On the Contrary

“If the government is involved, it is screwed up.”  This is the mantra of the government hater.  Now we hear this a lot lately in the health care debate by the Republicans and Conservadems who are against the public option.  But politicians are not real government haters.  They are just gargantuan hypocrites.  They are the government and they love government because it gives them power and employment.  They just mouth the words we hate government to exercise the real government haters so they get their vote and then can then be held in the embrace of that thing they say they hate so much. Try to focus on the fact that they want health care reform if they can insert government into the decision about whether you can have an abortion, but want government out of health care decisions.  Remember Congress is the government at the very seat of power.

So what about that group that they are catering to?  Do they have a point?  The answer to that question is in the micro-sense yes, but no in macro-sense.  My experience with government haters is that they can cite you anecdotal instances where the government has made mistakes or created interference in their lives, but they never think about the big picture.  Here is a prime example:  I have a friend who is a farmer and hates the government and in a micro sense he has a point.  The government, in its interest to insure water quality, healthy employees, and a safe environment, has hung many onerous reporting and tracking requirements on farmers.  In my own case, I have to pay into a water district formed specifically for tracking pesticides in water even though I don’t use pesticides and didn’t cause the problem.  I have to report monthly any use of pesticides or herbicides, get a license every year, and the rules are staggering.  It is a pain.

But what he and others fail to see is the macro achievements of government.  He would not have water to farm if it weren’t for the government.  In California between the State and Federal Government, the projects they have built to supply water massively subsidizes water users.  He ships his fruit around the country and he fails to see that the Department of Transportation and the FAA as the institutions that make that happen, that allow Fedex and UPS to operate efficiently.  He got his degree from the University of California and does not see that without the government subsidizing his education, he could never have afforded it.  He fails to appreciate that regulation of herbicides and pesticides are what keep him from using effective, but deadly chemicals. It is the government that tracks pests around the state and institutes large eradication programs that keep his fruit safe.  He hates land-use restrictions by government and yet bemoans the loss of farmland.  And of course he would be the last to turn down Medicare when he is eligible.

In fact during the health care debate many Americans were saying keep government out of Medicare which was the ultimate example of this myopia about the effectiveness of government.  They have their eyes on their path in front of them, but they are not looking around to see who created that path or where it leads.  Of course government does stupid things, just like any organization.  Would we say those Master’s of the Universe, those paragons of capitalism, who ran the banking industry did not make major blunders?  Nobody is immune.  The problem is not government and regulations, it is stupid regulations which we can fix.

Here is a prime example.  The State of California is concerned about business and tax revenue lost to internet purchases that may have a cost advantage because many of the businesses do not collect or pay California sales tax if they do not operate in California.  So California did a stupid thing.  They decided to put the onus on the consumer to report and pay that tax.   Really?  Each of us is going to set up and auditing system so every time we decide to use Amazon.com, we are going to track that cost and report and send that tax to the State?  That is what is required by current law, and it is patently stupid.  But is all government bad because some misguided representative thought this was a good idea?  Fix the bad stuff and focus on all they do bring us that we need and demand.

The future is not less government, and those that think so have forgotten how we got to be the greatest nation in the world.  But as the world is changing and the role government needs to play becomes more and more important, we really have to start thinking about smart regulation.  We need to look at the interests served in regulation and apply them in a way that has less impact especially on those who can least afford that impact.  Example:  If California wants its sales tax, then guess what?  This is a national problem.  It is called Intra-state commerce and it needs to be regulated at the national level.  Trying to solve this by putting one more unobtainable requirement on its citizens is just stupid, not to mention ineffective.  Government by fear is never going to work.

So come on people.  You have to look at the big picture.  We need to fix government when it does stupid things, but without government to attack our really big problems, we are doomed.  Maybe in your little myopic world you could see how less government would make your life simpler, but then your little myopic world would not have been possible without government.  But government haters will never admit this.  It is too easily find someone else to blame for all their problems.  After all the market place will solve all our problems.  Who needs government?  Hallelujah!

Since the media won’t start focusing on issues that really matter, I thought I would tackle one a week for a while and see if it sparks any discussion.  Here is a question for you: How much of an American new car price is health insurance for the employees?  It has been estimated that the average price per car is $1500.  Any wonder why healthcare is a cost that makes our businesses less competitive than their counterparts around the world?

I was at a dinner the other night and over a nice Petite Syrah I said that health care is the sleeping dog that is the real issue in the next election and one of the most important issues to the common voter.  This was an important issue to my host who had recently been successfully treated for cancer and once he looses his firm’s (which he is part owner) health insurance after he retires, he is uninsurable.  I asked him what he planned to do and he said he would work until Medicare covered him.  It was his only option.  I pointed out that we had one of the worst healthcare systems in the civilized world.  He strongly disagreed with me on that point.  It turned out that like most disagreements, it was over semantics.

I argued that studies showed that our health care costs on the average at least 30% more than in any other industrialized country.  The U.S. spends more on medical care any other nation, averaging $7000 per person, yet our infant mortality rate, maternal mortality rate, and life expectancy is rated one of the worst in the industrialized world.  As Nickols Kristof pointed out in his editorial Monday morning in the New York Times, “If we had as good a child mortality rate as France, Germany and Italy, we would save 12,000 children a year.  An American mother has almost three times the risk of losing a child as a mother in the Czech Republic.  According to a new report from Save the Children, a woman in the U.S. has a 1-in-71 chance of losing a child before his or her fifth birthday.  Given this argument I challenged my host on how he could disagree with me.  He said, “Oh you misunderstand me.  By best I mean we have the best technology in the world, and the best care, if you can afford it.”

And this is the crux of the issue.  We can’t afford it, not just the poor, but more and more of middle America every day.  We are one of the only nations that do not provide universal health care and we require employers to fund our coverage.  It’s a double whammy.  First we have a large and growing uninsured population and second we keep hanging these costs on businesses that, in a highly competitive global market, could put them out of business.  Add to that the extremely high cost of medical insurance caused by the “competitive” insurance companies burying you in paperwork so they don’t have to pay your claim and you understand that our medical care system is rapidly crumbling.  Clearly big changes are coming and here are our choices:
The existing system is made up of “competing” insurance companies that in theory fight with each other to gain a market share by providing the lowest premiums while presenting you with comprehensive health care.  So much for theory: The reality is that the insurance companies compete to cherry pick enrollees that do not have major medical problems , reducing costs and maximizing profits.  Their overhead at reviewing claims and doing their best to deny them is what has driven our system to be one of the most expensive in the world.  The bureaucracy and paperwork is driving doctors out of business and the cost to administrate these programs through the roof.  So the status quo is no longer tolerable.

There are two other options, both with a goal of reaching universal coverage, but the first one leaves the well connected insurance companies in place and the other one that does away with them.  First things first:  The first approach basically differs only in who they initially cover and the plan basically requires all insurance companies to cover all comers more or less.  They fund this usually by charging employers, workers, hospitals, shifting some to other existing programs, and doctors.  Usually everyone is required to carry health insurance.  They differ in who gets charged how much, limits put on insurance company amounts that can go to administration, and varying requirements on who insurance companies can refuse (means you pick up the bill in tax payments).  My problem with this approach is that it doesn’t solve the problem.  For profit medical care has been a disaster and is getting worse.  What it does solve is getting more people covered in the short term without an all out war with the insurance companies.  It still puts the burden of employee healthcare on business and does not address how we reduce the administrative burden on doctors.

The other approach is the single payer system, usually the government.  In this system we establish a fair tax system and health care is paid for by the government.  Before you go running screaming “Socialized Medicine! Socialized Medicine!” exactly what do you think Medicare is?  Many Americans are now traveling to foreign countries to have surgeries because they are cheaper there and even though they don’t have the profit motive, most survive.  Of course it does away with the insurance companies or in another scenario, the government can contract out the single payer to keep them efficient according to the capitalist theory of efficiency.  This has not worked well for almost all government services that have been contracted out and I would think expanding Medicare would probably be a good model since their costs are at least 30% less than the insurance industry in managing health care payments.   For my money this is the only way to go.  The rest of the civilized world has figured this out and for their money they get better care.  So who is going to propose it?

Don’t hold your breath.  The insurance industry has big pockets (because they are making tons of money and it will be their ox that is gored) and politicians do not say the obvious because it will hurt their campaign contributions until there is no other choice.  So in the meantime watch which candidate provides a plan that leans toward covering all children, with universal care a goal, and focuses on reducing administration costs by covering all comers and promoting preventive medicine.  It will take another 20 years before that system collapses and we face the reality of a single payer system.  In our system we believe that all people have a right to life, liberty, and the pursuit of happiness.  If your health is a function of your pocket book then all three are in jeopardy.