Here is the sequence for the death of freedom in the name of our good. Government perceives or invents a crisis. As we live in an imperfect world, there are always problems to solve. Then there is an outcry to “do something.” Of course, who is the one called to do? The government.

The government intervenes to solve the problem but very often the result is a bigger problem that springs forth other related problems. In effect, it is not uncommon to see that the problems before intervention were nowhere near the problems after intervention. This is not a problem for statists as the answers are ready:

  1. Things were in the brink of getting worse and we saved the day.
  2. We intervened but not enough, not enough resources.

The failures of the initial intervention are attributed to the need for further intervention till some come with a bright idea: why not let government take over completely? Oh, my, why we didn’t think of it earlier? In the process of further government expansion the private sector must be vilified for not being perfect. Every failure in government intervention is attributed to the need for more government but failures in the market are attributed to too much unregulated freedom.

The more government grows in power before the final take over, the more it lures some private actors to cling from government in search of benefit. Some are private companies that are defeated in competition and others are non-profits and churches benefiting from grants and “partnerships.” Eventually, it makes sense to them to “socialize” the whole thing. Remarkably here, society is identified with the state and the secular order collapses into the affairs and institutions of government.

From Obamacare to “single-payer” there is not much walk to make. Yes, insurance companies aligned with politicians have created a system where your whole existence has to be insured from any burden. Instead of just paying for care and having a sensible, narrow insurance for catastrophic events, we pay almost nothing for even the most menial procedure.

The divine right now is entitlement to care. In the past, the doctor was your neighbor and you paid for treatment. If something really bad happened, there was insurance. Otherwise, you paid for services rendered and it was affordable. As Murray Rothbard explains, the very creation of the health care insurance system guarantees the increase of costs and eventually triggers a call for the government to take over. Promoted by the government, this industry this industry is unsustainable. As Rothbard explains:

If your house burns down and you have fire insurance, you receive (if you can pry the money loose from your friendly insurance company) a compensating fixed money benefit. For this privilege, you pay in advance a fixed annual premium. Only in our system of medical insurance does the government or Blue Cross pay, not a fixed sum, but whatever the doctor or hospital chooses to charge.[1]

Eventually, and inevitably, premiums rise and benefits shrink. Who is blamed? The evil insurance companies. Who is called to rescue? The government. In the meantime, the entire system suffers as, when it is a third-party paying, people tend to overuse the benefit. To have the government cover all solves nothing as the concentration of power in a single entity creates a monopoly that triggers inefficiency and bureaucratic abuse.

But there we go to the government to rescue us when liberty is the answer. Let everyone pay for their care directly to the doctor who negotiates a price. Let civil society create non-profit health systems to care for the very poor. Bring the power of the market in and you will see the present problems get out.

 


[1] Excerpt from Making Economic Sense, Chapter 20. See it in http://mises.org/daily/6099/Government-Medical-Insurance

Advertisements