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August 20, 2007

All they hear

Spread the Downsize DC message. Forward this to friends . . .

Quote of the Day:

“Influence: In politics, a visionary quo given in exchange for a substantial quid.”
— from “The Devil’s Dictionary” by Ambrose Bierce

Subject: The drumbeat for a health-care monopoly

Have you noticed? Nearly every talking-head show on TV contains a plug for so-called universal health-care. Everyone, everywhere is being exposed to this message nearly every day.

Can you imagine, in such a climate, that we will not end up with some form of tax funded universal health care?

If we do, you can be sure of two things . . .

1. The resulting policy will be sold as a visionary step forward
2. The prices and terms of your health-care will be set behind closed doors

The so-called visionary quo will come in return for a substantial quid. The program will amount to the most massive system of corporate welfare yet devised.

Here is an important question to consider: How should the prices be set for health-care procedures?

We know how prices are set in a free market. Providers compete with each other to attract customers. They set prices at a level that will attract sufficient customers to turn a profit. But . . .

How do you set a price when there are no customers, plural, but only one customer, singular? If health-care providers do not have to compete for the business of their single customer, the government, how will anyone know how much to charge or to pay for a given procedure?

How will prices be set if there is only a single payer, who promises to pay for all procedures, no matter what? How will the government decide what to pay? The answer is that the price will be set in negotiation with health-care lobbyists.

But will it be the right price? The right price for what purpose? In a free market prices serve as signals to balance supply and demand. Higher prices send a signal that more suppliers/providers are needed. But what purpose do prices serve when there is only one payer and no competition?

One might assume that because prices will be set politically, by monopoly government, prices will rise dramatically. You might also assume that these monopoly prices will send a strong signal for more people to become health-care providers. This would be a correct assumption, in part, but . . .

Those high monopoly prices will come with strings attached. Regulations. Paper work. These burdens are another price, sending a different and contrary signal that says: “Do not become a health-care provider.”

Will these two kinds of prices be set in such a way as to provide optimal health-care? Who knows.

In fact, there is no way that anyone could know. This is why markets are so superior to centralized, bureaucratic, politically-managed, decision making. Market prices take advantage of decentralized knowledge that is simply unavailable to centralized government planners.

Fundamentally, in any given locality, and in any given transaction between provider and customer, there is only one price that is optimal for that situation. But there are an infinite number of ways for a price to be wrong, if it is set artificially by government fiat. This means that supply and demand will always be out of balance under a government monopoly.

This problem of price confusion was the fundamental reason the Soviet Union collapsed (far more important than Ronald Reagan’s defense build up). It’s also the reason why European health-care systems are so messed up, which is something Michael Moore could have easily learned while directing “Sicko,” had he not been so intent on cherry-picking the evidence.

Sadly, we are already more than half way to achieving a perfect state of price confusion in American health-care. Nearly half of all health care is already paid for by government, and most of the rest is befuddled by tax policies and insurance regulations that completely distort the natural relationship between supply and demand.

Example: Two weeks ago I went to an emergency room for a kidney stone. The bill was $7,304. Then my insurance provider negotiated the price down to $413. That $413 is not my co-pay, or the amount that applies to my deductable. It’s the full final price I will pay out of my medical savings account.

$7,304 vs. $413 — that’s a huge difference. Why was the first price so high? Why was the second price so low? What would the government have paid? What would the price have been in a free market? Who knows?

We don’t have a free market. Instead, we have a messed-up health-care system that politicians are using as an excuse to make an even bigger mess. It’s an old story. The politicians use their own failures as an excuse to grab more power. The resulting increase in resources politically diverted to “solve the problem” creates an even larger mess. It’s a vicious cycle.

For the most part, politicians don’t make these messes on purpose. They do it because the incentives are structured to cause failure. We must change those incentives.

One incentive that is driving us toward monopolized health-care is the constant drumbeat for so-called universal health-care. The politicians are living in an echo-chamber, in which they only hear one message repeated over and over. We must penetrate that echo chamber with a different message.

We provide you with a big advantage in achieving this penetration. Most constituents don’t communicate with their representatives, but you can, with just a few strokes of your keyboard, and a few clicks of your mouse. Use the tool that we provide, and you will have a huge edge.

So far, more than 600 Downsizers have sent 1,803 messages to Congress opposing any further federal funding of personal health-care expenses. That leaves nearly 19,000 Downsizers who have yet to take advantage of their power to make the politicians hear something different. Please use your power by sending a message now.

Of course, our current health-care campaign only serves to keep the problem from becoming worse, but don’t worry. It’s just the first step. There are other campaigns coming that will work to improve on the messed up system we have now.

In other news, nearly 1,400 Downsizers have so-far sent 4,197 messages telling Congress that they are “not afraid” of Islamic terrorism. If you have not yet taken your opportunity to instantly win the so-called “war on terror,” by not being afraid, please do so now. Your message to Congress will be something else they’re not hearing from other sources.

Please tell Congress you are not afraid, and ask them to stop being afraid on your behalf.

Finally, our ability to make Congress hear things they’re not used to hearing depends on growth driven by financing. Please make a contribution or start a monthly pledge to support our growth.

Thank you for being a DC Downsizer.

Perry Willis
Communications Director, Inc.

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