminating their prosperity through our own greed an selfishness. How many stimulus checks will it take to “stimulate the economy?” Where will it end?
Concerning “loans” to the auto industry, like bailout, after bailout, after bailout before the current one (and more are sure to come), it is sure to be a dismal failure. The bailouts will inevitably lead to the eventual nationalization of the auto industry. With talks of possible nationalization already circulating, and the empty coffee cup extended toward the government by the hand of the auto industry, investors are likely to continue to shy away from putting money into the struggling “Big-3.” As a result, stock prices will likely continue their decent, the government will see the industry as “to big to fail,” and the prophecy will fulfill itself. The “loans” then in essence become a “bailout” as US taxpayers again become owners of industry. As mentioned above, because the country is bankrupt, this will be funded through inflation or debt — either way we lose. Undoubtedly other industries will surely follow with their hands out as well, and as usual we’ll be left asking, “But where will it end?”
No matter how many times the old adage is repeated that those who fail to learn from history are destined to repeat it, it would seem that the majority of those in public office fail to learn from the past mistakes of government intervention within the marketplace. Government meets market, government intervenes in market, market gets fouled up, government proposes the solution of intervening within the market to fix the problem, and things end up worse than they were before. The vicious cycle continues, but where will it end?
Last night marked the end of another election cycle, and with its conclusion I have various thoughts and emotions that run though my head as I’m sure many do. What follows are some of those random thoughts concerning various aspects of the elections.
The Presidency – Either way the coin fell I knew that I would not be happy with the outcome. Being that I voted for neither one of the main party candidates, I can’t say that I would have felt any better should John McCain have won. Let’s face it, our choices were between a real democrat, and a republican pretending to be a democrat. That being said, it will be interesting to see just where Barack Obama will take this country as president. Also, on a positive note… can anyone say, “Ron Paul 2012″?
Congress - I’m very happy to see that the democrats were unable to gain a super majority. If that had happened, I feel that we would have been in for even tougher times than we are about to face as a nation. Government has ballooned over the last 8 years and I still worry that it will continue to grow at an alarming rate. One of the things that amazes me though is that with the dismally low approval rating of Congress, people still increased the size of the controlling party. Doesn’t seem to make a whole lot of sense. It will also be interesting to see if the Congress does an adequate job of investigating the whole bailout issue like they promised to do after the election. Being that the trail will lead back to many democrats, and many have a short memory of promises made, if it is done at all, I’m sure it will be a sham on the public.
Third Party Candidates – The third party candidates showed very low numbers as was to be expected, but there was one interesting thing to note… Bob Barr took 1% of the vote nation wide which I feel is a direct reflection of some of his words and actions related to Congressman Ron Paul’s unwillingness to “play ball” the way Barr wanted. Obviously the 6% polling Barr continued to cling to throughout the race was a figure that likely had diminished long before the ballots were counted. Be that as it may, we must continue to work to make sure that third party candidates have a voice in elections, and that people truly have a choice in elections rather than just having the option of the current two-party-as-one system.
With the next election cycle two years away, I continue to wrestle with my own options of running for office. Should I run, or shouldn’t I? That is the question, and it’s one that I’ll have to continue to discuss with my wife and children. As for now I’ll have to leave everyone hanging as to whether this will become official for 2010…
