Healthcare Efficiencies

According to Matthew Yglesias, Slate magazine’s central planning enthusiast, healthcare accounts for a large and increasing share of the overall labor force. He seems to suggest that increased efficiency in the healthcare sector (which he evidently expects as a result of the impending government takeover) could generate problems, because the displaced healthcare workers would have nowhere to go.

Does Yglesias actually believe that government control over healthcare will increase efficiency? If so, then I have some land in Florida that I’d like to sell him. In any event, Yglesias’ puzzlement of where the healthcare workers would go illustrates liberals’ lack of imagination. Not lack of imagination in thinking about where the workers would go so much as lack of imagination about how society works.

The economist, Friedrich Hayek, pointed out that “it is because freedom means the renunciation of direct control of individual efforts that a free society can make use of so much more knowledge than the mind of the wisest ruler could comprehend.” Because Yglesias’s one limited mind doesn’t see where healthcare workers would go, he’s decided that efficiency is no longer important.

Yglesias’ conclusion is a nice illustration of the mind of the central planner as well as the limitations of central planning, and further demonstrates his ignorance of why freedom is important to a society. If Yglesias could only understand Hayek’s point, his mind would no doubt be eased over the efficiency question. But we probably shouldn’t hold our breath waiting for him to come around.

Note: Some people seem to think that health systems in European countries show that centrally planned healthcare is efficient. But this confuses efficiency with overall costs. Any two-bit authoritarian government can control overall costs without efficiencies:  impose price controls, restrict access (e.g., make patients wait two years for the hip surgery), and you’re done. Of course, what you’ll have after this is inferior service and a stagnant society.

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