Who should pay for your compassion? » Forum Post by Draginol

I didn't say the state had monopoly power. I said the state has monopsony power.

My mistake. However, given the normal market forces, you would be correct. Given that the monopsony is a government institution, you are again wrong. Government tries to be "fair" and in so doing, creates a lot of silly rules that do not add to the product, just the cost. Under an ideal situation, prices should go down. But when you add the layers of bureaucracy into the mix, plus the reduction in customer service, prices go up (there is no incentive to keep them down after all - no profit motive), and service goes down (the producers get less - as the rules of a monopsony dictate).

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The point was, when you add in all the extra bureaucratic overhead involved in procurring the hammers/toilet seats, the average price for the items on the contract where way out of proportion.

My point on the cost. Thank you for saying it more clearly.

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The thing with the $300 hammer and the $500 toilet seats wasn't that the individual items cost that much

Nobody asssumed that it was.

The point is that funny anecdotes are not arguments and generally government isn't as inefficient as that.

The point was, when you add in all the extra bureaucratic overhead involved in procurring the hammers/toilet seats, the average price for the items on the contract where way out of proportion.

That's not a point but conjecture. Private enterprise also has administrative overhead. And thay include profits which have the same effect on the transaction as administrative overhead.

Under an ideal situation, prices should go down. But when you add the layers of bureaucracy into the mix, plus the reduction in customer service, prices go up (there is no incentive to keep them down after all - no profit motive), and service goes down (the producers get less - as the rules of a monopsony dictate).

And here's the actual point:

While the conjecture can be made that the administrative overhead will turn the effects of the law of supply and demand around, the actual facts suggest that the cobjecture is simply wrong.

Germany does NOT spend more for healthcare than the US (per person). In fact Germany spends less.

You can argue that healthcare in Germany is not as good as in the US (which is probably true in total but not true for the lower income half of the population), but that's a different argument than the inefficiency conjecture.

Fact is that public healthcare systems are cheaper.

Fact is also that the conjecture that the administrative overheard of such a system diminished and even turns around the price difference is simply not true.

A possible cobjecture is not an argument. You would have to show that 1) government does add a (relevant) overhead and 2) the overhead is greater than the overhead added by a private system and 3) the overhead is in fact greater than the overhead added by a privcate system including profits.

Mentioning anecdotes about toilet seats are simply not the way to go here and doesn't prove anything. I have heard anecdotes about resource waste in private companies that would similarly "demonstrate" that nothing should ever be in private hands.

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Given that the monopsony is a government institution, you are again wrong. Government tries to be "fair" and in so doing, creates a lot of silly rules that do not add to the product, just the cost.

You are wrong. Governments are not exempt from the law of supply and demand. All customers attempt to be fair towards the people they represent (in most cases each individual represents himself), create lots of silly rules (e.g. I will not buy anything that is pink), and never ever add to the product, just the cost.

None of these things are unique to governments and none of these things have any effect on reversing the law of supply and demand, or at least not a greater effect that any agent in the market with his behaviour. The agent's irrational behaviours are already included in and represented by the laws discovered.

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Well, right now, do you know how much my family pays for healthcare? Zero. So, having socialized medicine will help me how?

So, then I'm assuming that your employer covers your healthcare benefits? if so, congrats to you! If that is the case, a good sum of money is probably being paid on your families behalf by your employer, so a cost is still being incurred albeit transparently to you.

What about other companies out there that for a variety of reasons provide very little or spotty health coverage (or none at all) for their employees? How much would those families have to pay for healthcare? LW stated plainly that her husband had employer coverage but due to the usual maneuverings of HMO's and the former employer that the costs were essentially turned back to them although technically they should have been covered (LW please correct me if I'm wrong)

Does she use her US healthcare or Canadian? She uses the US because there are more Dr.s and more specialists.

That's nice. I know several folks who fell ill in the States and waited to go back to Canada so they wouldn't have to pay a 20,000 dollar bill! And I'm sure that of course your agent would chose U.S healthcare system over Canadian as with all things in life, if you've got money, life is good.

Yes, I've heard the horror stories of months-long waits for critical procedures. I've never seen it personally. In my personal experience, any truly serious ailment or condition that's come up between myself, family, friends and aquaintances has always been dealt with promptly.

That begs the question then what someone considers a serious ailment. A friend of mine blew his shoulder out at the gym (lifting too much weight trying to impress girls, go figure) they stabilized it, x-rays and the whole 9 yards to figure out the problem and recommended that he get arthroscopic surgery as well as another procedure.

Now we live in a geographically remote location whose hospital doesn't have the required specialists, so he's getting flown to the nearest major center for the operation. Wait time about 2 months, the only thing that he's "impaired" in any way is that he can't lift ridiculously large amounts of weight. The flight, accomodation, x-rays, and physio (which he is undergoing right now) is all covered under our healthcare. He doesn't pay a dime.

If the same situation were to happen to a fellow with no coverage (say he couldn't afford it, fell on hard times, yada yada) he'd essentially be screwed, have to live with a busted shoulder or shell out megabucks to get it taken care of.

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While the conjecture can be made that the administrative overhead will turn the effects of the law of supply and demand around, the actual facts suggest that the cobjecture is simply wrong.

Thanks for summing it up so well Leaki- it's refreshing to be able to agree on something once in a while!

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Thanks for summing it up so well Leauki- it's refreshing to be able to agree on something once in a while!

Likewise.

I am not an automatic anti-Artysim machine.

Most of my opinions are based on having been there while it happened. I lived in both a country with a complete public healthcare system (Germany) and a country with a mixed system (Ireland). I prefer the mixed system but that is because I can afford it.

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Governments are not exempt from the law of supply and demand.

No, Monopolies and Monopsonies are. The reason you cannot cite costs is for the same reason Artysim cannot. it is hidden.

There is a saying in government - throw more people at the problem. The reason being - the cost is invisible. The people are going to be paid regardless, so whether they do something productive, or stupid, does not matter - the money has already been spent (have you heard of governmnet layoffs?).

There is no way when your social budgets dwarf the US that you can convince me it will be cheaper. Not that you are not trying, but simply because it is not possible. (to prove).

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Quoting Artysim,

comment 33

That's nice. I know several folks who fell ill in the States and waited to go back to Canada so they wouldn't have to pay a 20,000 dollar bill!

The above is a muddy point since an American in Canada may have to do the same since we arent covered by your system.Basicly the American or the Canadian visitor has to purchase special travel insurance.

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Draginol

Join Date 03/2001

+137

I am not sure why people are so excited about the idea of making healthcare "cheaper".

I'm not interested in healthcare being cheaper. I want it to be of the highest quality that I can afford.

I'm not interested in having to pay for other people's health care through my tax dollars. Look at public schools. I don't want that sort of thing being done with my health care.

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No, Monopolies and Monopsonies are. The reason you cannot cite costs is for the same reason Artysim cannot. it is hidden.

Monopolies and monoposonies are not exempt from the laws of supply and demand. They just represent spikes.

The reason YOU cannot cite costs is because you think an anecdote about toilet seats is an argument. It isn't. It doesn't even occur to you that IF you are right about the invisibility of costs in a public healthcare system, neither of us will be able to tell what that cost is. But nevertheless you think that after demonstrating (if you were right, which I doubt) that the cost is invisible, you have somehow shown that it is high. But that's not true.

If you are right about the invisibility, then neither of us can tell how much it is.

But _I_ can tell, from living in a country that has a public healthcare system, that the cost is not as high as you think it is and certainly not as high as the profits that a private healthcare system produces.

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I am not sure why people are so excited about the idea of making healthcare "cheaper".

I'm not sure either, but I don't think anyone has argued that cheaper is better. I am merely stating that a public healthcare system is cheaper, not that it is better because it is cheaper.

I'm not interested in healthcare being cheaper. I want it to be of the highest quality that I can afford.

Everyone wants that. But not all people can afford the best. A private healthcare system is no doubt better for those with a good income. I for example profited immensely from more expensive and better dentistry than I could get in Germany. My dentist now costs me ten times more than my dentist in Germany, but he teaches at Trinity College and actually FIXED everything, which the German dentist failed to do.

For me that was excellent.

For someone who just cannot afford my current dentist, it's useless. That someone would have to rely on a dentist paid for by the public healthcare system who is as good as the share of money the public healthcare system can get from the entire amount spent on healthcare.

Question is, should I have a dentist at level 10 when others have a dentist at level 5 or should everyone have a dentist at level 7?

I am for my level 10 dentist. And I pay for that privilege. Others are free to make as much money.

But that doesn't mean that I have to defend my choice by making up stories about the inefficiency of government (which I have seen isn't true) or the costs of a public healthcare system (which I know is less than the costs of a private healthcare system).

If a private healthcare system is better, it should be possible to make that point based on its actual attributes rather than to rely on transparent lies about the alternative.

I'm not interested in having to pay for other people's health care through my tax dollars. Look at public schools. I don't want that sort of thing being done with my health care.

I am a product of the German state school system. I don't consider myself that stupid.

But I did attend a private college for two years and the fact that it cost me money actually made me work harder and get the diploma; something I failed to on a state university where the entire infrastructure was built to support long-term students who still don't have a job when they are 31.

I certainly don't want to see what would happen if those state schools were to be replaced by (you would call them) private schools that not everyone can afford. Boy would that help if the children of Germany's unemployed were no longer under state control during at least their time at school! Their parents would have such an excellent influence on them and I am sure they will pick (and pay for) the right school.... not!

My experience tells me that state schools are the way to go before the college level. But a college education should cost money (prospective students can surely work a year or two to pay for it; I did). I found that I work harder and get better results when I pay for it myself.

(To avoid confusion in later replies where I might not pay attention I should add that in British English a "state school" is a school run and paid for by the state while a "public school" is a privately owned school open to everyone who is willing and able to pay the fee. Thus in British English a "public school" (BE) is what Americans would call a "private school" (AE). The word "public" is here used as in "public company" or "public house". A "public school accent" is an Upper-Class British accent.)

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Leauki, hammers and toilet seats are anecdotal - you're right. Those anecdotes go to demonstrate the point that government (and the U.S. Government, in particular) is an inefficient, bloated, wasteful entity. Nothing that is done is done efficiently. When some of the largest (and highest profile) Army contracts are to streamline business process and then, utilizing the same methodology as business are still only half as efficient as the private sector (again - using the EXACT SAME methodology), there's a problem.

I work as a federal government contractor. I work in a federal facility, side by side with civil servants. I see all kinds of waste and inefficiencies going on around me, every day. When a simple request has to go through the hands of 10 different people before it gets from my desk to the guy 3 desks down ... that's a little wasteful. When it takes 3 weeks to process the paperwork (and 5 different people have to look at it) to EVALUATE the need to EVALUATE a leaky roof, there's a problem.

In theory, a government should be more efficient than multiple business entities performing the same task - just because it's one entity rather than multiple. In the US - it ain't happening. Too many little fiefdoms (at all levels) that have to be protected to be anything close to being efficient.

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I work as a federal government contractor. I work in a federal facility, side by side with civil servants. I see all kinds of waste and inefficiencies going on around me, every day.

I work as a private company contractor.

I have worked for universities and hospitals (state-owned) in Germany and private companies in Germany and Ireland. (I was also sometimes an employee.)

I have seen waste and inefficiency mostly in private companies, to very ridiculous extends that dawrf all the stories I have heard about government incompetence.

When a simple request has to go through the hands of 10 different people before it gets from my desk to the guy 3 desks down ... that's a little wasteful. When it takes 3 weeks to process the paperwork (and 5 different people have to look at it) to EVALUATE the need to EVALUATE a leaky roof, there's a problem.

Yes. However these things happen in private companies too.

(Perhaps you should read the Daily WTF to get an idea.)

The reason you see it in government is because there is fewer of them and they are more transparent than companies. Companies are both better and worse than governments, simply because there are more of them. Some are bound to be more efficient than government and that's the ones we compare government with. (Which is a good idea since we would want government to be more like them.) But some are bound to be worse than government and we never compare government with those (and for good reason too).

Arguing against public healthcare based on the argument that government is less efficient than the better companies is as fallacious as argainst against private healthcare based on the argument that government is more efficient than the worse companies. Statistically, private companies are both better and worse than government when it comes to efficiency. (You get the same result when you compare one apple to many apples. The one apple will be worse than the best apple and better than the worst apple. It's unlikely that the single apple will be one of the extremes.)

There is nothing inherent in government that makes it more or less efficient than private companies.

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here is nothing inherent in government that makes it more or less efficient than private companies.

In the world that may be true, but in the US Gov, every policy has to withstand constitutional muster. That may not sound like a big deal, but our laws have gotten so convoluted at certain levels, that the reason 5 people have to look at one thing is because each has their very own specialty. Which means at some point, somewhere, the easy way of doing it was challenged and found to be problematic when filtered through everyone's rights.

In a private business, the bottom dollar is the motivating force. Makes things much simpler.

Imagine running the same business but with all the laws and criteria governing spending the public's money. Every time you write a check ten people have to look at it to make sure the payment isn't violating some obscure rule, and then half of them have to make sure the record keeping is meticulous because its not their private money to be spending and they better account for every cent.

All it takes is for some specialty group to sue the gov, and even if the don't win in court, policies regarding paperwork change just to avoid the same issue later.

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In the world that may be true, but in the US Gov, every policy has to withstand constitutional muster. That may not sound like a big deal, but our laws have gotten so convoluted at certain levels, that the reason 5 people have to look at one thing is because each has their very own specialty. Which means at some point, somewhere, the easy way of doing it was challenged and found to be problematic when filtered through everyone's rights.

Other governments have the same problem. Particularly Germany is famous for its bureaucracy and I can tell you from my own experiences that Ireland and Israel can be even worse.

In a private business, the bottom dollar is the motivating force. Makes things much simpler.

In my experience the quest to save a penny causes many companies to have even more ridiculous rules than government agencies, which at least try to confirm to certain guidelines (no matter the cost).

I have seen companies risk their entire future (and lose it) because the procedure to buy a _network cable_ was so complicated that few systems administrators wanted to risk having to write a business case for replacing an old cable.

And while such companies generally don't survive in the market, I fear that healthcare is not really a market in which the death of a company is an acceptable casualty. I want to _know_ that my insurance company will still exist when I need it, even if run by idiots; but the knowledge that my insurance company, if run by idiots, WILL not survive because of the market weeds out the weak is not as comforting. (Government run by idiots does survive.*)

Imagine running the same business but with all the laws and criteria governing spending the public's money. Every time you write a check ten people have to look at it to make sure the payment isn't violating some obscure rule, and then half of them have to make sure the record keeping is meticulous because its not their private money to be spending and they better account for every cent.

That's pretty much how IT equipment was bought in the last company that employed me (I am a contractor now and have been for years).

The only exception is that the record keeping was not meticulous because replacing the non-working backup system (consisting of broken tape drives and scripts that were meant to backup servers that didn't exist any more) created costs subject to writing a check.

All it takes is for some specialty group to sue the gov, and even if the don't win in court, policies regarding paperwork change just to avoid the same issue later.

Specialty groups also can and do sue private companies.

*After World War 2 all those German citizens who had pensions saved up in private banks lost their money (when private companies were reorganised), but those who had their pensions with the government received their actual pension (including Lithuanian Nazis who worked for the German government for two years). Turns out private companies WILL use a way out of responsibilities, while a government run by the greatest idiot in the world is still a reliable trade partner.

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Those anecdotes go to demonstrate the point that government (and the U.S. Government, in particular) is an inefficient, bloated, wasteful entity. Nothing that is done is done efficiently. When some of the largest (and highest profile) Army contracts are to streamline business process and then, utilizing the same methodology as business are still only half as efficient as the private sector

This brings up a very interesting topic that hasn't received too terribly much attention in the last few years- that being, the fact that massive amounts of public money (your tax dollars) going to private hands (lucrative government contracts) due to the fact that the government is essentially at war with itself.

What does this mean? The current popular line of thought is that since all governments are wasteful and inneficient, they must streamline their operations by outsourcing as much as possible to the private sector. In some cases, this makes things more efficient and in many cases it ends up enriching the contractor while INCREASING the waste and inneficiency. Although the same work is now being done by a private contractor, it ends up falling back on the government's lap and making them look even more wasteful and inneficient.

In essence, this creates a self fulfilling prophecy and a vicious cycle that is self-perpetuating.

As an example, let's look at hurricane Katrina-

Technically, FEMA and the various government's involved were responsible for reconstruction and damage control- but, since they're big bad government agencies who are incompetent, the argument of the day was "contract out to the private sector!" This meant you had government agencies handing out contracts to companies that subcontracted to someone who sub-sub contracted and so forth. It worked out that at the end of the day the government was paying something like a hundred dollars per so many square feet of tarps to be laid over roofs- and that's purely labor costs as the government already owned the tarps and was contracting out for labor alone.

This example has been replicated over, and over and over again.

Current ideology states that government is wasteful and inneficient, so they should let the free market take over. So, government contracts out a necessary job to private company (at a profit for the company of course) company, wanting to maximize profits then sub-contracts to someone who'll actually do the work and employ real bodies to do things, for the least amount of money. So the primary contractor is essentially just taking a big chunk of money, taking their cut, then passing on a much smaller amount to the people actually doing the work. For maximum effect the money can pass through several companies before any actual work is being done.

This then leads to the government outsourcing a function to the private sector and paying 500 dollars in labor costs so that a toilet seat (which the government already owns) is installed by a guy making 7 bucks an hour. This makes government look terribly inneficient (Which it is when this happens) which then causes calls for FURTHER outsourcing and further contracting out, which will then make the government look even more innefficient!

The end result is

A) Poor quality of work as it's often being performed by the guy at the bottom of the pyramid, making peanuts

Big profits for private companies that were initially awarded the actual contract from the government

C) Massive amount of public money going into private hands

The only exception to this rule is A) as in the high-tech fields that are outsourced properly qualified and trained folks refuse to work for peanuts!

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Name me a single government entity that is a pleasure to deal with, one that's staffed with pleasant, well trained, and efficient employees and I'll kiss your hairy ass on main street.

The National Parks and Forestry Service.

I'm kidding.

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Anyone that has dealt with the US military health care system, would IMO have had a glimpse into what national health care would be like. Are there good military doctors, sure along with the hacks. The most prescribed pharmaceutical? Motrin along with a 24 bed rest chit (ask anyone that's been there, it's a running joke). All three of my children were farmed out to the civil sector when they were born (not complaining, glad it happened). I remember feeling sorry for the retirees camped out in the waiting rooms, probably waiting patiently hours, just to get their Motrin. Ha that's me now, except I get Naproxen (Aleve is the commercial name).

Leauki, many thinks I do agree with you on, but you'll never convince me the gov. can do it better, not here in the US anyway (seen it happen too often, too long), I'll trust your experience in Ger., Ire., and Israel.

This then leads to the government outsourcing a function to the private sector and paying 500 dollars in labor costs so that a toilet seat (which the government already owns) is installed by a guy making 7 bucks an hour. This makes government look terribly inneficient (Which it is when this happens) which then causes calls for FURTHER outsourcing and further contracting out, which will then make the government look even more innefficient!

Wow! Artysim I find that I agree with you on this! See, liberals and conservatives can co-exist!

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Monopolies and monoposonies are not exempt from the laws of supply and demand. They just represent spikes.

No, they do not. And it is not a conspiracy, but the fact that the law cannot work when competition does not exist.

The reason YOU cannot cite costs is because you think an anecdote about toilet seats is an argument. It isn't.

I cited no anecdotes. I only cited established teachings of the laws of Supply and Demand, and known facts about the operation of government. You are free to challenge either, but I dont think you will find empirical data to support it.

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Leauki, many thinks I do agree with you on, but you'll never convince me the gov. can do it better, not here in the US anyway

I agree. While I'm not against the idea of every American having health care, (I think as much money as we give away and things we do for other countries the very first thing we should be doing is making sure our citizens are healthy and strong and well educated, but that's me) I don't think our government as it stands today can handle the job.

I think that ship has sailed and it would take massive governmental restructuring and some constitutional alterations before it'd be close to feasible. And while the health care issue is important, I don't see it starting a revolution.

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*After World War 2 all those German citizens who had pensions saved up in private banks lost their money (when private companies were reorganised), but those who had their pensions with the government received their actual pension (including Lithuanian Nazis who worked for the German government for two years). Turns out private companies WILL use a way out of responsibilities, while a government run by the greatest idiot in the world is still a reliable trade partner.

I didn't know any of this, thanks for the info.

Let me ask, if you know. Was the German Gov the same after the war as before? The same style? Because I am wondering if the gov changed from one style (say dictatorship) to another (say socialism or whatever) if the new gov would honor the old one's debts.

I'm thinking if America is ever conquered by another country, or if there is a revolution and a whole new style of government emerges, I don't believe gov pensions would be honored. That's why I'm curious about Germany, tho I understand they weren't "conquered" in the traditional sense.

I am learning a lot from this thread, lots of different perspectives. Interesting.

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and remember, Leauki, what works in a country the size of Ireland or Germany is not always feasible here

Germany has a population of 82 million. It's not in a different league. It's 1/3 the size of the US. I believe there is a scalability issue between Ireland (6 million) and Germany (more than ten times bigger), but I don't believe that the problem kicks in above 82 million and at a factor of 3.

The Federal Republic of Germany is organised pretty much like the US. Even the average population of the states is the same. The difference is that Germany has 16 states while the US has 50 (three times as many).

The European Union government is one level above that and seems to be completely useless.

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I only cited established teachings of the laws of Supply and Demand, and known facts about the operation of government.

Your "known facts" were anecdotes.

And it was I who cited established teachings of the laws of supply and demand.

You are free to challenge either, but I dont think you will find empirical data to support it.

Neither of us has cited empirical data so that point is kinda mood.

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Let me ask, if you know. Was the German Gov the same after the war as before? The same style? Because I am wondering if the gov changed from one style (say dictatorship) to another (say socialism or whatever) if the new gov would honor the old one's debts.

Governments usually honour old debts. (That's why the issue of Iraq'd debts come up all the time. For example Iraq still owes Germany money for the poison gas used to exterminate Kurds.)

After the revolution the American government made deals with colonial/state governments regarding debted owed to British subjects.

In Germany's case the official line is that Germany's army surrendered unconditionally, but the state did not (and never will). Furthermore, the Nazi government is regarded as illegal. The state governments are legal continuations of the existing state governments (which Hitler abolished, also illegally). And the Federal Republic is both a new federation of those states (and derives its legitimaticy and souvereignty from the states) and the legal heir of both the state of Prussia (which was split up into its provinces) and the German Reich (as of before Hitler's illegal government).

Thus legal heads of state in Germany were the Kaiser, the series of Presidents during the Weimar Republic until abolition of the office, and then the first President of the new Federal Republic.

All debts of the Weimar government and the Imperial government are honoured and all property and titles owned by those states are now owned by the Federal Republic.

Legally there was no revolution after World War II. The revolution of the Nazis was merely rolled back and a new constitution written. But the continuity remains.

I'm thinking if America is ever conquered by another country, or if there is a revolution and a whole new style of government emerges, I don't believe gov pensions would be honored. That's why I'm curious about Germany, tho I understand they weren't "conquered" in the traditional sense.

Germany was conquered by the Americans and British who didn't intend to annex land and merely re-instated the state governments the Nazis abolished. Those states then decided to form a new union. The individual states, apart from the ones that were Prussian provinces released into independence when Prussia was broken up in 1946, have their own continuities, interrupted by Hitler and Napoleon and others occasionally, going back over a thousand years in some cases.

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