The Means Justify the Ends

“Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all….It is as if the socialists were to accuse us of not wanting persons to eat because we do not want the state to raise grain.”

Frederic Bastiat

I think that it is truly sad that there are those who simply do not realize that the “people” do a better job than the “state” in all things other than national defense and law enforcement.  Normally, I would include the courts in that list of things since that is the only other legitimate function of government, but juries *are* the people–and are the arbiters of justice.

Why is it so difficult for so many to realize that while they claim that the ends are worth it, i.e., people having access to universal health care, they can’t even conceive of the evil of the means by which they want to achieve it.  Why is it so difficult to understand that the means justify the ends, not the other way around?  If one’s means are evil or even just a little tainted, so will the ends be, too.

It’s Insurance, not Free Lunch

When people demand that pre-existing conditions be covered by health insurance, they are forgetting that insurance is to cover one’s risks, not one’s certainties. It is not fiscally possible to grant insurance at a price that makes it worthwhile when the insurance company is 100% certain they will have to pay out.

Since insurance companies have to break even (at the very least) in order to stay in business, they would have to charge a premium equal to the entire cost of the pre-existing condition PLUS the cost of administration and accounting related to processing claims for payment. At that point, one is better off just paying out of pocket.

Realistically, the people who demand coverage for pre-existing conditions are people who are scared of the costs of health care for their condition–which makes perfect sense.  The problem is that what they seek as a remedy is a FREE LUNCH instead of an actual solution to the costs of health care.  The only way to pay for pre-existing conditions without making the insured person pay 110% of the cost for treatment is to spread that cost to others–which raises everyone else’s premiums.

This spreading of costs is only possible in large employer groups and only when an employer voluntarily chooses a health insurance company and plan that allows it.  When the market (i.e., private companies) CHOOSE to offer this coverage and are willing to pay the costs, I have no issue.  The problem is that the proposal is to take away the choices available to companies and to prevent insurance companies from running the way they should.

How about we take a serious look at repealing all the “reform” [sic] since 1964 so that costs will come down?

Privitization IS the Answer

The news recently revealed that the United States Postal Service is running massive deficits yet again (translation: their hand is out to Congress).  When the USPS floated the idea of cutting Saturday mail delivery (which may well have been a good idea), the idea was slammed to the ground– but not by anyone managing the Postal service.  It was killed as an idea by Congress since the various elected folk didn’t want to have to answer to their constituents about no more Saturday delivery.  If the USPS was a private company, it’s Board of Directors would simply make decisions based on what made business sense to do.  But, of course that’s not the case here.  The decisions made by the Post Office are governed largely by the whims of Congress– which have little to do with what makes business sense.

So what’s the answer?

I never thought I would point to EUROPE as an example of free market success, but in this case, I can do so…

Let’s look at Deutsche Bundespost Postdienst–the German government agency equivalent to the United States Postal Service.  Prior to 1995, they ran massive deficits and were accused of all sorts of bad management practices, etc. Is anyone surprised that a government agency was poorly run??

But, on January 1st, 1995, Germany converted Deutsche Bundespost Postdienst into Deutsche Post AG–a for-profit stock corporation (i.e., privatized it) and the result is not only elimination of losses–but now it turns a profit for its shareholders!  As a for-profit company, Deutsche Post was then free to expand its services to create Deutsche Post World Net.  We here in the U.S. know them as DHL.  Perhaps you’ve heard of them? 

There are SO many examples of what happens when you take government OUT of the marketplace.  Privatization WORKS.  It’s not a theory, it’s a proven fact!  People are motivated by their own self-interest (whether they admit it or not) and so it is no surprise that when you rely on the profit motive of private corporations instead of the power motive of petty politicians, the results are far better and more desirable.

Attacking vs. Proposing

During an Objectivist dinner club meeting I attended with my husband this evneing, a new attendee asked, “Why is everyone so quick to attack Obama’s health care reform ideas and spreading fear about them–instead of proposing alternatives?”

I thought for a few minutes while the discussion went on, then I realized the “why” as to the volume and viciousness of attacks by people who are opposed to any socialized-medicine scheme for the United States…and why little airtime is spent talking about alternatives…

Think of it this way, what would you do when you’re on an airplane high in the air and terrorists are rushing the cockpit intent on crashing the plane?  Would you look to the people around you and start a discussion about way to improve airplane safety?  Or, would you do anything and everything in your power to stop the terrorists from killing you and everyone else on board?

According to a retired physician I know, the alternative is simple:  DE-regulate.  In his practice–before 1965–he talks about how everyone had access to medical care and how doctors were of a higher caliber.  But, he went on to explain that Medicaid and Medicare put an end to America’s clear dominance in health care– both in terms of access and quality.   Before the government got involved, health care costs were much lower than today (even after taking inflation and technological advances into account).

The poor had ample access to charity hospitals (supported by *private* charities) and most commercial hospitals offered some degree of free/low cost care as well.  A night in the hospital in 1965 would have cost you about $7 ($48 in today’s money).  Even the working poor could afford that!  But, thanks to government intervention and insane tort laws, an average hospital stay averages $1,000 a night ($148 per night in 1965 money).

He was also explaining that in the 60’s, there were 20 applicants for every seat in medical schools nationwide–and only the best of the best got in.  Now, there’s only 2 applicants for every seat– plus there’s the spectre of racial quotas.  So it is easy to understand what is happening to the quality level of doctors coming out of schools now.  Don’t get me wrong, there are some great physicians coming out of those schools even today– but they become disenchanted in many cases because of the switch from a focus on “solving the case” to “decrease time per patient to raise profits to overcome losses from government patients.”

Want to know why people like me are so terrified of any and all of the plans floating around inside the beltway to reform health-care?  Simple!  Look at what an abysmal failure Medicaid and Medicare have been– and they want to EXPAND that to the whole country?  It does NOT matter whether the plan is “administered” by the government (a la “public option”) or by private insurance companies– it will be bureaucrats deciding on the standards and compensation rates–not the doctors and hospitals–not even the insurance companies.

But, all that said, you want to know what the solution to our horribly corrupted health care system is for the United States?  ….  REPEAL Medicaid and Medicare (in an orderly fashion, perhaps a 5-10 year phase out program), DE-regulate medicine (who knows better…your physician or a faceless bureaucrat?).  Basically, remove government from the equation.  Government is a mechanism of force/enforcement– neither of which have a place in health care.

Let’s have REAL reform, not just more of the same.  Let’s dial back the health-care clock to 1964 (not including the technology or medicine, of course) and let’s re-establish the United States as the greatest health care in the world–to which everyone has ACTUAL access.

But before we can even have the debates and discussions, we must first stop Obamunism.

The White House Requests that Americans Inform on One Another

Most of us learned about how people in Communist countries were encouraged to inform on their neighbors and even their own families when they heard them say something anti-government.  Apparently, the Obamunists want Americans to become informants any time someone contradicts the White House goals for socialized medicine.  What’s next?  Will Acorn stop by and give gifts to those who inform and protest in front of homes where dissenters live?  Here’s more…

From WhiteHouse.gov:

“There is a lot of disinformation about health insurance reform out there, spanning from control of personal finances to end of life care. These rumors often travel just below the surface via chain emails or through casual conversation. Since we can’t keep track of all of them here at the White House, we’re asking for your help. If you get an email or see something on the web about health insurance reform that seems fishy, send it to flag@whitehouse.gov.”

From Dr. Michael J. Hurd:

“This statement is actually from the White House web site. I did not make it up. What exactly is “fishy”? And what exactly is the White House going to do with the “help” of those who report on the emails and conversations of those who disagree with them? If this doesn’t send a chill down your spine, then either you don’t care about freedom of speech, the most precious right an individual possesses in a free society–or you have no remote clue of the difference between living in a society with such freedom, or without it.

This is the White House web site we’re talking about here. It’s not a private organization. It’s a government context–it is, quite literally, the government of the United States. The official web site of our government is asking citizens to report on fellow citizens who disagree with the official statements of our government. Are you going to take this lying down? At a minimum, write your representatives and express outrage over the use of the White House web site for purposes of inhibiting freedom of speech on the Internet–while you’re still free to do so.

Why Are We Moving Toward Socialized Medicine?

Why Are We Moving Toward Socialized Medicine?

By Yaron Brook

Government intervention in medicine is wrecking American health care. Nearly half of all spending on health care in America is already government spending. Yet President Obama’s “reforms” will only expand that intervention.

Prior to the government’s entrance into medicine, health care was regarded as a product to be traded voluntarily on a free market–no different from food, clothing, or any other important good or service. Medical providers competed to provide the best quality services at the lowest possible prices. Virtually all Americans could afford basic health care, while those few who could not were able to rely on abundant private charity.

Had this freedom been allowed to endure, Americans’ rising productivity would have afforded them better and better health care, just as, today, we buy better and more varied food and clothing than people did a century ago. There would be no crisis of affordability, as there isn’t for food or clothing.

But by the time Medicare and Medicaid were enacted in 1965, this view of health care as an economic product–for which each individual must assume responsibility–had given way to a view of health care as a “right,” an unearned “entitlement,” to be provided at others’ expense.

This entitlement mentality fueled the rise of our current third-party-payer system, a blend of government programs, such as Medicare and Medicaid, together with government-controlled employer-based health insurance (itself spawned by perverse tax incentives during the wage and price controls of World War II).

The resulting system aimed to relieve the individual of the “burden” of paying for his own health care by coercively imposing its costs on his neighbors. Today, for every dollar’s worth of hospital care a patient consumes, that patient pays only about 3 cents out of pocket; the rest is paid by third-party coverage. And for the health care system as a whole, patients pay only about 14 percent.

Shifting the responsibility for health care costs away from the individuals who accrue them led to an explosion in spending. In a system in which someone else is footing the bill, consumers, encouraged to regard health care as a “right,” demand medical services without having to consider their real price. When, through the 1970s and 1980s, this artificially inflated consumer demand sent expenditures soaring out of control, the government cracked down by enacting further coercive measures: price controls on medical services, cuts to medical benefits, and a crushing burden of regulations on every aspect of the health care system.

As each new intervention further distorted the health care market, driving up costs and lowering quality, belligerent voices demanded still further interventions to preserve the “right” to health care: from regulations mandating various forms of insurance coverage to Bush’s massive prescription drug bill.

The solution to this ongoing crisis is to recognize that the very idea of a “right” to health care is a perversion. There can be no such thing as a “right” to products or services created by the effort of others, and this most definitely includes medical products and services. Rights, as the Founders conceived them, are not claims to economic goods, but to freedoms of action.

You are free to see a doctor and pay him for his services–no one may forcibly prevent you from doing so. But you do not have a “right” to force the doctor to treat you without charge or to force others to pay for your treatment. The rights of some cannot require the coercion and sacrifice of others.

Real and lasting solutions to our health care problems require a rejection of the entitlement mentality in favor of a proper conception of rights. This would provide the moral basis for breaking the regulatory chains stifling the medical industry; for lifting the tax and regulatory incentives fueling our dysfunctional, employer-based insurance system; for inaugurating a gradual phase-out of all government health care programs, especially Medicare and Medicaid; and for restoring a true free market in medical care.

Such sweeping reforms would unleash the power of capitalism in the medical industry. They would provide the freedom for entrepreneurs motivated by profit to compete with each other to offer the best quality medical services at the lowest prices, driving innovation and bringing affordable medical care, once again, into the reach of all Americans.

Yaron Brook is the president of the Ayn Rand Center for Individual Rights. The Ayn Rand Center is a division of the Ayn Rand Institute and promotes the philosophy of Ayn Rand, author of “Atlas Shrugged” and “The Fountainhead.”

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Enough, already! Leave me alone!

I can’t watch the news without feeling the need to be sick to my stomach.  From our pathetic attempts to keep the world peace to the utter nonsense coming out of the mouths of our elected officials, I am often left wondering, “Who is John Galt.”  While this character from Ayn Rand’s novel Atlas Shrugged may not exist in real life– the legacy of the novel is even more relevant today.  With sales of Atlas Shrugged reaching all-time-highs, I can only hope that enough people will come to their senses in time to stop Obama and the spend-drunk Congress.

I see Congress and the President falling all over themselves trying to spend money they don’t have– then using the “budget deficit” to justify TAX INCREASES.  By the way, ever notice that Congress is EXEMPT from all the laws they pass?  Funny how the lawmakers don’t want to live by the very laws they write– but that’s another issue for another time.

Today, it boils down to this.  LEAVE ME ALONE. I don’t want the “help” of Congress.  I want Congress to help assure that there is a competent Judiciary to adjudicate disputes and I want a decent President to be a statesman (no chance of either, but I can still dream/hope).  Why do these people think it’s their business to interfere in my life?  If I do not have health insurance, that’s my problem– no one else’s.  LEAVE ME ALONE.  Congress can only screw up the economy, not help it.  It comes down to this: the economy is market driven (the invisible hand, a la Adam Smith) and Congress can either let it work properly or it can try to interfere– which never works for long and said invisible hand comes to smack us all HARD for allowing Congress to be STUPID.

I have unending reverence for the accomplishments of the Founding Fathers of our county, and I have continued respect for the U.S. Constitution, but I have zero respect for pretty much ANY elected official in office at this time.  I realize that I may not know everyone, but I can say that the Republicans and the Democrats are both determined to “save the country by destroying it”, a la Lincoln (who I hate for his gross violations of the Constitution in the supposed name of saving said document).

One would assume SOMEONE has an idea what’s going on, but there are no viable third parties. Even the Libertarian Party is wrought with power-hungry morons who wouldn’t know principle-based action if it hit them on the head with a 5,000,000,000 ton brick.  I am left politically homeless, with an insatiable desire to find someone running for public office in whom I can place my trust and admiration.  I’ll keep hoping, but I’m realistic enough to not expect it any time soon.

I love the “ideal” of the United States, but am disgusted by the way that the dream has been wasted on petty, self-serving pragmatists with no morals and no principles.  The funny part though is that I trust opportunists like Hillary Clinton more than most because she is predictable and pragmatic– so at least I know how she plans to screw the country in advance.  The challenge is in dealing with the wild cards like Obama and the religious right.  They are “hell-bent” (to borrow an expression) on destroying America for the sake of their bull-hockey idea of Paradise.  Obama wants some never-never land of people who live like Kings without the necessity of work and the religious right wants a land of mindless zombies who cough up their cash to an charismatic televangelist.

Why won’t anyone accept the fact that I do not want their “help”?  I just want to work with those who agree VOLUNTARILY to do so, and to reap the rewards (or losses) for my own choices and actions.  Why is that so hard for elected officials to grasp?  LEAVE US ALONE.  WE’RE PERFECTLY CAPABLE OF RUNNING OUR OWN LIVES.

Artificial Constructs in the Economy

When I sit back and actually think about the artificial constructs in our economy, I’m not sure if the proper response is screaming or nausea.  You’re probably wondering what on earth is a “artificial construct.”  Well, to put it simply: an artificial construct is a segment of the economy which is not needed nor required in a truly free market.  In other words, an industry or segment which produces nothing of actual value– but yet is basically required by law to exist.

Allow me to start with an “easy” example…  Americans spend more than $300,000,000,000 to get their income tax returns prepared for them.  Can anyone really think that making a tax code so complex that it necessitates such expenditures just to fill in forms can be even vaguely rational?  Why not a flat tax?  No need to divert all those accounting minds away from things like discovering Enron’s malfeasance BEFORE it crashes…it’s more useful to use those minds to prepare 1040 forms….  Right?

Sticking with taxes… what about all the estate attorneys whose sole job it is to protect your wealth from inheritance taxes?  They would not be needed if we eliminate the Death Tax.  But, its not like we could use their help in things like advising prospective homeowners about the implications of 18% home loans or reviewing contracts to prevent bad corporate mergers and deals.  It’s much more useful to put brilliant legal minds to use working out creative ways to avoid paying taxes…  Right?

Think that airplanes are the best way to travel around the country?  Worried about carbon emissions?  Worried about travel safety?  Well, thanks to the Federally funded airport system, most people fly in airplanes…  But who cares that a train can move 1 Ton over 420 miles on a single gallon of diesel fuel (the average car can move 1 ton about 35 miles on a gallon of gas).  Of course, trains can’t be forced to knock down skyscrapers nor do they make appealing terrorist targets–not to even mention the whole thing about how the train simply stops if the engine goes wonky.  But, no one cares about that….  Right?

Then, what about the Federally funded highway system…  shall we even discuss the fuel required to move millions of tractor-trailers around the country since a single train can carry the load of hundreds and hundreds of trucks with a single engine? But, Washington knows that we’d prefer to have our roads full of trucks…. Right?

The list goes on and on, but I’ll stop here for now…  my point is this:  When Congress spends money, it creates artificial constructs in the economy which would not naturally exist–thus de-balancing the system.  Why is it so hard for people to understand that Congress and the President can do NOTHING to help the economy– they can only choose to get in the way or stay out of the way.  And the whole getting in the way thing hasn’t exactly been a success– just take a look at all the mortgages going bad because the CRE (community reinvestment act) encouraged/forced mortgage lenders to make bad loans all in the name of “equal access”.  Well, boys, the piper has come and its time to pay the bill!  What else could that money have been used for….?

“Just a few controls, to protect us!” they whine…

It is amazing to me to listen to people talk about how “just a few controls” are necessary and good.  Controls on what?  They say, “Well, you know those _______! They’d rip off the whole country if we let them!”  This is evidence of a complete lack of understanding of a variety of economic principles, not the least of which is “Supply and Demand.”

To think that a company can charge anything it wishes is ludicrous! How much would you pay for something you want? Only as much as you think it’s worth, right?  If Wal-Mart raised the price of a VCR to $900, would you buy one?  Heck no!  And if any company was stupid enough to charge above-market prices, a competitor will come who will charge a more reasonable price and the price will drop.

But, back to the cries for “good regulation”…

“There can be no compromise between freedom and government controls; to accept “just a few controls” is to surrender the principle of inalienable individual rights and to substitute for it the principle of the government’s unlimited, arbitrary power, thus delivering oneself into gradual enslavement. As an example of this process, observe the present domestic policy of the United States.”   –Ayn Rand

The sad part is that people actually believe the government is capable of regulating the markets.  Wake up, folks!  Only the market is capable of regulating the market!

“There is no way to legislate competition; there are no standards by which one could define who should compete with whom, how many competitors should exist in any given field, what should be their relative strength or their so-called “relevant markets,” what prices they should charge, what methods of competition are “fair” or “unfair.” None of these can be answered, because these precisely are the questions that can be answered only by the mechanism of a free market.” –Ayn Rand

“The concept of free competition enforced by law is a grotesque contradiction in terms. It means: forcing people to be free at the point of a gun. It means: protecting people’s freedom by the arbitrary rule of unanswerable bureaucratic edicts.” –Ayn Rand

Obama’s Pledge to Stop AIG Bonuses is Bonechillling

The headline in my local paper today declared that President Obama has pledged to stop the payment of bonuses to current and former AIG employees. As I sat looking at the headline, I was temporarily paralyzed with fear as to the implications…

“What’s the problem with stopping the bonuses, we gave them that bailout money!” is the cry we hear in the media.

The problem is that President Obama is pledging to VIOLATE A LEGITIMATE CONTRACT– contracts enforceable by Law.  See, the ironic part is that had the U.S. Government “bailed out AIG”, then AIG would have gone into bankruptcy protection (as it rightly should) and the bonus contracts would have been nullified as a primary obligation of the company.  BUT, since President Obama and the Demospenders said “But AIG is essential to preventing bank failures!”, here we are…  AIG is solvent (sort of) and so it is still obligated to pay the bonuses.

How would you feel if your employer owed you a bonus for work you did and then decided it was not good PR to pay you your bonus?  You’d go to Court and sue your employer, I’m quite sure.  You would never say, “Oh, well, it’s for the public good that I do not get my bonus, so that’s ok!”

Let me make my point crystal clear:

If President Obama and the Congress succeed in overturning LEGITIMATE CONTRACTS, then they have placed a massive nail of precedent in the coffin of the free market.

Our ENTIRE ECONOMY is dependent upon contracts being enforceable.  You want to see credit get tight, see what happens if contracts can be voided by Congress and the President just because they are not popular…

It’s simple: The U.S. Government invested in AIG and it has to be responsible for the legitimate obligations of AIG to the extent of their “investment” — just like any other investor.  They don’t get to change the rules just to suit their investment– at the expense of AIG’s employees.

Congress and the President cannot have their cake and eat it, too.  Either they bail out AIG and pay the bonuses, or they let AIG go bankrupt to avoid it (and deal with the consequences either way).

When will people realize that the Government should never, ever tinker in the economy?  The free market is self-regulating, but of course “reality” is not always politically correct.