Health Care Through Central Planning: A Helpful Analogy

Some wonderful analogies have been offered that sweetly damn the "Cash for Clunkers" idiocy. We can look at how this logic would extend to lousy houses that don’t "work" anymore, and the mainstream news is reporting a possible "Kitchen Clunkers" program to "stimulate" department and home supply stores, presumable complete with public spectacles of smashing refrigerators. For farmers, the latest buzz is a "Cash for Clunker Cow" program. "[T]here are vast differences in cow efficiency…So, how about providing, say a $200/cow subsidy to allow producers the opportunity to trade in our older, less-efficient models for more efficient, newer models?" writes Cow-Calf Weekly editor Troy Marshall. Of course, he is writing tongue in cheek, picking up on a joke that has been on the cattle circuit since the onset of the "Clunker" program.

Having the federal government buy or subsidize worthless assets (with borrowed or confiscated money) is not new. I remember the stories of the $500 hammers and $2000 toilets back in the day when it was popular to question military waste. And that’s parlor room stuff. In my lifetime, the wars pursued by the federal government, whether against drugs or countries or cultures have been classic case studies in obscene levels of federal spending, concomitant with physical destruction of people and property, for absolutely nothing. Afghanistan? Simply a "Cash for Clunkers" program on an international scale – this one targeted at sustaining US military contractors, subcontractors, and extended family members, as well as bumping up the military budget (think Government Motors, Rockets, Planes and Torpedoes, Inc). Iraq, on the other hand, could be viewed as government spending at extreme levels for non-operating and insecurable oil fields – and perhaps most significantly, on property that does not and will never belong to us! How Lehman Brothers! It all makes perfect and beautiful sense, in a "Cash for Clunkers" world.

The Bush buyouts were no surprise, nor should it be surprising that the insanity continues at home and abroad under Obama. After all, when you join a club, you do so because you like the way it does things and how it makes you feel, not because you want to make radical changes. Obama’s pledge of "Change!" was certainly a cruel joke on the masses of naïve believers in government who live, like picket-fenced housewives, in a world made substantial through dreams.

Let’s consider how all this will work in government-provided health care, whether you call it single payer, or just Article 99 writ large, or something in between. We already have several examples of government health care – and apparently the only one that people want to talk about is the Congressional insurance program, whereby millions of people subsidize the unlimited health care for an unaccountable few. Well, if you are the few, it’s a great program. But to hold this up as an example in town hall meetings is proof that a century of public schooling in this country has succeeded in producing a nation of parrots who can repeat words but have no idea, or apparently interest, in what those words mean.

The health care that the government already runs has also been mentioned. The real performance versus cost of the military hospital system, the abject hinterland of VA hospitals, and the contracted HMO memberships offered to the military families could be discussed. Less well known is the Indian Health Service, and its track record, described succinctly here in an article written by the executive director of the Property and Environment Research Center in Montana. It’s not rocket science – federal management of anything, even its bare-bones constitutionally chartered duties, is flawed at best.

But there is some good news about increased government ownership and direction of the health care system, presuming that’s the path we're on. It comes in small ways, and some might think, mysterious ways. For example, I have a government subsidized medical insurance. I’m not clear on what it provides or doesn’t provide, exactly, as in the six years since I retired, I have used it one time, in getting a school physical for my then high-school aged son. We found out, after we paid our part of the bill at the physician’s office, that they maintained one price for insurance, along with a cash price. Turned out .. drum roll… the cash price was actually cheaper than the deductible! So henceforth, we paid cash.

Of course, my family has in recent years, been healthy, and in the case of accidents, costs have been shared by responsible parties. My daughter crashed into something on the soccer field and had to have some MRI work done – our share for that ran close to $1000. One imagines how wonderful truly free market medicine would be, with real choice, and real competition in the industry.

We have examples – ophthalmology and veterinarian services come to mind first. You can get an eye exam for $50, and then order glasses online for another $20. Overall, that’s less than a pair of running shoes, or a meal out with the family at Applebee’s. The wide variety of eye surgeries available and the competitive and safe nature of these surgeries speak to the working of a freer market than what we see for the rest of our health care. The argument by the statist left and statist right is falsely premised by the idea that the current health care "system" is a free market system, and based on the ideas that free market systems can’t work for health care because people are not all equal in either health, desires for health or finances.

But the market works precisely and wonderfully because we are differently abled, financed, with unique wants and desires! It works well in animal health care (you can buy cheap medicines and health aids across state and international lines for your pets competitively and privately, and a whole new array of private insurance products have emerged to help you meet the unexpected health needs of Fido or Kitty). Compare this to our government controlled and manipulated system where buying your meds in Canada or Mexico, or self-medicating with THC will land you in jail.

But what happens in this private system when animals, for example, don’t get the heath care they need, due to poverty or ignorance? Private organizations – unfortunately often working with the state, as in the case of the SPCA, or working in extreme ways, as with PETA) do step in. More often than not, they are beaten to the punch by neighbors and concerned citizens who work far more quietly and lovingly. In the case of human poverty, innumerable private organizations run hospitals, providing clinics and eyeglasses, and even surgeries for the needy. Again, unseen, is the quiet and sustained help given by family members and friends when people are in dire straits. We don’t see this undercurrent on television or read about it in the news – but it is real.

The marketplace would do a wonderful job in providing organs and blood products, if unleashed from government control. Everything has value, including above all the health of human beings – and the most destitute among us can make a wish and have it granted by a free society and the innumerable charities a free society can support. For the rest of us, a little personal responsibility goes a very long way. It’s also the American way, if you ever watched an old Western, or one of Clint Eastwood’s more recent ones!

If we get more governmentized and centrally managed health care, one thing we can look forward to is even more waste and misallocation in the industry – and both of these eventually find a home in black and grey markets, which in turn foster increased distrust and delegitimization of government.

What Americans need is a helpful analogy, like "Cash for Clunkers," to help them think about the health care proposals being put forth by government and interested corporate beneficiaries. How about collective agriculture in the old Soviet Union and Eastern Europe? During the Cold War, we often heard about the incredibly productive backyard gardens of the downtrodden peasants, and the poor yields of the massive state fields. The uninformed among us credited this as an excellent example of incentive over command economies. But what we forgot then, briefly, is that, absent a true pricing system and real freedom, productivity and availability of goods will always be severely constrained overall.

In the 1980s assessment of backyard garden superproductivity of the old Soviet Union, agriculturalists, economists and pro-freedom advocates all missed a simple fundamental reality. This mythical small-garden "productivity" was wholly dependent on a concentration of work time, equipment, fertilizer, good seed, and actual meat, grain, fruits and vegetable products "stolen" from the "state" and subsequently sold on the "free market."

That this theft was justified to feed the people is beside the point. Collective and command driven health care will produce similar results – and ultimately we will begin to hate the healthy.

August 31, 2009

LRC columnist Karen Kwiatkowski, Ph.D. [send her mail], a retired USAF lieutenant colonel, has written on defense issues with a libertarian perspective for MilitaryWeek.com, hosts the call-in radio show American Forum, and blogs occasionally for Huffingtonpost.com and Liberty and Power. To receive automatic announcements of new articles, click here.

Copyright © 2009 Karen Kwiatkowski

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