Brad Wardell's views about technology, politics, religion, world affairs, and all sorts of politically incorrect topics.
The problem with universal healthcare
Published on September 23, 2004 By Draginol In Politics

The universal health care issue is such an emotionally charged issue that it's difficult to have a rational discussion about it. The problem with universal health care isn't specific to health care but rather to any solution that involves 100% coverage.

So to try to move the discussion away from a hot topic like health care, let's instead look at it in a way that more people will understand without emotion kicking in.

After being elected emperor, I decide everyone should have a television.  Because I have only so much to pay for these televisions, everyone receives a 35 inch TV.  After all, we couldn't afford to give everyone 60 inch plasma TVs and 35 inch TVs are pretty good.

So now everyone has a 35 inch TV.  But what about those people who want a plasma TV? Well, the price has gone up because you no longer have economy of scale working in your favor. Enough people are satisfied with the 35 inch TV that sales of the higher end ones plummet and so the cost of higher end TVs goes way up.

You then end up with a small group of rich people who get the big plasma HDTVs and the rest have the "free" TV.  But what's wrong with that?

Well it gets worse. So time passes and because sales of the higher end TVs are so low, the TV manufacturers have cut back on R&D.  And since the government has agreed to give everyone 35 inch TVs, there's no incentive for the manufacturers to lower their price on those TVs. In fact, they can slowly increase the cost on those TVs over time since, after all, what is the government going to do about it? And what does the government care anyway when "Caring" is measured in dollars spent, not results (look at federal education spending).

So rather than having seen increasing sales of higher end TVs in our reality that would bring the cost of older generation TVs down, we instead are stuck with these 35 inch TVs year after year after year.

This is precisely what happens in socialistic countries. The more socialistic it is, the slower the improvements are. Why make 1 inch thin, 75 inch HDTV displays when few people will buy them? Why even try when you know that the government is going to buy millions of the 35 inch displays each year?

Over time, the result is that we all end up with crummier TVs. At first, it wasn't so bad, everyone got a free 35 inch TV. Not too shabby. But by taking individuals making their own purchase choices out of the equation we effectively eliminate the incentive to innovate. 

We also effectively limit competition.  If the government goes with a single supplier such as Sony (or worse, builds its own TVs) then other TV producers will effectively be driven out of business or to the fringes. Or if the government goes with a confederation of providers, you end up with an artificial competition with only 1 buyer -- the government and the rest colluding on price (which is what happens in other industries).

Now this example is obviously an over-simplification. But you get the general idea. Any system that guarantees 100% coverage is artificial by definition and results in a slowing of improvement and quality of service. After all, in a capitalistic market, you can walk away - you can choose not to buy a product or service. But in a socialistic market, you are forced to buy -- you have to pay your taxes.

The reason why the United States enjoys the best material standard of living in the world is because it made a fundamental cultural decision long ago: Individual are on their own.  As a culture, we have decided that we can live with a small percentage of people failing utterly so that the rest of society can move forward. It sounds harsh and cruel on the surface but the alternative is a system in which all people are treated equally cruel.

Improvements in health, medicine, consumer goods, and services are almost always the result of individual initiative and the best way to encourage that is to create a system of self-interest -- where individual initiative is rewarded. That the selfishness of the individual benefits society.  That is, in effect, the goal of regulated capitalism.

In the United States, most people have health care. In fact, over 90% of the people in the United States either have health care or could easily afford it if they chose to. That is an impressive accomplishment in a capitalistic society such as ours.

It is a system that enables someone who is diagnosed with a heart condition to get in and have surgery within that week. It allows someone (like me) who wants to get Lasik to get an appointment and have it done within a couple of weeks. It allows someone who has the flu to make an appointment and get in that day to see the doctor. And it does this at a relatively reasonable cost.  And it does this with an incredible array of improvements being made technologically all the time (most improvements come from the United States btw -- nations with socialized health care make relatively little medical progress and find their improvements largely as a result of taking advantage of breakthroughs from the USA).

So the question you have to ask yourself is, how much are you willing to give up so that the last 10% of the citizenry receive "free" health care (free in the sense that you're paying for it). Keep in mind, right now, most Americans literally pay nothing for their healthcare. It's part of their job compensation and they don't have to claim it as taxes (and many companies let you opt out of it and take it as direct money compensation). Whereas a "free" system means you'll be paying it in taxes not just for yourself but for others too. And for vastly inferior service and a slowing rate of improvement.

Comments (Page 1)
on Sep 23, 2004
Draginol: Thank you for writing this. I do understand what you are saying, and it makes perfect sense.

The only problem for me is that I can't stand to see the small percentage "fail utterly." Obviously this an emotional rather than logical argument, but I am unable to set it aside. Medicaid is helpful because it is a safety net that "catches" children living in poverty, but there are many adults that have health issues that require attention that cannot afford to seek care and are unable to receive Medicaid (I realize that some people make the choice to not have health care even though they could make financial sacrifices and be able to afford it, but here I am referring to people who utterly and truly cannot come up with the money for insurance or health care). Their health issues will worsen and eventually disable them, kill them, or send them to the ER where the care they receive will be shouldered by the hospital and will in turn raise costs for everyone.

I just don't like to see people hurting and in need. I don't know what the solution is. Your article has been helpful, though.
on Sep 23, 2004
I like the analogy. Very well written.
on Sep 23, 2004
I guess I remember the good old days when everyone had a decent black and white set that pretty well got the job done (it was vastly better than no TV at all or a colored one that you could not afford) and the TV manufacturers were down to earth caring people who were not forever chasing the almighty dollar and drove a Ford...
on Sep 23, 2004
TW, the preferred solution to taking care of the "failing utterly" people is charity. Whether that's the hospital providing free services (which many do for people who are unable to pay), or a charitable organization such as Ronald McDonald House, or direct assistance from a benefactor, it still gives the people who need help with paying the ability to seek it and the people who want to help pay the ability to do so.
on Sep 23, 2004
Good article, people complain about free ice cream, they are going to complain about free healthcare as well. People just love to complain even when it is unwarranted.

Though there may be few left, there are still Doctors who treat people to help them not for the money, and I think that should be revived somehow, not by socializing the healthcare, because than Doctor's might care even less than since they are going to get paid either way so who cares if they cut off the wrong limb or sew someone's mouth shut. What are you going to do sue them? Oh wait they are a government employee.

Let us put our heads together to reform it instead of just quick fixing it with socialized healthcare.

- GX
"I have no answers to your questions, but I can question your demands." - Motto Inspired by Laibach's WAT
on Sep 23, 2004
Ah, yes. But charity is just not out there for the majority of the lower-middle class. Take me, for instance. I work 3 jobs to make ends meet, because there just aren't jobs in our area. I am one of the in-betweens. I have too much money to qualify for medicaid (although my kids do), and I have too little money to pay for health care for myself. I always make sure my wife and kids have what they need--but it's at the expense of my own health care. I have teeth which have desperately needed work done for over a year...but dental work is too expensive. And contrary to what Brad said, the majority of people around here where I live (in the midwest) *do not* have health insurance through their jobs. It's just too expensive for the employer in our economy here. I am one of those people. I just started my own business, so I'm hoping that somehow I can work that so I can have some health coverage of some kind. Of course, if my business does too well, then my kids will no longer be on medicaid and my health insurance costs will skyrocket and I'll be right back where I started.

I'm not an advocate of socialized medicine. Brad's argument is a good one. But the current system isn't cutting the mustard, either. I don't know that there is a perfect system. I believe, that if the church did its job, we wouldn't need welfare, and we wouldn't have people who couldn't get health care either.

And I say that as a pastor. That's my "primary" job.
on Sep 23, 2004
But the current system isn't cutting the mustard, either.

Damn straight...
on Sep 23, 2004
Though I think the ideas that have been proposed to lower premiums and to get small businesses the same low rate as big corporations is a start on the right path, the socialized healthcare should only be used as a last resort when all else fails not as way to change the system.

- GX
"I have no answers to your questions, but I can question your demands." - Motto Inspired by Laibach's WAT
on Sep 23, 2004
Anybody who would like "free" medical care, remember it isn't comes at the expense of the taxpayers...
I am a 100% totally disabled veteran (service connected) such, I not only qualify for VA benefits, but also medicare...
I have used the VA since my military sepperation...I have seen it go from a healthy organization to one that is understaffed with the exception of paperpushers ( an honorable position)...
This leaves a hole in actual provided healthcare...
As a top level patient, I am supposed to have my appointments scheduled within a months period...instead I have to wait just as long as anyone else...
President Clinton really fouled the system up when he dumped all the veterans into VA healthcare ( whether or not they had a military related injury)'s a shame it wasn't funded...
Now my doctor has a 2000 patient, if you want to see government socialized medicine, go to a VA and listen to not only the patients, but also to the personel...
And if you are still not concerned, visit a local nursing home or other healthcare facility especially in a rural area...they literally get away with murder and are warned of impending inspections or surveys as they are called...
Free health care comes a cost both moneytaryily and personally...
Also take a look at the executive offices or suites and all the fancy flower beds...get the big picture???
on Sep 23, 2004
We could try letting people use their payroll tax money towards health care.
on Sep 23, 2004
I have personally advised my good friend Tony on this issue, and the current system that we have in the UK is fine for the peasants. Many people have private healthcare which takes the burden away from the NHS, leaving those that cannot afford to pay thousands of pounds the chance to have adequate healthcare. The reason the NHS is so clogged up is that it is mismanaged, immigrants that pay nothing into the system receive free operations and many transexuals get free sex change operations, all courtesy of British taxpayers!

When the system is managed well, and only those that contribute get something out, then it is a far better system then any other system. After all, we have to keep the peasants healthy so they may carry out servile duties for men like myself.
on Sep 23, 2004
Hmm that's good point, Dragnol.
on Sep 23, 2004
In the United States, most people have health care. In fact, over 90% of the people in the United States either have health care or could easily afford it if they chose to. That is an impressive accomplishment in a capitalistic society such as ours.

I fall into that 90% who has health care, but I think it's a farce. Technically, I am self-employeed. Therefore, I pay for my own health insurance. I got the best policy that was offered in my area and when I had to have emergency surgery last year, I ended up with a bill for $10,000. Yup, that was my "share" of the surgery. And we aren't talking about open heart surgery, or even an overnight stay in the hospital. I'm not sure how you can say that most people "could easily afford" health care. On the contrary, I pinch pennies to pay my premiums and will be pinching pennies for a while to come to pay off my hospital bills. It is just another example of screwing the working middle class.
on Sep 23, 2004
The fact is: 90% of the population has health care or could easily afford it.  I consider that cutting the mustard. Maybe some don't but perfect is the enemy of good.

Lots of people who say they can't afford health care seem to have the time to afford cigarettes, cable TV, a bigger house than they really "need", etc. It all has to do with priorities.

on Sep 23, 2004
The fact is: 90% of the population has health care or could easily afford it. I consider that cutting the mustard. Maybe some don't but perfect is the enemy of good.

I guess I am just not sure what you mean by "could easily afford it." The monthly payments, or if they were to truly get ill? Where are you getting 90% from? Close to 44 million Americans have no healthcare at all, and (with myself as an example) a percentage of those of us that do struggle to pay for prescriptions and copays. 1.6 million families (90% of which are from the middle class) will file for bankruptcy in 2004--half of these bankruptcies will be from health care costs. I just don't think that "cutting the mustard" is good enough.