It’s always bizarre to see liberals like Matthew Yglesias ignore the historical evidence and argue that central government, with its central planning and price controls, will do a better job at managing the economy than a system organized around markets and competition. Yet here he is again, advocating more central control over the almost 20% of the economy that we call “healthcare,” this time singing the praises of Medicare and how our wonderful, benevolent central government gives Medicare recipients such great prices because of its bulk purchasing power.
Sorry, but the purchasing power argument isn’t convincing. Medicare prices are lower than prices under private insurance plans because the central government simply fixes prices at low levels. Providers accept these low prices knowing they can turn around and “shift” their costs to the private plans to make up the shortfall. Yglesias doesn’t seem to realize that when the private sector no longer exists, there will be no one left to shift the costs to, and at that point, if he thinks that federal bureaucrats will manage 20% of the economy more efficiently and innovatively than a competitive market, then he’s hopelessly confused.
But that doesn’t stop Yglesias from advocating that we should lower the retirement age, maybe even to zero. Yglesias also suggest that another more viable idea would be to bring back the so-called “public option” concept that Congress rejected when it passed ObamaCare. This is the idea that Barney Frank explained would serve as a stepping stone for liberals to eventually bring about a single payer healthcare system in this country. No matter how you look at it, Yglesias is bent on extending direct government control over 315 million people located across the country (for what is, in fact, a local activity)
It would be better for America to reject the liberal “vision,” and instead organize healthcare around a system based on markets and competition among insurers, providers, medical device manufacturers, etc. Not all healthcare markets today are necessarily competitive, but that only means we need better enforcement of the antitrust laws. Any two-bit government can implement price controls and restrict access to healthcare to “control” costs. But then the question becomes what would we have when all is said and done. People should realize that the plans of liberals like Yglesias would give us nothing more than low quality, stagnation, and eventual decline.