Honest Statism Beats a Fake “Free Market” Every Time

In an article for the January issue of Reason, Matt Welch compared his experiences in the “private” American healthcare system and the French “socialized” system, and found the latter a lot more attractive from the perspective of the average healthcare consumer. The “waiting lines” were a lot less of a problem in France than in the U.S., and the French system was a lot more user-friendly and simple from the standpoint of bureaucratic hassle. While people rich enough to pay for major procedures out of pocket might prefer the American system, the average American insurance policyholder would probably find the French system heaven on earth.

The point, Welch said, is not that a socialized system is better than a private system. The point is that their honestly socialized system is better than our socialized corporate system masquerading as a “private” one. He’d prefer a genuinely free market system to either the French or American system. But enemies of Obamacare need to drop the bullshit about the American healthcare system being “the best in the world,” and defending it as “our free market system.” Anyone with direct experience of foreign healthcare systems will be more than happy to expose such lies.

One of the commenters on Welch’s article, at Reason Hit&Run blog, made a good point: there’s really nothing all that astonishing about a comparatively well-run socialized system beating a really incompetent and slipshod mixed government-private system. But a genuine free market system wasn’t even in the running.

The fact that we’re dealing in the U.S. with a choice between two or more alternative state-private mixes is one reason I haven’t gotten too worked up about the whole Obamacare debate.

I especially don’t understand why the public option, of all things, is where self-described opponents of a “government takeover of healthcare” chose to draw a line in the sand.

The features of the plan that the Democrats, Republicans and Blue Dogs all agree on are far more statist than the public option as such.

An individual mandate, coupled with taxpayer subsidies of hundreds of billions over a ten year period to people at various multiples of the poverty rate strikes me as about as statist as you can get–especially when the “reform” maintains the insurance cartel’s jacked-up prices. As far as I’m concerned, a “private” insurance company that gets a huge share of its income from the taxpayers, and “sells” insurance to people who were forced to buy it, is as much a component of the state ruling class as a straightforward government agency. Even more so, in a sense, because the taxpayer-funded overhead includes an additional layer of parasites known as “shareholders.”

Prohibitions against denial of coverage for preexisting conditions, and other forms of denial of coverage, don’t bother the insurance companies at all. Since the entire industry is required to do these things it’s not a competitive issue, and the lack of cost controls means they can simply pass on increased costs to policyholders with a generous markup. They will subsidize coverage of the sick and currently uninsured by increasing everyone else’s premiums.

Consider this in light of the principles of dialectical libertarianism. A particular government measure is not to be evaluated on an atomistic basis, but in light of its contribution to the level of statism in the system of the whole. As Brad Spangler pointed out, when you’re held up at gunpoint the bagman who collects your money is just as much a robber as the guy holding your gun. The corporate bagmen who lobby for government intervention and profit from it are, therefore, part of the government. And when government intervenes to grant special privileges for nominally “private” actors, that is a net increase in statism. On the other hand, when a second government intervention qualifies or limits the exercise of this grant of privilege for the sake of ameliorating the worst effects of privilege, it is a net decrease in statism.

In this light, the public option would actually have represented a net decrease in statism. The major components of the healthcare “reform” that everyone agreed on were a naked power grab by a state-enforced cartel, forcing the entire population to purchase insurance at cartel prices and taxing the public to buy it for those who can’t afford it. The public option, on the other hand, would have been entirely self-financed after the initial seed money of a few billion, and nobody would have been forced to buy it. But it would have offered price competition to members of the insurance cartel.

It’s interesting, don’t you think, that all the professed enemies of “big government” and friends of “our free market system” objected to the public option of all things.

Lieberman and others explicitly said that competition to “private” insurance companies was what they couldn’t abide. But holding up taxpayers and forcing them to buy insurance at gunpoint, at whatever price the insurance companies choose to charge, with no competition–why, that’s not “big government” at all. Because the insurance companies are businesses, you see, and anything that benefits business is part of “our free market system.”

Whenever you see a Republican or beltway “libertarian” talking about “our free market system,” remember that they’d have been using the same rhetoric about Krupp and I. G. Farben if they’d lived in Nazi Germany.