Politics

John McCain (re: health care in the USA):

“For all the grandiose promises made in this campaign, has any candidate spoken honestly to the American people about the government’s role and failings about individual responsibilities? Has any candidate told the truth about the future of Medicare? Its costs are growing astronomically faster than its financing, and leaving its structural flaws unaddressed will hasten its bankruptcy. Has any candidate warned that we have a personal responsibility to take better care of ourselves and our children? Yet that is the only way to prevent many chronic diseases. Has any candidate insisted that genuine and effective health care reform requires accountability from everyone: drug companies, insurance companies, doctors, hospitals, the government and patients? Yet that is the truth upon which any so-called solution must be based.

“Democratic presidential candidates are not telling you these truths. They offer their usual default position: If the government would only pay for insurance everything would be fine. They promise universal coverage, whatever its cost, and the massive tax increases, mandates and government regulation that it imposes. I offer a genuinely conservative vision for health care reform, which preserves the most essential value of American lives — freedom.” – The Health Care Blog

Hillary Clinton (re: universal health coverage through force – a response to George Stephanopoulos‘ question):

When Mr. Stephanopoulos asked a third time whether she would garnish people’s wages, Mrs. Clinton responded, “George, we will have an enforcement mechanism, whether it’s that or it’s some other mechanism through the tax system or automatic enrollments.” – New York Times

I see two distinct philosophies when it comes to health care.  Republicans: personal responsibility.  Democrats: everyone else’s responsibility.  Of course, these core values are seldom stripped of their politically correct “cocoon language,” as it were…but when you break it down – that’s what we are looking at.  Perhaps I’m oversimplifying…

Or perhaps not.  The New England Journal of Medicine (thank you to the HealthPopuli Blog for pointing this out), did a political survey that is available to everyone for free.  One of the most striking results is that 94% of Democrats surveyed think it is a serious problem that some Americans are lacking health insurance.  Only 55% of Republicans feel this way.  45% of Republicans felt it was a person’s individual responsibility to ensure that they have health insurance.  Only 13% of Democrats felt this way.  Interestingly, 74% of Democrats are willing to pay higher taxes so that all Americans can have health insurance (vs. 46% of Republicans).  I’d be curious to see how many of those Democrats are currently paying for other people’s health insurance, out of their own pockets, out of the goodness of their hearts.  Wouldn’t it be so much more efficient, if you truly did believe you had a moral obligation to support the uninsured, to just find somebody without health insurance and subsidize them directly?
79% of Democrats favor an insurance mandate (the Hillary plan cited above).  This many sound like championing individual responsibility…but what it truly means is raising taxes and giving the bill to everyone else.  44% (surprisingly high) of Republicans favor this.

Finally, 65% of Democrats said they would support a candidate that proposed a plan to insure everyone even if it mean significantly increasing government spending.  A plurality (42%) of Republicans favored reducing health care spending.   Perhaps McCain and Clinton truly echo basic values of their parties.  Perhaps they have fantastic campaign researchers and are just pandering.  But it really is true, Republicans overwhelming favor people taking personal responsibility for their wellness.  Democrats overwhelmingly favor people placing this burden on others.  I’m not a Republican nor a Democrat, but I have to ask: what incentive do we have to be healthy if, at our very core, we’ve assimilated values that entitle us to our more productive citizenry’s charity?

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Are Free Markets a False Idol? Or is Regulation a Trojan Horse?

Peter Goodman of the New York Times writes an interesting retrospective of free markets entitled “The Free Market: A False Idol After All?”  The article’s basic conclusion is that unfettered free markets (unhampered by regulation)…systems merely based upon ideology, cannot stand without some basic rules of government.  And I don’t disagree.  In the short run, the market can be as fickle and irrational as Lindsay Lohan after a few Vicadin, some blow, and a rude text from her boy-toy of the week.  Just watch any blue-chip stock get slaughtered after missing some analyst’s quarterly earnings estimates by 2 cents.  But Adam Smith’s invisible hand, in the long run, will put resources where they can be invested most efficiently…creating the most value.  And I truly believe that.

The problem illuminated by Goodman’s article isn’t that we have government regulation…it’s that the same knee-jerkedness that renders a short term market stupid is what’s driving legislation through Congress.  Politicians are elected for a term of years, not decades, and in order to make a difference…an elected official must be able to pass a bill quickly, no matter how hastily researched or ill-conceived.  Republicans and Democrats alike are killing America’s competitiveness in an increasingly globalized world.

The latest disgrace is the Bush Administration’s efforts to freeze adjustable mortgage rates for families who cannot afford the contractual step-ups in rate that will soon torpedo many of them into foreclosure.   Bill Gross, who manages one of the largest bond funds in the world at PIMCO (Pacific Investment Management Company), is one of the most brilliant minds in the world when it comes to markets and capturing value…and even he is pro-bailing out the American Idiot.  Now, Gross, who is quite possibly the greatest bond trader alive today, may have some super-complicated, multiple-degrees-of-separation reason for why this will create value that none of us can see…but based upon the interviews he has given, and the articles he has written, it’s just plain ole bleeding heart self-defeating behaviour.

To bail out people who borrowed more than they can afford is to teach America that the government will always be there to bail them out.  There’s no way a society who doesn’t have to develop its own good judgement will ever compete in a global economy.

To quote the article: “Every regulation reduces people’s freedom,” said David R. Henderson, a libertarian economist at Stanford University’s Hoover Institution. “The more regulation we get, the worse we do.”

Enron and Worldcom cooked their books and stole from their employees.  The government’s knee-jerk reaction was Sarbanes-Oxley, which is so cumbersome and expense to comply with, that companies are leaving the U.S. rather than spend the billions required to comply.  Two bad apples (really bad apples, granted), sparked hastily drafted regulation that is making good companies so uncompetitive in a global market, that they are actually leaving the country for freer markets.  

There’s a fantastic, tongue-in-cheek article written by former bond trader and author of “Liar’s Poker,” Michael Lewis, where he jokes about how an overly paternalistic America has dared him and his wealthy, productive friends to up and move to Dubai.  His point is that pandering politicians can scapegoat successful people, because they are easy targets, and work to tax the hell out of them…b/c they must be doing something evil…making so much money in the first place.  How can these select few entrepreneurs and hedge fund managers earn so much money?  They must be unethical and worthy of our scorn.  As soon as someone makes $100mm, a mentality has been created that has trained people to try to pull them down.  Its driven by jealousy, guilt, and in the case of people like Hillary Clinton, pathological ego (and hypocrisy).  Michael Lewis ends his comedic piece daring the IRS to tax him more…he’ll always stay a step ahead.  And if not, its a mobile world.  There are plenty of places with low taxes who will encourage the forward-thinkers, the innovators, thecreaters of wealth and value.  Are free markets a false idol, or is the belief in the notion an expression of envy and a lack of foresight?

If these sentiments trickle into health care, we will be a third-world, possibly Arabic-speaking country withing a few generations..

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