The only way Paul Krugman can think of to lower health insurance premiums is to use the authority of government to force healthy people to buy insurance that they don’t think they need. Krugman was a brilliant Economist once, but there must be something in the water at the New York Times offices. Now he has all the depth and creativity (and the same confidence in liberty and the free market) as Leon Trotsky. It’s a tragic thing to see. But I suppose that’s what happens to your thought processes when you live your whole life insulated from any consequences for being wrong.
Since he has apparently slipped off the edge of reason, let me toss out another, more reliable idea on how to lower costs. Deregulate. These days, in the shadow of credit crisis, your average New York Times reader is under the impression that deregulation only leads to excess and catastrophe. Politicians and talking heads have been trashing it so aggressively that few people realize that it didn’t cause the problems they say it did. But one thing it has always reliably done is lower costs.
Government is already deeply involved in the medical and insurance industry. One excellent example is how liberal New Jersey proudly requires that mammograms be covered by all group medical insurance policies. But that requirement increases the minimum cost of premiums. If the insurance companies wanted to create a low cost policy that included catastrophic care but not preventive care like mammograms, the state insurance director would prohibit it. Let me say that more clearly, the government is mandating that costs be HIGHER.
This is the point where your average liberal starts pulling out all the unproven assertions. “Well preventive care keeps people healthier, and lowers overall costs”. (There is no evidence of that anywhere, and my doctor laughs every time I mention it... but that doesn't deter liberals from believing it.) Or “If the industry was deregulated then insurance companies could charge what they want and gouge people for coverage.” (If you understand how the free market works you know that 'insurance companies charging what they want' doens't mean higher costs, it means lower costs.)
If there really were a free market for insurance products, Aetna or Blue cross may be charging more for their policies out of cruelty or racism or whatever liberals think drive them to it, but if they did… some other small company would figure this out. They’d use those higher prices as an opportunity to steal customers away from the big insurance companies… then the big companies would be forced to lower costs to keep market share. The net effect would be lower prices to the consumer. This result has been the case EVERY SINGLE TIME DEREGULATION HAS BEEN TRIED. History is absolute on this point.
“But what about all those people who wouldn’t get mammograms?” say the dim witted liberals. The answer is, they still would. What would inevitably happen is that the number of options for consumers would expand dramatically. Customers will be able to pick and choose the kind of coverage they want; customizing their costs and coverage in a way that best suits them. If they want their mammograms to be covered they choose a plan that includes it but costs slightly more. If they don’t want it covered, they are rewarded with lower premiums. A deregulated market leaves the choices with the customer, instead of with some bureaucrat in Washington or Trenton.
Central to the liberal political ideology is the belief that most people are simply too stupid to run their own lives. They believe that we’d be better off with some expert making our decisions for us instead of making them for ourselves. History shows the foolishness of this idea, but they don’t care. The fact is, the experts who engage in central planning don’t really know what’s best for others. They can’t… that’s not how knowledge works. But you can explain this till you’re blue in the face and liberals still won’t get it. Maybe it’s because their dim, or in the case of someone like Krugman, maybe they just don’t want to understand it. The prize of commanding the lives of so many others is simply too tempting for them so they'll believe anything they have to if it ends with them in control of the lives of others.
The American public understands this of course, which is why they’ve reacted with such revulsion at the Democrats’ idea of centralizing all healthcare decision making. But the Whitehouse and Democrats in congress apparently still can’t resist the temptation. That’s why Obamacare is back from the dead in spite of all it’s cost them this year politically. Krugman lets it cost him his credibility, and for the politicians it may cost them their jobs. In that way I guess this healthcare bill really will help America after all.
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