Are the dire warnings of the wreck of the health care industry just so much hot air?

VFR’s leftist Canadian reader Ken Hechtman writes:

Now that the bill has passed, let me ask you something:

Do you ever hold onto these apocalyptic predictions people send you (“By its built-in logic, Obamacare will cause the health care industry to go bankrupt within months”), take them out after the due date and compare them to what you see outside your window?

I’m going to guess this one began its life as a fundraising letter. It has that pushbutton feel to it—“Be angry and afraid. Something you value and have always counted on will be lost forever (unless you act RIGHT NOW!)”

LA replies:

No, but I recommend that we both keep Kristor’s and the doctor’s analyses/prognoses in mind, and revisit them in the future. However, it’s not clear when the relevant provisions of the bill become active; it may not be until 2014.

Also, it doesn’t strike me as a fundraising letter—its analysis is too detailed.

A reader writes (March 23):

What sorts of predictions would Ken Hechtman like you to save? Predictions that Social Security would lead to massive government debt? Predictions that Medicare and Medicaid would lead to rising medical costs? Predictions that racial integration of the public schools would destroy them? Predictions that proliferation of the Negro would lead entire cities—such as Detroit and New Orleans—to snap off of American civilization like dead branches off a tree? Predictions that Bolshevism would ruin Russia? Predictions that the end of apartheid would ruin South Africa? I should imagine there were a few of each of those.

The reader continues:

Predictions that illegal immigration across the Mexican border would bankrupt California? Predictions that the 1965 Immigration Act would change America’s racial composition? Predictions that union pension plans would destroy the American auto industry?

Mabye your correspondents and you can think of a few others.

Kristor writes:

Ken has a good point at the end about people muddling through—although I guess it would also depend how we define “complete collapse.” People muddled through the Fall of Rome and the Fall of Constantinople, but that did not at all mean those collapses were not real and disastrous. Still, people, and I would say, Americans in particular, are incredibly resourceful, and good at muddling through. We made it through the Ice Ages, we can make it through this. [LA replies: People always dismiss warnings of mortal dangers to a society with this: “Life goes on, therefore your warnings are false.” And the answer is: Yes, life goes on—in a ruined country.]

I made much the same point in a message to you (never posted, so far as I know) that followed up on my message explaining how Obamacare would destroy health insurance. I said there that exploding the current system might be a good thing, in a perverse sort of way. If Congress were in the hands of conservative Republicans when Obamacare finally kicks in—as seems not unlikely—and causes the collapse of the private market for health insurance, so that almost all Americans suddenly find themselves uninsured, then it is just possible that such a Congress could resist the siren song of extending Medicare to the whole population. If they did thus resist, Americans and their doctors would instantly be in the novel and refreshing situation of dealing with each other directly about the price of care, with no mediation from insurers. The private market for healthcare would be reborn almost overnight, and the pricing system would begin to achieve economies that have been prevented ever since Medicare opened up for business. This is the kind of thing that can happen when people are allowed to muddle through, instead of being saved by yet another deus ex machina government intervention from having to do so.

Even better, such an event would open a “policy window.” In the normal course of things, revolutionary changes are prevented by the inertia of existing facts. Most of what Congress does is tinker at the margins with programs that were themselves initiated by prior Congresses as minor tweaks of the then current situation. In the final analysis, Obamacare is just a particularly vicious round of tinkering with an existing situation. When Obamacare turns out to be the piano that breaks the back of the camel, we’ll have an opportunity to start over from the ground up. No doubt we’ll opt for the voucher plan I advocated. ; )

Posted by Lawrence Auster at March 23, 2010 01:51 PM | Send