Health Care and the Myth of the Market

Ultimately, Barack Obama wants to cut spending and re-invest it back into America. That idea is exactly what I am looking for in a presidential candidate. However, you must be aware that his definition of investing in America involves a lot of government programs, and government programs have a historical track-record of being fabulously inefficient.

Obama’s ideas on trimming the fat on pork-barrel politics are visionary. I find myself agreeing with him on a good majority of issues, and as far as the democratic candidates go he understands the principles of our free market economy as well or better than any of them. But there are always trade-offs. The financially savvy voter would want to see any cut in spending come with a corresponding decrease in taxes so that you could have more control over your financial future. And when you are voting for Barack Obama, you are voting for political and social change at the expense of your personal ability to accumulate wealth.

from Richer Than Your Dad, October 1

I was fascinated to hear Bush (and his Republican machine) claim that the recent attempt to expand health care for children was an attempt to “Federalize” the Health Care system. I was surprised only because usually they argue against ‘socialized’ medicine. Here, though, I suspect they were using one of those Southern right wing code words to suggest that the Democrats are attempting to take away so-called Sates rights.

It was particularly interesting that he did thus in a period that included the Jenna demonstrations and the anniversary of the integration of Central High School in Little Rock. Is it possible that somewhere back there in the shadows lies Bush’s Brain, dreaming that National Health Care can be defeated by associating it with the over-reaching, intrusive Federal government that forced the South to end Jim Crow.

It sounds more far-fetched than it is. I found the above assessment of Barak Obama, right leaning but more or less fair-minded, laced with myths about the market and the government. It seems almost shocking to hear someone claim that the market has done a good job with Health Care. Still, the market, as many have argued, is at bottom a kind of religious belief.

If you have faith in god and you believe god is good, then nothing can every convince you otherwise. Similarly, if you have faith in the market and you believe that the market is efficient, then nothing can ever convince you otherwise, even the holy mess that is our system of financing health care. The idea that the government is always less efficient is an equally strong and perennial myth.

In fact, studies have shown again and again that government health care systems spend less on administrative costs– think of those giant CEO salaries, as a start– than the private sector. A study summarized in the New England Journal of Medicine a few years ago, for example, noted that “administration accounted for 31.0 percent of health care expenditures in the United States and 16.7 percent of health care expenditures in Canada.”

There are dozens of good reasons why a single-payer plan would, to use the langauge of Richer Than Your Dad, help all of us in our pursuit of happiness and prosperity. One reason that wages are depressed, for example, may be that workers are afraid of taking a chance on a new job because it means loosing health care. We need a federalized, socialized system, like Canada.