United Liberty

In a special podcast, Jason discusses the latest details of healthcare reform with Michael Cannon, the director of health policy studies at The Cato Institute and the co-author of Healthy Competition:  What’s Holding Back Health Care and How To Free It.

Their discussion includes the use of reconciliation to pass the latest healthcare reform bill amd the hurdles that procedure faces, the bill’s cost and new taxes, and health savings accounts (HSAs).

You can download the podcast here. The always lovely Aimee Allen graces us with “Silence is Violence” in the music that opens the interview.

You can subscribe to the RSS of JUST our podcasts here, or you can find our podcasts on iTunes here.

Note: I intended to merely comment on this chart when sharing it via my Posterous. During the 5 or so minutes I was commenting, it grew to be something more substantial, and at the urging of others, it has been cross-posted here.

Since the 1960s, the percentage of total healthcare cost paid directly by the end consumer, aka patient, has dropped drastically, but out of pocket costs have risen and the cost of healthcare has risen drastically over that same period.

What has happened between then and now? The intervention of government into the marketplace. Insurance regulations, government mandates about what MUST be covered, Medicare/caid, and inflation make costs skyrocket, but the opacity of the prices keeps patients from seeing what each visit, prescription, and procedure actually costs. With that opacity, there is no competitive pricing, because the prices paid by patients are merely co-pays and the withholding from their paycheck for employer-sponsored health plans, insurance companies, and government programs that pay negotiated rates. Without competition and price transparency, prices will continue to rise.

In addition, patients largest out of pocket expense is their insurance coverage, which does not fluctuate to accommodate the amount of healthcare services consumed. The patient knows they only pay $10-$50 for each office visit, but the overall costs of those visits can be thousands of dollars. The patient rarely, if ever, sees the actual cost… Usually only if their insurance claim is denied.

My flight was canceled due to the DC snowstorm and there were no government buses or trains to take me home from the airport.  Stranded, I was left at the mercy of a taxi industry operating in a (brace yourself) free and open market system. On any other day, cabs are price controlled by the government through a meter system that makes drivers very little money. It is illegal for them to charge more or less for a ride, even if the services and quality of the ride are superior than others. But today, King Mayor Fenty graciously allowed taxi drivers to charge a higher market price to encourage cabbies to drive out in the snow.

(Let me take a paragraph here for obligatory grovelling: Oh, thank you, your Majesty. Your Graciousness, Your Holiness. Thank you for allowing your subjects to engage in voluntary exchanges without the fear of fine or imprisonment)

Anyway, I hail a cab and he says it’s gonna cost me $45 to get home. (It’s usually about $15). On top of that, I have to share the cab with two other folks who also have to pay another $45.

I happily take the offer.

Now, why wasn’t I outraged? Why didn’t I rampage against this taxi driver’s clear use of extortion through price gouging?

Demand. That’s why. Without this incentive to make some extra money by risking his car in the snow, that taxi driver would have stayed home for the day with his family. I was grateful that he could charge me whatever he wanted. Without the open market,  no one would have any reason to drive anyone anywhere on a day like this.

There are investment advisors who claim that their clients should not worry about investing in the stock market because markets are inherently efficient, or rational. Are they efficient? That depends upon your definition of the word “efficient.” Are they rational? That depends on your definition of “rational.”

I have pointed out previously that vocabulary is important, all the more so in any discussion of scientific subjects. Here are some definitions taken from Merriam-Webster:

Efficient:

1. being or involving the immediate agent in producing an effect
2. productive of desired effects; especially: productive without waste

Markets are efficient-No.1 in the sense that they produce an immediate effect. Are they efficient-No.2? Do they produce desired effects, or productive, unwasteful effects? That is the question.

If you are advising an investor to believe in markets because they are efficient, are you stating that they are efficient-No.1 or efficient-No.2? Isn’t it possible that markets are efficient-No.1 but that they are not efficient-No.2, because they produce unproductive and wasteful side effects? And isn’t it possible that one of the victims of those side effects is your client?

Rational:

1.b. relating to, based on, or agreeable to reason

Reason

1.c. a sufficient ground of explanation or of logical defense

Reasonable

1.a. being in accordance with reason
1.b. not extreme or excessive
1.c. moderate, fair
1.d. inexpensive

After attending several Atlanta area health care town hall forums sponsored by legislators in support of HR 3200, I decided to participate in one hosted by MY Congressman, Representative Phil Gingrey (R-GA, 11th). I should note that I did not vote for or against Dr. Gingrey in 2008, as I lived in Georgia’s 13th Congressional District then. The convenience of the location of August 31st’s event could not have been better, unless it took place in my living room (the Cobb Civic Center is across the street from my neighborhood), however a 5:30 PM start time made it difficult for many constituents to attend.

I arrived at the Civic Center shortly after 5 PM to find a parking lot approximately half-full, some cars present as early as 3:30 PM. Outside the venue, there were a few individuals and groups handing literature to those entering, including members of GOP gubernatorial candidate, John Oxendine’s You Can Stop ObamaCare. I expected police-enforced restrictions that I encountered at previous town hall events, so my only tool to capture and share media of the event was my cell phone.

Once inside, I noted many of Rep. Gingrey’s older constituents in attendance, as I expected from reports of his previous forums on the subject. I also expected that most in attendance would be opposed to the health care reform bill known as HR 3200, also known as “ObamaCare,” like their Congressman, Rep. Gingrey. There were a handful of

Naturally a recurrent theme of this lecture was monetary policy, specifically having to do with the dollar’s spiral toward hyper-inflation in the midst of the current economic collapse.  Schiff stressed that sooner than later the rest of the world, more importantly those still buying our debt would wise up to our inability to repay those fiscal obligations.  He told a short story about a wily old man in a certain neighborhood who had hoodwinked the neighborhood kids into vying for the job of painting his fence.  He related the metaphor by surmising, “We’ve got the world painting our fences, as if they don’t have their own fences to paint.”  Essentially, he said the way it is now, we get all the stuff and they only get the jobs.  He then fittingly asked, “What good are jobs without stuff?”  In short, we are barreling straight toward a currency crisis.

Milton Friedman answers tough questions with well-reasoned answers, pointing out that many of the arguments against the free-enterprise system are based on questionable assumptions.

Dr. Paul explains why the Federal Reserve needs to go and why the free market and saving money (vs. printing money) is part of the solution to the current crisis.

This is a great video follow up to the full-page ad CATO published listing hundreds of economists who don’t believe that a “stimulus package” is the best option for American taxpayers.

Though it seems to fall on deaf ears, Dr. Paul continues to drive home the fact that central planning does not work and that it’s time to liquidate the bad debt.