The end of the Soviet Union, together with China’s movement towards free-market capitalism, proved to the world that the planned economy of controlling supply and demand had failed. Free market economies are engendered in Liberty.
In any economics class, you learn the law of supply and demand. All other things unchanged (technology, shipping, efficiency, productivity, etc.), as the supply goes up and demand remains constant, prices go down. As the demand goes up, and supply remains unchanged, prices go up. As prices go up and the opportunity for a return is seen, individuals jump into the market and offer new innovations or comparable services, thus bringing the price back down and giving those individuals part of the wealth they created. Naturally, the best way to bring down prices is to increase the supply or decrease the demand.
Businesses come and businesses go according to their ability to meet the demands of the consumers in the marketplace. If the business can supply a service that enough people find value in and are willing to pay an amount that is sufficient for the business owners and operators to continue to work for, it will succeed. If not, it will fail and some other business will generally take its place.
Because the Government can no longer afford to be in the health care market, it is seeking to adjust these laws to their own circumstances. Rather than accept the natural laws of economics, government wishes to change the rules.
If government can become the primary insurer of health care for Americans, it can limit the demand by helping Americans avoid, what it deems to be, unnecessary services. By limiting the number of people who get CAT scans for example, the supply appears to go up because “demand” goes down and thus prices go down. Additionally, we may even see government built and ran hospitals as it attempts to increase the supply of services. By increasing the supply of hospitals and doctors, it would cause prices to go down, all other things unchanged.
“If you like your doctor you can keep your doctor. If you like your plan you can keep your plan.” That is what the President keeps repeating, over and over again. However, let us think through this. If you can get the same, or similar plan, for less money (because it is subsidized by the US taxpayer), and still keep your doctor, why wouldn't you go that route? The truth of the matter is, the government's plan will eventually put your plan out of business.
Because of the taxes that will be laid on what the government is calling “Cadillac plans,” mandates to have health insurance, and the heavy subsidies that will be involved in the “public option,” there will eventually be no viable alternative to government ran health care and private insurers will not be able to compete. It is a simple law of economics; the ignoring of which would set aside ages of experience. Even the health care exchange, although an excellent idea in concept, will bring more and more people and businesses onto the “Public Option.” Thus the government will eventually have a vast monopoly on services and will be able to dictate the price it will pay for them. This will appear to bring down costs. It will - but it won’t be natural – it will be by force, and the industry, and therefore our citizens, will be hurt.
What the government doesn’t take into consideration is the human condition. Within each individual there exists varying degrees of desire for freedom and liberty. Some would rather be told to do what needs to be done, some would rather tell others, while still others would rather just tell themselves, and others would do nothing at all. Those individuals who capture the moment and make things happen are the ones that bring about the greatest innovations, changes and events in families, communities and nations. Those individuals who catch their vision and support them by following their lead make those events or innovations occur. And together, we all have brought the world ahead.
The government monopoly over health care reimbursements, payments and costs will ultimately lead to a decline in the innovations and quality of care that has distinguished American health care worldwide. How will it do so? By reducing, or altogether limiting in some areas, the individual liberty of the citizens who make up the health care industry. When the laws of supply and demand are controlled by government, they can control the prices and therefore how much they may pay for the services, but it also will take the opportunities that the human condition needs, opportunities for gain, risk and reward, out of the equation. The reduction, or elimination of these opportunities, will lead to fewer innovations, poorer quality of care, and fewer of our best and brightest going into the Health Care Industry as has been witnessed in other countries with a government monopoly on health care. I can attest to this from my own experience.
By reducing the liberty available, we will be reducing mankind. If we were created to act, and not to be acted upon, the more we are forced to be acted upon rather than to act for ourselves reduces the very fundamental purpose of our existence.
Interrupting this natural balance and flow of human forces is destructive to both the individual Human and the supply/demand balance for the good or service rendered. This destructive force is called oppression or tyranny.
I remind you of what Adam Smith wrote in his 1775 Lectures on Jurisprudence:
“Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes and a tolerable administration of justice; all the rest being brought by the natural course of things. All governments which thwart this natural course, which force things into another channel or which endeavor to arrest the progress of society at a particular point, are unnatural, and to support themselves are obliged to be oppressive and tyrannical.”
There is an option besides the status quo and the President's plan. Essentially, that option is the one that will break up insurance monopolies, cut back the government’s involvement as an insurer, elevate the government to a role of supervision and regulation where they can setup the right structure for free market forces to work, find a way that the uninsured can pay rates comparable to that of the insured, and create a model for affordable, private insurance not obtained through an employer.
That is the best chance for America.
As our founders stated in the Declaration of Independence, “all experience hath shewn that mankind are more disposed to suffer, while evils are sufferable than to right themselves by abolishing the forms to which they are accustomed.” However, let’s not volunteer for more eventual suffering, oppression and tyranny at the hands of government – no matter how subtle it may appear at first. Let the government govern, protect and regulate and let the People remain the masters of their own fate.