Murray Rothbard fully destroys the arguments in favor of Hillarycare (or any socialized health insurance scheme, for that matter) in “The Devilish Principles of Hillarycare,” the 14th installment of the 30 Day Reading List.
He begins with some background, showing that supporters liked the program, but were concerned with issues relating to cost, how it might be financed, etc. Detractors had similar objections, but were not opposed to a centralized, federal bureaucracy administering healthcare on principle. Indeed, even now the Republicans, for all their bellicosity, aren’t opposed to the idea of Obamacare on principle; their slogan from day one has been to “repeal and replace” it, ostensibly with their own centrally planned and managed version.
Anyone who truly espoused the notion of free enterprise or personal freedom would simply repeal not only Obamacare, but all of it, the whole rotten mess. Healthcare totalitarianism does no one any good, save for the politically well-connected who benefit greatly from government largesse. So then, as now, the real dispute is that the “devil is in the details.” But, as Rothbard so brilliantly exposes, the “details are petty demons compared to general principles, where Lucifer really lurks.” He lists eight points central to any socialized health insurance system, and comments on each.
Guaranteed Universal Access: For the healthcare totalitarian, a government mandate is supposed to magically provide everyone with universal access. The actual economics of the industry, the reality that resources – land, labor, capital-goods – are scarce, never makes it into their plans. They simply assume the number of physicians is a constant; that people will continue to enter the profession at the current rates, and all their calculus is based on this fallacy. Rothbard notes that the dollar is what gives people universal access, and that any other scheme is despotic.
Coercive: Every such government program is coercive, or, as Ron Paul says, “everything government does is a mandate.” This is all provided for by coercing money from individuals, and as Rothbard notes, “this extortion is not changed by calling these taxes ‘fees, […] premiums,’ or ‘contributions.”
Egalitarian: Healthcare totalitarians cry foul when they observe what they call the “two-tier” healthcare system, wherein the rich have access to the best care and the poor are left to scrounge for the scraps. First, as Rothbard adds, in a free society there would actually be a multi-tiered system, where various levels of care can be provided depending on the price one is willing to pay. And, because there wouldn’t be a “universal system,” doctors and healthcare professionals would compete for patients, thereby improving service and driving down prices. But also, we see from Yuri Maltsev’s account from the Soviet Medical Bureaucracy that an actual two-tier system exists even in the people’s Utopia.
Collectivist: The natural progress of the market, once adulterated by the state, is towards larger and more consolidated firms who grow on the power and privilege of government. Contrast this with the unhampered market, where firms only grow by attracting willing business from voluntary consumers. But as the market becomes more and more tightly regulated, government collectives such as HMOs, or in modern terms, “state exchanges,” take over and individual preferences, innovation, and solutions are driven out or prohibited.
Price Controls: The intrusion into the market almost always comes from the idea that healthcare costs too much. Because the poor and uninsured can’t afford to pay the high costs, government must intervene. But the idea that costs are too high can be quite misleading. When measured as a percentage of GDP, the numbers might seem formidable. But percentages only tell us that more is being consumed, not that prices are rising. Rothbard explains that an increase in the percentage of GDP in the computer market hardly means that computers are more expensive. In fact, since they first hit the market, the prices of personal computers have fallen dramatically. Since the government and those who work in government don’t understand this, they resort to arbitrary price controls.
Medical Rationing: When the government provides a “free” service, or institutes prices controls as above, it provides incentives for over consumption and disincentives for production. This leads to shortages, and just like above, the government doesn’t understand this either. So they begin rationing services.
The Annoying Consumer: Rothbard explains how on the market the consumers are kings and queens, the firms which they patronize act as servants, slavishly working to please their masters. The same cannot be said of government service providers. They view customers not as someone to be served, but rather as unwelcome intruders who interrupt their peaceful “work.”
The Great Leap Forward: Rothbard concludes by equating the idea of a nationalized system as a “great leap forward” for the U.S. He writes: “The Clinton health plan is not ‘reform’ and it doesn’t meet a ‘crisis.’ Cut through the fake semantics, and what we have is another Great Leap Forward into socialism. He goes on to say that while the U.S. is moving closer to a socialist, or at least fascist, economic system, the former communist countries are establishing a more laissez-faire approach. Clearly something was wrong with centralized government planning in those countries, if, when given the choice, the people began moving away from it formally.