Tag Archives: Free Market

News

If government can’t fix health care, then who can?

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Story from the New York Post. (H/T Right Klik via Neil Simpson)

Excerpt:

The state is trying to shut down a New York City doctor’s ambitious plan to treat uninsured patients for around $1,000 a year.

Dr. John Muney offers his patients everything from mammograms to mole removal at his AMG Medical Group clinics, which operate in all five boroughs.

“I’m trying to help uninsured people here,” he said.

His patients agree to pay $79 a month for a year in return for unlimited office visits with a $10 co-pay.

[His] plan landed him in the crosshairs of the state Insurance Department, which ordered him to drop his fixed-rate plan – which it claims is equivalent to an insurance policy.

He says he can afford to charge such a small amount because he doesn’t have to process mountains of paperwork and spend hours on billing.

“If they leave me alone, I can serve thousands of patients,” he said.

Government doesn’t like it when private businesses solve problems. Government only wants solutions they can control and regulate. After all, if there is no (government-caused) health care crisis, then these commies would be out of a job. They have to cause the crisis and then market themselves as the only solution.

Right Klik also has a handy list of the problems caused by government.

* “Community Rating” laws, which limit insurers’ ability to charge different prices to different customers, raise prices by 20.3% for individual policies and 27.3% for family policies

* Mandated benefits raise the expected price of an individual policy by approximately 0.4% per mandate. For family policies the increase is approximately 0.5% per mandate. The typical state has about 20 mandates (with a range from 6 to 48) so a reduction from 20 to 10 mandates would imply a 4% decrease in price for individual policies, and a 5% decrease for family policies.

* “Any-Willing-Provider” laws, which limit insurers’ ability to exclude hospitals and doctors from their networks, raise prices by 1.5% for individual policies and 5.3% for family policies.

* Federal law places limits on the discounts employers and insurance companies can provide for healthy, cost-saving behaviors.

* Twelve million Americans go without health insurance because the Federal Government does not allow people to purchase insurance across state lines.

The way insurance works is that people need to pay premiums that take into account the likelihood that they will make claims. The people who make a lot of claims need to pay more. This is what encourages people to take fewer risks and keep costs down. When government gets involved to equalize outcomes regardless of risks, then there is no incentive to live responsibly. The result is a shortage caused by high demand for medical care, and low supply.

How about we just let the free market work instead?

News

Is government more efficient than the private sector?

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When it comes to providing quality services at the lowest cost, private firms are very different from government bureaucracies. A private firm has to compete in an open marketplace where consumers are free to shop around for the best deal. So a private firm has to provide more quality at a lower price or consumers will take their business to a competitor! And the owners and employees share in the profits or losses. They have an incentive to cut costs, raise quality and lower prices. They have a stake in pleasing the customer.

But what about government? Do they have competitors that pressure them lower costs and raise quality? Do the people who run the government benefit financially if they please customers? Do employees of the government benefit if they please customers? Do customers have the freedom to buy from someone else if they are not happy with the price or quality of government services?

Consider this Washington Times story. (H/T John Stossel via ECM)

Excerpt:

An audit of the government’s legal aid program for the poor concluded Monday that the purchase of more than $188,000 worth of imported Italian stone to decorate one of the program’s office buildings in Texas was unnecessary and excessive…

The inspector general of the Legal Services Corp.(LSC) said the stone, which adorns three full stories of a newly remodeled Fort Worth office building, “appears only to be decorative in nature” and does not constitute a “reasonable and necessary” expense.

If a private firm wasted money like this, they would go out of business. The directors and employees who run private firms never waste money like this! If they did, the private firm would go out of business. But the government wastes money like this all the time. It’s not their money, after all – it’s your money. Why should they spend it wisely? What’s in it for them?

And they’re aren’t exactly accountable when they get caught wasting taxpayer money, either.

The inspector general quoted officials involved with the Texas program as defending the purchase, saying the high-end imported stone was selected for its beautiful finish and installed as a decorative flourish.

And this applies to government-run health care, too. Why should be expect government to cut health care costs when they have no incentive to be efficient? Private firms have an incentive – to keep their jobs, to be promoted, to get raises, etc. Government has no incentive to be efficient.

News

Canada signs free trade deal with Panama, tracks Russian subs on east coast

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Two pieces of good news for our neighbor to the North.

First, while Obama has been embracing protectionism, Canada has signed yet another free trade deal.

CTV News reports:

Canada has signed off on a free-trade agreement with Panama, which will immediately slash tariffs on a number of Canadian exports.

Excerpt:

[…]The new agreement with Panama will cut more than 90 per cent of tariffs on various Canadian exports, including agricultural exports and high-tech machinery. Any remaining tariffs will be eliminated within 10 years under the terms of the deal.

Beef producers will also benefit, as Panama will lift a six-year-old ban on Canadian beef as part of the deal, CTV’s Roger Smith said Tuesday.

[…]Beyond reducing tariffs on export goods, the deal will help Canadian businesses gain greater access to the Panamanian market, Smith said.

[…]Panama is the eighth country to reach a trade pact with Canada in the past year. Canada has also reached trade deals with four European countries and Peru. Similar deals with Colombia and Jordan have been signed, but not implemented.

Previously, I wrote about Obama’s naive protectionism. Anti-free-trade policies (= protectionism) is the kind of policy favored by people who do not know the first thing about economics. Being anti-free-trade is right up their with being pro rent-control. We are talking about amazing levels of economic ignorance, coupled with pandering to his ignorant special interest groups.

CTV also reports that Canada’s anti-submarine warfare (ASW) aircraft detected nuclear-powered (= quiet) Russian attack submarines patroling off the east coast.

Frankly, I am surprised that Canada was able to detect Akula class SSNs by using airborne ASW aircraft. I’ve used the S-3 Viking and the P-3 Orion fixed-wing platforms before, (as well as helicopters), and this CP-140 doesn’t look much different. If I had to bet, I would bet that they got the contact on the SOSUS network and that this press release is fudging things to make the Canadian forces look more effective than they really are.

Excerpt:

It’s unclear whether Canada took the initiative to have a CP-140 Aurora patrol plane watch the vessels, or whether there was a request from the U.S. Northern Command which tracks submarines.

My guess is that this is a SOSUS contact that was delegated to the Canadians for PR purposes. I just don’t believe that you are going to get a contact cold on an Akula-class attack submarine from a fixed wing aircraft. Akulas are quiet. These are not SSBNs like a Typhoon class – they much smaller. ASW aircraft are usually brought in after a sonar contact – otherwise you’re just wasting sonobuoys looking for a needle in a haystack.

Did you guys miss the story from earlier this year about Canada chasing off Russian bear aircraft?