Thursday, August 05, 2010

This political prop brought to you by the letter C

In a development that surprised absolutely no one, Missouri voters passed Proposition C with more than 76 percent of the vote on Tuesday. Prop C declared that the state would exact no penalties against its residents if they refused to comply with the federal health care insurance mandate.

Of course, the referendum is ultimately worthless, because it’s a state law written to undermine a federal law. And the Articles of Confederation hasn’t been in force for awhile.

But Prop C drove tea party-leaning voters to the polls and its success has energized a base that didn’t seem all that unmotivated to begin with. So regardless of what happens next, it’s served its purpose.

On an intellectual level, it would seem like no one has any reason to support Prop C. Obviously you have anyone who supports health care reform, who understands that a mandate is necessary under this new system to broaden the risk pool and thus drive down premium costs. To those tired of hyper-partisan politics, Prop C seems like the latest temper tantrum from the anti-Obama-at-all-costs crowd. Neither of these are particularly surprising.

Yet, even those who hold true to conservative views would seem inclined to dislike Prop C, given its unconstitutional nature. And those given to disgust over government spending and so-called frivolous lawsuits should have a field day over what the coming rounds of court will cost taxpayers.

But this isn’t an intellectual exercise at all. Like seemingly everything else these days, it’s fraught with emotion and irrationality. Not to mention the smug pronouncements of Republicans who claim The People Have Spoken!

(Side note #1: When a conservative candidate or proposal wins, it’s because The People Have Spoken. When Obama overwhelmingly wins the presidency, it’s a mistake made by a bunch of young voters who will soon have buyers’ remorse. People speak selectively, you understand.)

Regarding Prop C, the voters have spoken, but they haven't said what its supporters think. The mind is capable of staggering compartmentalization, and this is a case of that. As long as the idea of a health care insurance mandate has been around, the conservative cry has been, “The government can’t force me to buy insurance!” And thence Prop C becomes a question of, “Do you want the government to tyrannically force you into buying something you don’t want?” Of course not! Come to think of it, how did this get only 76 percent of the vote?!! To quote Christopher Walken in Blast From The Past, "COMMIES!"

Of course, if the question was framed as, “Do you think the state of Missouri should spend thousands of dollars unsuccessfully defending a law that is not only constitutional, but could shrink the health care risk pool to a point where insurance companies might just leave the state altogether due to the expense?” you might get 76 percent voting in the other direction. Yes, that question isn’t any less loaded than the first, but it’s more truthful.

(Side note #2: For what it’s worth, I’m not a fan of the system being put into place. It’s a hard sell. I think it’ll be better than what we have now, but it’s ultimately a compromise over the much-better ideas of a public option or single-payer. But a mandate is the only way it’ll work in this form; otherwise, only sick people will sign up. And you need a large pool of healthy people to drive down costs and sustain payouts.)

I find it fascinating how successful the rhetoric has been in the Prop C campaign. Mainly because it’s so ridiculous. As I mentioned in my last blog, “freedom” piped up with much regularity. Freedom apparently means to the right to deal with massive bills and giant corporate conglomerates your own way. With bootstraps as your tourniquet because you can’t afford anything better to stanch the hemorrhaging. And if you have a problem with the way we do health care in this country, get a job or move away, freeloader! The People Have Spoken!

One interesting, though scary, side effect of Prop C (and Obama in general) is the emergence of a whole batch of sudden constitutional scholars who snidely ask just exactly where in the Constitution it says the government has a right to grab citizens by the balls and demand they pay up for health care. In those exact words. These types have been around for a while, but the Obama era has brought them into the mainstream. And they could very well drive the debate for years to come, aided and abetted by screamers like Glenn Beck, who frame the debate in twisted ways that American voters inexplicably lap up with a beer funnel.

(Side note #3: One reason political debate is so stupid these days is the terminology. Who knows if they really believe it, but many conservatives — especially tea partiers — paint things they’re against in the worst possible terms, and blithely assume liberals think in the same bizarre mind-set. That’s why we’re so often accused of wanting dead babies, for example, because clearly that’s all being pro-abortion rights is about. Or that we want racial and gender equality because, as white liberals, we hate ourselves. Or that we insist on separation of church and state because we hate Christians and actively worship gods and demons we know are wrong and evil.

Same thing with health care. Obviously, we’re for reform because we want the government to rule over everyone with an iron fist. It has nothing to do with addressing the serious health care crisis in America, with saving people from being one illness away from bankruptcy. No, it’s all an insidious plot to make everyone slaves to our elected representatives. For some reason or other. I imagine this mind-set exists is because it’s exactly what right-wingers want — money, power, glory and moral certitude at the expense of everyone they deem inferior — and they assume that’s what we want too and resent the competition.

And that, I think, is why it’s so hard to debate nowadays. How do you make your case that something is the smart and humane thing to do when your counterpart can quantify things only in terms of their personal checkbook?

Side note within side note #1: George W. Bush’s 2000 campaign was little more than an appeal to greed and moral superiority. “It’s YOUR money, and I want to give it to you!” “It’s time to restore honor and dignity to the White House.” I remember my aunt telling me she voted for Bush because “He will be good for my stocks.” When Bush took office, he had no qualms about enacting a far-right agenda and was open about his rich-enriching intentions. Obama gets the same criticism from the right that Bush got from the left, but without foundation. Obama has gone out of his way (maybe too much so) to compromise and to enact provisions that help middle-class and poor Americans, which is not in his self-interest. And that’s the fundamental difference in why conversations now are so irrational. When one side claims to hold the monopoly on freedom and accuses the other of Marxism, the exchange is already too far gone. End side note within a side note, as well as the side note itself. I think.)

Ultimately, Prop C is a political statement, and while its success in the short term seems to portend an end to the Obama era, it could just as well backfire. And even if it doesn’t, it’ll take more than a symbolic rebuke to bring about a significant pendulum swing. Having actual solutions would be a good start. So would a healthy sense of perspective.

After all, California just declared Proposition 8, the ban on gay marriage, unconstitutional. Wonder how that fits in with our supposed rightward march?

54 comments:

Robert Taylor said...

"Obviously you have anyone who supports health care reform, who understands that a mandate is necessary under this new system to broaden the risk pool and thus drive down premium costs"

Literally writing things like this and your first side note say that you're guilty of the EXACT same position as the conservatives: you're postulating that the poor voting majority doesn't know what they're talking about and, in your own words, "it’s a mistake made by a bunch of young voters who will soon have buyers’ remorse."

Ian McGibboney speaks selectively, you understand.

Ian, is the lack of universal coercive patronage the reason for the high cost of health care? If so, please prove it.

Just prove it. Shouldn't be that hard, you say it all the time. Prove that the correlation is the causation. If you can successfully do it, I'm sure you'll get more people on your side. Up until now, you've only shown lip service of assumption.

Ian McGibboney said...

Robert, I don't know what either of the first two quotes has to do with the point you're making, but I do know this:

If a state law goes against federal law, it doesn't matter how handily it wins. As I've mentioned before, Michigan can't choose to reinstate 1970s auto-emission standards and South Carolina can't hold a vote on slavery. And if they did, it would get thrown out on legal grounds. That's the kind of system we have.

Also, I didn't say lack of universal coercive patronage, as you put it, is the reason for the high cost of health care. There are plenty of reasons for the costs, and anyway everything seems coercive to you. What I'm talking about is the entire principle behind insurance in general: the more people involved, the cheaper it is for everyone, and the more stable the pool is. Add to that government checks on corporate policies (i.e., pre-existing conditions), and I see that as an improvement. Not as much of one as I want, but I'll take it for now.

Finally, enough with the "Ian McGibboney says/thinks this and that." It's not as clever as you think.

Robert Taylor said...

Ok Ian, your first point on the issues of the legal rights of states is debatable. But ok, let's assume you are completely correct about your postulates.

On your second point: "everything seems coercive to you" That's not an opinion. As long as there is one Republican who does not want to pay into the system, coercion is necessarily a part of your plan. That's not debatable. If it were, then you would be the strongest advocate of free market I know. A mandate as you called it is necessarily coercive in nature.

Your third point: "the entire principle behind insurance in general: the more people involved, the cheaper it is for everyone". Ok, let's assume you're right. Every year, the number of customers in the insurance industry has grown. Why then, have the premiums increased in price faster than inflation?

Is it because the insurance industry has limited their own growth to only allow the healthiest of individuals who are less likely to suck from that insurance pool?

I think this is a good starting point for you, please explain your position. Prove it.

Ian McGibboney said...

True, Robert, everything is coercive in the sense that 300 million people will never all want exactly the same thing. Does that mean we have to get 100 percent approval to do anything? Because nothing will ever get done. So to say that a policy shouldn't be enacted because someone is coerced in the loosest sense of the word is being unrealistic. There are lots of reasons to be against this health care reform, but this one's a stretch, I think.

As for insurance, the reason costs have gone up is because private companies largely operate unchecked. This is one reason why I favor a public option, because it would provide a competing plan for people to buy into, which would by simply by market forces drive down private prices. As it is now, private companies largely set their own prices and fatten profits by curbing payoffs through policy cancellations and loopholes. And that has contributed to higher public costs, because these sick people often suddenly find themselves without insurance and still have to get expensive treatment.

Opponents of health care reform completely ignore this, as if we're paying nothing now and will start paying for others when this starts. But in fact taxpayers shoulder a huge health care burden already, and usually via circumstances that access to cheaper, preventive care would keep from happening in the first place.

Robert Taylor said...

Ian, I have expressed my disdain for coercion on any level as personal opinion, however I have not used it as an argument against health care. I have left open the possibility that coercion could possibly lead to "utilitarian" benefit IF you can prove it. You still have not.

So for your first point: "the reason costs have gone up is because private companies largely operate unchecked" Please prove that your correlation is causation. Merely saying things does not in and of themselves prove anything.

Your second point: "This is one reason why I favor a public option, because it would provide a competing plan for people to buy into, which would by simply by market forces drive down private prices. Having continued on with your unproved circular reasoning, you continue your argument...

Let's assume for a second that Big Business has just arbitrarily hiked prices. Ok. How does a public option provide a "competing plan"? As I said, it is coercive. If people are forced to pay for the plan against their will, you have now eliminated competition. You have eliminated market forces. How then will prices be pushed down? Economic calculation only works through competition, it is only method for which man has ever discovered how to adjust their actions to become more efficient.

Nevertheless, you continue with your third point: "Opponents of health care reform completely ignore this, as if we're paying nothing now and will start paying for others when this starts"

I don't ignore it. But ok, let's now take that third point into account. HOW DOES THAT PROVE YOUR YOUR FIRST AND SECOND POINT? It doesn't, because each point builds upon the previous from a false premise. That is, unless you can prove your premise.

I'm still waiting for that proof.

Michael said...

Ian, you have the patience of a saint. Several saints. Maybe an entire calendar of saints. God knows how you manage to keep a level head about you with all the drivel that routinely comes your way, but I just wanted to take the chance to say thinks for doing it.

venessalewis said...

Amen brother Michael. The crap gets so thick in here sometimes I don't even engage because I know it will require way more of a time investment than I can afford. But Ian is like a verbal ninja, chopping away at these haters day in and day out.

Robert Taylor said...

Ok Venessa and Michael, in what part of my comments and questions am I unreasonable or disrespectful?

venessalewis said...

Robert, you've managed to stay civil in the last 48 hours I'll admit. But up until 2 days ago, you and Tom shared the same stupid avatar that openly mocked Ian. I'd say that is pretty childish and unreasonable...and puts a big dent in your credibility from the gate. Trying to stand alone and distance yourself from Tom at this point, although admirable, is a bit like trying to wash off skunk piss.

NOLA Progressive said...

Skunk piss...I like that. Almost types fragrant.

Robert, it's a lot of call to prove that which doesn't really need to be proven that is soliciting the response you are getting here. I get you are coming from what, I deem at least, to be a staunch libertarian perspective, but the more people who are in a pool of the insured creates a larger group to share the expense. This does assume that the pool is homogenous and not full of only critically ill people. I don't think that this requires a modicum of proof.

I get the coercion talk laced throughout your comments, because that is your schtick. It's useless to harp on as we are all coerced constantly. It's the nature of society as it is formed. That fact is here to stay for the forseeable future.

Tom Alday said...

Once again Nessie makes a comment and includes me, it's like you're obsessed. Sorry sugar tits, I'm taken.

Ian, I'm still waiting for an answer on what other liberties you're happy to let the government take away to advance your agenda.

venessalewis said...

If I were half as obsessed with you as you are with Ian, my family would have had me involuntarily committed me by now.

And sorry sour dick, you wouldn't have a chance with me if there were a nuclear holocaust and we were the only 2 people who survived...and were therefore charged with repopulating the Earth.

Tom Alday said...

Wow, did you really just break out the "not if you were the last person on earth stinkyface!" insult? I thought, foolishly, that you might be up to the challenge of an old fashioned INSULT OFF, but sadly your shit is as tired as your face and as worn out as your snatch. I'd beat you like Ian beats his dick every night, fiercely and without remorse.

Ian McGibboney said...

Tom, here's a partial list of freedoms I'm willing to surrender to the government:

1) The aforementioned right to expensive medical bills and to constantly worry about a catastrophic illness;

2) Freedom to never have my tax dollars help another human being, only to kill them;

3) Freedom of speech as defined by dollars;

4) Freedom to base my entire political philosophy on how it affects only myself and my money;

5) Freedom to be completely on my own when I lose my job;

6) Freedom to turn everything into a constitutional argument, but only when convenient;

7) Freedom to take my chances with shoddily built products and crumbling infrastructure;

8) And finally, freedom to read hot (or at least tepid) Not Right fan fiction.

venessalewis said...

Well hell man, if you are up for a INSULT OFF...here's one for you: people as (pick one: angry, pathetic, talentless, evil, worthless, fugly, jealous, mental, frustrated, just plain wrong on every single point he's ever made) as you, should not be allowed in public, much less be allowed to breed. I'm frankly stunned someone would even willingly mate with you. God bless her though, it takes a strong woman to hold up under you, literally.

rhonda said...

tom alday: i usually don't say much of anything to anyone on here, but you know what? fuck you, sir. you have sucked ass prolifically for years now. ever since your blog was the awkwardly-named aldaynet.org (which was actually better in its old age when it was about vampires than it was when you were still trying to pretend you knew flaming fuck about how to articulate your views on politics), the only thing that you have ever consistently done is stalk and harass. your own blog has gone through several different incarnations, ALL of them shitty, and people know you primarily for the dubious honor of being a long-standing troll. you can't even decide on which shitty name to go under! doesn't it bother you that people remember that, or do you just assume that since you're cursing loudest, it somehow drowns out the sound of all that nothing that you've been saying all these years? i would be embarrassed if the only thing i consistently did was suck.

i want you to know something, tom. i personally don't give a fuck that you are conservative. i don't think anyone here really does! it would be a pretty boring world if we were all the same, and frankly, i am just not like you. i don't feel the pathetic need to violently stamp out that which i cannot directly relate to. i want you to know what what makes me sick to my fucking stomach is that that you have a child on the way. no, i'm not being histrionic. i find it upsetting almost to the degree that i'm willing to accept it as proof that we live in a godless universe. no joke. i'm not going to do as you would do and go all ad hominem here, and i'm not going to attack your wife or that poor child. all i will say is this: please take the tenacity you devote to being a nuisance here- hell, take a fraction of it- and channel that towards raising a child that's better than you turned out to be. you might be a waste of a person who sees the world as nothing more than a craphole valley (is that what you were going under in late 09? i tended to agree with that assessment), but *try* to channel some of your efforts on raising a child who won't grow up to be an adult who needs medications to forget his/her childhood.

i know, i know. i'm a fangirl, i'm sucking ian's dick, i want your dick, name-calling this, pejorative nickname that, blah blah blah. save it, tom. it's all been done to death- and you ought to know, since you're the one who killed it. grow up, sir. now's as good a time as any.

Robert Taylor said...

@NOLA In these past two posts, I actually haven't expressed my Libertarian views. You're right, I'm a Libertarian, but I've been keeping my questions of Ian value-free.

Economics is a value-free science, just like the natural sciences. They don't tell you what ought to be, Economics only shows you the best method by which to achieve those goals.

With that said, the market-forces argument does not work, not only because of the coercion, but even if the majority of people wanted the single payer solution, the market wouldn't be deciding where to allocate expenses. A bureaucrat would.

Even if that bureaucrat were the smartest medical doctor in the world, he still wouldn't be equipped with the omniscience to understand everyones needs or values.

With all due respect to Ian and yourself, your arguments aren't new. They have been around for at least 500 years, but they were mostly articulated by Marx and Engels: mainly that the technological ability to fix most problems in this world already exist, the only thing necessary is to find the proper allocation of funds.

Clearly the fundamental misunderstanding was of where money comes from and how production forces work: an ignorance of the laws of human action and economics. That's why Marx and Engels would resort to emotional appeals, claims of bourgeoisie logic, determinism and material dialectics.

Maybe the most pertininent point they made is the one you just repeated: "it's the nature of society as it is formed. That fact is here to stay for the forseeable future". Socialism is inevitable, Marx claimed. This is a fact because of the nature of society. However, he never fully formed his explanation of understanding about what the nature of society is.

Ultimately, yes, I think it's extremely important for Ian to explain how his project would work economically, and not just through rhetoric. Rhetoric is easy.

Robert Taylor said...
This comment has been removed by the author.
Tom Alday said...

@Ian - None of those are actual liberties. They are worn out liberals grievances. Having the government FORCE me to buy something I may not want is outside their scope. Period. You can't justify it in anyway outside of some emotional appeal that has no place in the discussion.

@Nessie - God, you suck. "You shouldn't be allowed to breed!!!!" is about the lamest comeback possible. Congrats on wasting my time.

@Rhonda - Whoa, check out my mystery stalker. Here's the thing you stupid twat. I don't give a fuck what you think of me, my various websites or anything else. I'm not like you with all those pathetic internet-emotions that make me LONG for people to like me and make me seek out and admonish others for their "meanness". I merely want to ridicule Ian for his half thought out ideology and political opinions gleaned from internet forums and late night comedians. I mean the guy considers Dennis Kucinich some kind of political savant for christs sake, shit like that needs someone to tell him he's a fucking moron. He agrees with people that use interstate freight laws to justify the government taking away my freedom of choice with Obamacare. When I see moronic shit like that I'm compelled to correct him, and because I'm such a vicious asshole, call him a fucking idiot at the same time. If you feel that makes me mean, well as I said, I don't give a shit what you think.

Robert Taylor said...

@Ian your freedom list baffles me bro. You might be trying to be funny, but you might want to elaborate on a serious note.

I mean just starting off from #1, freedom to expensive medical bills.... You don't have a right to medical bills to begin with, you have a choice to have medical bills. And what you're saying is that you would rather have no choice, because it will guarantee you...cheaper medical bills?

Let me ask you first, how do you assume that all people want medical care to begin with? What if a Christian Scientist? Do you think it's fair to project your personal values on other people? If they're not personal, please explain how you came to the conclusion that your values are universal.

And finally,as I've requested over and over, please explain how lack of choice gives you cheap medical bills. I just don't understand. Why is that you do understand, but aren't to explain it to me?

venessalewis said...

Rhonda makes one comment in 5 years and she is stalking Tom. Tom harrasses Ian almost daily, and this is perfectly normal. Tom's sense of reality is parallel to that of Alice in Wonderland. Poor Tom.

Tom says he doesn't care,twice, for clarity. Truth is he cares... ALOT. Which ALMOST makes me feel sorry for him, and the verbal mudhole Rhonda stomped in his ass. ALMOST. If he didn't care, he wouldn't work so hard on crafting his carefully thought out responses day in and day out. You see, Tom lives in opposite world...and he is the biggest projector I've come across in years. By claiming Rhonda "seeks out" people with similar pathetic "internet emotions" he actually means this is what he does. Which by the way can be proven by how upset ole Tom got when Robert "turned" on him. He thought he had a friend. A freshman psychology major could see that. Poor Tom.

Tom resorts to calling women twats and cunts when they hurt his feelings revealing just how large of a sexist and easily wounded asshole he is....and he calls Ian weak.

Poor Tom. He always comes out the loser. Let's all say a little metaphorical prayer for him as he bangs his head on his keyboard and cries for the next hour and then spends the next 5 hours thinking out a response only to come up with "Waaaa....you bore me and that's all you got?"

rhonda said...

oh, but you do give a shit what i think, tom. it doesn't take a giant, pissy paragraph to express nonchalance! it strikes a nerve with you that people notice that you with your "various websites" can't do anything but suck on a regular basis. i'm not a stalker, tom- i just have an impeccably good memory, unfortunately for you. that's why you feel the need to name-call. you're just the proverbial angry bully on the playground. you're pissed about who and what you are- granted, i would be, too. you're the one that didn't even address the most important issue, the horrifying specter of you NOT fucking up your child. pretty sad that i'm more concerned than you are. you need to start owning up, and quick.

i say what i need to say one time- i say it with clarity, and with venom when necessary, but unlike you, i have enough of a command of the language without resorting to scorched-earth obscenity- i save that for when i'm joking, something anyone who knows me is aware of. i only needed to call you out once in five years. we both know that it'll be ringing in your ears for another five :-)

you're not bored with us, tom. you're bored with YOU. and that's why you do care, why you keep coming back, and why it's YOU- out of all of his many readers- that has the biggest hard-on of them all for ian paul mcgibboney.

Tom Alday said...

Oh man, my favorite part of any effective trolling, when the people band together and start the e-psychoanalysis of poor little Tom. I have daddy/mommy issues, I hate myself/women/god. It's always the same and always so far from reality that it makes me laugh and let's me know when the internet emotions of my targets are at a boiling point and I've done my job to perfection.

So keep patting yourselves on your backs thinking you've "destroyed" me. The truth is that nothing you say is new to me, nor affects me in any meaningful way. Your anti-Tom campaign is a failure, just like Ian's career and sex life.

Ian McGibboney said...

My list of "freedoms" is an extension of one of my original points, that couching resistance to health care reform as preserving freedom is ridiculous. I think it's disgusting that critics can spin one of the most necessary reforms of our time in this manner. It makes me wonder to the depths to which they'll resist every change in the Obama administration, now that they've decided to be constitutionally and economically prudent.

As for the Tom-bashing, well, there's no reason to make this about his soon-to-be kid. But Tom, can you admit now that such cheap shots hurt? If you're going to dish them out, don't be so shocked when you get them right back. None of these people would be so disrespectful toward you if you had behaved in a civilized manner. Politics has nothing to do with it; I as well as all of them, have conservative friends with whom civility is never an issue. Even disagreements are friendly. Some advice, Tom, if you want this to stop: Stop.

I can't and won't control what people say here. It's up to you and everyone else to work it out. If you can't, man, nothing's forcing you to come here.

Robert Taylor said...

My list of "freedoms" is an extension of one of my original points, that couching resistance to health care reform as preserving freedom is ridiculous.

But Ian HOW is it ridiculous? You haven't proven that market forces make you more likely to spend more on health care or more prone to injuries, you somehow tried to marry government and market forces to prove the opposite.

But as I've stated again and again, you arguments are only lip service that you just blurt out like they're common sense. You just ignore me when I ask for an explanation.

All you do is attack on Republicans on their inconsistencies. I'm here, agreeing with you. They are inconsistent! But so are you. You have not shown an ability to stay consistent in your logic or understanding of the subjects which you claim you're passionate about.

Ian McGibboney said...

Robert, we're in such different ballparks in all senses of the word that such an explanation is moot. I think that, on the simplest economic level, it's cheaper to have a huge risk pool full of healthy people to pay for the sick. Is anyone really making the argument that is isn't? I think in that case, the burden's on you to prove otherwise.

That said, we come from different philosophies. You think everything should be profitable monetarily. I think government is different than a business, and that some things (like education, health care, etc.) aren't there first and foremost to make a profit (though they shouldn't be wasteful). So I'm not going to convince you on your terms that this is a good idea. And I'm OK with that. Because it satisfies my parameters of the good government can do.

Robert Taylor said...

Yes, Ian, that is precisely what I am saying. A larger risk pool of healthy people does not equal lower prices for all. So now I will explain my side:

You are basing your thought on the assumption that health insurance companies can charge premiums to a pool of cutomers, predict and pay for a large loss triggered by an event outside the control of the customer, and make a profit. But sickness combines risks that are uncontrollable with risks that are indeed controllable by the customer (eating, exercise, preventative habits, and adherence to treatment plans, for example) and the provider (selection of diagnostic tests, specialists and hospitals, for example). As a result, insurance companies are left with tools of rationing via higher premiums, deductibles, copayments and utilization controls placed on providers, which have a tendency to create nonrandom groups of customers and providers.

Health insurance companies are more instruments of income redistribution than risk managers, and they are left with only one option: to charge healthy individuals enough to subsidize sick individuals. Eventually, when the impact of the redistribution on individuals is high enough, many either opt out or are priced out of the market.

That wouldn't be able to happen in a mandatory system, and it would bankrupt the system. Your logic is flawed. And your idea holds no ground.

Furthermore:

Simply put, you don't seem to understand how insurance works. If everyone can have insurance, regardless of preexisting conditions, it is no longer insurance.

Let me give you an example: Ian goes skating on the ice. Ian falls and cracks his head and suffers a major concussion. Ian goes and gets medical help, and then Ian gets an insurance plan and wants the insurance company to pay for his bills. That's not insurance.

Finally, I understand that you think government is not about profits, and that health care and education should not be about profits. Does that change the fact that medicine takes resources to produce and transport? Does that change the fact that teachers have to pay for food and housing?

I don't think everyone should be profitable monetarily. I think people should be profitable in whatever sense of the word they want. I just think the commodity known as money happens to be one of the easiest inventions known to achieve such needs.

I'd like to know philosophically or otherwise if you have ideas for a better system. If that's the case, I'd be extremely surprised you've thought that far into your ideologies, considering you haven't been able to explain the surface of them, let alone the deepest recesses of a non-monetary possible reality.

Robert Taylor said...

Anyways, I know what I wrote is a lot for anyone not fully aware of topics like how the health care system works to grasp. It's not just health care, but understanding how resources are allocated, transformed and distributed.

I wise man once said that the curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.

Hopefully my last post helps make you a little more humble when you think you might have the political answers to solve the biggest problems of mankind.

Robert Taylor said...

In other words, leave space for humility where humility is due.

Ian McGibboney said...

Robert, I'm not an economist. I don't think you are either, but maybe I'm wrong. I may or may not be able to satisfy your arguments or requests. I'm not even all that sure I understand them.

But the more I think about it, the more irrelevant it seems. I mean, I'm calling for the need for health care reform and equally that things like Prop C are purely political wastes of time. And we've gone from that to the philosophical particulars of what can and can't be called insurance in various hypothetical situations. And, frankly, it's nitpicking. The fact that you arguing this stuff at all in the first place suggests to me that you will find any way to be against it.

I don't think I'm making that controversial of an argument, or one that is particularly complex.

As for humility...keep in mind that this is my blog and I'm offering my opinion, which - your feedback notwithstanding - I think I back up pretty well. I don't pretend to have all the answers, let alone write from a position of absolute certainty. I'm not out to seek converts or condescend to other people. You do. So maybe you should take your own lesson in humility.

Jenni said...

Hi. I’m Jenni and I’ve been watching this debate from the outside for a while. Philosophies have been exchanged regarding healthcare and the debate between government intervention for societal good versus allowing the free market to dominate.

However, the one voice I haven’t heard is from those having to struggle to provide heathcare coverage, i.e. the business owner. Though I don’t have that kind of direct experience, I knew a person who did and agonized over it every year.

My father was the comptroller of 2 manufacturing companies in southwest Missouri for over 20 years. The last 15 of them was for an industrial welding and custom metalcrafting company. During his time, he dealt with an array of issues – steel tariffs, immigration policy (when the company wanted to hire an engineer from Cuba), and, as is the focus of this blog, healthcare coverage.

In the manufacturing industry, one of the key selling points of retaining quality employees is by the type of healthcare plan offered. Most often than not, companies try to match or surpass local competitor plans. Needless to say, this became harder as the years went by. Both competition and overhead costs grew, medical costs escalated, the economy tanked, and like other firms, the company struggled to stay afloat.

Roughly six months into a new medical plan, my father would work with his list of insurance agents to get the best deal for the employee, but at the same time, not bankrupt the business. My father agonized over this because he would openly talk about this struggle with my family. Until we were 23 and out of college, my sister and I were on my dad’s insurance plan and we could understand his perspective.

Dad wasn’t bitter about the jump in rates from year to year, though he also had to think about keeping the company in the black, but he wished that the field could be broadened to help out the little guy. He explained that having some sort of reform in place, albeit insurance, tort, or healthcare, should and would allow small businesses to join together to get a better insurance plan. This flows into Ian’s argument of having a larger field of healthy people to offset the sick ones. I agreed with the philosophy because from a statistics perspective, it makes sense. However, I didn’t much more thought into the discussion because I thought my family would always have healthcare coverage.

All of that changed on April 27 this year when Dad died of a heart attack. My first fear was that my mom would not have health insurance, but after a discussion with the insurance company, she has COBRA at $400 a month until October 2011. Because of the cost, she went to see what the market would offer her with a private plan. The amount was staggering, even for her age, so she’s sticking with COBRA until she can find a job with some sort of benefits.

In this day and age, it’s foolish to not have health insurance. Why? Because one accident or illness can ruin a person financially for years. I’ve had friends and in-laws of friends fall into this boat and it’s not pretty. These people work hard, pay their taxes, but their company either doesn’t provide insurance or makes it so expensive that there’s nothing left after premiums to pay rent, utilities, gas and groceries. It’s a struggle for most of them (and yes, they are college educated).

Some argue that the government does not have the right to dictate what society can or cannot do. BS. The government does this all of the time, but it’s argued for being in the interest of the public good (traffic laws, drug safety, food safety). I have no problem with the government telling me that I have to be responsible for myself and have insurance. Whether offered by business or the government, healthcare coverage is a public good commodity and should be treated as such. However, it has got to be easier for people to get into the system. How to do that is an answer I don’t have.

Robert Taylor said...

Ian, I've tried to keep it civil, so don't accuse me of condescending you. Secondly, I am in school to get my masters in Economics. I didn't feel it was necessary to tell you that because I thought the arguments should speak for themselves.

Your argument is not controversial. It's what the majority think. The majority also believe in god and aliens, as you like to remind us. It doesn't mean they're right. Your argument isn't complex either, but the subject you want political action for is. It's extremely complex. It's beyond the comprehension of you or me. In fact, the tools that are used in the medical industry are so complex, that no single human being actually knows how to make them. They are the result of massive uncontrolled social cooperation and exchange. Not a result of bureaucratic mandates.

@Jenni, hi, this third part is addressed to you and to Ian: Your story is unique and compelling. I think the most erred part was when you brought up statistics.

Unlike the natural sciences, human action cannot be studied using history or statistics. This is specifically because of the uniqueness of human values and historical phenomena. Human beings are not homogeneous bits of data. NOLA Progressive had alluded that this might be the case. He is wrong.

As long as statistics are employed in Economic arguments, people like Ian are going to think that there is a way to manage solutions that are beyond human comprehension.

I understand that you feel health care should be cheaper, but I've been trying to explain to Ian that getting government involved actually does the opposite and raises prices because it interferes with the natural tendency of competition to bring down prices. Simply saying that you want prices to come down is not a solution. It is not freedom. I want to jump across the Atlantic ocean, I even have the freedom to, but I don't have the power to.

Wishing and hoping moreover, is not action. Consequently, because government cannot resolve this problem, the only action they can do is to take more money from people like your dad and hurt everyone. Your means are counterproductive to your ends.

Robert Taylor said...

Finally Ian, on humility:

Scientists have to stay humble when studying the nature of the physical world. Their theories can always be replaced by new theories. This is the nature of empirical science.

Economics studies human action. The difference between studying stones, atoms or planets is that they don't choose. They don't have values. They don't grow and change their mind. Humans do.

Because of this, we are in a position to know certain things logically without testing: the fact that human action is purposive.

This fact is known not tentatively and hesitantly, but absolutely and apodictically. It is empirically true and unfalsifiable.

Once you can establish a fact like that, you can be certain of every conclusion that follows the logical chain. Economics can show how tools like medical equipment, which no one knows how to make come to be.

THAT is where the humility of an economist kicks in. He has to realize that once he knows how the tools and spontaneous order of society occur, he has little control on shaping or creating new order: because people have changing personal and subjective values!

NOLA Progressive said...

Rob, you argument pretty much boils down to it's really complicated, so don't worry about it.

Your general idea could apply to anything involving people. My point was not to dehumanize earlier, but we were speaking statistically. The point being is that lots of human factor-relative problems are extremely complex, yet we still attempt to solve/make them better. I mean programming traffic lights is extremely difficult. After all some people are good drivers, some will get into wrecks, etc... We still program traffic lights and address the problem. I'm certainly not going to say sit back and it will work itself out.

Robert Taylor said...

@NOLA, no. I didn't say "don't worry about it". Worry about it all you want. But understand how the problems arise.

You brought up a good example. Traffic lights. Last year over 30,000 people died from traffic fatalities. That's more Americans than have died in nearly 10 years at war in the Middle East. If this number came from a pharmaceutical company, you'd be outraged. You wouldn't buy their medicine. Likewise, you wouldn't want to drive on a road by a company that had that many fatalities.

But because it's the government, it's ok? They're even worse when it comes to pharmaceuticals. The FDA makes it so difficult to get drugs approved and sold in the US, that there are some drugs sold in other countries that could save untold number of lives. We don't know how many people are dying from preventable diseases due to government bureaucracy.

Economics deals not so much with what is seen, as what is not seen. And yes, my "general idea" deals with anything involving people because the moment you act, you enter the realm of the science praxeology and economics.

Robert Taylor said...

So, for the attainment of any material well being, you need division of labor. To achieve efficient division of labor, you need economic calculation. For economic calculation, you need people to be able to choose. Socialism has no economic calculation. Hampered welfare economies disrupt economic calculation and lead to further government intervention and eventually to the collapse of the division of labor: socialism.

So government mandates are not a suitable attainment for the ends of material well being because there is no economic calculation and no improvement in the division of labor over time.

First you have to understand how prices come to be. How do people choose goals and seek to attain them. What factors signal producers that their resources are properly allocated to meet the values of consumers?

Robert Taylor said...

One more thing (and this is purely opinion):

There seems to be a level of elitism coming from Ian and NOLA Progressive. They're so impelled to stop market forces and prevent new entrepreneurs from entering the market and competing against the government, that it almost seems as though they want to keep the already established rich CEOs in power.

If one didn't know any better, he might think they're the exact opposite of helping the common man, but bourgeois elitists, trying to protect the continuing power of the rich.

Ian McGibboney said...

That's amusing, Robert, because I addressed that exact point in my blog.

You're accusing NOLA and I of wanting to stop market forces, as if that's what drives our want for health care reform. And that's why it's so hard to talk to people like you. I could explain how wrong it is to assume that the free market is helped by our current cartel-like system, or that government reform doesn't fit the definition of free-market meddling, but man, we are not even at that level.

You and your type need to gain some real perspective on why people who disagree with you believe the things they do. Everything isn't ulterior and everything isn't a conspiracy intended to bring someone down out of economic envy.

That's like if I said people voted for Bush because they wanted the economy to collapse. Now you can argue that what Bush campaigned for (regressive tax cuts) and did in office (started two wars) did destabilize the economy, but I doubt those who supported these actions did so for that reason.

Whenever I disagree with people, I can at least some positive aspect of why they believe what they do, whether it's, "This is what they think is right" or, "I can see how this would benefit them." I think you, Robert, should do the same thing. That might make it a little harder for you to feel superior toward us, but at least we could have a reasonable discussion.

So I ask you from here on out to at least consider the idea that I, along with NOLA and everyone else who has commented in favor of reform here, that we back health care reform because it would help people. To insist that a group of progressive Americans wants to undermine our own country is pretty low. And considering that it comes from someone who often argues that people owe nothing to society, ironic as well.

Robert Taylor said...

First off I said "if one didn't know any better" because of course I know you and NOLA mean well. 

I've made absolutely no assumption of where you and NOLA are coming from, but you haven't wanted to debate the issues. You just say that what you believe should not be questioned. 

I haven't questioned your ultimate goals, just your means. You haven't defended your means with anything but emotional appeals and dismissal. 

Do you see the issue here? I've shown comment after comment how your system wouldn't work, you haven't shown any sign that it would.  So now what you and NOLA are saying is that we have to fix it?

Ok. I'm giving you a solution! Let the health care industry compete to provide the best quality lowest priced health care that consumers want. Remove government regulation that raises prices and hurts the poor. 

Robert Taylor said...

You and NOLA say: "adding more to the risk pool lowers prices". I explain to you how that is not true.

You and NOLA respond: "that's your schtick" or "you just want to oppose government"

Now who is assuming they know the ulterior motives of the other? It's outrageous when someone does it back, isn't it?

Nonsense! Prove how your system would work economically!

NOLA Progressive said...

I find the bourgeois elitist part really funny. Not in a mocking way, just insomuch as I drive a used minivan, drink cheap beer outside of the super dome on Sunday, and do yards and landscaping in addition to teaching to make ends meet. I wish I had the option of being an elitist.

I'm not sure when and where I've ever argued against competition either. I was under the impression we were discussing a public option type solution to healthcare. There is no such thing as free enterprise in this country on any grand scale. It's a money begets money nation. Little of that money is given back by the wealthiest, and a disproportionate amount is taken from those who aren't the super elite and wealthy. That's the reality.

Advocating for the government to have control over certain very important aspects isn't elitist. It's pragmatic. When corporate interests have full control greed is the factor at play. I don't personally sit on any coporate boards, but I am currently enfranchised to vote. At least I have a modicum of influence in that regard.

Conversely, I find your take, as much of it as I can fathom at least, to be uncaring and without empathy. You would argue that the free market will take care of all, but that's assuming that people will not use the guise of the free market to take advantage and secure positions that are virtually untouchable. You are approaching this from the stance that you have the answer and the truth.

I refer to the saying "I bow to those who seek the truth and flee from those who have found it."

Robert Taylor said...

@NOLA I know, it wouldn't seem that you would be supporting the ultra rich if you drive a minivan. Interestingly enough, on a historic level, the concepts of regulation and Socialism were never put forth by any proletariat. All the concepts of wealth redistribution were put forth by wealthy elites. Marx and Engels were wealthy well-to-do's,

So first off I don't even understand what "money begets money nation" means. Maybe you'd like to clarify.

Secondly, to address your disproportional argument, you're simply misinformed. The wealthy pay more into the economy. They are the ones who risk and invest more into new projects. They are in the highest tax bracket.

Even if a guy who makes a million dollars a year pays 1% of his income he'll pay more in taxes than a guy who makes the minimum taxable income (somewhere around 8000) and pays 10% which is the minimum amount taxable.

You said you drive a minivan. Do you know how expensive it is to create a minivan prototype and all the salaries and manpower it takes to make an affordable car for you?

Next, ok, you're enfranchised to vote. Do you know that the wealthy consume the least in this country? It's the masses of middle class folk like yourself who consume the largest quantity of goods. The proof is that the largest companies can't even be owned by one person, but they're publicly traded.

Lastly to your claims that I think I know the truth. Well let's consider here what I am saying. I am saying that I understand how markets work. I would never presume to say I understand how the medical industry decides where and what to invest in. That's for the entrepreneurs in that industry to do! Not politicians!

Let's consider what you claim to know, "When corporate interests have full control greed is the factor at play". Excuse me? Are you now telling me you can use telepathy to understand why rich people are doing things? I think it's you sir, who has assumed they no too much.

That is, unless you can prove it. Prove to me that government doesn't inhibit competition. Prove to me that economically, it's pragmatic to let government control health care, and then prove to me that all rich people do things purely out of greed. Just saying things doesn't prove them, as obvious as they may sound to some.

NOLA Progressive said...

I'm glad to see you at least haven't drunk the Kool-Aid to the point that you think that the ultra wealthy don't heavily come out the favorite in percentages. Total dollars don't mean a lot to me when it relates to equity.

Money begets money. If i'm a total slacko douche and inherit a few hundred million from my daddy then I can simply make millions a year off of interest alone. Money begets money. That's certainly we don't have rags to riches success stories in our country, but money certainly begets money.

We are both speaking an opinion here so let's not pretend that you are discussing this with me or anyone else from a point of universally accepted fact. I certainly am not making this argument. I simply don't adhere to the free market is the only answer theory.

Seriously dude, because I own a few shares of Wal Mart doesn't put me in the same universe as Sam Walton (or wouldn't have when he was alive).

On the note of the minivan. I don't hate business. I value businesses and the contributions they make. I simply don't care for those who take advantgage of people in obscene ways. Insurance being the foremost. I'd like to see regulations in place that stop them from doing the things that they are doing. The same for any corporation who uses their wealth to gain power and make a profit at the suffereing of others. So I applaude Honda for taking the time and money to make my minivan. They also make a handsome profit when they sell their product.

I don't claim that all rich people do things purely out of greed. Quite the contrary, I think some are quite selfless. What's with the prove it crap? What exactly do you want me to prove? That insurance companies let people die for profit? I think there is ample proof out there of that. I do know one thing, that there are many people who if the government or any entity told insurance companies that they had no choice but to provide health insurance to people regardless of their illnesses or conditions, that some or many of those people would still be alive. That's enough for me. Beyond that prove it yourself.

Robert Taylor said...

Ok NOLA... money begets money... that's not because we have a corrupt system. It has to do with the time-preference of money. I can explain if you're interested.

When I talk Economics with you, I'll tell you when I'm talking opinion, or unfalsifiable facts. Like if I say, human action is purposive, you can't argue against that. If I build, as Economics does, on that fact using logic, all the logical conclusions I come to in the logical chain are facts that cannot be debated.


"Seriously dude, because I own a few shares of Wal Mart doesn't put me in the same universe as Sam Walton (or wouldn't have when he was alive)."
Ok and what's your point? As a voter you have the same power as Barack Obama?

You get angry at companies that use their wealth to make a profit off the suffering of others... ok.... Where did their wealth come from? Was it just magically created? Oh wait. Their wealth actually came from HELPING people. People, believe it or not, actually gave their money to these companies, because they valued what they got in transaction more than the money they had. Both parties benefited.

As for your Honda... I don't know. Profit is left over after revenues. Did Honda make a profit off of your minivan? Or did they invest that money to create a new minivan? Can you prove what you're saying is so?

Yes I want you to prove that insurance companies let people die for profit. Why the hell would they let their customers die? How is that profitable? Be critical of the sentences you write before you hit the publish button.

NOLA Progressive said...

Okay I'll address a couple of those points. The rest I really find to be drivel. I don't really mean that to be an insulting, just pretty much how I feel about it.

Honda makes a profit. They are a pofitable comany as defined by their earnings statement. Did my particular minivan turn a profit? I really don't know, but it was a factor.


My point was that as a voter I have more influence over elected officials than I do over any corporate decision-making apparatus. I believe I said this when I first made the statement.

Finally, insurance companies let people die instead of covering people all of the time for many reasons. A major reason is because that person is deemed to have a preexisting condition and therefore is deemed to be too costly to insure. That person then can not afford various types of medication, treatement, preventative care, etc... and dies. There is a Harvard study that attributes 45,000 deaths a year to lack of or no insurance. http://prescriptions.blogs.nytimes.com/2009/09/17/harvard-medical-study-links-lack-of-insurance-to-45000-us-deaths-a-year/

Also, people who actually are customers of insurance companies are denied coverage after they have already paid their premiums and die. These are facts. This is practiced by all of the insurance companies in varying degrees. I'm not sure if this fits into one of your theories or equations, but it is simply the way it is.

Hopefully, recently passed reform legislation will reverese this travesty, but it is a credible piece in the argument for health care reform.

Finally, don't assume that what you see as logic is logical. Especially don't assume that I or others see it that way either. Your building of a solid house of logic through the use of your "logical" conclusions can turn into a house of cards very quickly.

Robert Taylor said...

If my logic is built on an unsolid foundation, then please, address it! That's all I've been asking of Ian this entire time. I'm addressing his logic and he can't seem to stay on the subject.

So back to your Honda... ok so Honda is a profitable company now. What if you had chosen Ford? Do you think they would have survived without the bailouts? Interesting how these giant companies can crumble so fast, isn't it?

And no, you could buy more shares in a company and have more say. Unfortunately, for (not exact on the date) about the last 60 years there has been a cap on representatives in this country. If the cap didn't exist we would have around 9000 representatives in the House. That's representation. Right now, if your Rep does something that you don't approve of, you have little power until the next election. I believe you are gravely mistaken.

On the subject on insurance companies, you explained it: they make decisions based on the fact that if they just allowed everyone to have coverage, they would go out of business and then EVERYONE would not have insurance.

If they have broken their contract agreement, then it's a legal matter. But as for people that are rejected, they don't have an entitlement to the insurance's coverage, just like they don't have an entitlement to taking your Honda against your will, even if they can make a case that they need it more than you.

Following your logic, people die every year because you choose to buy a Honda instead of giving them money for medical care. Reductio ad absurdum.

The problem is your shallow approach to the problem. You only deal with what is seen: an insurance company denies coverage to a person.

What is not seen is the fact that their administrative costs are through the roof to avoid fraud, deal with government regulations and now deal with the high-cost customers with preexisting conditions who they can't turn away. The costs will continue to rise.

This all has to do with scarcity but if you approach all these problems as if EVERYONE can be saved because resources are unlimited, well then of course everyone who doesn't help someone else is a greedy bastard.

Not only is this point of view naive, but profoundly UNSCIENTIFIC.

Ian McGibboney said...

Robert, you strayed off topic long ago. This was once about Prop C, you know. An expensive, symbolic FU to the Obama health care plan.

But if you must stray off, then explain how it's OK that those who buy into an insurance plan are not entitled to its coverage. That's exactly what they're buying, isn't it? I'm not following your logic here. Is this another example of the free market you love so much? Because it sounds like the worst scenario possible. And don't say that it's a matter of the company wanting to act in the best interest of the consumer to keep its business, because by then it's too late, and there's no incentive for the company to pay it out. That you see nothing wrong with that suggests not some free-market advocacy, but a pathological pro-greed philosophy.

Robert Taylor said...

@Ian I'm saying that if insurance companies were truly violating their contracts, they'd be out of business real quick. Not just because of litigation that would bankrupt them, but consumer reports and the mainstream media would inform people and they'd take their business elsewhere.

Just think how lucrative it would be if you created the first insurance company that doesn't defraud people! You'd be a freakin millionaire. See, it's not that easy. The sad fact is that premiums are high because as I've said time and time again, the government puts a myriad of regulations on companies.

I know you don't know all the laws in the US Law Code. No one does. Companies have to spend millions to make sure they don't break laws and even then sometimes they do by accident. It's important to sympathize on that level and not lose touch with reality. Laws are a black hole that can be used to destroy political opponents. If so inclined I could probably find some laws you're breaking right now everyday and destroy you.

So am I saying it's OK for a company to not meet their contractual obligation? Absolutely NOT. If everyone started doing that, our entire world society would collapse. IT IS ESSENTIAL for individuals and corporations to uphold contractual obligations.

Unfortunately, on a side note, taxation is not a contractual obligation. It is a coercive, non-contractual transfer of capital. That's what you should be angry about, because it attacks the very contracts you want to uphold. It messes with the very fabric of our social contract as human beings.

Ian McGibboney said...

I'm not even sure how to approach what you just said, Robert, but I'll try:

• Are you suggesting that government regulation burdens insurance companies to the point where they can't pay off claims? Because their bottom lines all seem pretty fat to me. And I'm not sure how removing and and all regulations is supposed to give them any incentive to be of any better service to their customers;

• The market is not self-regulating in this case. If I spend 20 years paying into an insurance policy, have the need to collect one day and suddenly the payout is not there, my response is not, "well, guess I'd better take my business elsewhere for next time." No, I want my coverage. The one I PAID FOR, and which I may very well sue for if I feel I've been legally cheated.

• You seem to contradict yourself over the social contract. What is government and taxation if not the social contract?

Robert Taylor said...

-Yes, government taxes fluctuate, which makes the money pooled for their customers unstable. Regulations fluctuate as well which makes these companies have to spend varying degrees of their revenue on their legal teams and accounting teams.

-Your complaints are not a fault of the company. They're rooted in the changing face of government. My parents have been paying their whole lives for Social Security, unfortunately, the system is broken. They probably won't get any money when they hit retirement age. The problem is part of your system, not the free market.

-Taxation is not the social contract I'm talking about. You're probably thinking along Rouseau lines. I'm talking about Spontaneous Order. The order that arises from people working together without central planning.

Languages, and any product that comes from the free market is a result of Spontaneous Order.

Taxation is not voluntary exchange by definition. If you were paying for roads, protection, education, and health care voluntarily, it would simply be called
"paying for something". Taxation is coercive by definition. It fluctuates. You did not sign the Constitution. 39 old men signed the Constitution. There's no provision for federal income tax there, by the way.

The social contract is one of consent (i.e. the way the real world works), not of coercion.

NOLA Progressive said...

Re: social security, what about the folks who invested in retirement in the free market system? Stocks, bonds, etc...? When the bubble burst and they lost all or nearly everything? To my knowledge no one that was eligible for social security has been unable to receive it due to lack of funds to date. The same can't be said about the free market system.

Robert Taylor said...

@NOLA I think you've just identified the key common misunderstanding about the bubble. As I've said time and again you have to look beyond the surface.

Was the bubble caused by the free market, or was it because of the manipulation by the government? If the government federally insures bank accounts up to 100,000 dollars, do you think banks will feel safer to lend more money? Of course.

How about if--as they did--they raised the insurance limit to 200,000? More risky lending because the bank has less on the line. But again, it's not the free market failing you, it's your government manipulating the natural order of the market that fails you. Of course if you just look at the issue on the surface, you have a great political argument. Solve the failure of regulation with...more regulation!

As for Social Security: are you kidding me? You haven't seen this headline? http://money.cnn.com/2010/08/05/news/economy/social_security_trustees_report/index.htm

And so what if the government "pays" out Social Security? Does that mean the money is worth anything? The dollar has lost 96% of its value since we instituted a Federal Reserve.

Yeah, they can pay out: they own the printing presses. They can also tax you out of life and limb because they have a monopoly on violence. And lastly, they can run up the debt to infinity and beyond. 13 Trillion and counting. That's a convenience the free market doesn't have. Try and think about these problems beyond the political arguments.

NOLA Progressive said...

There is no separation from the political argument. The government is the vessell which oversees the functioning of the country in many different aspects. Whether you argue in favor or in protest of this, it is still the reality.

Also your argument is a bit counter-intuitive to me. The bubble was able to be created by lack of oversight and regulation, not by too much of it. Our financial sector is basically congruent to Vegas without all of the cameras and security. Also, the big boys have learned how to count the cards really well. I'm ready for the pit boss to step in and break a few knee caps to ensure that others don't follow suit. The argument is to solve lack of oversight and regulation by imposing some.

Your cnn link while concerning is not in contradiction to my statement. It underscores the urgency to place safeguards on our social trust, by stopping every Tom, Dick, and Harry from stealing from the Social Security Trust to pay for other needs such as war.

I'm not arguing against using fiscal wisdom. I'm not arguing against being aware of the debt. I do however believe that these issues are inherently tied to the political debate.

Robert Taylor said...

@NOLA Yes, there are issues inherently tied to the political debate, issues that wouldn't exist sans the government.

My argument would only counter-intuitive if you were not aware that the financial markets are the most regulated markets that exist. If you came at the issue of a bubble with the false assumption that the financial markets were completely unwatched, then it would obviously seem like a failure of the free market.

Unfortunately, the reality is that the financial crises occurred as I've said time and time again because of misallocation of resources propped by the financial regulators.

Your Vegas analogy is a complete misunderstanding of the most basic premise and reality of the situation. If your analogy were true, then it wasn't that the pit boss wasn't seeing the "big boys" count the cards. It was the pit boss who was egging them on, and, when THEY FAILED to count the cards and lost all there money, the pit boss went into the vault and gave them the money to continue gambling. Except that the money that they were gambling wasn't there's. And the bailout money wasn't the casinos. And in many cases the pit boss WAS the gambling big boy.

Your analogy is a non-sequitor.