Saturday, October 16, 2010

The collectivized responsibility of petty socialism

A fat tax is a vain attempt to contain medical costs that will spiral upwards regardless

Rising healthcare costs and continuing recession-related fiscal problems have impelled numerous world governments to introduce a "fat tax."[1] Support for a similar policy is growing in the United States, which according to leading intellectuals suffers from a collective "weight problem."[2]

Fast-rising weights and a general deterioration of health have increased the volume of weight-related medical issues. The implications for countries burdened with socialized medicine (including the United States, which suffers from a government-restricted insurance market that provides limited federal healthcare in the form of Medicare and monetary aid to the poor) consist in an increased monetary burden for society as a whole.

Fixed low costs to the consumer, whether free (universal healthcare ) or relatively cheap (limited welfare, like that of the United States), have caused a predictable increase in quantity demanded.[3] While the consumer directly pays a below-market price for the service, the true cost is hidden since the rest of it is subsidized by the government. Therefore, the rising costs that come with a rise in quantity demanded are simply deferred to taxpayers. David Leonhardt, writing for the New York Times, puts it simply,

"This extra weight has caused a sharp increase in chronic diseases, like diabetes, that are unusually costly. Other public-health scourges, like lung cancer, have tended to kill their victims quickly, which (in the most tragic possible way) holds down their long-term cost. Obesity is different. A recent article in Health Affairs estimated its annual cost to be $147 billion and growing. That translates into $1,250 per household, mostly in taxes and insurance premiums".[4]

The solution to the problem is a tax on selected foods,[5] based on the idea that a price floor on certain foods will lead to a fall in quantity demanded.[6] However, this solution can be likened to building a barrier to regulate the height of the waterline in a swimming pool, yet leaving the hose on. In other words, a fat tax — of any and all variety — does not address the root problem.

The root of our current medical problem lies in the collectivization of the consequences of an individual's irresponsible choices. The issue is that the costs of one person's decisions are spread equally throughout society, to the point that that individual hardly feels the penalties of his value judgments — short of illness and death. Indeed, this socialization of responsibility effectively rids the individual from all incentive to reconsider his or her values and desires. The erosion of responsibility, operating with the understanding that the consequences of poor decisions will be mitigated by what is benignly called a "social safety net," is where the viability of socialized medicine falls apart.

Despite all the money and legislation thrown at fixing socialized medicine — including the current crusade to replace the bloated Medicare and Medicaid programs with a universal healthcare system in the United States — the fact is that temporary mends are just that, temporary. The system is bound to collapse given the nature of the problem. Worst of all, while the system is artificially maintained, the consequences — including corroding standards of living — must be borne by society as a whole.

The only solution is the one provided by the free market, where the consequences of one individual's actions are internalized lest he provoke some form of reaction from another individual.[7] We can therefore derive that in a free market the costs of irresponsible choices related to one's health would be shouldered by the individual only.

Negative Externalities of Medicinal Socialism

An economic externality is a cost or benefit of an action that affects an individual unrelated to that action. A common example of a negative, or cost-related, externality is pollution. If a firm dumps its waste into a river, and the current manages to transport the waste onto another individual's property, the cost of the waste is said to be externalized to, or borne by, an individual who had not agreed to the action in the first place. Similarly, the cost of theft is not suffered by the thief but by the victim, and as such the cost of the act of theft has been externalized to the victim.

This is the fate that has befallen socialized medicine. The costs of health-related irresponsibility have been externalized to society through the mechanism of public subsidization of medical costs. The costs of an unhealthy lifestyle, manifested in the free market in the form of expensive hospital bills or rising insurance prices, are borne by the government and distributed among the population as a whole. Therefore, it follows that in a completely socialized market in medicine — a true universal healthcare system — all monetary costs are externalized to those coerced into paying for a system they never agreed upon.

Just as bad, socialism incentivizes irresponsibility. In the case of socialized healthcare, it does so by distorting or completely doing away with the price mechanism. The price mechanism can be seen as the market's process of balancing supply and demand of a certain good or service. It guarantees that generally speaking a particular good and service will never experience a notable shortage or surplus, as far as the entire market goes.

This is because, given the axiom of purposeful human action,[8] people will economize their use of a particular good based on its price. For example, if the price of a short medical checkup is $35, an individual might decide his symptoms aren't worth the cost, whereas he might have gone if the price were $25. Simply put, the price of a good will allow an individual to decide whether or not he can garner the highest utility from a particular action, or whether he can reap greater utility from the alternative.[9]

What socialized medicine does is artificially reduce the price of healthcare or do away with it altogether (if universal healthcare is completely subsidized by the state). This leads individuals to acquire the service when they would have otherwise abstained from it. In a situation in which the cost of the service is not subsidized by a third party, such price ceilings usually lead to severe shortages — one needs only to point at the effects of price ceilings in the gasoline market or those imposed on the utilities market. In the case of socialized medicine, since the cost is borne by the whole of society — masquerading as "public funding" or "government funding" — faux price ceilings simply lead to upward spiraling costs.

Government, determined either through power-driven self-interest or a distorted concept of utilitarianism, tends to attempt to solve cost-related problems by plugging holes in their system with ad hoc regulations. Such is the nature of this recent fat tax — and such will be the nature of all future regulations that attempt to control the way man lives his life.

The moral dilemma is clear: Does the provision of universal healthcare justify infringement upon individual liberty? More broadly stated, do the ends justify the means? Morality aside, it is nevertheless clear that, regardless of the means, the outcome of socialism — including socialized healthcare — is the same. One can plug a hole, but doing so will only cause the system to rupture elsewhere.

A fat tax might cause a marginal decrease in consumption of fatty foods; but it has absolutely no bearing on whether or not individuals may decide to cut down on exercise, eat too many calories worth of healthier food, etc. Each of these problems requires their own set of regulations. Not only does the end result of socialized healthcare remain the same, but the state itself slowly transforms into a police state in an attempt to enforce these regulations.

Unfettered Markets and the Internalization of Responsibility

That the United States and other governments are seriously considering implementing — or have already implemented — a fat tax should not be used to illustrate the problems of unhealthy behavior. Rather, it should be a clear sign of the problems that plague socialized healthcare. To the extent that the aforementioned is true, it therefore follows that given these empirical examples of economic theory at work, the correct path to take for the future of healthcare is toward privatization. Only through privatized healthcare, or a free market in medicine, can marginal costs be internalized.[10]

The fact that markets are imperfect should not be a reason to substitute them with socialism. The market is a continuous process of entrepreneurship, driven by the profit motive and guided by the price mechanism. Economic competition and the insatiable desire for profit guarantees rising standards of living, as long as entrepreneurs are allowed complete liberty in exercisable action. Only through the free market can individuals innovate and labor to internalize both benefits and costs, and therefore only through the free market can externalities be resolved.

It is only through the free market that healthcare can ultimately be provided to all those who seek it. Much like automobiles, televisions, foodstuff, water, and countless other goods and services that have been left to the devices of the market, those who produce within the healthcare industry would be forced — by their own self-interest, in conjunction with competition — into providing greater supplies of healthcare along with augmenting quality.

To assume that a free market in healthcare would not provide demanded services to potential customers is to assume that the individuals who compose this market operate irrationally.


The rescued Chilean miners came out well DESPITE the therapy industry

Millions of people around the world will crack a smile today as they watch the 33 Chilean miners finally being hoisted back to life. But Those Who Know Better, the overlords of the therapy industry, see something different: not a happy ending to a two-month nightmare, but the start of an even longer nightmare of ill-health, craziness and PTSD for these unfortunate creatures from the dark. According to the experts, what we’re really witnessing in Chile today is a volcanic eruption of human instability, as 33 ticking timebombs of emotional frailty are raised to the surface.

One psycho-expert, echoing an army of others, told Fox News that the rescue of the men will release a ‘cauldron of emotions’; apparently ‘molten, churning reservoirs of emotion are about to emerge from that mine’. And there’s no telling what this geyser of two months worth of repressed feelings will give rise to. Fox’s fortune-teller says it could spawn ‘divorces, violence, terrible despondency, panic attacks, plays for celebrity that fall short and lead to suicide, addiction to alcohol and illicit drugs and gambling, and wild allegations levelled by one miner against another’. For the mental-health lobby, it seems, every silver lining has a cloud.

How will these men who coped remarkably well in a 32 degrees Celsius underground cavern for more than two months now cope with the temptation to descend into a drug-addled world of violence and backstabbing? On this question, the experts are unanimous: as one of them sums it up, the freed 33 will require ‘all the skill of the very best mental-health professionals available’.

Is it just me or does this look like a brazen job-creation scheme? At a time of recession and cutbacks, I guess even the mental-health lobby has to find ways to earn a crust - even if that means cynically re-presenting 33 fairly hard, robust miners as men on the verge of a nervous breakdown who will need professional help for the rest of their lives.

The most startling thing about the various psycho-pronouncements being made about the miners is not their undiluted miserabilism, their ability to see future suicides where most of us see a moment of joy, but their ignorance of the facts of the past two months. Because the inconvenient truth is that the 33 miners survived underground not as a result of psychological advice and intervention but by sometimes rebelling against the psychologists who kept a watchful eye on their every move. The real story of the Chilean miners, for anyone who cares to look, is that the interventions of the various wings of the trauma industry often make things worse rather than better, and people are mostly happier and healthier without them.

The on-site psychology team at the San Jose mine treated the trapped men with extraordinary mean-spiritedness. Driven by the conviction that they, as one headline put it, ‘know best’, and backed up by the dime-a-dozen profferings of every headline-hungry psychologist and therapist around the globe, the psychologists saw it as their duty to police the men’s thoughts and even to censor letters from their families in case they triggered ‘problematic emotions’. Such petty authoritarianism is the end result of the deep-rooted idea that life is way too hard and complicated to be negotiated without the words of wisdom of the therapy lobby.

One of the medical experts at San Jose - part of a team of 300 people that oversaw the men’s health and needs - said there was a ‘daily arm wrestle’ between the miners and the psychology team. That isn’t surprising. The mental-health experts overground used a system of ‘prizes and punishments’ to try to control the men’s behaviour - for their own good, of course.

So when the men assented to hour-long phone calls with the mental-health team, as they did when they were first found to be alive 17 days after getting trapped, they were rewarded with prizes such as access to TV shows. But when they refused to talk to the psychologists, as they started to do in mid-September when their health and body weight were improving as a result of sent-down food and they insisted that ‘we are well’, the psychology team would deprive them of luxuries. As one on-site doctor put it: ‘We have to say, “OK, you don’t want to speak with psychologists? Perfect. That day you get no TV, there is no music - because we administer these things.”’

The psychology team became judge and jury of what the men could do for enjoyment and even how they could communicate with their families. When the men asked for cigarettes and alcohol, saying that these small pleasures would help them cope better than their daily phone call with the experts, the psychology team begrudgingly agreed to send down cigarettes but not booze - because ‘the average miner consumes large quantities of alcohol’, one of the psychologists said, and there is no telling how they will behave when inebriated in hot, cramped conditions. The men were furious. But only because they don’t understand the dangers of drinking, one of the on-site doctors snootily declared. ‘These are not PhD scientists, they are rough-and-tumble miners’, he said, giving a glimpse into the experts’ deep disdain for the men they were supposed to be helping.

But the thing that really tore the miners and their mental-health betters apart - the thing that ensured ‘the honeymoon was over’, as the lead on-site psychologist put it - was the psychology team’s ‘widespread censorship’ of family letters to the men. Early on, every time a family member wrote a letter it had to be submitted for psychological evaluation first, before being sent down the so-called umbilical cord to the men underground, so that any material judged ‘psychologically inappropriate’ could be removed.

There was uproar when the families discovered that there was a backlog of letters waiting to be okayed. One of the miners had asked his wife during a video link-up: ‘Why don’t you write to me anymore?’ In fact she had been writing everyday, but her letters were awaiting ‘psychological approval’. Eventually government officials stepped in and ended the vetting of the letters.

The men rebelled against these measures in any way they could. At one stage they delayed taking vaccines that had been sent down until they got something they wanted. And as they regained weight courtesy of the food sent down the umbilical cord, ‘their antagonism to the daily psychology sessions increased’, as one report put it.

That is, the healthier they got, the closer they became through their own methods of bonding, the more they looked upon the psycho-sessions as an unnecessary irritation. Their decision to blank the mental-health team was not a result of stupidity, of their lack of a PhD in science - rather it sprung from a belief that they could cope better on their own, without videophone advice from on high. As a psychiatrist at Chile’s Catholic University put it, ‘If there is one group that is not exactly disposed to psychologists, it is miners’.

Indeed, the men instituted their own systems for coping: they had a leader, they set up a prayer room, they lunched together everyday, worked in shifts to clear rubble, and had a daily ‘showing your cards’ session at which they got things off their chests. That’s far healthier than sharing your problems with a faceless stranger who might ground you or deny you television privileges if you say the ‘wrong thing’. In working together rather than relying on external expert advice, the men reminded us of a truth often forgotten in today’s Oprahite age: mucking in, offering solidarity, is a far better guarantor of survival and happiness than being told how you should feel by aloof know-it-alls.

The way the men were treated was like a microcosm of today’s therapy industry. The censoring of letters spoke to the idea that people are psychologically fragile and easily harmed by other people’s words. The deprivation of certain ‘prizes’ if they didn’t speak to the mental-health team revealed the authoritarian dynamic behind today’s therapeutic interventions. The notion that they wouldn’t survive without external expertise highlighted the general view of all of us as needing guidance from the new gods of emotional correctness. That Fox News expert said the men are ‘just as subject to the laws of psychological gravity as you or I’. In truth, the men broke these so-called, actually non-existent laws of psychological gravity. And in doing so they have shown, implicitly at least, and contrary to every piety of the modern age, that we don’t need expert advice to survive and thrive.


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