Arnold Kling  

Socialized Medicine

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Paul Krugman and Robin Wells write,


If US politicians could be persuaded of the advantages of a public health insurance system, the next step would be to convince them of the virtues, in at least some cases, of honest-to-God socialized medicine, in which government employees provide the care as well as the money. Exhibit A for the advantages of government provision is the Veterans' Administration, which runs its own hospitals and clinics, and provides some of the best-quality health care in America at far lower cost than the private sector. How does the VA do it? It turns out that there are many advantages to having a single health care organization provide individuals with what amounts to lifetime care. For example, the VA has taken the lead in introducing electronic medical records, which it can do far more easily than a private hospital chain because its patients stay with it for decades. The VA also invests heavily and systematically in preventive care, because unlike private health care providers it can expect to realize financial benefits from measures that keep its clients out of the hospital.

In summary, then, the obvious way to make the US health care system more efficient is to make it more like the systems of other advanced countries, and more like the most efficient parts of our own system. That means a shift from private insurance to public insurance, and greater government involvement in the provision of health care—if not publicly run hospitals and clinics, at least a much larger government role in creating integrated record-keeping and quality control. Such a system would probably allow individuals to purchase additional medical care, as they can in Britain (although not in Canada). But the core of the system would be government insurance—"Medicare for all," as Ted Kennedy puts it.


In my forthcoming book, Crisis of Abundance, I agree with some of the Krugman-Wells diagnosis, but not with the prescription. (Note that Amazon has the wrong book cover pictured.)

Meanwhile, Tim Worstall has some comments on the Krugman-Wells article. Also, more on the general topic from Paul Howard.


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COMMENTS (21 to date)
Mcwop writes:

In concept I am not opposed to a single payer system, but to convince me I need details. For example, if I am not allowed to buy supplemental private insurance, then I will be opposed to such a scheme.

Meryn writes:

"the obvious way to make the US health care system more efficient is to make it more like the systems of other advanced countries, and more like the most efficient parts of our own system."

This could have been a lead-in to a 'free market prescription'. That's the most prevalent system in most 'advanced ountries', and I certainly feel those parts are the most efficient.

Is that what you meant?

Meryn writes:

"the obvious way to make the US health care system more efficient is to make it more like the systems of other advanced countries, and more like the most efficient parts of our own system."

This could have been a lead-in to a 'free market prescription'. That's the most prevalent system in most 'advanced ountries', and I certainly feel those parts are the most efficient.

Is that what you meant?

john writes:

I think the key is that you can't be barred from private insurance.

The fact is, socialized insurance countries pay much less and have longer life spans. The only argument I can find is that to explain this is they are free riding on our system, but even that arguement is getting weak.

So, the argument is whether socialised medicine is better than the "system" we have now, which is not a free market system, but some other contraption for which there is no easy label.

You really can't argue we need to go to free market becuase that is not politically possible. Let's stay in reality, not some libertarian fantasy land.

The one free market principle you may be able to cling to is the ability to contract for services outside the public sector.

T.R. Elliott writes:

Is this the Krugman that you lumped in with Sean Hannity?

Now, here's a brief response to your post yesterday. Yes, anger as theatre, and the spectacle, as we well know, has long attracted crowds. In the TV news environment, we've got FOX news on the cutting edge of fancy graphics and spouting pontificators, and it grabs an audience, in many cases an audience that wants to hear the message, but the approach attracts copy-cats at CNN, MSNBC, and then the broadcast networks.

This is just the free market in action.

Now why all the anger? And why does it sell? It's a long tradition. Who attracts the audience? The polite debating society or the screaming man on the soap box? It's basic human nature I suppose. It does make great theater.

But there is another aspect to this. One you seem to have ignored, both in that post and more generally in posts I've seen of yours in the past. There are some who seem to think that the flow of power relations is some sort of polite high school debating society. That's the feeling I get from some of your comments--which I think are sometimes self-serving and high-and-mighty, e.g. you are above all the riff raff. I remember an argument you made that one should always argue with the points made by an opponent, not what you think their motives are. This is nonsense. The analogy is that I never reason by using abstractions like the center of gravity. There is no center of gravity, but physics is much simpler by using it when "debating" the motion of bodies. And public discourse—or let's say private discourse in the board room—is often more efficient by cutting to the chase, but determining what somebody is really after. In fact, that's the way the human mind works. It's an abstracting machine.

I've worked with people who want to endless debate the fine points. They will pontificate and debate forever. And they never accomplish anything. Finally, they are pushed to the side. Perhaps they would do well in a high school debate team, but that is all. In the real world, they serve a role but more like accountants. Checking the numbers now and then. Summing them up. Human computers perhaps?

Now don't get me wrong. Logic must be checked. But then one must admit that in fact one cannot prove almost anything in the real world using logic. Not in the complex world of humans. Physics of a moving body under the influence of another body? Sure. But not the human world. Use your logic, but it's only going to play a partial role.

So one of the reasons why anger is popular, why people resort or respond to it, is that they would prefer to see the divisions between groups brought to the surface, instead of the polite debating society pretending to actually make progress when in fact they are crossing "t"s and dotting "i"s. Not intending to change.

Because let's face it. Is a book published by the Cato institute going to tell us something new? Is Cato or TCS really going to analyze the issues, or are they going massage the data to meet their ideological goals? I think it more the latter. Me, personally, I don't trust Cato nor TCS. I don't trust them to actually analyze issues. They might. But I've found so many errors and fallacious arguments that appeared correct on the surface, why trust them?

That Worstall article. Health care is expensive because we want it to be expensive? This argument is so far off in the weeds, it is so non response to the issues, it is nothing more then self-serving. It analyzes nothing. It takes a few basic concepts in economics and/or psychology and massages them to meet its ends. It's an ideological argument, based upon selective quoting. It's worthless.

That's why I think anger sells. Because most of the polite debates are totally meaningless, so let's just get it over with and see the people sling mud. Because that's all they're really doing anyway, but they try to pretty up the mod with their claims of civility and logical purity.

And sometimes, what is perceived as anger is actually passion. I think Krugman, who you lump in with Sean Hannity, has an honorable career and, in addition to not deserving of the association with Hannity, should be described for what he really is: passionate.

Perhaps that's the issue. You are not angry. Nor passionate. Just logical. But the logic based upon axioms and arguments that you've collected together and winnowed to meet your ideological predilections.

Rick Gaber writes:

In 2003 The Washington Times reported that many veterans wait up to six months for an appointment to see a doctor. So once again Paul Krugman relies on his traditional fallback position of inventing his own facts so he can arrogantly arrive at his favorite collectivist conclusions.

Rick Gaber writes:

T.R. Elliott:

That's why I think anger sells. Because most of the polite debates are totally meaningless ...

Your entire commentary there strikes me as lacking in substance, being itself angry and meaningless. Hey, I can call my anger "passion" too. Big deal.

john writes:

In 2003 The Washington Times reported that many veterans wait up to six months for an appointment to see a doctor. So once again Paul Krugman relies on his traditional fallback position of inventing his own facts so he can arrogantly arrive at his favorite collectivist conclusions.

But this waiting doesn't appear to be huring canadians, as they live longer than US citizens, on average, and pay much less for health care.

Or should I say, other benefits from the socialized health care system outweigh any negatives arising from waiting periods for certain proceedures.

Rick Gaber writes:
But this waiting doesn't appear to be huring canadians, as they live longer than US citizens, on average, and pay much less for health care.
doesn't appear

Right. If you rely on appearances and not actual facts, including the fact that tens of thousands of critically-ill Canadians rush to the U.S. for (much) faster service.

Uh, doesn't that itsy bitsy little fact kinda skew the results, hmmmm?

Ol' Paul can never seem to keep up with the news from Canada; a Quebec court ruled that their health care system violates basic human rights.

Nor with developments in France, where that system is heading for a crash (and what is good about it is largely due to its market-like incentives).

Nor with what the State Department warns its personnel to expect from Taiwan health care.

Ivan Kirigin writes:

How blazingly obvious do the failures of government administered health care in other countries have to be before people drop the idea?

It's just ridiculous.

Barkley Rosser writes:

I think the difference should be kept in mind between a single payer system, like Canada's and many other high income countries, and a full blown socialized medicine system as in the UK where the medical personnel are all employees of the state. The latter seems to suffer from all kinds of morale and supply problems that the former does not, despite the waits for non-fatal stuff that one encounters in Canada and some other places. It may well be that the VA does not look so bad because it is embedded in a broader mostly free market system with wages that reflect that system rather than what one sees in the UK and similar places.

PJens writes:

Is everyone aware that VA health care has varing eligiblity and subsequent means tests? I think it is a good system as a safety net. But most Vets I know get their health care at other providers. Insurance -government or private- never pays for everything. The sooner people realize that they must be responsible for their own health, the better.

Randy writes:

I think setting up some sort of basic government run system to replace the reliance on emergency rooms is a good idea. But nothing that would otherwise interfere with the current system.

Half Sigma writes:

We have a healthcare system that is mostly paid for by government (either by tax incentive or directly through Medicare), and the prices are set mostly by goverment (by Medicare again), and the people consuming the services don't actually pay directly so there are no free market incentives in system.

In other words, our system is so much like socialized healthcare that the actual differences aren't important.

Surely someone could design a better socialized healthcare system than the socialized system we currently have.

Dr. T writes:

Socialized medicine will be disastrous. Krugman and Wells praise VA medical care because they readily swallow the myths of great care promulgated by the Veterans Health Administration. I am a VA physician, and I will state unequivocally that VA health care is not better than the average healthcare in the private sector. It also is not cost effective care: the VHA is incredibly inefficient and wasteful. What the VHA does best is score well on quality indicators. Many schools teach to the test (to get good scores on standardized exams). The VHA focuses tremendous efforts on the indicators (often to the detriment of more important healthcare needs).

VA healthcare services and quality vary tremendously depending on where one lives. My VA has a nursing shortage combined with an existing staff of mediocre nurses. I would not want to be hospitalized there. Standardization of care does not exist among the VA hospitals. At my VA Medical Center, we only use five clinical pathways (standardized methods of handling particular conditions). We should be using dozens, as should all other VA hospitals.

I dread the thought of VA-style healthcare becoming the only healthcare in the U. S.

john writes:

How blazingly obvious do the failures of government administered health care in other countries have to be before people drop the idea?

You will not acknowledge the FACT the countries with socialized medicine provide better results for less money.

Until you do your arguements ring hollow.

asg writes:
You will not acknowledge the FACT the countries with socialized medicine provide better results for less money.

They really don't. Really. Seriously, have you ever read a book or even a long article that didn't have your view on this?

Robert Schwartz writes:

Why do we continue to listen to these people? Why on earth do they think that a government run health care system is going to work better than anything else the government runs? To me the real prospect of solving health care problems lies in getting government out of the 50% of the system that it runs , not raising that 50% to 100%.

Paul Zrimsek writes:

It's easy to have a jaundiced view of the value of debate if every single debate you have taken part in your entire life has included T.R. Elliott.

As for Krugman, he has now written hundreds of columns about the malevolence and incompetence of Institution A, and several suggesting that our health-care system would benefit from the superior efficiency of Institution B. If you didn't already know otherwise, you'd never guess that Institution A and Institution B are one and the same.

Tom West writes:

How blazingly obvious do the failures of government administered health care in other countries have to be before people drop the idea?

You will not acknowledge the FACT the countries with socialized medicine provide better results for less money.

Let's get real: measurement of a medical system is not one dimensional, and pretending there is one system that is optimal over all measures is ridiculous.

Here are some measures that people might use:

  • Best care for a specified and low budget. Socialized health care *without* private insurace provides that by allowing experts to ration health care.

  • Best care available for any price. Obviously the American system has developed effective, but expensive procedures to address the segment of the population that can afford such measures.

  • Universal coverage. Normally provided by a socialized (or at least national) health care system. Considered by many as non-negotiable in their definition of a "successful" health care system. This *can* be provided by either an American-style system, but the cost and tax environment makes it near prohibitive.

  • Introduction of medical technologies. American-style systems will introduce new costly medical technologies that eventually drop down in cost, allowing cost-rationed systems to use them.

  • Universality of quality of health care. Socialized health care systems will tend to produce *more* universal health care results (for identical illnesses). Of course, it's nonsense to think care will be exactly identical for the same illnesses, but it's the philosophy rather than the exact results that are more important here. Many people believe it is acceptable that quality of life should improve with increased wealth, but find do not accept that *amount* of life should depend upon one's wealth (i.e. there are some things money *shouldn't* be able to buy). This is a very common view among those in counties with socialized health care systems.

Personally, I am happy to be under the Canadian health care system, and even happier that the American system is close by. Since American levels of health care spending would be catastophic to Canada (America is much wealther), I suspect that we optimized properly for the vast majority of our population given our budget. (And yes, universality is a prerequisite for me). However, having the American system nearby does act as a second, fairly inaccessible tier. This allows the ultra-wealthy to obtain the health care they seek (reducing pressure to allow a second tier in Canada), and allows development of new technologies that can be used when they become affordable.

Free-riding? Nonsense. Simply extracting the maximum benefit from a nearby resource.

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