Economic Doomsday for the USA

Now that Obama and the rest of the Government has failed to produce a health care plan that will reduce costs or provide equal access, the biggest question becomes what price will be paid by society for this failure. The only reason why "health care reform" is being talked about at all by the ruling corporations and the Government is the apparent truths that the sky high cost of health care has (1) contributed to the current economic collapse and (2) might very well prevent an economic recovery.

Incidentally, when rich people on television talk about "economic recovery," they are talking about a recovery for rich people (through stock market gains and so forth) not about a true economic recovery that obviously would have to include a large number of jobs being created. But in fact, for the first time in history, the US Government has recently been dropping hints that there might be an economic recovery with few or no jobs created! Seriously though, any jobless recovery would be a recovery only in the fantasy world of very rich people.

So going forward, the relevant question becomes whether the failure to fix health will keep the economy from recovering and, specifically, will the failure prevent jobs from being created. If the number of US jobs does not rise anywhere near enough to cover the need for jobs (or continues to drop) for years and years, while the population continues to grow, (more slowly due to reduced immigration) then I for one don't see how the system as a whole can continue indefinitely.

This "doomsday" scenario would represent a systemic collapse on a scale seldom if ever seen in the world, and I assume that the relevant question would then become when a new political order would be established, not if. The US Constitution or at least some parts of it would probably be history in any doomsday scenario.

Although the new order could be less right wing than the existing one, I suppose it could be more obviously fascist than the current one, also. The US population appears to be too inherently right wing and too "dumbed down" for there ever to be Social Democracy" there, at least within the next 50 years or so. However, on the other hand, the virtually unprecedented scale of the very possibly developing systemic and essentially permanent economic collapse is a wild card factor that, to me as an economist anyway, makes possible almost any future political order, including a more progressive one.

[The above was in response to this article.]

The Economics of a Just and Efficient Health Care System

The public option, never anything more than a Trojan horse type of diversion from single payer, is so lame that as of now it can not pass. That is not a big loss.

First, the ruling Corporations are not going to allow more than about a 10% initial discount from private plans for any "public option" plan. Second, the public option plan will quickly load up with the sickest and those who have been going without insurance for years and years and need some care immediately, which will swamp the plan, meaning that long waiting lists and huge deficits will quickly develop. Third, right now the whole hopeless thing of tinkering with a failed system instead of going with single payer is so twisted and lame that essentially nothing can pass.

Let me give a quick economics lesson.

First, keep these three things in mind about competition. First, payment mechanisms and insurance plans have almost nothing to do with competition. Second, competition per se is nothing more than a pain in the neck to producers. The main reasons why competition is wanted in an economy is that it is very effective in keeping costs under control and in keeping prices and quality reasonable for customers. Third, competition and the cost control coming from it can and does play out in other aspects besides price, including quality of results, which can be more easily monitored in a single payer system than in the US system.

Regardless of the payment mechanism(s) "real competition" in health care can be increased by a bigger supply of doctors, diagnostic equipment, hospital rooms, and the like. In the USA right now in fact, single payer needs to be accompanied by a bigger supply of health care providers and health care goods in order to reduce costs and cost pressures. The bigger the supply, the less the underlying cost pressures, the better single payer works, and the better the potential for the economy to do well freed up from excessive health care costs. Whereas, if costs are excessive due to artificial limitations on the supply of doctors, hospitals, and so forth, single payer can still provide health care to everyone but it can not by itself make sure the economy is not damaged by excessive health care costs.

The thing that most people don't understand is that when a Government oversees an industry such as it does with single payer systems, it does not mean that competition is out of the picture or discouraged or anything of the sort. Quite to the contrary, the Government can, with the appropriate power and mechanisms, keep costs very reasonable by, among other things, making sure that the supply of providers is high enough to both meet the demand and to generate some real competition.

Moreover, there is still competition going on in all of the non-price aspects, everything from office hours to different doctor preferences regarding various drugs and surgeries. If I think surgery will do me more harm than good for example, than I am going to look for and find a doctor who thinks like I do, and the fact the system is single payer is irrelevant.

In general, the biggest non-price aspect of competition is quality which, assuming the Goverment takes an interest in this, which it almost certainly will, is much easier for customers to monitor in single payer systems than it is in private systems such as the US one. One "secret" reason why some US doctors (the not so competent ones) don't want single payer is that they know that the quality of their work will come under some greater scrutiny in a single payer system.

Prices can in the private company context usually be conceptually broken down into costs and profit. In Government single payer, profit is irrelevant and prices disappear, so only the costs are left, which, however, is the only thing ultimately relevant.

Technically, increased competition generated by Government subsidized supply increases does not show up in prices, simply because there are no “prices” per se in full single payer. Rather, there are set payment fees which are supposed to be almost exact representations of real costs. But the actual health care costs are most definitely reduced by Governments increasing supply in conjunction with single payer systems, so when all is said and done, single payer systems can generate as much cost control as you would get in a full “free enterprise” system, which, of course, does not exist anywhere anyway, due to monopolization and restraints on supply such as excessive licensing requirments..

If the powers that be in the US are afraid of using the power of the Government, which is “the commons,” and which is all of the citizens equally, it is their fault if by not doing so their whole economy and society go down the drain.
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[The above is in response to this article.]

The "Public Option" is Doomed

As of now you can forget the public option. First, the ruling Corporations are not going to allow more than about a 10% initial discount from private plans for any "public option" plan. Second, the public option plan will quickly load up with the sickest and those who have been going without insurance for years and years and need some care immediately, which will swamp the plan, meaning that long waiting lists and huge deficits will quickly develop. Third, right now the whole hopeless thing of tinkering with a failed system instead of going with single payer is so twisted and lame that essentially nothing can pass.

How USA Tribalism Makes Health Care far more Expensive

Unlike Norway and numerous other advanced countries, the USA has always been stuck in the primordial soup of economic tribalism. By that I mean that US individuals have (almost from day one of the Republic) frequently formed into formal private organizations that engage in such things as public relations, licensing (in conjunction with Government) and lobbying of the federal government and all the state governments to make it more difficult for young people to get the credentials needed to get a license and to join their group.

Why do the US tribal occupational/industrial organizations (like the AMA) support making it more difficult to become, for example, a doctor and to join them? The biggest reason is that by inducing the Government to put up ever increasing barriers to entry, these organizations, among other things, artificially increase their own incomes and also their own clout. That is Economics 101: artificially keep the supply down and the price stays higher than it really should be.

Right of center organizations such as the AMA actually do not give a damn about US health care in general, from the vantage point of the overall public good. Nor does the AMA really care whether the ordinary US citizen has good health care or not, except to the extent of the potential that this and similar issues might enrich their members further. The AMA and similar US organizations are motivated by money and money only.

Norway and similar (mostly Western European) countries do of course have private industrial and occupational organizations, but these entities generally don't act in the greedy and anti-public good way that the US versions do.

Partly as a result of the differing attitude and motivations of these "gatekeeper" organizations, Norway has many more doctors per capita than does the United States, which in turn makes the Norway single payer system even more effective and efficient than it would be if the number of Norwegian doctors was artificially kept down like it is in the US.

Another reason why Norway has more doctors though is that the Government there recognizes doctors and health care in general as a public, common good, so the heavy subsidy of education in Norway extends up to the level of medical school. Whereas in the United States, medical school is so expensive and the economy is so bad that even high income doctors, burdened by among other things huge student loans, high malpractice premiums, and by the need to hire numerous paper pushers to meet all the requirements of their health insurance company overlords, are sometimes forced to declare bankruptcy!

Greed Never Seen Before and Nasty Karma

A GUEST QUESTION

terry a July 21st, 2009 8:45 pm
Why have the people of the US lost control of their government so badly --almost totally... Especially in comparison to most W. European nations that until not so long ago had been for centuries official monarchies or worse - but which are now fairly egalitarian social democracies?

You can pretty well identify HOW the USA's logic of power increasingly degraded; from communities of reasonably accountable flesh and blood people to increasingly abstract, unaccountable, and powerful fictional individuals known as corporations...
But understanding the Why of it isn't so clear.

Why did the USA's people not see the fatal fraud -- the danger of corporate personhood -- as it began to play itself out with ever more dire consequences over the past 120 years?

Why were the reconstituted capitalist societies of post WWII W. Europe able to avoid the worst of modern corporate capitalism? At least in terms of a more humane per capita distribution of national wealth?
Was it because of some deeper Knowing about Life in those far older and far more suffered cultures? Seemingly so; but even this factor can't account for much what we see in the case of the USA.

If you analyze the USA, and conclude that it's decline is due to too many people becoming too prosperous too quickly -- and therefore becoming all-too-self-absorbed and cognitively/politically lazy -- it still doesn't answer the question:
Why did our nature-given, creaturely common sense collapse so fast under achievement of a momentary freedom from mere existential, age-old, hard-wired-tolerated drudge?

Even if you say it was the rise of the USA's unique, legally liberated ultra-capitalist corporate mass news and entertainment media -- that scattered the fatal common epistemological poison -- fooling millions of otherwise normal human creatures into becoming ego addicted to existentially-softening delusions and distractions and hyper-atomized narcissistic self-images -- we still need to better comprehend Why.

WHY would the normal, ultimately self-balancing human instinct in virtually all human creatures, in Americans atypically become so easily and quickly overthrown, as opposed to, let's say, an also relatively new capitalist, immediately adjacent, race-stock-similar nation, like Canada?

It's not enough to say that we USAans have come to our now, almost irretreivably fallen state efficiently because of the erroneous ideas we've chosen to believe-in.
If we chose to so-believe: why did We where Others didn't?

I've been wondering about this myself for many years. All I can do is make a few educated guesses.

Aside from greed on a scale never seen before (even in Britain) there may be some supernatural factors involved. I have the sneaking suspicion that there is some big time nasty karma that has literally infected the US, like the plague did Europe a few centuries ago. In fact, maybe we are all just bit characters in "Europe's Revenge," which is now playing at the Milky Way Theater.

Or it could be just my imagination getting away from me.

[The above exchange was in response to this article.]

Horse Health Care and Horse Unemployment in Kentucky

In Kentucky, many of the horses get better health care than do the uninsured humans and the humans who are insured but have been denied care by a greedy insurance company. Similarly, I hear that the horse unemployment rate is lower than the human one these days.

[The above is in response to this article.]