Someone suggested that I post my comments on the Health Care "debate" going on.
I haven't really been following it. I am absorbing other material right now (economics).
I can say this though: the Federal Government does not have a great track record with getting rid of something once they are started. You are still paying income tax because of the sixteenth amendment from 1913 (right around the time that the Federal Reserve came into being).
So whatever happens, plan on it starting small (social security started out a 1% and is now a hefty 6-7%-- double this to include the indirect tax on the employer) and then turning into an iron band around your neck. Of course, this will need to be raised in order to "save" the program after the money has been blown on other stuff. What we need saving from is the incompetence and voraciousness of the federal government.
The thing I keep wondering is if there is a shortage of doctors? Or of medical equipment? This problem should be attacked by increasing the supply of thing people want. Isn't that so obvious? If a doctor's appointment, say to get a checkup, were only $15, then there would be no problem just paying for it out of pocket.
Part of the reason healthcare is so expensive is becuase of the stratospheric rise in malpractice insurance costs.
There's no talk of how to increase the availability of health care. It needs to be less expensive. Talk of making everyone get insurance somehow so they can afford something just boggles the mind. And if the insurance is too expensive, then how can that be cheaper.
It can't help the cost of healthcare when giant, black tick-like beings (called trial lawyers) are sucking the life out of the system either.
The story of my ingrown toenail is illustrative.
When I returned from South America in 1992 I had a mother of an ingrown toenail. It was red, pustulent, painful and infected.
I went to the major hospital in my town; a monolithic building squatting in a pool of asphalt. They wanted over a thousand dollars just to book the surgical room. It was a major deal. It's my opinion that these prices are a distortion of the system caused by government involvement.
Then I went to a family practice. It was insanely busy, the doctor scarcely had time to look me over. He wanted to get an x-ray. He prescribed pain medication. We left about $80 poorer and with no solution.
Finally, my mom found a local podiatrist. He had an excellent reputation in the entire valley. He was in a clean, yet modest office in a downtown building. There were several elderly people in the waiting room. On the walls were various diplomas, one of which indicated that the Doctor was a surgeon in the Korean war.
He sat me down, looked my foot over, disinfected the lot then cut a notch in the toenail. Then he took a chisel-like tool, gently inserted it into the notch, then (without warning) rammed it all the way into the matrix. It was a searing lance of screaming agony. In a swift motion he used another tool to pry out the offending shard. He washed the whole thing down with iodine, bandaged me up, and the sopped the blood off the floor with paper towels.
Total cost: $35 cash in hand. I walked out of the office and went to work pushing carts at the local market the same day.
Now that's affordable health care. Pay cash for what you need. Keep a modest policy for catastrophic stuff like brain tumors.
People should have a choice. They should be able to choose what option they want.
Employers have expenses. Here's an example of the types of things a business has to pay for:
Rent
Insurance
Advertising
Materials (to sell)
Office Supplies
Payroll (which includes all subsets of "things that are required to keep people on the payroll")
What's left is profit.
When the government makes employers add expenses for regulation and taxes, what do you think gives in that budget? Shall the business stop paying rent? Advertising?
The place that gives is Payroll. That is what will happen when employers have to provide benefits by law. Wages will go down. Plain and simple. Or people will get cut.
Every so often I get the exciting privilege of giving my workers a raise. I have occasionally asked, "would you like me to give a raise across the board or provide health insurance?" The answer is invariably, "Just give me the money, I will take care of my own insurance."
Profits do not give, that's a myth. It simply does not exist. A business exists for the profit. Once the profit falls below a certain level, where it does not justify the risk, then the business closes doors and everyone gets a pink slip. Goodbye jobs.
Make no mistake. The Feds don't care about you. They only care about lining the pockets of favored constituents (ie not you).
The Federal Government is like an evil reverse Midas, everything it touches turns to dog crap.
There's a good reason why the CONSTITUTION of the UNITED STATES limits the Federal Government to a specific list of things and then reserves everything else (including health care) to the States or to the PEOPLE.
If the Sixteenth Amendment (income tax) were repealed you would get a 20% raise. And the government would still be able to fund all necessary functions quite easily. Could you take care of yourself with that 20% extra?
If fractional reserve banking were abolished, you would (in my estimation) get about a 30% raise (in terms of net purchasing power). Could you take care of yourself then?
How much would you give to charity if there were no Federal programs for the poor?
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Comments from a Client
Hey Shawn, believe it or not, im writing to you not to beg again for information on the army I am eagerly awaiting, but to comment on your thoughts on health care. Pardon the surely endless spelling and grammatical mistakes, this is a spur rant. I welcome your responses, for or against.
Whenever I hear people talking about how amazing socialized medicine is, I am reminded of the old grass is greener saying. There seems to be this grand ideal about it that all other countries in the world have amazing medical care for all, for no cost, and they are all living happy, sickness free lives without a care in the world. But the fact is, there is no perfect system. Nothing is going to provide everyone what they want, or maybe even need. It is the way of the world.
I honestly think that if we as a country develop a plan of health care paid for by the government, or by businesses, it would be one of the biggest mistakes in our history. The costs for just medicare and medicade now are astounding, and would balloon to unimaginable numbers if spread to cover everything. The only way to pay for such huge costs would be to tax the american people to death. And that only hurts the lower class more than they already have been. Everyone likes to talk about how much this would help people who cant afford health care now, but how will they afford a home when they are paying crushing taxes? And we can't lay all of it on the wealthy, because the moment we try to do that, they will be gone, and we will be in much worse shape then.
Another point to consider is that as it stands, we provide, I feel, some of the best care in the world. We have many of the best doctors and scientists working for us every day. When was the last time you heard of anyone having to go to another country to have a special procedure? They all come here. Because we have the best. And why? Because in our system they will not be making the federal wage for a doctor. I think the moment the government starts deciding what to pay our doctors, they will be gone. They go where the money is just like the rest of us would.
A great irony I think is that people believe people are just falling dead in the streets because the hospitals wont admit them. Maybe I missed those news bits. Because it seems to be the other way around. In the socialized medicine countries, they have to wait weeks or months for care, even if they need it immediately. But in this country we have immigrants who come into the country illegally, have nothing, but if they need care, they can go to the hospital, and get the care they need.
It seems to me we are going about this in the wrong way. Why are we not working to reduce the costs of health care now, instead of just band-aiding the problem by having the federal government write a blank check to the health insurance industry? I think everyone would agree that health care costs are totally out of this world, so why are we just ignoring this? Isn't it a better idea to work on bringing them down than just throwing up our arms and saying "oh well, just pay them what they want?"
Whenever I hear people talking about how amazing socialized medicine is, I am reminded of the old grass is greener saying. There seems to be this grand ideal about it that all other countries in the world have amazing medical care for all, for no cost, and they are all living happy, sickness free lives without a care in the world. But the fact is, there is no perfect system. Nothing is going to provide everyone what they want, or maybe even need. It is the way of the world.
I honestly think that if we as a country develop a plan of health care paid for by the government, or by businesses, it would be one of the biggest mistakes in our history. The costs for just medicare and medicade now are astounding, and would balloon to unimaginable numbers if spread to cover everything. The only way to pay for such huge costs would be to tax the american people to death. And that only hurts the lower class more than they already have been. Everyone likes to talk about how much this would help people who cant afford health care now, but how will they afford a home when they are paying crushing taxes? And we can't lay all of it on the wealthy, because the moment we try to do that, they will be gone, and we will be in much worse shape then.
Another point to consider is that as it stands, we provide, I feel, some of the best care in the world. We have many of the best doctors and scientists working for us every day. When was the last time you heard of anyone having to go to another country to have a special procedure? They all come here. Because we have the best. And why? Because in our system they will not be making the federal wage for a doctor. I think the moment the government starts deciding what to pay our doctors, they will be gone. They go where the money is just like the rest of us would.
A great irony I think is that people believe people are just falling dead in the streets because the hospitals wont admit them. Maybe I missed those news bits. Because it seems to be the other way around. In the socialized medicine countries, they have to wait weeks or months for care, even if they need it immediately. But in this country we have immigrants who come into the country illegally, have nothing, but if they need care, they can go to the hospital, and get the care they need.
It seems to me we are going about this in the wrong way. Why are we not working to reduce the costs of health care now, instead of just band-aiding the problem by having the federal government write a blank check to the health insurance industry? I think everyone would agree that health care costs are totally out of this world, so why are we just ignoring this? Isn't it a better idea to work on bringing them down than just throwing up our arms and saying "oh well, just pay them what they want?"
VF
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And a counter argument from another...
I've been enjoying your blog and also giving feedback, and I wanted to chime in on your healthcare post.
"Employers have expenses. Here's an example of the types of things a business has to pay for:
Rent
Insurance
Advertising
Materials (to sell)
Office Supplies
Payroll (which includes all subsets of "things that are required to keep people on the payroll")
What's left is profit."
One big point in the healthcare debate that has been pointed out repeatedly in interviews and articles I've come across is that currently insurance companies use 15-30 cents of every dollar they take in on overhead costs--mostly those things you listed above including profit. The other 70-85 cents of each dollar is spent on medical expenses--doctors, nurses, equipment, and medicine. Shareholders in these companies want that profit percentage as high as possible and encourage the companies to limit those medical expenditures as much as possible. These limitations basically mean that they do everything they can to avoid treatment ... which sucks if you are sick and need treatment.
The hope is that the government system would be able to drastically reduce that overhead. They don't have to pay for those expensive TV commercials. Those evil bureuacrats everyone fears have much more reasonable paychecks than the evil CEOs people tend to ignore. The government, as much as you hate it, is not for profit in the same sense as the insurance companies. Most sources I've seen assume the government overhead should be somewhere around 3-5 cents on the dollar.
Insurance companies only real goal is to make money, and they are very good at that. However, I think the goal of healthcare needs to be making people healthy. The government can prioritize that in a way that insurance companies cannot.
"There's a good reason why the CONSTITUTION of the UNITED STATES limits the Federal Government to a specific list of things and then reserves everything else (including health care) to the States or to the PEOPLE."
Of course their is room for interpretation and such interpretation will depend greatly on your other beliefs, but in Article 1, Section 8 I think it is pretty easy to place healthcare under the category of "general Welfare." You can certainly argue that governement run healthcare isn't in the best interest of everyone (I would disagree), but I don't see the unconstitutional argument.
"The Congress shall have power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States"
"Make no mistake. The Feds don't care about you. They only care about lining the pockets of favored constituents (ie not you)."
Although you certainly are right about many elected officials I don't think you are right about all of them, and most people in the government are not elected officials and I think many of those people (again, not all) do care deeply about taking care of their national community.
I've rambled here, so in closing, would you agree that some change needs to happen even if you don't think the government system would work?
WHO Ranking of healthcare systems:http://www.photius.com/rankings/healthranks.html
WHO Ranking of % of GDP spent on healthcare:http://www.photius.com/rankings/total_health_expenditure_as_pecent_of_gdp_2000_to_2005.html
WHO Ranking of healthy life expectancy:http://www.photius.com/rankings/healthy_life_table2.html
Right now US healthcare is expensive and crummy by developed world standards. If the government isn't the solution, what would be?
Regards,
"Employers have expenses. Here's an example of the types of things a business has to pay for:
Rent
Insurance
Advertising
Materials (to sell)
Office Supplies
Payroll (which includes all subsets of "things that are required to keep people on the payroll")
What's left is profit."
One big point in the healthcare debate that has been pointed out repeatedly in interviews and articles I've come across is that currently insurance companies use 15-30 cents of every dollar they take in on overhead costs--mostly those things you listed above including profit. The other 70-85 cents of each dollar is spent on medical expenses--doctors, nurses, equipment, and medicine. Shareholders in these companies want that profit percentage as high as possible and encourage the companies to limit those medical expenditures as much as possible. These limitations basically mean that they do everything they can to avoid treatment ... which sucks if you are sick and need treatment.
The hope is that the government system would be able to drastically reduce that overhead. They don't have to pay for those expensive TV commercials. Those evil bureuacrats everyone fears have much more reasonable paychecks than the evil CEOs people tend to ignore. The government, as much as you hate it, is not for profit in the same sense as the insurance companies. Most sources I've seen assume the government overhead should be somewhere around 3-5 cents on the dollar.
Insurance companies only real goal is to make money, and they are very good at that. However, I think the goal of healthcare needs to be making people healthy. The government can prioritize that in a way that insurance companies cannot.
"There's a good reason why the CONSTITUTION of the UNITED STATES limits the Federal Government to a specific list of things and then reserves everything else (including health care) to the States or to the PEOPLE."
Of course their is room for interpretation and such interpretation will depend greatly on your other beliefs, but in Article 1, Section 8 I think it is pretty easy to place healthcare under the category of "general Welfare." You can certainly argue that governement run healthcare isn't in the best interest of everyone (I would disagree), but I don't see the unconstitutional argument.
"The Congress shall have power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States"
"Make no mistake. The Feds don't care about you. They only care about lining the pockets of favored constituents (ie not you)."
Although you certainly are right about many elected officials I don't think you are right about all of them, and most people in the government are not elected officials and I think many of those people (again, not all) do care deeply about taking care of their national community.
I've rambled here, so in closing, would you agree that some change needs to happen even if you don't think the government system would work?
WHO Ranking of healthcare systems:http://www.photius.com/rankings/healthranks.html
WHO Ranking of % of GDP spent on healthcare:http://www.photius.com/rankings/total_health_expenditure_as_pecent_of_gdp_2000_to_2005.html
WHO Ranking of healthy life expectancy:http://www.photius.com/rankings/healthy_life_table2.html
Right now US healthcare is expensive and crummy by developed world standards. If the government isn't the solution, what would be?
Regards,
M
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My only response here is the "general welfare" clause. By that interpretation there is no limit on the federal government at all since they will simply claim that whatever they are doing is the general welfare. You name it. Thomas Jefferson said (paraphrasing) that if that were the case, the constitution may as well be a blank piece of paper.
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