HAWAII, June 28, 2012 – Like Glenn Frey’s song that warns “someone’s gonna cry when they know they’ve lost you, someone’s gonna thank the stars above” today’s SCOTUS ruling on Obamacare has everyone who profits based on the inflation-fed FIRE economy thanking the stars above at the expense of the rest of America.
But make no mistake: basic economics reveals to us that whenever government creates a mandate that all persons must subscribe to a service, that service becomes infinitely expensive and of lower quality.
The reason why public and private K-12 education is so expensive is because the government mandated compulsory schooling. On the private side, compliance costs and high demand for quality education causes tuition to be massive.
On the public side, just look at your state’s Department of Education budget and how they run education will speak for itself.
As Rose Wilder Lane famously warned, “A ‘planned economy’ destroys Government because when men use force in an attempt to control productive energies, they have no means of knowing real costs, and these costs automatically increase at an increasing rate until the people can no longer pay them.”
Healthcare is going down the same path as education. Already plagued by inflation, the addition of compulsory subscription to healthcare insurance almost certainly assures that the cost of healthcare will continue to increase, not decrease, even as people’s standard of living and incomes fall.
The only way for healthcare to become more accessible, more affordable and capable of providing the quality people seek is to allow consumer choice in the market. The existence of HMOs and public plans buffers the actual cost of healthcare so that the market does not know and can only speculate the appropriate cost of service. In a free market, people pay to see the doctor when they get sick, not when they’re not sick.
Over the last eight years, my personal healthcare insurance has gone from $70 a month to close to $200 per month. In total, I’ve probably seen my doctor not more than 4 times in eight years. Now perhaps insurance companies think that’s funny and chuckle over the fact that Obamacare has given them unlimited license, but for the record let it be known that the market cannot sustain this.
Both conservatives and liberals alike should be extremely disappointed with Obamacare. This is not about healthcare, this is about government-established monopoly and it is a major blow to personal finances and freedom.
What concerns me most is in spite of all the Obamacare rhetoric, I suspect that the SCOTUS ruling privately gives both the Democrats and Republicans in Congress a behind-the-scenes sigh of relief. Congressional Republicans now have the political banner to wave in the air to arouse agitated voters at the polls and Democrats have the blessing they have desired over public mandates. But here’s the question I have to ask the voters: do you really trust politicians of either legislative party to actually reform healthcare (or repeal Obamacare)?
If anything, career incumbents will denounce publicly the upholding of Obamacare but see this as an opportunity to move on to the next cartelization of the market. Like J.R.R. Tolkien’s Isildur in The Lord of the Rings trilogy who won a mighty battle against evil but when told to cast the One Ring into the fire said “No!” so one can expect whoever wins in 2012 to give lip service to reform but refuse to destroy that which gives them power.
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