Proponents of government-run health care, (i.e. – socialists), want to redistribute wealth from producers to victims. Producers create wealth and victims engage in risky and/or immoral activities that are likely to require medical treatment. (I am concentrating on medical treatment for culpable activities here). Wealth redistribution reduces economic growth because producers stop producing while victims incur more costs, since they do not pay much for their treatment. Eventually, reduced economic growth leads to poor health care, as seen in socialist countries like North Korea, Cuba, Venezuela, Zimbabwe, etc.

Socialists do not trust people to make their own health care decisions, and to deal with the consequences, (i.e. – liberty). In a socialized system, a producer might have his wealth redistributed to victims for services he would never need himself, because of his lifestyle decisions. He might even have his wealth redistributed to victims for services that he objects to on moral grounds, like abortions or sex-changes. He may pay into a mandatory government program for his entire life, without ever making a claim. If at the end of his life, he finally makes a claim, he may be told that he must get in line behind the government’s favored victims – victims who may not have even paid into the system. To see how this actually happens in Canada, watch these excellent 5-minute films from On the Fence Films: Two Women, A Short Course in Brain Surgery, The Lemon, and Dead Meat. Also see this Fraser Institute article.

Imagine how socialism would work if applied to a different business, like auto insurance. Everyone would have to carry mandatory auto insurance, whether they owned a vehicle or not. People would pay into the system based on earned income, not based on personal choices, desired coverages or risks. Different vehicles, driving infractions, vehicle usage, and other risk factors like age would be irrelevant to the price charged. Socialized auto insurance would just be a huge transfer of wealth from non-drivers and safe drivers to risky drivers. The socialist system of redistributing wealth to equalize health care outcomes, destroys productivity and personal responsibility. For further details, see this Heritage Foundation lecture transcript.

Socialized medicine involves price-fixing. The government is the single-payer, and set the prices that doctors can charge for services. Since doctors cannot make a fair profit practicing medicine, compared to other fields, we get fewer doctors. But since health care is “free” to victims, we get more risky and/or immoral behavior, and increased demand for medical care. Fewer doctors, and more victims results in a shortage of medical care, and waiting lists. Medical costs also increase because doctors often practice “defensive medicine” to avoid exposure to lawsuits from lawyers, worsening the shortage, (Investors Business Daily editorial, podcast). Another factor that increases medical costs is mandatory licensing, which forces hospitals to pay more for labor and supplies, (Cato Institute podcast). For further details, see this Cato Institute research paper.

Even if the socialist claims that he wants to set up a parallel system to compete alongside the private medical insurers, the government can easily engage in predatory pricing in order to drive out private businesses from the market. The government is far more able to price medical services lower than private alternatives, and run deficits, until their private rivals go out of business. The government does not have stock that private companies could short in order to prevent this predatory pricing. Monopolies are never good for the consumer, because consumers can’t shop around for the best deal. In a government system, you are forced to pay for services you don’t need. The government is already woefully mismanaging Medicare, and Medicaid, (Investors Business Daily editorial, podcast), do we really really want to give them the whole system to manage?

People need to be responsible for their lifestyle choices, and their medical bills. The free market approach preserves liberty, and economic growth. Medical providers have an incentive to lower costs and improve quality. Consumers keep their liberty by taking responsibility for managing their own risks and costs, (see Investors Business Daily editorial, podcast).

It is important to note that upholding traditional morality and traditional relationships, like marriage, helps to reduce medical costs. Government should therefore avoid assaulting religious beliefs, and moral values. An additional problem with socialized medicine is that Christian medical practitioners often have their religious liberty infringed by the government, (see examples here, and here).

These Cato Institute podcasts describe Obama’s medical policy proposal, (first, second). For more on Obama’s plan, see this Heritage Foundation research paper. For more about socialized health care in other countries, see this Cato Institute research paper. A recent debate on this topic, hosted by the left-wing National Public Radio is here. If you prefer books, there is David Gratzer’s book, Sally C. Pipes’ book, Arnold Kling’s book, and Michael F. Cannon and Michael D. Tanner’s book.