Arnold Kling  

Fogel on the Two-Tier Health Care System

The Great Factor-Price Equaliz... Tom Saving on the Social Secur...

Robert Fogel writes,

Health care isn't a homogeneous good, all of which is essential. There are large luxury components that may appeal to some but that aren't necessary for sound basic care. It is, of course, necessary to provide medical care for those who are too poor to purchase it, but for those with more resources, shifting to private savings accounts for health services is an effective way to relieve pressure on the finances of both businesses and government.

I made a similar point in my National Review piece. Note that most of Fogel's article concerns forecasting increases in lifespans. Pointer from Tyler Cowen.

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COMMENTS (5 to date)
Joe Cushing writes:

Up to this point in time, medicine has done nothing to extend lifespan beyond what is natural. Every increase in average life span has been by reducing the number of people who die before old age kills them. For example, we can bypass arteries that will choke off a heart 30 years before its cells' DNA have worn out. So the person gets to live those 30 years but eventually, aging will get them. We have done nothing to stop the aging of DNA within our cells. Untill we do, medicine is limited in its ability to extend life by our natural aging process.

All that said, there is promising research in the antiaging field. It might be possible to shut the aging process down. Aging doesn't even begin untill age 12. So the mechanism for not aging already exists within us in childhood.

The point is, once we conquer aging, all bets are off on social security because life expectancy will jump to at least a 3 didget number--maybe 4, maybe more.

Steve Sailer writes:

19th Century department store mogul John Wannamaker used to say that he wasted half of all the money he spent on advertising, but he just didn't know which half.

Same goes for health care.

Lauren writes:

Hi, Steve (Sailer).

A different 19th century store mogul, one in my family, used to remark that he wasted half his time bargaining one-on-one with people. He said it saved his half his time to advertise his prices outright--rather than spend more time to bargain.

There were a lot of changes going on in the 19th century. One of the major changes was a switch from on-the-spot bargaining to advertising listed prices.

I suggest you look at this recent item by _Wired_ Magazine that happens to talk about the history of moving away from bargaining into definitive prices in the 19th century:

It might have been six of one and half a dozen of another for established businesses in the latter half of the 19th century. But, advertising versus on-the-spot bargaining might have afforded a net benefit for consumers that afforded incentives for businesses. It might also have afforded a benefit for employees of those businesses, and also for the entrepreneurs who owned those businesses and emporiums--would they see more clientele coming in.

When it comes to health care, let's just tell people the price.


fred-m writes:

The two elephants in the room are high jury awards for malpractice and elderly, many of whom are indigent, lying intubated in intensive care units because the children cannot let go.

Since we won't deal with those nothing we do will make much difference.

Tracy W writes:

Joe Cushing - that's a surprising claim, can you provide any sources for it?
My own understanding from demographers is that we have seen an increase in life expectancies beyond what was previously thought of as the natural limit - see and!OpenDocument

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