- The Mystery Of Rising Healthcare Costs

The WSJ is up in arms about the rapidly rising cost of public health. This touches on the broader issue of the laws concerning our healthcare system. Medicare, which is really what the debt ceiling debate was about, is all but bankrupting the country. We dither and fret and push and pull trying to find a solution to the great mystery of rapidly rising health care costs. Our great minds are stymied, and our leaders distressed.

Oh for goodness sake...

There is no mystery to the reason that healthcare costs are rising. Let me explain it in terms even Paul Krugman could understand.

Medicare and the broader issue of our laws concerning the entire medical industry, basically give unlimited free medical care to any human who can manage to present themselves at the door of a US emergency room. They don’t have to be a US citizen. They don’t have to be in the country legally. They don’t have to meet any threshold of criticality or financial desperation. Show up by hook or by crook, and the US taxpayer will pick up the tab for your medical needs.

That makes virtually every one of the 6.7 Billion people on the planet eligible for free medical care in the US, provided they can present themselves to be treated. Now maybe I’ve been operating under a mistaken impression, but back when I was learning about economics it worked this way. If you leave supply of a product unchanged and expand demand to include 6.7 Billion people, all the while assuring them that they will be treated without any direct cost whatsoever; you’re going to have a modest(stratospheric) increase in price.

But even if you were giving 'free' stuff to only 300 million people, you'll still end up broke eventually. When you give the service to one person and the bill to another, the person who is getting the service will find an excuse to get much more of it. Why not? It's not like it costs them anything. And without market forces to let the caregivers know what services should be increased or decreased, nothing ever improves.

Progressives will tell you that this is a highly complex problem to solve, but it really isn't. In my life I've found it universal that complex solutions only benefit the people who create them, while real solutions are in fact very simple. If you don’t understand it that way, then it means that you aren’t actually seeing the real problem.

Which would be absolutely on trend for progressives.