Well, that was a nauseating debacle. I hope Bart Stupak enjoys his mess of pottage.
We might call this the day that private insurance died. I doubt that the imperial throne will need to fight like this again to complete the move to single-payer health care. Economics will do the dirty work. That is, private insurers will exit because they can’t cover pre-existing conditions (imagine selling fire insurance and being required to take people whose house has just burned down. It’s not the best business model). The government will enter in its usual role as the “lender of last resort” (aka. savior), using its printing presses of course.
I predict that we’re 5-6 years away from the health care system being on the verge of collapse. The revenues will be spent (in fact, they’re already spent) long before the “benefits” of this disaster are implemented in 2014. As Massachusetts discovered, it’s a pretty short trip to insolvency.
The people who are going to lose the most in all of this will be the baby boomers. As Gary North has said, expect a hard retirement. If you’re not in shape, think about getting in shape.
Has there ever been an instance in all of history where government involvement in something led to increased quality and lower costs for all? Think public education. The government provides direct funding, cheap credit for student loans, and other forms of subsidy (by the way, artificially-low interest rate loans are a boon for the seller, not the buyer). These actions increase resources. Demand explodes. Prices rocket upward (prices are a form of rationing). The bureaucracy expands, employees get raises, and empowered unions secure large pensions and are able to provide time and money for the reelection campaigns of their benefactors. Meanwhile, students and their parents go heavily into debt. Taxpayers pay through the nose (for example, the Cato Institute notes that public schools cost $25K/yr per student in some cities). High prices increase calls for more gov’t help to make education “affordable.” And so the government responds with more funding, and prices go even higher. Lather, rinse, repeat. One government intervention begets another.
You have to wonder if people will ever figure it out.
I think the U.S. health care system will be on the verge of collapse by 2017 (several years after the “benefits” kick in), but that optimistically assumes that the U.S. economy avoids collapse under the weight of unsustainable debt it has already accumulated. All the money that will be collected is already spent, unless the U.S. can use the revenues as collateral of sorts to borrow even more money at low rates.
Which leads to death panels. I’m not a huge fan of Sarah Palin, but she’s right that death panels are coming. There’s no getting around it, just as I see no way (short of repeal) around the fact that this bill is pretty much the death of private health care. Care will have to be rationed because the money eventually will not be there. This bill’s astronomical cost makes it worse.
The government isn’t going to ration fairly or humanely, it’s going to ration politically. I’m guessing that working-age taxpayers will eventually get first dibs, while old timers with extended problems are going to see their plug pulled. Economic malaise, the lack of free market competition/incentives, the addition of millions of people to the system, and government subsidies are going to make health care even more expensive. The stifling effect of the government on the economy is going to make things even worse, because it really is true that a prosperous society materially benefits all in that society. A poor society does not. You cannot build a prosperous society by attacking production and savings, and that is exactly what big government attacks through its spending, its debt, and its costly regulations.
You can’t legislate away economic reality.