I have always been somewhat puzzled by those well-educated and intelligent people who are clearly liberals. The economist Paul Krugman is one of them. He won the Nobel Prize in economics, mostly for his work on the economics of international trade. In his work he went beyond the economic concepts of absolute advantage and comparative advantage and introduced some new concepts, with supporting data, which added to our knowledge of international trade. All well and good. So why is this guy so much in favor of some kind of “universal health care system” in the United States, as are most liberals?
Even before the election of the Republican Scott Brown this month, Krugman wrote columns in which he made it clear that he wants, as a minimum, some kind of federal “health care reform” legislation in the United States. Just before the Senate finally passed their version of a “health care” bill, Krugman wrote: « With all its flaws, the Senate health bill would be the biggest expansion of the social safety net since Medicare, greatly improving the lives of millions. Getting this bill would be much, much better than watching health care reform fail » . Oh really? With all its flaws you still want it passed? Why? Are you really sure that it will greatly improve the lives of millions? I most certainly think not.
Just after the election of Scott Brown as the new Senator for Massachusetts, Krugman still stuck to his guns, this time writing:
A message to House Democrats: This is your moment of truth. You can do the right thing and pass the Senate health-care bill. Or you can make excuses and fail the test of history. Tuesday’s Republican victory in the Massachusetts special election means that Democrats can’t send a modified health-care bill back to the Senate. That’s a shame, because the bill that would have emerged from House-Senate negotiations would have been better than the bill the Senate already has passed. But the Senate bill is much, much better than nothing.
Much, much better than nothing? Oh really? How ? Why? From reading Krugman’s various columns, it is clear that he does not at all like our existing health and medical care sector (often deceptively called a “health care system”). He believes that it is inefficient. He does not at all like health insurance companies, one piece of evidence for that being his comment: « Bear in mind that the horrors of health insurance — outrageous premiums, coverage denied to those who need it most and dropped when you actually get sick — will get only worse if reform fails » . [My emphases] Horrors? Outrageous? Those are mighty strong words! He says that insurance companies discriminate when they deny coverage due to pre-existing conditions. He writes that “America desperately needs health-care reform”. Desperately? Really?
What America needs almost desperately is a citizenry that better understands economics, to include the strengths and weaknesses of the free-market system. It needs a citizenry that better understands the faults and weaknesses of politics, politicians and the federal and state governments that politicians mostly control. It also needs a citizenry that learns to spend its money wisely, to spend less money on non-essentials, to avoid “easy” credit and borrow less, and to save more money. A more responsible citizenry would also help – citizens who depend less on government, luck and prayers, and depend more on their own work and efforts. I think that Krugman really wants government-run health insurance, although failing that he wants government regulation of the health insurance industry. He does not want anyone to be denied health insurance due to pre-existing conditions. And in order for premiums to not go up, he wants everyone to buy health insurance, with the poor being heavily subsidized by the government (taxpayers).
What is amazing to me is that Paul Krugman is one of the very, very few people whom I have found who seems to understand the major reason for the present high cost of medical care in the United States, a reason which I have pointed out on my web site. He and a co-author wrote in this book review article that “new medical technology is the major factor in rising spending: we spend more on medicine because there’s more that medicine can do. . . . in medical care, ‘technological advances have generally raised costs rather than lowered them’: although new technology surely produces cost savings in medicine, as elsewhere, the additional spending that takes place as a result of the expansion of medical possibilities outweighs those savings“. I agree with that. So? Are we then supposed to have the federal government come in and help pay for all this? But the government can not pay for anything because just about all the money that it has it first has to get from taxpayers. Failing that, it must borrow the money, money which must of course eventually be repaid by taxpayers. (The federal government can also “print” money by monetizing the debt – “buying” its own bonds – but that practice usually contributes to inflation. It has been doing that recently.)
In a very limited sense, I agree with some of Krugman’s thoughts on health insurance, since health insurance itself provides no actual medical care. Health insurance just pools financial resources and acts as a third-party payer. As I have pointed out on my web site this leads to some waste. But I do not go so far as to call health insurance premiums “outrageous” and use the word “horrors” in describing health insurance. I do go so far as to describe what I called an excellent single payer plan, which I wrote would probably be an improvement. However, I also pointed out that an excellent single payer plan is politically untenable, and so it has proven to be. Furthermore, the federal government with its huge programs of Medicare, Medicaid and Social Security is just getting us deeper and deeper into debtor’s hell, and that will not improve given the nature of politics. But apparently Paul Krugman does not believe that those programs are doing that because in this article I referenced above Krugman wrote:
Social insurance programs tend to start out highly imperfect and incomplete, but get better and more comprehensive as the years go by. Thus Social Security originally had huge gaps in coverage — and a majority of African-Americans, in particular, fell through those gaps. But it was improved over time, and it’s now the bedrock of retirement stability for the vast majority of Americans.
Mister Krugman, Social Security is only the bedrock for many Americans; it is certainly not the bedrock for the “vast majority”, and it never will be. In fact, this year or next, Social Security payroll taxes are expected to finally be insufficient to pay current retirees. So to say that Social Security is the bedrock for the vast majority is not only a falsehood, but something which makes me wonder just what the heck your motives are. With the baby-boomers now reaching retirement age, almost every thinking person knows that Social Security will soon be in big trouble, unable to provide the retirement funds that have been promised by the federal government. And the same goes for Medicare. Why does Mister Krugman not see that? Or, if he does see that, why does he not admit to it? Also, what’s the point here of his reference to “a majority of African-Americans”? Was he playing the “race card” in an attempt to score points? What is it with this guy?
I’ve frequently heard the phrase “liberal élite”, thinking that it is overblown. But I am no longer so sure. There are just too many liberals, such as Paul Krugman, who call for actions which are sometimes described as “social engineering”. It seems to me that these people, who admittedly often do know more than the “common man”, then believe that, with the power of government, they can improve things and thus help most of us. What audacity! However, I also believe that some of these people call for “social engineering” programs because they make money out of them !
Yes Mister Krugman, there are inefficiencies in our health and medical care sector. But there are inefficiencies in all of our economic sectors – housing, transportation, food, finance, entertainment and so on. However, it is clear to me that the “sector” with the greatest inefficiencies is the government sector with its own deceptive advertising, propaganda, partisan bickering, waste, some corruption, and near countless laws, regulations and boondoggles.
(My observations, comments and opinions on this entire “health care reform” business start with this web page.)