Health Care: Statism or Competition?

"A government with all this mass of favours to give or to withhold, however free in name, wields a power of bribery scarcely surpassed by an avowed autocracy, rendering it master of the elections in almost any circumstances but those of rare and extraordinary public excitement."

 --John Stuart Mill  

“[W]e're moving from a society where the goal of government is not to equalize opportunity but to equalize the results of our lives. ... The more we ask government to do for us, the more government can take from us. ... Government is doing so much in our lives that we have less freedom to govern ourselves."

 --Paul Ryan

Obamacare is the key path to government take-over of American society. Stanford economist Victor Fuchs said, in a 1976 statement repeatedly quoted here, a “most effective” way to build “allegiance to the state is through national health insurance.” It’s certainly worked in Europe’s top-down social democracies, beginning with Otto von Bismark’s autocratic German state in 1883.

Obamacare’s not just about a loss of freedom. It’s about the well-understood inefficiencies of any big government program. As Harvard conservative Niall Ferguson wrote recently:

[Obamacare] did nothing to address the core defects of [health care]: the long-run explosion of Medicare costs as the baby boomers retire, the “fee for service” model that drives health-care inflation, the link from employment to insurance that explains why so many Americans lack coverage, and the excessive costs of the liability insurance that our doctors need to protect them from our lawyers.

Obamacare doesn’t fix the big problems with our health care system. It primarily expands ponderous, big government coverage to 30 million more people.

Here’s another health care warning, this about Medicare from the National Review’s conservative Yuval Levin:

Democrats want to test the idea that yet more price controls and central planning will make [Medicare] more efficient while Republicans want to test the idea that intense competition for customers among providers will make the system more efficient. The Democrats’ idea has been tried for decades, it is the organizing principle of Medicare’s fiscal design, and it has gotten us to our current predicament. The Republican idea . . . — as Medicare’s chief actuary, who works for President Obama, has said [—] “can get you to the lowest cost consistent with good quality of care.”

Scott W. Atlas, MD, is a senior fellow at Stanford’s conservative Hoover Institution. He defends the Romney-Ryan Medicare reform plan as one that

would present American seniors with the option of private insurance, instead of traditional Medicare – and voters of all ages should contemplate this next phrase very seriously – giving seniors the choice is an idea that President Obama and his supporters find unacceptable and threatening.

Atlas is worried Obama is transforming America’s health care system into a Western European one, where waiting lists and technology shortages have already moved citizens in Denmark, England, Finland, Ireland, Italy, the Netherlands, New Zealand, Norway, Spain, and Sweden to move toward privatization.

Grace-Marie Turner, a market-based health care reform advocate who heads the Galen Institute, recently took apart the president’s August 25 radio address on Medicare. She first quotes Obama saying that as part of Obamacare’s reforms, “we gave seniors deeper discounts on prescription drugs, and made sure preventive care like mammograms are free without a co-pay.”

Turner’s response:

Does he believe that seniors aren’t going to understand that $4 billion worth of drugs and free mammograms can’t begin to equate with the $716 billion that will be taken [from Medicare]?

Why is the pro-con debate so even on Obamacare and Medicare reform, when the contrast between what works in the competitive private sector and big government inefficiencies is so stark? Isn’t it because such a large portion of the electorate is already dependent upon government?

With this administration, there is another reason. Advocates for our free enterprise system are--to an historically unprecedented degree (see below chart)--almost wholly absent from the Obama leadership team.  J.P. Morgan examined the prior private sector experience of 432 cabinet members in presidential administrations since 1900, including secretaries of Commerce, Treasury, State, Interior, Agriculture, Transportation, Housing and Urban Development, Labor, and Energy (and excluding Navy, Postmaster General, War, Homeland Security, Veterans Affairs, and Health, Education and Welfare).

The results: