Arrogance
It’s crazy for a group of mere mortals to try to design 15 percent of the U.S. economy. It’s even crazier to do it in a few months.
Yet that is what some members of Congress presumed to do. They intended, as the New York Times put it, “to reinvent the nation’s health care system.”
Let that sink in. A handful of people who probably never even ran a small business actually think they can reinvent the healthcare system.
Politicians and bureaucrats clearly have no idea how complicated markets are. Every day, people make countless tradeoffs in all areas of life based on subjective value judgments and personal information as they delicately balance their interests, needs, and wants. Who is in a better position than they to tailor those choices to best serve their purposes? Yet the politicians believe they can plan the medical market the way you plan a birthday party.
Leave aside how much power the State would have to exercise over us to run the medical system. Suffice it to say that if government attempts to control our total medical spending, sooner or later, it will have to control us.
Also leave aside the inevitable huge cost of any such program. The administration has estimated $1.5 trillion over ten years with no increase in the deficit. But no one should take that seriously. When it comes to projecting future costs, these guys may as well be reading chicken entrails. In 1965, hospitalization coverage under Medicare was projected to cost $9 billion by 1990. The actual price tag was $66 billion.
The sober Congressional Budget Office debunked the reformers’ cost projections. Trust us, Obama says. “At the end of the day, we’ll have significant cost controls,” presidential adviser David Axelrod said. Give me a break.
Who Knows Best?
Now focus on the spectacle of that handful of men and women daring to think they can design the medical marketplace. They would empower an even smaller group to determine–for millions of diverse Americans–which medical treatments are worthy and at what price.
How do these arrogant, presumptuous politicians believe they can know enough to plan for the rest of us? Who do they think they are? Under cover of helping uninsured people get medical care, they live out their megalomaniacal social-engineering fantasies–putting our physical and economic health at risk in the process.
Will the American people say “Enough!”?
I fear not, based on the comments on my blog. When I argued that medical insurance makes people indifferent to costs, I got comments like: “I guess the 47 million people who don’t have health care should just die, right, John?” “You will always be a shill for corporate America.”
Like the politicians, most people are oblivious to F. A. Hayek’s insight that the critical information needed to run an economy–or even 15 percent of one–doesn’t exist in any one place where it is accessible to central planners. Instead, it is scattered piecemeal among millions of people. All those people put together are far wiser and better informed than Congress could ever be. Only markets–private property, free exchange, and the price system–can put this knowledge at the disposal of entrepreneurs and consumers, ensuring the system will serve the people and not just the political class.
This is no less true for medical care than for food, clothing, and shelter. It is profit-seeking entrepreneurship that gave us birth control pills, robot limbs, Lasik surgery, and so many other good things that make our lives longer and more pain-free.
To the extent the politicians ignore this, they are the enemies of our well-being. The belief that they can take care of us is rank superstition.
Who will save us from these despots? What Adam Smith said about the economic planner applies here, too: The politician who tries to design the medical marketplace would “assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it.”
Comment by solarwindspirit on 23 September 2009:
I have just ‘one’ question and ‘one’ statement.
Are mere mortals suppose to design the united states economic slavery system?
I am guessing that they aren’t worthy enough and you know a god that can ‘will’ this in existence. . .or you are god.
Comment by D.T. on 24 September 2009:
The United States economic system is supposed to be set up by, and between, private citzens wishing to purchase or trade for something and those private citzens wishing to sell or provide something.
With minor exceptions, the United States has no constitutional authority to either “design” or meddle in economics except for coining the money, setting equal import duties, and ensuring free trade between the citizens of different states.
Comment by L.R. Shultis on 24 September 2009:
One should remember that “economic system” is an abstract object which stands for all the concrete economic actions of the concrete individuals who are acting. Only individual living beings can act to obtain values.If a number of them agree on a common value they may individually act toward that value but that group as a whole has not chosen to act, only the individuals did so. Much mischief has been done by believing that a group has some kind of group consciousness rather than just having a number of thinking and acting individuals. If is best always to be sure that one is clear as to which is an abstract object and which is a concrete object and distinguish strictly between the two.
Comment by Steve Hankin on 24 September 2009:
Mr. Stossel, your note is, right on the mark, and I would hope that it is only that gentleman called “Solarwindspirit,” who fails to see that.
It is ironic that this brilliant insight, that the note refers to -called, I believe, the “pretense of knowledge”– was the insight of one of the most brilliant minds of all time. That is, if Hayek did not think he, himself, possessed the necessary knowledge or the capacity to plan something as vast as our national health care,let alone the entire economy, then it should be abundantly clear to anyone that no one person does (or group of people do) possess such knowledge or capacity.
Solarwindspirit, I think you have completely missed Mr. Stossel’s point. A free market, economic system cannot be “designed” by one person or even by many people-rather, it arises spontaneously through the actions of everyone who actively participates in the market(and, in a sense, also by anyone who chooses not to participate in the market).
Also, I might point out to you that the essence of a free market economic system is voluntary acts, and so your description of our economic system as one involving “slavery” (which would be the ultimate non-voluntary arrangement) would seem to demonstrate a faulty understanding on your part of what a free market, economic system actually is.
Mr Stossel, I hope you are not annoyed by my taking the liberty of having responded for you here.
Comment by Nick on 25 September 2009:
solarwindspirit,
If the political class has its way with centrally planning the healthcare system, then it would effectively be turning the healthcare givers into our slaves. Yes, they still have a choice, they can choose to practice medicine under despotic rule of our government overlords or they can choose to pursue a career elsewhere.
What if the next generation looks at medical school and decides that there are too many rules, mandates, and regulations to make it worth their time? Do we then start drafting doctors into a government medical core like they did with the military during WWII and Vietnam? How will our government decide where to fund future technologies? Or will they only worry about developing new technologies when the populace starts an uproar and rioting? Then again, how will they decide who is going to develop these technologies? Who gets the funding?
Mr. Stossel is correct, let the market decide.
Comment by richard j mayer on 25 September 2009:
You are so right. the government has run fannie mae, freddie mac, social security, medicare, post office, dept of energy( to get us off foreign oil! for billions of dollars!) etc. now they can run healthcare! and there is not 46 million or even 10mil. facts are a scarce commodity in the debates.
Comment by Rod Smith on 2 October 2009:
Brilliant, John. Keep up the great work.
Comment by scott g on 5 October 2009:
The truly sad part is that everyone repeats this “16%” figure. Where does it come from. What does it include? Contact lenses, Gucci eyeglasses, boob jobs, braces, false teeth? Nursing homes, electric scooters. lear jet ambulances?
What % is actual doctor/hospital/lab bills??
Comment by voteright on 7 October 2009:
Solarwindspirit has been in the Sun so long that his/her thought process has been “burned”.
Remember when 47 million uninsured became 30 million because the President chose to omit the 17 million illegal immigrants (which cannot really be uninsured, if other citizens are being insured). This HC — HR7200 has many provisos that are bad, worse and ugly. For example, if a person does not have Government approved Health Insurance the fine can be as much as $25,000 plus jail. The key term is “Government Approved”.
American Citizen, you have lost your Soul and allowed your Spirit to be enslaved by the self-serving Politicians.
Comment by Bigote on 7 October 2009:
sweet stach!
Comment by Randall Scott on 8 October 2009:
SolarHoleinHead,
Are you trying to funny, ridiculous or just nonsensical?
Slavery ended in 1865.
If you are trying to label anything today as such, you really need to be more specific on how you think so.
I feel like typing 2 pages on how your label is so wrong, but you are clearly out of step with reality & see things for what they are clearly not.
However, there is a close resemblance to slavery in regards to gov redistribution. The gov punishes/takes from those who are very productive & rewards/gives to those who who do not earn much education or skills.
From IRS data, in 2007 the top 5% of income earners, paid 60% of all income taxes. Are they slaves, working for others?
The bottom 40% paid no income tax.
Under BO’s plan, it will be roughly the bottom 50% that pay no income tax.
The revenue from the top 5% (it’s only 2.2% making over $250,000) will be lower, w/the higher rates, those are inversely correlated.
See Laffer curve, but I doubt that you are not much of a researcher or reader, and probably don’t even care to learn about anything.
Comment by James on 12 October 2009:
The pretence of knowledge speech available online opened my mind to the limits of what can be known by science. I believe accurate knowledge of market forces is one of those things that will forever be beyond our ken. We have to remember that the market is really just individuals making transactions on a daily basis that they believe are beneficial to them (otherwise they wouldn’t make them). There are no equations that anyone human being or machine can come up with that would accurately simulate the market. What equations (I’m referring to modern economist believing that there exist a formula or series of formulas that if they work hard enough will allow them to decode the market) exist that can tell you what makes John prefer beef to pork or any other hundreds of decisions that he might make during the course of a day? Take that one individual and the complexity of trying to figure out accurately what moves him when he is transacting in the market and add about 6 billion more individuals all involved in market in some form or other and then you began to see how ludicrous it is to believe that governments (all of them) can understand the market and positively influence.
Comment by PaddyK on 13 October 2009:
This is the result of the common people suddenly discovering that the money from others can be confiscated by electing the right people to power.
Comment by Jacob Steelman on 19 October 2009:
As the late Leonard Read (FEE founder and President)so graphically demonstrated in his story I Pencil, no one person knows how to make such a simple thing as pencil. Yet, politicians and bureaucrats, who for the most part have no experience in running a business as John correctly points out, think they know how to design a healthcare system.
Comment by RobertD on 19 October 2009:
I was lead to believe that the Government has had these plans on the books since the 1920′s.
That doesn’t seem like a few months and I doubt very much that is rebuilding a whole new system. I would suggest reading some of Uwe Reinhardt’s articles. He knows of what he speaks.
Comment by Lynn Atherton-Bloxham on 21 October 2009:
Excellent! as usual.
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