The Health Care Debate Has Been “Meaningful”? It Just Ain’t So!
There's no "I" in "health care reform."
Credit where credit is due: David Brooks does say one true thing in his New York Times column “The Values Question” (Nov. 24) on government health care reform: “The system after reform will look as it does today, only bigger and more expensive.”
Brooks is certainly right that no “health care reform” proposal with any chance in mainstream partisan politics promises any fundamental change to the status quo. What we have had is a system where pervasive government regulation, subsidy, and mandated captive markets corral workers into an industry driven by sky-high costs, managed by bureaucratic pencil-pushing and corporate economizing (often at the expense of innocent people’s health or lives), and owned by a handful of uncompetitive, well-entrenched incumbent corporations. No mainstream “reform” proposal will change anything about that. The proposals mainly concerned themselves with introducing new government subsidies and new captive-market mandates to force yet more workers and money into the broken system.
But Brooks takes all this as a sign that the health care debate is about fundamental “values.” I think it’s a sign that conventional political debate is a superficial squabble over meaningless details. The real debate is about grammar.
Brooks sees “a debate about what kind of country we want America to be”: Although “many of us” thought “we” were in a regulatory sweet spot in which “we” could extend coverage to the uninsured and lower costs, “we” were wrong; “we” cannot make gains without substantial costs. So “we” face a “brutal choice”–a tradeoff between economic “vitality” and “security.” “Vitality” for “America” means an “unforgiving nation” but also a more “vibrant” one; security means “a more decent society” but also one where “more of the nation’s wealth would be siphoned off from productive uses and shifted into a still wasteful health care system” (emphasis added). We are told that “we all” have to decide what “we” want–for “America.”
No “I” to Be Seen
Remarkably, among Brooks’s 800 words, supposedly on a debate about deeply held convictions, the word “I” never appears in the author’s own voice. (The single “I” appears in a quotation.) Lost in this thicket of plural pronouns, “nations,” and “societies” is any notion that I might settle on different preferences from you, or that you might have a right to decide for yourself which preference to pursue. There is only one decision for all, and “we” are left only with the engineering decision of which output to optimize for: vitality or security.
For the individualist, half of human decency in political thinking is just learning to keep your personal pronouns straight. There is no right outcome in this debate except to reject the conventional political premise that “we all” need to decide on anything when it comes to health care. Life is full of tradeoffs. But the right question to ask is not which choice to take, but rather who should choose and who should bear the costs of the choice taken. And the answer is that each person should choose how much of her own resources she wants to devote to health care and to insuring against future disasters. These tradeoffs only become “brutal” when I am forced to take your risks or you are forced to fund my security.
Brooks might reply, “Ah, you claim to avoid the hard choice here with a free market But really you are making a choice without admitting it. Free markets mean everyone is limited to her own resources to meet medical bills; but by definition poor people have no real resources to fall back on. So really you’re just advocating one option: a system that chooses vitality and growth over insecurity and suffering for the vulnerable.” Indeed, Brooks insists that “The unregulated market wants to direct capital to the productive and the young” and confusedly suggests that this is more or less the kind of “vitality”-oriented system that America has had and will continue to have unless government forces taxpayers to chip in for more extensive government “welfare policies” in health care.
That might seem true if the corporate health care system we face emerged from “the unregulated market.” But it didn’t. Government licensure controls who practices medicine, and where and how they practice it. Government prohibitions restrict which drugs are produced and where to get them because government thinks it knows better than you what drugs you should take and because they are engaged in a deliberate effort to raise drug prices through a system of patents. Federal tax loopholes and regulatory micromanagement make most full-time workers dependent on their bosses for health insurance and force most other workers to deal with government health insurance or none at all. There is a “market” of a sort here, but far from a free market: It’s a rigged market, shaped by government regulation, funded by government subsidy, and owned by government agencies and government-privileged corporations.
Confusions Abound
Pervasive confusion of the existing government-supported anticompetitive corporate health care market with medical services provided by a genuinely freed market leads to two related confusions about what a real market in medicine would mean.
First is the widespread, but ultimately ridiculous notion that free markets would require individual workers to rely only on personal savings or expensive corporate health insurance to cover high medical costs. In fact in the late nineteenth and early twentieth centuries, freer medical markets actually offered many competitive, noncorporate means for working folks to get affordable, decent health care for themselves by pooling resources through free-market bargaining and free association. As libertarian scholars David Beito and Roderick Long have discussed, “contract practice” agreements, organized by low-income workers and primarily negotiated through unions, mutual-aid societies, and fraternal lodges, provided reliable medical care for 20-50 percent of workers in English-speaking countries for about one day’s wages per year. These affordable arrangements were ultimately driven out not by the ruthlessness of the free market, but rather by deliberate assaults by government and the government-privileged medical guilds.
Second, if we recognize the importance of freed markets to the prospect for a civilized solution to the health care crisis, it also quickly becomes obvious that there are many opportunities for reform that simply do not present the kind of tradeoff that Brooks wrings his hands over–specifically, reforms that get rid of the government interventions which cause costs to skyrocket in the first place. For example, instead of levying massive new taxes to cover the rising costs of pharmaceuticals, freed medical markets would abolish the government interventions that drive up those costs–most notably FDA approval requirements and the monopoly pricing imposed through patents. Freed markets would both make it easier to cover costs that customers face and free up resources for other uses outside of the medical system.
There is a clash of fundamental values in the health care debate, but it’s not within conventional electoral politics. The real debate is between politics as a means of providing health care and a freer, more humane alternative: consensual social organization.”
Comment by Kyle on 22 December 2009:
Great read. One of the best articles I’ve read concerning this so-called health care ‘reform’
Comment by John on 22 December 2009:
If it was so that medical care and mutual aid was so easy to come by, then why was their a perception that the poor and elderly were dying sick in the streets? I think the Austrian critique, that somehow accreditation is bad and one of the reasons for such high costs is true in one respect: the intellectual property system favors entrenched interests over those of the public – ie, innovation and affordability. This is obvious from the data.
However I am not ready to drink the cool-aid and say that we need to rid ourselves of the FDA or of medical accreditation.
Kevin Trudeau is a salesmen of alternative cures for a variety of ailments including cancer and I believe even dementia! Well Kevin has also been sued multiple times for being a conman by the FCC, and because he exploits an exception to regulation from the FDA, he’s allowed to peddle dangerous garbage to the American public on public television.
It turns out that you can sell the equivalent of sugar water on the supplement market under the label “proprietary blend” and thereby avoid disclosing what is actually in your supplement. This speaks for regulation and jail time, not federal budget cuts.
Vioxx showed the weakness of an overburdened and underfunded (Thank you, President Bush!) government organization when it screwed up and allowed a killer drug to be put on the shelves! The Government is the referee, because these entrenched interests /are/ the multinational corporations that exploit the capitalist system and distort the market through lobbying. Wal-Mart has more power to put you out of business than you do of ever making a dent in their sales. We need a referee for that. So I am not ever so convinced by accreditation.
The truth is that of all the industrialized countries, America is the only one with a private for profit system, and America is also the only country that has a healthcare system no one else in the world wants. Maybe we should ask ourselves why that is.
Pingback by Rad Geek People’s Daily 2009-12-22 – There’s no “I” in “Health Care Reform” on 22 December 2009:
[...] The Health Care Debate Has Been “Meaningful”? It Just Ain’t So! [...]
Pingback by The Health Care Debate Has Been “Meaningful”? It Just Ain’t So! | Anything Peaceful on 22 December 2009:
[...] Read the rest of Charles Johnson’s article at TheFreedomOnline.org. [...]
Comment by Joe on 22 December 2009:
John,
There’s a perception now, among the pro-healthcare reform crowd, that the poor and elderly are dying in the streets due to lack of health insurance. No doubt this is true in some cases, but it wouldn’t be the first time proponents of tighter government regulation used scare tactics to sell their agenda. The real problem with the mutal aid societies, at least from the perspective of the medical associations, was that they were driving the costs of medical care down and thus putting too much power in the hands of consumers.
As for the government being a referee, I don’t know about that. I’d say the reason “Wal-Mart has more power to put you out of business than you do of ever making a dent in their sales” is because of government granted privilege. When a company like Wal-Mart comes to town, it’s often given all kinds of subsidies and tax breaks, which come at the expense of the already existing businesses. The government’s anything but an impartial referee.
Comment by Bogart on 22 December 2009:
The problem is price and the ONLY mechanism known to man kind to reduce the price of something is the free market. All other human systems steal wealth first to give it to the medical establishment. The free market forces the medical establishment and all other businesses seeking capital to compete with one another thus providing consumers with their preferred amount of care. The free market is the only human system that provides incentive for suppliers to supply a product cheaper or provide an alternative. This new Anti-Health Anti-Care will do exactly the opposite of what a free market does. The government will intervene more and more into the health care delivery business and distort prices and the management of scarce resources further and further.
The result will be fewer people receiving health care they want and/or need. This bill will lead to stagnation and poverty for the rest of society.
The ironic part is that the people in the medical business themselves will be most hurt as government rationing will extend far beyond the consumers into their pockets.
Comment by JAlanKatz on 22 December 2009:
I never understand the tactic whereby government failure is an argument for more government, but “market failure” is an argument for more government too. If the failure of the government to get Vioxx off the shelves is a reason for more government, then every so-called market failure should be a reason for more markets. The fact is, Vioxx could not have had the effects it did if the presence of the FDA didn’t give people the impression that everything on the shelf or prescribed is safe. Most people understand that Kevin’s wares are questionable (some things he sells aren’t, by the way) specifically because he is exempt from the FDA, and look into the matter before buying from him. That said, I simply don’t think he’s all that “dangerous” and certainly I’m not persuaded about how bad he is because the FCC dislikes him. Based on his commercials, I didn’t take “Okinowa coral calcium” but I did go to a doctor and think to ask about electrolytes. I did first learn about low-carb diets from his commercial, did some research, and lost 100 pounds on one.
Finally, the current discussion about reform has nothing to do with any of this.
Comment by Michael Wiebe on 22 December 2009:
“There is a “market” of a sort here, but far from a free market: It’s a rigged market, shaped by government regulation, funded by government subsidy, and owned by government agencies and government-privileged corporations.”
Libertarians really need to start using the “blaming the victim” rhetoric when people attack the free market for the negative consequences of statism.
For example, when people say the current health care system is the product of the free market, you can excoriate them for blaming the victim, because it is the free market being injured and abused, while government intervention is the real culprit.
Also, this naturally gives you an opportunity to explain that we do not have a free market, but a highly regulated interventionist mixed economy.
Comment by John Irby on 23 December 2009:
Where to begin…
I want you, Jkatz (sorry if the abbreving is rude), to REALLY think about what your arguing.
Should people REALLY not think that a product is safe since it has an FDA label? Have you no idea why the FDA came about in the first place? It was not because domestically produced food and pharmaceuticals were inherently safe or because some naturally occurring regulatory mechanism was being pounded on by the Government.
You also REALLY – the Austrian framework aside – ask how anyone would come to the conclusion that failure warrants giving up. The police and military fail all the time; so do businesses and people, but we haven’t thrown them into the rubbish bin of history because of occasional failure.
I am also coming to a perception, especially viewing the replies here, that seems to indicate that the ‘free-market’ – in all its natural and splendid un-encroached glory, is incapable of failing on its own. Considering how much of a human institution it is, I find this perception flawed. Markets do not exist independent of people, so the problems of the people are the problems of the market unless there is some sort of novel solution I’m not aware the Austrians have that is somehow different from the utopianism of the Marxists or syndicalists.
To Wiebe: To the degree that Obama’s soft-fascist turn bares you out, I find myself in general agree. At least since the Carter days when deregulation began, the Market has only rewarded the top percentile of the population, at the expense of everyone else.
However!
I disagree that somehow the Market isn’t supposed to be this way. Corporations, unless Austrians have a definition of them I am unfamiliar with, WILL ALWAYS act to preserve their own interests through whatever means are available. Unless we can come to some sort of consensus that corporate market activity is malignant and should be in some way stopped, I don’t see how short of regulating their powers you expect the market to survive. Either we have corporations or we don’t.
As it relates to Joe, well that all being true, it is surely terrible, but even naturally, a corporation is an organism that is far beyond your power as an individual. Do you want that power to be completely beyond scrutiny or reproach? Or do the Austrians have a way to keep these powers in line?
Comment by John deLaubenfels on 23 December 2009:
Would you give companies that research and produce new drugs NO protection from competition, starting the moment someone gets ahold of the new drug, analyzes it, and creates a knockoff? Nothing for all the money the original company has spent doing trials? I don’t think that such a system would be either fair or likely to motivate companies to produce new, life-saving drugs.
Comment by D. Saul Weiner on 23 December 2009:
John Irby,
It would be nice to live in a world where the FDA (taken as a given that it existed) screened out the dangerous treatments and allowed the others to thrive, but experience has proven beyond doubt that this is not the way that the FDA works in the real world. In the real world, Big Pharma has captured the FDA and hampered its competitors in order to generate outsized profits. In such a world, one should be highly skeptical of FDA claims, whether for or against any particular product or therapy that the FDA approves.
The free market provides the best recourse against bad products and services: litigation against producers who committed torts or fraud and opportunities for safer, more cost-effective treatments when the prevailing ones prove unsatisfactory. The free market does not require that each participating corporation or practitioner is scrupulous and that every product or service is valuable. It is a process which allows the cream to rise to the top. But it can only work when it is allowed to, not in the fascist type of environment in the U.S. today.
Comment by Charles Johnson on 23 December 2009:
John: If it was so that medical care and mutual aid was so easy to come by, then why was their a perception that the poor and elderly were dying sick in the streets?
It depends on what period this “perception” is supposed to apply to.
1. If you’re referring to the heyday of the mutual aid societies in the late 19th century through the 1910s, the answer is simply that this “perception” exists because statists often promote bogus perceptions of crisis without much supporting data, in order to put over the need for their desired programs with the politicized public. Some actual data on the circumstances faced by the poor and elderly, rather than impressionistic and sensationalistic “perceptions” would be useful here. I have some actual data on how available these arrangements were to ordinary workers, which I present briefly in the article — typically between 20% and 50% of workers in major urban areas in English-speaking countries were covered, and these numbers were rapidly rising in the 1900s, prior to the political campaigns to eradicate the associations and raise medical prices. If you want a fuller presentation of the data, I recommend David Beito’s excellent book, From Mutual Aid to the Welfare State, especially Ch. 6, “The ‘Lodge Practice Evil’ Reconsidered.” If you have actual countervailing data that tends to cut against the conclusion I draw, feel free to present it, but if what you’ve got is just ill-specified “perceptions,” well, so what?
2. If, on the other hand, you’re referring to the decades leading up to the passage of major government entitlement programs for the “poor and elderly” — programs like Social Security (1935) or Medicare (1965), then you need to keep in mind that these programs were introduced and rolled out decades after the non-corporate, grassroots, free-market alternatives that I discuss in the article had been deliberately dismantled by politically-driven campaigns — coordinated mainly by establishment medical guilds, using their power over government licensure of practitioners as their primary means of enforcement — to drive them out. (The blackballing campaigns against lodge-practice doctors in the U.S. ramped up in the mid-1910s and succeeded in forcing dramatic declines in lodge practice starting in the 1920s. See Beito, p. 124 et seq.) So, to the extent that government could point to a crisis of health care accessibility or affordability for the poor and elderly, just before the New Deal and Great Society transfer programs were created, it’s because government was pointing to a situation where the kind of grassroots, consensual social organizations that had made health care accessible to the poor and elderly had already been rubbed out by government in the decades prior. Once again, an example of government breaking your legs, then handing you crutches, and telling you, “See, without me you couldn’t even walk!”
John: However I am not ready to drink the cool-aid …
I don’t want to be a dick about this, but can you not use that phrase when what you mean is “I don’t accept your delusional beliefs?” It’s an offhand jokey reference where the “punchline” is the murder of 276 children, and the senseless deaths of almost 1,000 people, just 30 years ago. Jokes like that suck.
John: … and say that we need to rid ourselves of the FDA or of medical accreditation. Kevin Trudeau is a salesmen of alternative cures for a variety of ailments [etc., etc.]
The existence of quacks and dangerous drugs today, in spite of already-existing heavy government regulation, seems like an odd argument for relying on government regulation as a means of getting rid of quacks and dangerous drugs.
In any case, the free-market position is not that we need to get rid of drug testing or medical accreditation. The free-market position is that the state should not force any particular scheme for drug safety or efficacy testing, or for medical licensure, on you or me without our consent.
The important thing, from the standpoint of individualist principle, is that, if you want to pay for snake oil without any consideration of demonstrated effects, you should be free to do so. And if I want to spend money only on drugs that scientific research has demonstrated to be safe and effective, or on doctors who have garnered the recognition of their peers as honorable and competent professionals, then I should be free to patronize only those that consensual consumer-protection outfits and professional medical institutions have approved.
In a freed market, there will certainly be both drug testing and medical accreditation; it will simply be drug testing and medical accreditation that relies on informed choice, or education and persuasion, rather than on the force of the law. How do I know that such institutions will exist? Well, of course, because they already exist, or have existed in the past. Before the modern prescriptions system was created in 1951, the role of objective watchdog for drug safety and efficacy in the U.S. was handled by the American Medical Association (which maintained a private drug-testing laboratory and published annual guidebooks of drugs that received their seal of approval). They provided a system of voluntary, independent oversight that worked — until government “fixed” it.
Similarly, nobody that I know of is proposing that existing methods of accrediting doctors or other medical practitioners be abolished. Where would you get such a ludicrous notion? There’s already plenty of non-governmental means of accrediting doctors — among them, well, the doctoral degree in medicine, which is issued by medical schools and still would be issued by medical schools in a freed market, based on standards of training and mastery. Similarly for nursing degrees, certification by professional associations like the AMA, etc. What radical individualists oppose is not accreditation, but state licensure laws, which add an unnecessary layer of politically-directed licensing restrictions on top of already-existing, voluntary professional standards and certifications within the medical profesion. The problem with this is, first, that they are coercive, and hence violate the rights of patients and practitioners; and, second, that the standards for governmental licensure are imposed through political decision-making and legislative fiat, rather than being determined through open debate and consensus over best practices within the health care market.
As a result, they often use the force of the state to shut down debate and impose requirements that have nothing to do with medical fact and everything to do with political pull — as when state licensure laws were used to attack feminist women’s health centers, midwives, or other alternative medicine providers, even without any evidence that any identifiable patients had been harmed or were even dissatisfied with the service. Or, to return to our original topic, when state licensure laws were used to blackball doctors who were providing perfectly adequate care, but who were seen as “underselling” (that is, providing competent care at costs that were affordable by ordinary working people) during the political campaign against lodge practice in th 1910s and 1920s.
John: The truth is that of all the industrialized countries, America is the only one with a private for profit system,
Didn’t you read the article? “America” doesn’t have a private health care system. It has a government-imposed health care system. The market is dominated first, by direct government control, and, second, by the operations of a handful of corporate privateers who depend entirely on a combination of government subsidy and government-imposed barriers to entry for their day-to-day operations and long-term strategy.
A freed market in health care would look completely different from the “system” that you and I face today.
John de Laubenfels: Would you give companies that research and produce new drugs NO protection from competition,
You are correct that I do not believe that protectionism for pharmaceutical corporations is an adequate argument for imposing government-granted monopolies.
If you want to “protect” pharmaceutical companies’ existing business models, do so on your own dime by boycotting competitors and directing your money to first movers. (Hey, it worked for Tolkien.) But I’m not nearly so invested in protecting current business practices in the pharmaceutical industry, and I’d rather that you don’t use government monopoly to force your protections on my pocketbook.
John de Laubenfels: starting the moment someone gets ahold of the new drug, analyzes it, and creates a knockoff? Nothing for all the money the original company has spent doing trials? I don’t think that such a system would be either fair or likely to motivate companies to produce new, life-saving drugs.
On the cost of doing drug trials, of course, in the same sentence where I advocated the abolition of patents I also specifically stated that I supported the abolition of the FDA, which would dramatically reduce the compliance costs involved in developing new drugs and bringing them to market. So I don’t know what you’re referring to here. (Of course, if companies want to do internal testing they can do so, but in voluntary independent oversight systems, the costs of running trials are typically assumed by the independent watchdog organizations themselves, as part of their institutional charter.)
However, if it turns out that it’s no longer profitable for big, for-profit corporations to do medical research, then — horrors! — it may just turn out to be the case that medical research has to be carried on by non-corporate or not-for-profit institutions. But I hear we have some of those. And I’m not typically impressed by broken-window arguments that fail to take any account of the value of the unseen alternative uses to which money might be put, if not for the coercive government intervention.
Pingback by Rad Geek People’s Daily 2009-12-23 – Dialogue ensues on 23 December 2009:
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Pingback by I’m Against Free Trade Agreements Because I’m For Free Trade | Bleeding Heart Libertarians on 22 August 2011:
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Comment by Anton Sherwood on 24 August 2011:
In a lot of old movies, I get the sense that poverty – while obviously no fun – is not the end of the world; cheap lodgings are readily available, and you can work a bit now and then if you want to. There’s never a hint that my children and I are gonna die if I don’t get a job with corporate benefits!.
One must assume that the world of movies was rosier than real life, but poor people went to movies too and the studio probably wouldn’t want to insult them by distorting things too much. (Unless they were Black.)
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