Why Government Backed Businesses Will Always Be Inefficient

from the limitations-on-actions dept

Mon, Mar 2nd 2009 1:08am — Mike Masnick

As it appears that the US government will be putting even more money into AIG beyond the $150 billion we've (us, taxpayers) have already spent, Fred Wilson has a good point about why government funded businesses will almost always act inefficiently. The very fact that every move they make is extra-scrutinized for how they're "spending our dollars" makes it almost impossible to act in ways that can help a company actually make the investments and decisions it needs to make. Instead, everything is second-guessed and scrutinized for "how will this look." This results in business decisions that are forced to respond to populist sentiment rather than good business judgment. This again raises questions of why we're propping up businesses that failed, rather than helping new entities open up.

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: business, government, inefficiencies
Companies: aig

36 Comments

If you liked this post, you may also be interested in...

Reader Comments

Subscribe: RSS

View by: Time | Thread

Lawrence D'Oliveiro, 2 Mar 2009 @ 1:27am

Fallacy
Any business that needs a $150-billion capitalization is, practically by definition, inefficient. Doesn’t matter whether the money comes from the Government or any other entity with similarly deep pockets, they’re going to demand a level of oversight that precludes any kind of action that might seem spontaneous, risky, or the least bit unplanned. Every single move they make is always going to be scrutinized to death. Big corporations, regardless of who is funding them, are always inherently less nimble than small ones. That’s a fact of life.
[ link to this | view in thread ]
ECA (profile), 2 Mar 2009 @ 2:18am

Yes
the inefficiency ISNT at the bottom..
Because IF' you dont do your job, they (1 of the 20 boss's) will fire you.
And I find it funny, that ALL these banks/insurance corps/banks/auto makers/... ALL show'd profit in the last few years OVER previous years.
Dont you think they would be ASKING for assistance BEFORE it got this bad?
And as the article SAYS..LET the idiots DIE, and NEW better corps POP UP..other wise we are keeping the SAME(Rulers) Boss's that MESSED UP..
[ link to this | view in thread ]
Jack Sombra, 2 Mar 2009 @ 2:29am

While i agree with the conclusion (Government Backed Businesses Will Always Be Inefficient) cannot agree with the reasoning.

Having worked in both public sector and Gov backed private business i can pretty much garantee you, once the initial "shock" period wears off the very last thing they do is extra-scrutinize how they are spending the money, it's more of case of "how can we make sure we spend ever dollar we have to spare"
[ link to this | view in thread ]
Jerry in Detroit, 2 Mar 2009 @ 3:28am

Oxymoron Government Efficiency
People who believe government has any insight in running a business should recall my favorite bad example; the infamous bordello, the Mustang Ranch. What does a cat-house have to do with government, you ask? Back in 1990s, the operation was seized by the feds for tax evasion. The government attempted to continue the operation to recover some of the money they claimed they were owed and finally shut it down just before Clinton left office because they lost money. That's right. The federal government could not run a cat-house and turn a profit. We expect these people to run large financial corporations and our auto industry?
[ link to this | view in thread ]
Stephen Downes (profile), 2 Mar 2009 @ 3:30am

Not Scrutinizing
As it turns out, not scrutinizing non-government business turns out to be a false economy. Or have you not noticed the financial crash happening all around us these days?

And in non-scrutinized enterprise, business decisions are not made according to sound business judgment, but rather, based on the short-term greed of the person making the decider. Or, again, have you not noticed the crash.

I think that if this crash teaches us anything, it is that the tired old reasoning recited in this post is simply wrong. Private enterprise is not inherently better. Life and economics are more complex than that.
[ link to this | view in thread ]
anonymous hero, 2 Mar 2009 @ 4:07am

Govt vs Prvt business
I have worked half my working career in private busines and half in government and am currently working in a government agency. There is very little scrutiny even with new programs. They claim there is but when push comes to shove it just doesn't exist. The problem is that most government programs are too large to micro-manage and constantly scrutinize and monitor.

The only time there IS scrutiny is when something comes up on the radar. But by then it is usually too late. Anyone under the illusion that there is scrutiny of funds of government agencies simply have never worked in a large government agency.
[ link to this | view in thread ]
Anonymous Coward, 2 Mar 2009 @ 5:00am

Just another step towards the United Social States of America
[ link to this | view in thread ]
Grateful, 2 Mar 2009 @ 5:19am

The biggest government business in the UK
is of course the National Health Service.

All I hear here in the USA is how inefficient a socialized medicine system is. But consider these points.

1. The people who make the decisions here (the House of Representatives, the Executive Branch, the Senate) have socialized medicine. As do the military.

2. Instead of a Government Bureaucracy you have Insurance companies - all of who have to make a profit in addition to the direct Health Care Costs.

3. Per patient cost here is TWICE the cost in other advanced countries.

4. The "Emergency Room" is the primary option for many many people. Because of this there is almost no preventative medicine for most citizens,

5. Yes, in England they pay an additional tax. It is still less than the average cost of Health Insurance here.

6. They still make house calls in England.

7. My mother, now 84, has had a hysterectomy, treatment for three minor strokes, a broken hip, two replacement hips, a 6 week hospital stay to fix a severe intestinal problem, and is now in an excellent nursing home where she will stay for the rest of her life. Can you imagine the surgeries, MRI's X-rays etc she has had? And yet she has no Medical debts to pay off. In the USA she would have to have declared bankruptcy years ago.

8. And I repeat, all at a cost per patient less than half of the USA.

Now tell me that a Government-run organization can't be more efficient?

And my last point is that from her and my own experiences the most important single aspect is that the doctors there make time to listen to the patient.

My HSA plan here in Pennsylvania for my wife and I costs me around $12,000 a year, with a $4,000 deductible. I wonder how much of that goes toward running the Insurance Company rather than towards Our Health care? It's not too surprising that there are so many uninsured here.

One more thing, 'Instead, everything is second-guessed and scrutinized for "how will this look."'. You think that companies here don't consider this when they are required to submit Annual Reports to Shareholders? Not to mention the requirements of Sarbanes-Oxley which has turned out to be an expensive waste of effort and money.
[ link to this | view in thread ]
AJ, 2 Mar 2009 @ 5:27am

Re:
That's because it's not *their* money. There is no *ownership*. Its an unlimited supply of money that, if you don't spend, will get taken away next year during the budgeting process. This is the exact reason why socialism just won't work.
[ link to this | view in thread ]
tom termini, 2 Mar 2009 @ 5:44am

Re: Not Scrutinizing
I think one thing we've learned, from the death of millions, is that life and economics are MORE complex than the government or any individual can get their heads around. News bulletin: state-controlled economies FAIL, often with the collateral damage of dictatorship, oppression and death of innocents.

The crash has taught us -- don't give loans to people who can't pay them back; don't hide the fact by making derivatives opaque, and don't take control of companies out of the hands of the owners (the shareholders). Corporate democracy, like political democracy (someone tell the previous administration), needs transparency.
[ link to this | view in thread ]
tom termini, 2 Mar 2009 @ 5:47am

Re: Not Scrutinizing
"7. My mother, now 84, has had a hysterectomy, treatment for three minor strokes, a broken hip, two replacement hips, a 6 week hospital stay to fix a severe intestinal problem, and is now in an excellent nursing home where she will stay for the rest of her life. Can you imagine the surgeries, MRI's X-rays etc she has had? And yet she has no Medical debts to pay off. In the USA she would have to have declared bankruptcy years ago."

Not if she had health insurance. You are deluded to think that 'nationalized health' = free health care. In the US, the costs are bourne by the consumers of health care, efficient or not. The costs are not as hidden as in a government-run program. I am not defending the US system, I am merely suggesting you refine your view to include the real cost of that UK tax you so blithely dismiss.
[ link to this | view in thread ]
AJ, 2 Mar 2009 @ 5:54am

The reason that our cost per patient is double is because medicare and the non-paying 'entitled' people receiving free healthcare. Fully 30% of healthcare in this country is already 'free'. And the amount the government reimburses for medicare is less that 30% of the true cost. So the money has to come from somewhere... so it comes in the form of higher prices for those of us who pay. The reason you pay so much? You're paying for the ones who get the free ride.

Face it, folks... Healthcare is a limited resource and must be rationed in some form. Free healthcare for everyone is a fallacy. WHY is the waiting list in Canada for routine procedures so long? (remember, Hillary's good buddy had to wait 9 months for her cancer surgery in Canada, so flew to the US where she had it done that week!!!) Its because EVERYONE wants them because they're 'free'. Back to Econ 101... people will overuse any resource that they perceive has little or no value, or cost to them. People will normally sign up for what is 'free' vs having to pay for it. Look at the mess Hawaii had when they put every child on free healthcare. It bankrupted the program in just six months. Why? Those paying felt like suckers for spending $200-$300 per month per child on private insurance and put them on the state plan. The people who wanted the program NEVER considered that consequence and it went belly up in very short order.

If everyone got every medical procedure they wanted for free, where would the line end? And how much of the total GNP of the country would be consumed by the healthcare industry? You'd have to keep taxing and taxing to pay for it (hey, the cost has to be paid by SOMEONE) and the number of providers would get larger and larger until it would consume a considerable portion of the economic resources.

All that crap about the 60 million uninsured? Look at the numbers. There were 11 million illegal immigrants in those numbers. Of the rest, fully 50% earned more than $50,000 per year and CHOSE not to buy their own coverage. Some earned as much as $70,000 and still chose to not buy insurance. So who pays? YOU DID whey you had to pay your $12,000.

If there is no economic rationing system in place, and you rely on the government to confiscate the money you earn in order to pay for yours and everyone else's healthcare, its going to be a whole lot more than $12,000. And as the government starts to control expenses, as they have in medicare, they will underpay the providers. This forces the good physicians out of the business leaving the hacks (as has happened in many of the socialized havens for healthcare--WHY do most come HERE for their healthcare? because they get the BEST in the world). Why would anyone invest a hundred thousand dollars and eight to ten years of their life in school to go into a business where the government is going to pay you $50,000 per year? They don't. That's why the best physicians from the socialized countries come to practice here.

More government is NOT the answer. Get government out of it. Go back to a system where you pay for what you use. Get a sore throat? Pay for it yourself. Use the insurance for what insurance is for... catastrophic expense.

So get your hand out of my pocket. Pay for what you use. If you can't pay, then DON'T GO. Harsh? Yes. You can't run a country and an economy because you feel sorry for people.
[ link to this | view in thread ]
hegemon13, 2 Mar 2009 @ 6:28am

Huh?
Yeah, because they acted so responsibly, efficiently, and profitably before this pesky government oversight.

This IS AIG we're talking about. We should have just let them fall. Yes, it would have hurt the economy badly, but it looks like that's happening, anyway. Now's the time to let the giants tumble and be replaced by smarter companies.
[ link to this | view in thread ]
Anonymous Coward, 2 Mar 2009 @ 6:31am

Inefficient may not be relevant
Most business need to be efficient. That is that the maximization of output for the input factors.

Some business are a failure at output maximization or the most efficient use of the input factors.

Consider agriculture:
If out put was maximized for the input factors then in prosperous years there would be sufficient supply of food for everyone but in unproductive years there would be insufficient supply resulting in famine and starvation. To compensate for this excessive production is guaranteed by government subsided which is bad economic policy but excellent social policy especially if you are one of the ones being saved from starvation.

Or Medical Care.
Medical care can really be divided into two parts, normal and emergency, and two time tables, planed and unplanned.
If one is in a car wreck, incompact aced, and need immediate medical attention one in not in a position to negotiate price and availability.
If one is old, feeble and not of sound mind one is equally not in a position to negotiate.
On the other hand if one has a long term issue not requiring immediate action and one is fully conscious of one actions then health care is best supplied much like any other normal purchase based on quality, price, and availability.

Or a fire department.
When one’s house is on fire one simply does not have the time to search for a fire company to put out the fire. Time is of critical importance.

Or Health Care
Does one really want a restaurant being inspected by a health department whose employment is based on their providing a passing rating.

Or Banks
Where the critical objective is the preservation of capital and the distribution of usage of such savings into investment geared to increasing society ability to produce or into critical non immediate obtainable consumption such as housing which can take either of two forms, home ownership or rental units. The objective of government here should be to eliminate the Los Vegas casino aspects of markets. Efficiency of markets here should not be the prime consideration but market safety and stability should be.

The whole principal of markets is based on the ability of a willing supplier who has something that they are willing to trade to a willing consumer. Markets do not work when either or both participants are not willing or are captive participants. When production is being made by unwilling participants the society is a slave society with the principal difference in a progressive, communist, fascists and feudal society being who is the slave which is why it is so critical how the above production abnormalities are adjusted and accounted for.
[ link to this | view in thread ]
Grateful, 2 Mar 2009 @ 6:33am

AJ and Tom Termini
First of all, and most importantly, I very carefully did NOT use the word "free" anywhere in my posting. There is no such thing as a free lunch, or as my Yorkshire friends would say. "There's always a come-from".

Second, you both miss the point completely, which is that the cost-per-patient here in the USA is TWICE that of other leading countries. That is NOT twice the cost of insurance-carrying patients, that is the average cost to treat every patient. To put it simply, the cost of a hip replacement here is twice that of the UK. Now we're not talking about what the patient pays, that is pretty much irrelevant, it is the cost of providing that service to the patient.

Third, you do not have to go very far to find many, many examples of people with insurance who do not get reimbursed for their claims, sometimes on spurious grounds. My own best example of this was when I was a Virginia resident, driving to Austin TX. By the time I reached Texarkana I was running a 105F temperature so I went to the Emergency Room. Suspecting meningitis they promptly gave me an MRI. It turned out to be blood poisoning from an abcessed tooth, but my Insurance company tried to deny the claim because "You had not first visited your primary physician". According to them, I should have turned round and driven the 1,152 miles back to Arlington, VA to see my primary physician before going to the emergency room. Sure, they were just trying it on to avoid paying, and one very strong letter sorted it out. But that's not an untypical reaction by insurance companies to avoid payment (and thus increase profit).

AJ, you've been drinking the Kool-aid. Get hold of the one fact that matters. It costs twice as much to treat a patient. Nothing to do with illegal immigrants, nothing to do with socialized medicine, the rest of the world (except for a few highly publicized cases) do NOT beat their way here for medical treatment.

You may want to check out www.nchc.org, the National Coalition on Health Care. The Coalition's Honorary Co-Chairmen are former Presidents George Bush and Jimmy Carter, and its Co-Chairmen are former Governor Robert D. Ray (R-IA) and former Congressman Robert W. Edgar (D-PA). Its President is Henry E. Simmons, M.D., M.P.H., F.A.C.P.

You say "get your hand out of my pocket". I've got news for you. A good socialized medicine system would leave money IN your pocket.

Unless of course you own an Insurance Company. Like AIG?

Like everybody, I have my own political views. My favorite three presidents of the last century were Reagan, Clinton, and Nixon. The difference is that I spend a lot of time thinking about politics, and I can tell you flat out that the rabid Rebuplicans and the equally rabid Democrats are both wrong. There are awesomely good aspects of capitalism, and equally great aspects of socialism. If this country could pragmatically combine the best of both then it really would be "the greatest nation on earth".
[ link to this | view in thread ]
AJ, 2 Mar 2009 @ 6:41am

Re: AJ and Tom Termini
But I think you miss the point. Our health care costs might appear to be double because you're not counting the ones who get a free ride. I would think if you compare total spent per capita you'd see a different story.
[ link to this | view in thread ]
Anonymous Coward, 2 Mar 2009 @ 6:46am

Re: Oxymoron Government Efficiency
that's because Clinton was getting comped too much! ;P
[ link to this | view in thread ]
Chris H. (profile), 2 Mar 2009 @ 6:59am

Re:
Canada's per capita health costs are HALF the United States because of one simple thing: An ounce of prevention is worth a pound of cure. Diabetes is easy to control early, but expensive to control late. This is the same for all diseases! Yes, rich Canadians go to the US to get medical treatment when things look bad, because you guys are experts at the "pound of cure" stuff. I'll take an "ounce of prevention" society any day, AND PAY LESS TAXES FOR IT!
[ link to this | view in thread ]
Grateful, 2 Mar 2009 @ 7:17am

AJ & Tom Termini
Thanks Chris H. That's exactly the point I was trying to make. Health care costs are double here per patient, that is per capita. And you're spot on about the prevention aspects.

AJ, costs don't just "appear to be double" they ARE double. If you prefer to look at it a different way, in 2008 they used up 17.9% of the Gross Domestic Product. The next highest was Germany with 10/9% of GDP.

Take away the "Capitalism is best" kneejerk reaction, and there is just no question that the US Health System is unbelievably inefficient in hard financial terms.

As an aside, I have always found individual Americans to be among the most generous people in the world. You give to charities, you would never pass by a starving child in the street, but for some strange reason a significant portion of you will not allow your government the same privilege of generosity. Maybe in Europe we have learnt to trust our governments more. Maybe in fact, our systems of government are better. Maybe the constitution is a bad thing.... (Oh wash your mouth out Alan!)
[ link to this | view in thread ]
mobiGeek, 2 Mar 2009 @ 7:23am

Re: Re: Not Scrutinizing
You have completely missed the cause of this crash and its main less, which won't be learned this time around.

The reason for the crash is not "loans to people who can't pay them back". It is because of the incentives given to salesman to make money TODAY, ANY WAY POSSIBLE.

The fact that they did it by giving away unsupportable loans, hiding risk factors in complex financial vehicles, whatever is only the symptom of the problem.

There is a world of hurt out there right now, but those who caused it are only feeling it in that their personal empires aren't as big as they expected them to be. The lesson those individuals likely have learned is to score bigger faster, and then bail sooner.
[ link to this | view in thread ]
mobiGeek, 2 Mar 2009 @ 7:24am

Re: Re: Re: Not Scrutinizing
...its main *lesson*...

(sorry).
[ link to this | view in thread ]
Chuck Norris' Enemy (deceased), 2 Mar 2009 @ 7:32am

Re: Not Scrutinizing
Private enterprises have to answer to their investors. Why should they have to answer to everyone else? If the corporate strategy fails, the CEO gets off with a score of millions, the investors leave, and the business files bankruptcy. Some people lost money, that is the risk of investing. The fact that the government wants to step in and help these failing businesses to continue to fail with taxpayer money is what brings the need for total transparency to the nation of taxpayers. So I say the government should just butt out and, I quote, from the movie Airplane, "I say let'em crash!"
[ link to this | view in thread ]
Anonymous Coward, 2 Mar 2009 @ 8:02am

Re: The biggest government business in the UK
Ok, can we agree that a __US__ government run health care system will not be anywhere near as efficient as a __UK__ government run health care system?
[ link to this | view in thread ]
jonnyq, 2 Mar 2009 @ 8:04am

Re: Not Scrutinizing
You're starting from two false assumptions.

First, you're assuming that all these business are failing due to "non-scrutinized" business decisions. In fact, banks were making poor business decisions because the government told them to through various regulations. Many of the failing businesses are so because their hands are already tied. That doesn't absolve these businesses from responsibility, but it does put things into perspective.

Second, you're assuming that "non-scrutinized" businesses are leading to an economic crash. In fact, in a competitive market, some businesses will fail and some will succeed. Businesses, even large ones, can fail without causing a "crash". The "crash", such as it is, is happening because of the notion that some business are "too big to fail" and must be saves, whereas Mike is correct to say that more nimble competitors could fill the void left my big businesses without causing a crash.
[ link to this | view in thread ]
Anonymous Coward, 2 Mar 2009 @ 9:06am

For several years, Chief Export of USA was CDOs and MBSs
Seriously, folks. There is much more to the collapse than JUST AIG. For a primer which, is somewhat spooky how close it matches to some of the conversations here, see "House of Cards" on CNBC. I thought Greenspan was better. Yikes.

http://www.cnbc.com/id/28892719
[ link to this | view in thread ]
Liberty Dave, 2 Mar 2009 @ 9:13am

Good title
Government should NEVER, ever, ever prop up business. If a company is failing, that's the economy's way of weeding out inefficiency. Then if the government comes along and takes the stolen money from taxpayers to prop up ineffcient companies, they're just rewarding bad business practices.

This type of behavior is just more degrees of socialism, and it needs to be stopped.
[ link to this | view in thread ]
Liberty Dave, 2 Mar 2009 @ 9:50am

Grateful
Grateful, first of all you're stating that the cost of healthcare is greater here in the United States than in a socialized country.

Health care is more expensive in this country for many reasons. For example, the federal government has increased the cost of insurance by regulating insurance deductibles.

The AMA also holds a monopoly on the supply of physicians, and they have restricted entry into the medical field on many occassions. This of course has hurt health care affordibility.

Of course increased health care costs, due to government intervention, causes an increase in health insurance premiums.

Then there's frivolous lawsuits. This excessive litigation causes many doctor's to practice "defensive medicine" so they can say in court, if they're sued, that they did everything they could have to prevent whatever they're being sued for. The costs of "defensive medicine" is high, with doctor's ordering tests and treatments that they wouldn't ordinarily do.

You also fail to realize the distortions that exist in reporting how wonderful a socialized medical system is. What about the waiting times for treatments in socialized countries?

Walter Williams writes..."In Canada the median waiting times from a patient's referral by a general practitioner to treatment by a specialist, depending on the procedure, averages from five to 40 weeks. The wait for diagnostics, such as MRI or CT, ranges between four and 28 weeks."

"According to Michael Tanner's "The Grass Is Not Always Greener," in Cato Institute's Policy Analysis (March 18, 2008), the Mayo Clinic treats more than 7,000 foreign patients a year, the Cleveland Clinic 5,000, Johns Hopkins Hospital treats 6,000, and one out of three Canadian physicians send a patient to the U.S. for treatment each year. If socialized medicine is so great, why do Canadian physicians send patients to the U.S. and the Canadian government spends over $1 billion each year on health care in our country?" - http://townhall.com/columnists/WalterEWilliams/2008/10/22/affordable_health_care

And let's talk about Great Britian. You bring up one example of how your mother got great treatment there. What about the fact that there are 750,000 Brits awaiting hospital admission in 2008? If their health care system is so great, then why was it in 2008 that over 70,000 Brits went to places like Malaysia, South Africa, and India for major operations (where they pay out of their own pocket, even though they have "free" health care at home)?

As Walter Williams states, we have health care issues here in the U.S., but it's not because we have a "free market". Over 50% of health care costs are made by government.

There's so much more to discuss on this topic, not enough room or time here. But it's a subject I enjoy researching.

Suffice it to say that if the government would get the heck out of the health care field it would be extremely more affordable for people, as it used to be before government got involved.

A good example is Lasik eye surgery, which is not covered by hardly any insurance. The price of Lasik has actually gone DOWN over the years, not up, like in the heavily regulated health care market where there's always a third party payer, instead of the consumer paying who shops around for the best product/service for the money. And the quality of Lasik has gone UP, with innovation in the field in regards to equipment and techniques.

And finally, the fact that you think it's someone's "right" to medical care, meaning you have the "right" to take money by force from someone to provide that "right" to you, is immoral and wrong. A natural right to something means you don't have to force another into providing you that "right".
[ link to this | view in thread ]
Liberty Dave, 2 Mar 2009 @ 9:59am

Grateful
One last thing, to respond to some of the ridiculous remarks you make:

"Take away the "Capitalism is best" kneejerk reaction, and there is just no question that the US Health System is unbelievably inefficient in hard financial terms."

As I mentioned in my comment, we don't have a capitalistic system here in the United States. It's heavily regulated, which raises the cost.

"Maybe in Europe we have learnt to trust our governments more."

Yes, this is definitely the case. In Europe you believe that when a group of ordinary people get together and run things via mob rule, calling themselves "government", they can suddenly take care of problems better than free people.

"Maybe in fact, our systems of government are better. Maybe the constitution is a bad thing"

Right, even though Europe has been around much, much longer than the United States, and yet in a fraction of that time the United States has given it's people the greatest standard of living in the world. The main difference between our countries is that we have a constitution that LIMITS government. However, our government has ignored the Constitution for a long, long time, so you can't blame the state our country is in on the Constitution. If our government actually followed the Constitution things would be much, much better off in this country.
[ link to this | view in thread ]
Grateful, 2 Mar 2009 @ 10:27am

Re: Grateful
Liberty Dave, that's a well-reasoned reply, but permit me to answer a few of the points.

1. I don't think than argument based on what the US government does is valid when you're trying to make an argument about the costs of socialized medicine. For WHATEVER reason (and you may well be right) health care cost per patient is twice as high here in the USA.

2. Frivolous lawsuits. Absolutely correct. We don't have them in the UK. How is this a strike against socialized medicine?

3. Canada. 33 million population. 60,000 doctors. given even distribution if your 1 in 3 figure is correct this is a range from 20,000 to 11,000,000 Canadians came to the US for treatment. Perhaps you could research this a little more specifically.

4. Great Britain. Maybe there are 750,000 people waiting for hospital Admission. I can guarantee you that tehse are not fur urgent operations. Some will be for joint replacements, some will be for wart removal, and all levels inbetween. The fact is that medically urgent operations are available. As far as the "health tourists" are concerned, sure there will always be people who want to spend their own money to get something done more quickly. There will be people who buy Corvettes and people who buy Corollas. There should always be a right for people to decide what to do with their own money over and above their responsibilities to society.

5. Lasik is a good example, but not in the way you mean. Quite simply, any new procedure is more expensive for two reasons. a. There are a limited number of practitioners and b. The manufacturers want their R&D costs back as fast as possible. Both quite reasonable ideas. And of course the quality of Lasik has gone up. Couldn't be because of all those "early-adopter" guinea-pigs could it?

6. Your little diatribe about "rights" is all in your imagination. I didn't say anything of the sort. In fact, it was the USA's Declaration which talked about the inalienable rights being "Life, Liberty, and the pursuit of Happiness". It's a little difficult to have "Life" without good health.

The real question is whether or not you believe that a society has any responsibilities towards the individuals that make up the society. Clearly the signers of your D of I thought so, and frankly so do I.

I cannot "pass by on the other side of the road" either physically or financially. And neither should you.
[ link to this | view in thread ]
Liberty Dave, 2 Mar 2009 @ 12:57pm

Grateful
"2. Frivolous lawsuits. Absolutely correct. We don't have them in the UK. How is this a strike against socialized medicine?"

This isn't a strike against socialized medicine. I was explaining yet another reason why health care costs in the U.S. are so high, it's just one of the contributing factors.

As for #3 I'm not sure what I need to research more specifically.

"Great Britain. Maybe there are 750,000 people waiting for hospital Admission. I can guarantee you that tehse are not fur urgent operations."

You can gurantee this? Really? How can you guarantee this? I think you're wrong, mainly because the number of people with serious illness that die due to waiting are in much greater number in socialized countries, such as Great Britian. For example, of the number of women diagnosed with breast cancer only 1/5 die in the United States, compared to one third in France and Germany, and almost half in the United Kingdom and New Zealand.

"As far as the "health tourists" are concerned, sure there will always be people who want to spend their own money to get something done more quickly."

Right, there will always be people who want to spend their money to get something more quickly, especially major surgeries that they have to wait exceptionally long periods of time for. That's a big strike against socialized medicine. Your country has had socialized medicine for years and years, and yet there's still a great number of people, that if they can afford it, have to go somewhere else to pay for treatment. How about those people that can't afford it? They're forced to wait...and wait...and wait.

Among men with prostate cancer fewer than one fifth die in the U.S., compared to one fourth in Canada, almost half in France, and more than half in the UK.

The numbers just don't support your claim that the great numbers of people waiting to get into a hospital aren't for serious issues.

The British government themselves have said that at any one time there are about 1 million people waiting to get into hospitals. Why? Because socialized health care is rationed health care. RATIONED. In a free market society health care wouldn't be rationed at all. Consumers would be free to consume however much health they needed, and the prices would not be anything like they are now.

The problem is that we don't have a free market economy here in the United States, and we haven't for a long time.

"Quite simply, any new procedure is more expensive for two reasons. a. There are a limited number of practitioners and b. The manufacturers want their R&D costs back as fast as possible."

Actually this is a great example in the way that I meant. There's no government mandates forcing insurance companies to cover Lasik. There's no government coverage of Lasik. In other words, the free market, more or less, has been allowed to work in regards to Lasik. So like all things, as you explained, costs start off high and go down as competition enters the market, forcing competitors to attract consumers by offering higher quality goods and services at lower and lower costs.

"Your little diatribe about "rights" is all in your imagination. I didn't say anything of the sort."

You ARE saying that people have the right to free health care, that's what your post was all about. And yes, the Declaration of Independence mentions "Life, Liberty, and the pursuit of Happiness". This was written in regards to allowing people the freedom to live their lives without government interference, to allow people to freely trade with one another, among other things. You can read anything into "Life, liberty and the pursuit of Happiness". You can say that someone can't really have a life unless they have a house. Does that mean people should be forced to buy houses for other people? No, it means you have the freedom to strive for those things freely.

"The real question is whether or not you believe that a society has any responsibilities towards the individuals that make up the society."

Yes, I do feel we have an obligation to help those less fortunate. However, there is a difference in thinking between you and I, between those that believe government force is the only way to achieve the goal of helping out those less fortunate and those that do not.

As you already mentioned, our country is extremely giving in regards to charity, and that's a great thing. People giving of their own free will is one thing. But using government to force people into giving is quite another. It's wrong, because you're basically saying that part of the fruits of one's labor is the property of someone else, or a group of others. That's slavery, not freedom.

We don't need government to force us to take care of those less fortunate, we can take care of them ourselves. We already do, and not only in this country but other countries as well.
[ link to this | view in thread ]
Liberty Dave, 2 Mar 2009 @ 12:59pm

Some quick facts
From one of my heroes, Walter Williams:

"The Vancouver, British Columbia-based Fraser Institute annually publishes "Waiting Your Turn." Its 2006 edition gives waiting times, by treatments, from a person's referral by a general practitioner to treatment by a specialist. The shortest waiting time was for oncology (4.9 weeks). The longest waiting time was for orthopedic surgery (40.3 weeks), followed by plastic surgery (35.4 weeks) and neurosurgery (31.7 weeks)."

"As reported in the June 28 National Center for Policy Analysis' "Daily Policy Digest," Britain's Department of Health recently acknowledged that one in eight patients waits more than a year for surgery. France's failed health care system resulted in the deaths of 13,000 people, mostly of dehydration, during the heat spell of 2003. Hospitals stopped answering the phones, and ambulance attendants told people to fend for themselves."

http://townhall.com/columnists/WalterEWilliams/2007/07/25/health_care_government_vs_ private
[ link to this | view in thread ]
Azrael, 3 Mar 2009 @ 2:41am

Re: Re:
Actually in almost all socialist countries there have been cases of company directors convicted as saboteurs and executed for not having met their economic or financial targets. Trust me, fear for your life is the best incentive to do the job well.
[ link to this | view in thread ]
Anonymous Coward, 3 Mar 2009 @ 8:45am

Re: Re: The biggest government business in the UK
Why not subcontract that out to the UK or canada or some other non-profit with experience? Preferably a set of non-profits in competition actually.
[ link to this | view in thread ]
Michael, 3 Mar 2009 @ 8:58am

Re: Good title
The roll of government should be to regulate the market to protect consumers and part of that roll should be gracefully deflating and clearing out failing/failed companies.

What they should do is an asset freeze, put anything that has a good chance of being solvent later or which can be restructured aside to have that treatment, and sell off the rest to the market to divide things up and liquidate remaining value.
[ link to this | view in thread ]
garrat cooper, 22 Jun 2009 @ 5:15pm

Re: Re: Not Scrutinizing
how abour this for an example. I accidentally shot my sister with a pellet gun. the pellet was lodged in her neck in a non fatal area She went to two emergency rooms and had surgery with localized anesteshea. Now me being the purpotrator and wrong doer in this incident agreed to pay any bills she recieved. to this day I have forwarded over 2,000 dollars in payment of her medical bills and she does have medical insurance.

or this example I could easily not use my medical insurance for a year (I pay 80 a month so that would amount to $960) and I would still get a bill from my insurance company stating that I still owe the medical examiner.
[ link to this | view in thread ]
garrat cooper, 22 Jun 2009 @ 5:39pm

Re: Grateful
Whose to stop the mob from being anyone else? people need government if people could live without government we would have don so a long time ago. and Alot of people aren't getting a "free Ride" they simply are not paying often because they can't. it's very cyclical a person cannot afford to pay so they don't so the money owed goes to the hospital which inturn bills the insurance company which in turn bills people higher which in turn cause fewer people to have insurance which in turn when these said people get sick they don't pay the bill cause they cannot afford it.

If we take the constitution bluntly that is a strict interpretation we likely would not have expanded beyond the thirteen colonies and thus would not have Oil rich Texas, The bread basket mid-west tourist haven florida or gold rich California since the contitution borderlinde forbade any expansion of the colonies. Also any one could get a gun there were no restritions on firearms in the constitution. and given the current destructive pawer of firearms today I do not think that would be a good idea.
[ link to this | view in thread ]