Rights versus Privileges: The Coming American Debate - Part Three

In the last (second) installment of this diatribe, we ended by pointing to "Gammon’s Law." As postulated by Dr. Gammon, the law, simply put, is the "law of bureaucratic displacement." To whit: "In a bureaucratic system, increase in expenditure will be matched by a fall in production." Remember, if you will, Dr. Gammon was a physician in the National Health System of Great Britain and formulated his theorem after an extensive study of the British system of socialized medicine. And, generally, one can observe that the inefficiencies of bureaucratic systems extend beyond simply nationalized health care. The inadequacies discernable in America’s two largest existing governmental bureaucracies – public education and the standing military – add more validity to Gammon’s Law.

Let me just add a few quotations to drive home I hope does not require too much hammering, Item one comes from Alieta Eck, M.D. writing on the Pennsylvania Chapter of the American Association of Physicians and Surgeons (PA-AAPS) who writes the following:

"Walter Reed demonstrates Gammon's Law perfectly. The system has evolved whereby a soldier is required to file 22 documents with eight different commands, most off-post, to enter and exit the medical processing world. Sixteen different information systems are used to process the forms. The Army has amassed three different personnel databases that cannot communicate with each other. People with "safe" government jobs run the outpatient center, a rat- and roach-infested, filthy, moldy deteriorated building. Since "free" care is provided, the veterans are expected to shut up, hold their noses, and wait. One cannot blame the VA employees, most of whom are eager to do a good job, but are helpless to change the "system.""

These items from the British Broadcasting Corporation (BBC):

"The NHS employs 300,000 more staff than when Labour came to power. Doctor and nurse numbers have both increased. However, GPs say another 10,000 family doctors will be needed in coming years to keep up with demand. Critics also point out there has been a huge rise in NHS managers, and subsequently, bureaucracy. But others say the health service - with more than 1.3m staff - is actually under-managed." [N.B. The graphs and charts that accompany these figures will certainly support validation of Gammon’s Law. The numbers for the "Support and Administrative Staff" are approaching 500,000 and is the most rapidly growing segment of the 1.4 million employed within the NHS.]

And I was startled to find - on Wikipedia – this little tidbit: The National Health Service (NHS) of Great Britain is the fourth largest employer in the world, trailing only the Chinese Army, the India Railroad, and Wal Mart.

Paging Dr. Gammon, paging Dr. Gammon…

The ivory tower academics and the pie-in-the-sky liberals attempt to extol the grand virtues of "universal health care" in the European Union, Great Britain and, at least according to Charlene Theron and Michael Moore, Fidel Castro’s Cuba. They cite statistics from U.N. surveys and leftist think tanks that show Americans near the bottom of "the industrialized countries" in health care delivery, satisfaction, quality of care, et cetera. But, if this is true, why do:

  • Foreign medical graduates flock to this country for post-graduate education and end up staying?
    Citizens from the Far- and Middle-East come here for health care when they are ill.
    Why do we serve as the back-up for Canada’s overstuffed and back-logged health program?

Most clear thinking individuals know the answers. America, quite simply, is the world leader in health care technology and expertise. We have the best training programs and research establishments in the world. Our pharmaceutical industry has carried the development of new drugs and new treatments for disease for the entire planet. Period. End of story.

Are there problems? Of course there are. But, as shown time and time again thoughout our history, one cannot undertake sweeping reformations – particularly at the governmental level – to solve them. Every grand attempt to solve a societal problem in American – be it a "War on Poverty" or a "War on Drugs" – has lead to Robert Merton "Law of Unintended Consequences." The only things that can be predicted when a broad, national initiative is set in motion are, consistently, the following:

  • There will be unpredicted and, frequently, disastrous accompaniments that will call for additional interventions
  • The program budgetary costs will be grossly underestimated (See Gammon’s Law, above)
  • The plight of few of those the program intends to help will be significantly or measurably improved by the program.
  • Conversely, those the program intends to help may actually be hindered by the program (see Affirmative Action)
  • Finally, the program will lead to a massive expansion of federal government’s bureaucracy and will be continued long after the perceived "problem" has been ameliorated

[N.B. Albright’s First Law of Government: "Programs, once in place, can never be dismantled."]

As the late Noble-laureate economist Milton Friedman observed: "Government IS the problem!" The problems with health care in America began when Franklin Roosevelt began his grand attempts to mix "Uncle Joe’s" Stalinism with a little home-grown liberalism (courtesy of Herbert Croly). He succeeded in implementing his wrong-headed programs because two back-to-back catastrophes (The Great Depression and World War II) were so calamitous for the American public that they fell for anything that might solve their sense of dread. Roosevelt, exuding his hallmark enthusiasm and good cheer ("We have nothing to fear, but fear itself!") sold his "New Deal" programs left and right, but mostly left.

Roosevelt, while a terrific politician (if that is, indeed, a compliment) was not a deep thinker. He did, however, have his "brain trust" of liberal academics, principally Cordell Hull (Secretary of State) and Henry Morganthau, Jr. (Secretary of Treasury). Roosevelt was a hands-off manager and turned his minions loose to reshape and, ultimately, establish what we now see as a growing welfare state.

With the establishment of Medicare and Social Security and other government-based "feel-good" programs, the table was set for the liberal agenda that reaches, a half-century later, into the modern day. Current Democratic politicians are primed to release a "second wave" of federal socialism that will complete what FDR began. And the easiest and most popularly accepted target is health care.

But before we set out on the flowered path of the Yellow Brick Road to national health, it would be instructive to see just what previous government intervention in this particular system. And we have several lines already in the water, thanks to FDR.

Again, back to Milton Friedman, and his wonderful analysis "How To Cure Health Care." In it, he writes:

"A look at the data is instructive. The effect of tax exemption and the enactment of Medicare and Medicaid on rising medical costs from 1946 to now is clear. According to my estimates, the two together accounted for nearly 60 percent of the total increase in cost. Tax exemption alone accounted for one-third of the increase in cost; Medicare and Medicaid, one-quarter.

Now consider a different breakdown of the cost of medical care: between the part paid directly by the government and the part paid privately. Government’s share went from an eighth of the total in 1919 to a quarter in 1965 to nearly half in 1997. The rise in the government’s share has been accompanied by centralization of spending—away from state and local governments to the federal government. We are headed toward completely socialized medicine and are already halfway there, if, in addition to direct costs, we include indirect tax subsidies.

Expressed as a fraction of national income, spending on medical care went from 3 percent of the national income in 1919 to 4.5 percent in 1946 to 7 percent in 1965 to a mind-boggling 17 percent in 1997. No other country in the world approaches that level of spending as a fraction of national income no matter how its medical care is organized. The changing role of medical care in the U.S. economy is truly breathtaking. To illustrate, in 1946, seven times as much was spent on food, beverages, and tobacco as on medical care; in 1996, 50 years later, more was spent on medical care than on food, beverages, and tobacco." [Emphasis mine]

I urge you all to read this extensive analysis of the problems of health care in America and how to fix them – without more layers of government bureaucracy. What politicians are never allowed to claim (or even suggest) is that there are non-governmental (primarily, economic) ways to handle perceived "problems." After all, if we got the notion that we – as a country – could find solutions without government action, how would politicians and the Washington bureaucracy gravy train get along? Would they have to find real jobs?

The key to health care reform lies not with the expansion of the federal government. That simple fact has been hammered home, time and again, throughout our history. The keys are:

  • Tort reform: Stopping the outrageous predatory lawyers from nipping at the heels of the health practitioners. If doctors were allowed to practice medicine as it was practiced before the rise of the malpractice establishment, costs would go down.
  • Expand – yes, expand – Medicare to cover children that are legal citizens of the United States from birth to age 16; 18 if still in school.
  • Allow the establishment of tax-free medical savings accounts – set up like IRAs – funded equally by employers and employees to cover the cost of routine health care (annual physicals, colds, et cetera). This would serve as an incentive (there’s that word again) for people to participate in maintaining their own good health because, if their medical savings accounts are not fully expended, they will be the beneficiaries of the money when they qualify for Medicare.
  • Establish low-cost catastrophic policies to cover major medical illness; this should be done through the private sector. Insurance is for the prevention of devastating loses – home-owners, automobile, etc. – not for routine care.

These are some of Friedman’s ideas with an occasional addition from this author. We can continue to have the best health care system in the world if only we can keep the government at bay. It will be difficult in the next 24 months but it can be done with will and participation in the electorate.

 

 

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