Commentary

Free Market Is the Answer

Today’s debate: Health care

Opposing view: Government, interference keeps costs of care, insurance high.

The last thing patients need is for the government to inject more socialism into their health care in the name of expanding coverage. To borrow a phrase from President Reagan, government is not the solution to U.S. health care problems. It is the problem.

Most of America’s health care is private, so many assume it operates as a free market. In truth, it is dominated by the government, resulting in high costs and stifling bureaucracy.

The federal government effectively socializes 86% of all health spending, a greater share than in 17 other industrialized countries, including Canada (though other features make these systems less free).

By discouraging individual responsibility, the government guarantees irresponsibility. We pay less attention to our health and demand more care — with little regard to the costs we impose on others or the rising prices that result. (Should it surprise us that health insurance is unaffordable for millions?) Those footing the bill — employers, insurers and the government — try to impose responsibility in ways both offensive and harmful (read: managed care).

Estimates by Harvard economist Martin Feldstein suggest that the federal government’s quasi-socialization of private insurance alone will leave us nearly $ 200 billion worse off this year. Moreover, Chris Conover of Duke University estimates that health regulations will leave us $ 128 billion worse off. Taken together, that is more than what taxpayers will spend on Medicare or Medicaid in 2004. The only way to make health care affordable is to get the government out.

Democratic presidential hopeful John Kerry sees only bad outcomes — rising prices, millions of uninsured — rather than root causes. He therefore recommends more socialism (under the guise of “expanding coverage”) even though this would further increase costs and make a total government takeover inevitable.

Though President Bush’s record is far from perfect, he supports strengthening health savings accounts, which reduce the government’s role in health care. Health savings accounts restore individual responsibility, curb medical inflation and will make health care and insurance more affordable for millions.

Ronald Reagan demonstrated that free markets are superior to socialism.

So why do we continue to tolerate socialism in our health care system?

Michael F. Cannon is director of health policy studies at the Cato Institute and coauthor of Healthy Competition: What’s Holding Back Health Care and How to Free It (2005).