I'm not entirely sure basic health care isn't already covered.
The US already has clean water, sanitary sewerage, food stamps, the CDC stopping the spread of contageous diseases, the FDA keeping our food ultra-safe, and in some places free needles for drug addicts. To me, this is all basic healthcare.
But this is not what the current public debate is about. People want more. People want to take the next step, improving things even further.
And I'm all for improvement, if it's possible, and if it's just.
Let me point out one of the injustices. Many parts of China don't have sanitary sewerage or clean water. Guess who would be paying for a good chunk of the health care bill? China. China holds massive amounts of treasuries that they are now stuck with, because if they sell them, as they sell them they sharply devalue the remaining treasures they have not yet sold. All of the new debt has to be paid off by someone. The part that gets inflated away (and massive inflation is already baked into the cake based on the recent bank rescues) gets paid for by people in China that have much worse health conditions than us. The remaining (nominal portion) of the new debt is paid for by our children.
So if you are prepared to make an argument from the heart, I must instruct you to please look at the Chinese first. Then take a good look at a baby. You can do that by clicking right HERE. Then tell me what your heart says.
So if you agree with me that we should save the Chinese, and we should save our babies, then we must pay for the health care from our existing programs.
The US is $11,795,045,980,436.61 in debt. That's about $33,000 per person. Unfunded medicare and social security vaults this figure to about $400,000 per person. Yet we capriciously continue to go into debt as if it doesn't matter. Did you know that you were $400,000 in debt? Do you know how much further into debt you will be when the healthcare bill passes?
I think if we don't treat China fairly, we are going to be risking World War III. The US already has too many enemies. And even if the US were to win that war, my stomach would turn for the injustice of it all.
Business deals with a lot of money. And executives get paid exorbitant amounts. So it's natural to assume that businesses have money to spare. Natural,... but naïve. The pay of executives is almost always a very small fraction of the cash flow of a company. And the amount of revenue says nothing about how much a company gets to keep. You have to look at margins, at return on equity, and at net earnings. And the figures show that businesses have over the long term received profit on par with fixed interest investments. So please... put aside your prejudices about business.
Business has it hard. If you have ever run a business, then you know just how tricky it can be. If you charge too much you lose your customers to the competition and your business fails. If you charge too little you don't get enough revenue to cover costs and your business fails. If you pay your labor too much, you fail. If you pay them too little, you fail. If you mess up in any little way, your competition will pounce on you like a cougar on an antelope. You have to walk a very fine line in order to succeed.
Not only is that line a fine one, it is constantly moving like a tightrope in the wind. Market prices fluctuate in unpredicable ways. If you don't make enough extra profit in one quarter, you won't be able to cover the severe losses in the next quarter.
Nobody feels sympathy for the companies that don't make it. The corporate world is ruthless. And only the very best (or very lucky) survive.
We have learned over the years that this competition is actually good for the vast majority of people (being bad only for the investors and workers at the failed businesses). So the overall net effect of competition is good. Just like evolution, it places a strong selection pressure upon market participants. Only the very best remain....
...that is, unless they are government run. Government run businesses remain all the time, because they don't need to be profitable. They suck public money. They don't need to walk a tightrope. And they don't need to improve. In fact, the worse they do, the more of an argument they can make for additional public funds. It is truely perverse.
Initially, given the advantage of not needing to fight fairly, the government option business will drive private business out of business. It is actually Barack's stated intent to "stoke competition" as a means of driving prices down. What that presumes is that there is leeway for private businesses to be leaner than they already are.
But if there was leeway, if margins could be cut further, why hasn't one company done it to best the others?
In fact, competition is perfectly available in the private market, if the bonds that tie it down would only be cut. There is no need for a public option to create competition... competition is natural among the private providers... it is only being sedated (see the next section on how so).
It has been proven theoretically, and confirmed in practice, that without real price signals, regulators (and heads of government run businesses) with the very best intentions, with their hearts squarely in the right place, cannot possibly correctly guess what the proper level of prices or service should be. Regulation and government run business does not fail due to corruption. It fails for a much more technical, subtle, and fundamental reason: a lack of price signals. They just don't have the information they need in order to do it right. They have no idea where the tightrope is. They are walking blind. And the longer you walk blind, the further you take the company towards being an inefficient bloated bureaucracy that eventually needs to be rescued.
(hat tip to the late Milton Friedman)
Healthcare costs are high today because there is no price signal being sent to the providers. There is no incentive for providers to do better, because the prices are fixed by a third party. There is no incentive for customers to shop around because they are not the ones paying for it.
Two areas of healthcare have benefitted from normal market forces precisely because they are not covered by insurance: Lasik eye surgery and cosmetic surgery. The prices in these areas have come down quite a lot, because the providers can get more business with lower prices, and because customers can shop around and pick a cheaper provider. And the quality has come up because customers will shop around for a better quality provider.
Freedom of choice then is important both to keep the prices low, and the quality high. Normal market signals must then be maintained and/or restored in order to get prices down.
The Obama plan actually does fix some of the issues with price signals. But it also creates new issues. And it's not clear how the overall package is going to work out.
I'm fine with government as an arbitrator. I'm not sure government as a provider is sustainable.
I think America is close. I hope congress can work out a compromise that addresses my issues.