Thursday, December 26, 2013

John Cochrane on after Obamacare craters

Probably the closest to truth that I've seen on healthcare it'll be tough but worth it.  Read the whole thing, but the key grafs:

No other country has a free health market, you may object. The rest of the world is closer to single payer, and spends less. 

Sure. We can have a single government-run airline too. We can ban FedEx and UPS, and have a single-payer post office. We can have government-run telephones and TV. Thirty years ago every other country had all of these, and worthies said that markets couldn't work for travel, package delivery, the "natural monopoly" of telephones and TV. Until we tried it. That the rest of the world spends less just shows how dysfunctional our current system is, not how a free market would work. 

While economically straightforward, liberalization is always politically hard. Innovation and cost reduction require new businesses to displace familiar, well-connected incumbents. Protected businesses spawn "good jobs" for protected workers, dues for their unions, easy lives for their managers, political support for their regulators and politicians, and cushy jobs for health-policy wonks. Protection from competition allows private insurance to cross-subsidize Medicare, Medicaid, and emergency rooms. 

But it can happen. The first step is, the American public must understand that there is an alternative. Stand up and demand it. 

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