My school has a newly formed debate club and, as you may have guessed, it is dominated by liberals and has a hardy make-up of Neoconservatives. We are to discuss Health care next meeting and I have already been asked many difficult questions. I am young and fairly new to Austrian economics, and when hammered with many of these questions, I have no valid response except " Let the free market handle it". I was wondering if anyone could please help explain the Austrian view towards free market health care, and I was looking for an answer to some frequently asked questions that I have a hard time answering thoroughly.
Here are some questions I struggle in answering ( if you think of any more, please feel free to address them and give me an Austrian answer. Also, I am writing as a Liberal that may question me, I myself follow Austrian views):
- Private health care caused the problems we have today, look at our private health care now!
- How could old people, poor people, or very sick people get coverage when they needed it, when companies would most likely have rates too high for them to pay, based on their bad conditions physically and economically? They could not be able to afford it when they need it and die!
- Even if one is not denied coverage initially, a person may become very ill and may be old or poor, and the company could drop their coverage all together. How would that be regulated ( I imagine the market would let these unfair companies go out of business, but it would have to happen to some people before it was denied by the market).
-How would people pay for expensive problems that may come up out of nowhere if the government can not help. ( should a tax free Medical Savings Account be established and how would it work).
These are only a few questions, but feel free to go in depth on this issue and offer answers to additional questions I or others may have. Thank you very much for your time and help everyone.
Quinn Rogness: 1. End the FDA (Food and Drug Administration)The FDA was founded to protect us from unsafe drugs and medicine. The FDA has failed in that aspect and has caused a significant increase in health care costs today. The FDA should be replaced by free-market alternatives that do not drive up health care costs and are beneficial to the average American. An example of FDA failure includes the 10 year wait in approving the drug Propanolol (Heart medication). 100,000 people died during this time that could’ve been saved by this drug. The FDA has been destructive to Americans, and deserves to be abolished.
1. End the FDA (Food and Drug Administration)The FDA was founded to protect us from unsafe drugs and medicine. The FDA has failed in that aspect and has caused a significant increase in health care costs today. The FDA should be replaced by free-market alternatives that do not drive up health care costs and are beneficial to the average American. An example of FDA failure includes the 10 year wait in approving the drug Propanolol (Heart medication). 100,000 people died during this time that could’ve been saved by this drug. The FDA has been destructive to Americans, and deserves to be abolished.
I think the Vioxx case also provides an example as to why the FDA is pretty useless. Vioxx and products like it (called COX-2 inihibitors) are similar to aspirin, but are more specific to certain receptors in the body. It was believed that this specificity would eliminate or vastly reduce the number of deaths associated with aspirin by substituting a COX-2 for people taking aspirin for chronic mild to moderate pain. Most people don't know this but aspirin kills about 15,000 people a year in the US by causing bleeding ulcers in the stomach. Unfortunately, Vioxx also resulted in some deaths due to affects on the heart. This affect wasn't detected in the studies the FDA requires for approval because it doesn't occur that often and the studies weren't statistically powered to detect them. It also was not an endpoint in these studies because, at the time, no one suspected it. Even today, after the effect has been detected, the mechanism for it is still not clear.
In any event, the FDA was not able to prevent this and I don't think any amount of regulation really could. The issue was settled where it should be settled - in civil court. If there had been no FDA, it would still have been settled in court. So why have an FDA? The best "check and balance" for manufacturers to market safe products is the liability they assume, not any regulations. All the FDA does is run up costs for everyone - the tax payer, the consumer and the manufacturer. I imagine the clinical studies groups in all major pharma companies are working hard to find ways to improve their ability to detect any bad effects of their drugs prior to marketing in order to avoid litigation. This is at it should be.
C Le Master: Private health care caused the problems we have today, look at our private health care now!
Not really a private healthcare system. Really it is a system of price controls on insurance, doctor protectionism, and elimination of any competitor who could do a better job. As such, no wonder people can't afford it or are dropped by insurance companies.
P.S. I can't wait to see how socialist healthcare fails in america. I'm gonna enjoy the "prescience" factor. (Of course I'll probably be dead from all the floridated water by then).
This is a baseless assertion that they cannot prove. They can only dogmatically proclaim it as self evident. All that they currently see around when they look out the window is a heavily hampered market.
C Le Master:How could old people, poor people, or very sick people get coverage when they needed it, when companies would most likely have rates too high for them to pay, based on their bad conditions physically and economically? They could not be able to afford it when they need it and die!
People will die under any government system as well. The government will not be able to afford all types of healthcare at instant demand. There will be rationing either directly or indirectly and all medical expenditures will be confined to a finite amount of resources. This means that contrary to propaganda, the government cannot guarantee anything. The question remains: what system can best alleviate the problem of scarcity?
Under any government system, the rates will be higher when government controls more and more of the industry due to subsidy and regulations. Demand is increased due to 3rd party paying schemes and prices seize to reflect the action of voluntary exchange. Prices therefore, do not provide meaningful information any longer with respect to how to utilize the limited resources available to best satisfy the consumers.
Basically, what all of this means is that the economic problem of scarcity is not being alleviated with respect to medical care. There is more scarcity, not less. Costs are much greater, not less. There is less health care and not more. How can a system that produces less healthcare better solve the problems they themselves raise?
C Le Master:Even if one is not denied coverage initially, a person may become very ill and may be old or poor, and the company could drop their coverage all together.
So will the government! The government is no magician. If it buys 4 MRI machines, then that's all it has - 4 MRI machines, not 5 and not 6, but 4!. All needs for the MRI will have to do with 4 machines. No government insurance card will give rise to another machine. You will have to wait or basically not wait. The same goes with any treatment that you need.
Those who cannot get properly diagnosed in time and then seek the correct treatment in time will also die! Again, the question remains, who can alleviate this problem more efficiently: A free market or a hampered market? If the market is completly destroyed, there will be no more health care.
It is better to be sick and poor in a capitalistic nation then in a socialist nation. Likewise, it is better to be sick and poor in a capitalistic nation with free market health care then one with socialized medicine! The US currently has no free markets so comparison with Europe is nonsense. Prices will be much lower in a free market. More people will be able to afford more and better healthcare. Charity can serve the very poor much better in a free market then in a hampered system or socialist system where the government crowds out charity, and medical care itself is much scarcer.
If people oppose charity on the grounds that it may not be sufficient, then
1. We're back to the myth that government can provide more. They can't prove it and you know that it's wrong.
2. What is sufficient? If the government is in charge, I'm sure the politicians will come up with some arbitrary definition for sufficient. We're back to #1.
3. Charity receives whatever people in a free society choose to give. The amount, whatever it will be, is a reflection of the will of the people, or all those who are in a position to give. If the government deems it not enough and decides to provide more by confiscating more wealth from people, then the questions arises: On who's behalf is the government acting? It can't be the people since the people have already made their choices in the market.
I would use the upfront and pushy approach as the folks evaluating the debate will give the win to those in favor of using other peoples money (Their own) to pay for a giant bureaucracy full or promises, dreams and talk. Start by saying that no matter how you feel about, giving health care away will only force out providers, turn caring medical professionals into government employees, stifle innovation and cost a lot more for a lot less care.
Do you know about this:
http://mises.org/daily/3737
My humble blog
It's easy to refute an argument if you first misrepresent it. William Keizer
Wow, I have read Mises for a while but just registered, and am very suprised by the willingness of all of you to respond. Thank you all for your help very much, I really appreciate it.
This audio may also help: Walter Block talking on socialized medicine It may give you a few pointers on how to make your case. It also talks about how the cartel of doctors contributes to high costs.
Ok, now I am going to spend alot of time writing this post to help you out ok? So I implore you to try to use the resources that I give you.
Just taking a bunch of stuff from the fringe elements site. Ryan Faulk is a beast.
Why is Healthcare so expensive?:http://fringeelements.ning.com/video/medical-services-restrictinghttp://fringeelements.ning.com/video/medical-services-insurance
The One Way out of medical hell:http://fringeelements.ning.com/video/the-one-way-out-of-medical-1
"Universal" Healthcare:http://fringeelements.ning.com/video/universal-healthcare
How Government Solved the Healthcare Problem by Roderick Long:http://libertariannation.org/a/f12l3.html
The Health Insurance Market is Not Free by Anton Batey:http://fringeelements.ning.com/video/the-health-insurance-market-is
Conservatives and Obamacare:http://fee.org/audio/conservatives-and-obamacare/
http://www.youtube.com/watch?v=Ws7hdwQNJOs
http://www.youtube.com/watch?v=Nt0tKl0J-S4&feature=PlayList&p=0629B97DDFA9C7DB&index=55
Now, addressing your problems directly.
C Le Master: - Private health care caused the problems we have today, look at our private health care now!
Healthcare is also crappy in other nations. Furthermore Healthcare is not private with Medicare, medicate, government controlling insurance, FDA, MDA, ECT. Check the articles, but this is the ultimate strawman.
C Le Master: - How could old people, poor people, or very sick people get coverage when they needed it, when companies would most likely have rates too hfalligh for them to pay, based on their bad conditions physically and economically? They could not be able to afford it when they need it and die!
- How could old people, poor people, or very sick people get coverage when they needed it, when companies would most likely have rates too hfalligh for them to pay, based on their bad conditions physically and economically? They could not be able to afford it when they need it and die!
With costs consistently falling more people would be able to afford healthcare more effectively without the state being involved. Furthermore your concern with these individuals shows a demand that they should be taken care of. You could very easily start up some sort of charity organization in order to fund these people.
- Eve
C Le Master:n if one is not denied coverage initially, a person may become very ill and may be old or poor, and the company could drop their coverage all together. How would that be regulated ( I imagine the market would let these unfair companies go out of business, but it would have to happen to some people before it was denied by the market).
Its not a case of letting the firm go out of business, its a case of contract enforcement, pure and bloody simple. Enforce the contract.
C Le Master: -How would people pay for expensive problems that may come up out of nowhere if the government can not help. ( should a tax free Medical Savings Account be established and how would it work).
Once more, costs would be falling consistently on a free market. People would naturally form mutualist organizations and save in order to prevent such things from happening. Or the hospital could guarantee a degree of coverage should this happen for this would greatly boost the reputation of the hospital.
Really hope this helps.
I just spent like half an hour responding to this and I hooked you up with alot of sources. It said "Post awaiting moderation" or somthing. I hope for the love of jesus that, that thing gets posted
http://cabalist.wordpress.com/2009/12/22/unhealthy-healthcare/
This might be of some help. I wrote it back in December so it's not necessarily up-to-date in terms of current health care legislation, but you should be able to get some good information to help with your debate regardless.
C Le Master: Wow, I have read Mises for a while but just registered, and am very suprised by the willingness of all of you to respond. Thank you all for your help very much, I really appreciate it.
As filc said in another thread, we all have the common issue of constructing arguments that opponents of the free market can understand. "Just come here and we can bash out an argument together."
Thank you everyone for all of your help, but someone has given me another question. A friend said that often hospitals are not profitable and need government help. I replied about how private practices today make so much profit, and the better ones would grow, and if they became inprofitable, they would go out of business and sell the hospital or another one would grow. But the kid I was debating with brought up the point about how if a major hospital in an area goes under, and people need medical assistance in that time, who would take care of them. I replied that food is also a necessity, and if a local Publix Super Market goes out of business, people still have food and will not die. Am I correct on the situation? I would just like to know what really would happen, and what would happen if someone who is very poor without insurance gets shot, do we just let him die?
You are correct. Just to add about why the hospital goes out of business: About 40 years ago government at all levels got more and more involved in health care in all portions of the business with the approval of the medical industry. Eventually government had its tentacles in basically every aspect of running a hospital. Improvements in medical technology allowed doctors to break off on their own and take the profits that would have gone to the hospital. The hospitals still had a love affair with the government as the government especially local government would help them in their cause against the evil doctors competing with them.
Of course over time the doctors won this battle and really stuck the hospital with a lot of very low profit services. Now the hospitals ended at the mercy of government as they held the only cards left that help the hospital make money: 1. Payments for free care, 2. Territorial monopolies and 3. Non profit status.
Now the citizenry is stuck with hospitals that can not financially exist without government, ie they work for the government, which means worse care and less cost containment. And don't look now but the Obama is about to worsen this whole mess.
Fairly correct. Why not just go somewhere else? Suddenly it becomes more profitable for smaller hospitals and traveling doctors to come to the area, remember that whenever someone supports any type of firm with government funds it is by necessity a net drain on resources.
You are on track and despite what the "only government can help" crowd, there is hope. Humans in the absence of force, will work together through mutually beneficial exchange to produce greater and greater products and services. Just as in the supermarket case where one or two supermarkets may go out of business and be switched with one giant supermarket and several convenience stores, so may a hospital be replaced by sending patients to a larger hospital near by and by doctors providing emergency and other medical services with smaller facilities.
Necessity is the mother of invention. Suppliers of healthcare: Doctors, nurses, etc will rush to an area to supply services as there is profit to be made. Without government intervention these people will always find cheaper and better methods to provide care as they will have to compete with others to maintain profits.