Smokescreen

“Markets” are a creation of government?

Of all the silly things I’ve read on this blog this one ranks near the top. Markets existed for thousands of years before governments did, and would continue to exist if every government on the planet somehow evaporated over night. People trade things–they always have, and they always will. As long as humanity exists there will be markets whether there are governments to regulate them or not. Government efforts to regulate, harness, or control this activity doesn’t mean that government created it, any more than the presence of a dam on the river means that the government created the river.

And government does not always “decide the rules by which business will be conducted.” If they did, there would be no such thing as black markets.

Mr. Turner, it’s clear that you really do not know what markets are. But it’s good to see you opine on them so openly. That information will help to put into proper context anything else you may feel moved to write about the subject.

I have to disagree with you, Jim, on your example of the black market. It could very easily be argued that black markets are the only markets that are truly created by government. If government didn’t ban items or impose excessive taxes on items there would be no such thing as a black market.

Steve,
I will again call you back to Adam’s post in which he declared not once, but twice that the problems of the health care industry are a result of “market failure.” I challenged him several times to justify HIS CLAIM that the health care industry operates under a free market. He failed to do so, as do you. Besides, Adam claims the health care industry operates in a free market, and you claim free markets don’t exist – so which is it?

At any rate, when you want to detemine the causes of rapidly escalating health insurance premiums and health care costs, I am still waiting for an explanation of how Adam can place blame on “market failure” when the actual mechanisms of a market are virtually nonexistant in our health care system.

To quote from the link you provided about free markets:
“A free market economy is an economy in which the allocation for resources is determined only by their supply and the demand for them.” (we can also substitute ‘prices’ for ‘allocation of resources’)

What part of supply or demand in our health care industry is not heavily subsidized or regulated already by government?

Your claim that “So-called market fundamentalists like Brian are really corporate fundamentalists, since they favor rules that advantage corporations” is patently absurd. We actually favor rules that don’t advantage anyone, innovation fostered by competition determines who gets an “advantage,” and in the end the consumers win. For example, look at a medical procedure such as laser eye surgery – which is relatively free of government intervention, and subject much more to market forces. The result has been remarkable advances in technology with a concurring reduction in prices. That is what a free market does.

First off, thanks for further proving my point by listing more free-market success stories. Each of those procedures are now more technologically advanced and provided at lower prices thanks to market forces responding to demand – not government intervention.

On the topic of vaccines and those “low or nonexistent profits”

“Thirty years ago, more than a dozen companies were in the business. Today, only two companies make the vaccine for America … The difference? Over the past 15 years, the government has become the biggest purchaser of flu shots…
The inevitable result: Sellers gradually exit the market and are not replaced; innovation drops off, and soon there are shortages, forcing the government to ration the product and decide who gets treated — exactly what happened with the flu vaccine.”
http://www.heritage.org/Press/Commentary/ed102204a.cfm

And more:
“In 1993, Hillary Clinton’s Vaccines for Children (VFC) program was set up to buy children’s vaccines from manufacturers and provide them to Medicaid clients and the uninsured free of charge. To ensure low prices, the program legislation capped the price of the three vaccines then in use …. The price controls did what price controls always do, they created a shortage. As a 2005 Department of Health and Human Services (HHS) budget brief pointed out, “the price caps [were] so low, however, that the tetanus vaccine was removed from the VFC program in 1998 when no vender would bid on the contract.”
http://www.i2i.org/main/article.php?article_id=1349

As to polio, smallpox, etc.- I’m glad you brought that up. A little background is appropriate:
“In the 1780s Edward Jenner, an English country doctor, began work on a vaccination for smallpox. After more than a dozen years of experiments funded entirely out of his own pocket, he found one.”
“Thanks to private organizations like the National Foundation for Infantile Paralysis, however, victims of polio received medical care, and beginning in the mid-1950s nearly all Americans were protected from the disease by vaccine … ‘In its heyday in the early 1950s the privately supported and administered Foundation spent ten times as much on polio research as the tax-supported National Institutes of Health.’”
“the ‘primary difference between the polio campaign and the wartime ventures was that the polio effort was coordinated by a private foundation and not by the federal government.’”

Moreover, the government is not really necessary for such research:
“For example, the National Tuberculosis Association, the American Cancer Society, the National Society for Crippled Children (now the Easter Seal Society), and the American Heart Association all emerged between 1904 and 1924, years before the federal government became heavily involved in health issues and medical research.”

So, to answer your question: yes – and it did.
(above quotes taken from: http://www.fee.org/publications/the-freeman/article.asp?aid=3370)

Now, with all that said, you still have not answerd the question: How can you reasonably describe our current health care industry as a “free market”, and thus blame the problems on “market failure?”

Nice try Adam – trying to avoid answering my question by posing a question to me.
I’m not going to take the bait, but I will ask you or Steve again to address the original reason I posted a comment to your post:
How can you reasonably describe our current health care industry as a “free market”, and thus blame the problems on “market failure?”

This question is at the heart of the debate.

BTW – we’ve never met so don’t pretend you know what I believe

I suspect that the real failure of the so-called markets (free or otherwise) to deliver inclusive care is more a result of laws related to corporate personhood than to market structures.

The last century has seen greed institutionalized as companies have acquired the rights of human beings, with few of the attendant legal and moral responsibilities.

When an insurance company does something that leads to the death of a person and no individual is called to account. The liability rests with the faceless corporation, which, frankly, has only one prime directive: make money. The owners (the shareholders) and employees are protected from liability in ways too numerous to recount.

We the People erred when we constructed a legal system that grants human rights to corporations – and in doing so we have fundamentally altered the structures of markets so that “free” is a literal impossibility. It simply cannot happen inside the model we have created.

I’d gladly embrace the idea of free markets, if by that we mean the complete elimination of any legal protections for corporations and their shareholders.

Steve,
You FINALLY fessed up to what I have been driving at all along:

“Neither Adam nor I care whether the current ailing state of healthcare is a failure of government bureaucrats or markets”

Let me repeat…you DON’T CARE what is causing the problem!
If you can not be bothered to understand what is causing the problem, how can you reasonably expect to fix it?
Sounds like I am not the one bringing an “impassioned ideological purity” to the table.

Furthermore, in Adam’s orignal post which started all this, he did blame the problems on “market failure.” Now you say “there is no free-market in healthcare.” If there is no free market, how can the problems be blamed on “market failure?” I’m getting mixed signals.

You also say, “We choose to focus on the “failure” part, you seem obsessed with the “market” part” Huh? If the “failure” is a result of the “market,” how can you seperate the two?

You confess to not even “care” to understand what is causing a problem, but then insist on plowing forward with a solution anyway. That is like a doctor telling her patient “I have no idea what is making you sick, nor do I care. But, here, take this medication anyway.”

Guys, guys,

It’s pretty simple: either government provides institutions that lower transaction costs, which facilitate the exchange of values (trade) and protects people from force, theft, and fraud. Or, government is a third party intermediary in the provision of goods and services. We prefer the former. You prefer the latter. The problem with your version of things is that it’s not only distortive of people engaged in exchanges between consenting adults – and doesn’t ever give you your hoped for result – but it’s just wrong from the perspective of not making one person the slave of another (we call that rights).

But more importantly, Steve’s conflation between institutions and bureaucracies doesn’t suggest anything against the efficacies of the market. Markets are more effective at providing people with things cheaply and at higher quality. Regulation and intercession distorts that process. That’s why market-friendly reforms will help poorer people get insurance at a lower cost. If you want to “solve” the problems of healthcare, get the government out. The government is causing the problems… Your answer – more government, more coercive distribution – is simplistic ad hocery and adds further distortions to a system that could be vibrant and accessible. I must add, for people who claim to be smart, wealth redistribution is really not all that creative or intelligent a ‘solution.’

Think hollistically, not hierarchically. :)

Steve,
Max beat me to the punch with his answer, which I second.

By the way, I hope you are not so condesending with your patients. As Max put it in an earlier post over at Red Clay Citizen:

“It’s no secret that the left’s only instruments of persuasion are smart-assedness and fear-fongering.”

So far I have been called infantile, irrelevant, and been subjected to your holier-than-thou sarcasm; never mind being accused by Adam that I “believe that it’s OK to allow 47 million people in our country to get inferior health coverage than those who are insured.”

Some bedside manner, doc.

Steve,
With as many posts that this thread has produced, neither you nor Adam has yet to answer my initial question. The only attempt to directly address my question was when you admitted that you do not even care what is causing the problems in the health care industry.
Adam has made no attempt to quantify his claim that it is a result of “market failure.”
Furthermore, your analagy of the cardiac arrest patient further proves my point. The patient arrives in need of medical attention. Before you decide what action is necessary to alleviate the patient’s ailment, you first had to know the CAUSE of his suffering (cardiac arrest) before you could determine the proper SOLUTION (resuscitation). You simply can not seperate the two, just like when we are addressing the rising costs of health care and insurance.

Unfortunately for you and Adam, you have completely failed to identify – nor express any concern – for the cause of the problem. Without accurately understanding what is causing the problem, we can not hope to address any appropriate solutions.

In regards to your comment: “As to being a smart-ass…guilty as charged. Get over it.” Don’t worry, I am over it. In fact I expect nothing less coming from someone trying so hard to mask his inability to understand the subject matter. The fact that you feel it necessary to resort to such petty tactics is quite telling.