President Obama's fatal conceit: Insurance is too complicated to buy

Admitting that insurance is complicated to buy after passing legislation that will control it is not only funny, 
 it is fatally conceited. Photo: Friedrich Hayen (historical) / President Obama (2006 / Associated Press)

WASHINGTON, November 17, 2013 – President Obama said in that even with a functioning website, buying insurance is a difficult task.

“But even if we get the hardware and software working exactly the way it’s supposed to with relatively minor glitches, what we’re also discovering is that insurance is complicated to buy.”  (November 14, 2013)


SEE RELATED: HealthSherpa.com: Does what Obamacare can’t - provides rate information


Putting this quote in context, the President admitted the federal government does not do a very good job procuring information technology. Buying computers is an extremely challenging task for the federal government; using this hardware to set up a website doubly so.

What makes him think that arranging for 300 million people to procure insurance wouldn’t be that much more difficult?  Or even possible?

Nobel Prize winning economist Friedrich Hayek used the phrase “fatal conceit” to describe attempts of this magnitude. Hayek’s assertion was that governments would never have enough information to successfully and reliably make decisions for an entire nation. 

In contrast, individuals will have an advantage in making decisions for themselves because they each possess beneficial and unique information that is specific to only them.


SEE RELATED: Barack Obama’s cookie jar presidency


Multiplying that beneficial and unique information times 300 million means that no small group, no matter how smart or educated, will be able to come close to possessing, let along processing, the information needed to yield the best results for each individual or society as a whole as a result.

One of the things integral to having the audacity to consider this task possible is to be able to ignore other similar efforts. 

In 2012 the U.S. Post Office had a deficit of nearly $16 billion, losing a little over $43 million per day. It has a monopoly: no company or individual is allowed to deliver mail to residences. Picking up pieces of paper, in locations that are fixed and in boxes that are built specifically to USPS specifications, and then putting them in other boxes is certainly not as complicated as healthcare.

Over the last decade Amtrak has lost $83 million per year on food service, close to a billion dollars. On average, Amtrak trains sell hamburgers at $9.50. But the cost of those hamburgers is more than $16. Taxpayers kick in $5.50 on every hamburger Amtrak sells.  It has a monopoly: no company or individual is allowed to sell hamburgers on Amtrak trains. Cooking meat and warming buns for passengers who have no other option is certainly not as complicated as healthcare.


SEE RELATED: Obama breaks new constitutional ground, oath of office, in insurance letter


President Obama admitting that insurance is complicated to buy is funny, after working with Congress to pass legislation that will control it and then having three and a half years to implement it.  

Still attempting to do it is fatally conceited.


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