Wednesday, August 19, 2009

Single-Payer Syndrome

President Obama wants a single-payer system. Barney Frank says that a "public option" is a necessary step to an SPS. Listen to left-wing talk radio (Stephanie Miller, Thom Hartman, Ed Schultz, etc.) and the message of the host, the lackeys, guest hosts, and almost every caller is that an SPS is the goal, a PO can lead to it, or (because they're confused) that a PO is an SPS. One of the most amazing claims is that a PO will act as needed competition with all of the current insurance companies.

(There is no way that all of these insurance companies are colluding in this country, requiring a government monopoly-buster. Blue Cross is not part of some health insurance OPEC.)

What's clear is that liberal America wants the Canadian system, or something very similar. A system where everyone has pretty equal coverage and no one pays for his own care directly. If they want cheap, steadily improving care, then they shouldn't.

High inequality of health care is good and necessary. Without it we will be much worse off. When new technologies/services reach the market (GPS systems, media players, laser eye surgery, car "improvements") the initial buyers tend to by richer, smarter, and savvier than late-adopters. These early products are buggy, expensive, and sometimes useless. As newer versions reach late-adopters, they've been refined and the methods by which they're produced better routinized. This means that late-adopters gain by the pain and loss of pioneers... and any time the rich/savvy will volunteer to be Guinea pigs, you know you have a working system. Early adoption is status-seeking and sometimes pays off, but the safe way to buy new tech or services is to wait.

Consider the PC. Early adopters got something like this (or worse). It was a marvel then, a paper-weight now, and cost over $4000 (inflation-adjusted) for the 4K RAM model. Wal-Mart sells a laptop for $300.00 now and we'll probably see netbooks near $100.00 in less than a year. These price drops and improvements are the result of a market much closer to free than the one Americans supposedly have in health care (with 46% of it paid for by governments.) Why do liberals want to avoid voluntary markets for health care? I think it's because they prefer slow improvements if everyone has equal care.

The CEO of Whole Foods was channeling Milton Friedman when he wrote his recent article. The Friedman piece is long, but describes how even George Bush could get things right once in a while.

And SPS advocates keep espousing price controls as a good way to drop prices. Lunacy. As the Friedman piece points out, we got our crummy current system as a result of price controls, and we all know that with price controls you often get some version of this. Just because the negative consequences of price controls in some markets are not as visible as those for gas doesn't mean they aren't there.

Finally, SPS advocates allude to the small minority who are uninsured. If they really care about this problem, they can voluntarily contribute to a fund to produce a liberal insurance company (not-for-profit, of course) and wipe this problem out. Politically active liberals spend their time figuring out ways to force people they don't like to pay for fantasy programs instead of just solving problems themselves. The time spent scheming at Daily Kos could be channeled into non-coercive solutions (like, why not just make DKos into a primary planning/funding site right now?) but it never is. Why is that?