How Efficiently Will Government Run Health Care?

Their “success” in the Cash for Clunkers program should answer that question.

A clunker that travels 12,000 miles a year at 15 mpg uses 800 gallons of gas a year.

A vehicle that travels 12,000 miles a year at 25 mpg uses 480 gallons a year.

So, the average Cash for Clunkers transaction will reduce US gasoline consumption by 320 gallons per year.

They claim 700,000 vehicles so that’s 224 million gallons saved per year.

That equates to a bit over 5 million barrels of oil.

5 million barrels is about 5 hours worth of US consumption.

More importantly, 5 million barrels of oil at $70 per barrel costs about $350 million dollars.

So, the government paid $3 billion of our tax dollars to save $350 million.

We spent $8.57 for every dollar saved.

I’m pretty sure they will do a great job with health care though…

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4 Responses

  1. Actually, there is a difference between CFC and health care. CFC was not about saving money on gasoline, but the salvage of the auto industry through incentives to purchase new cars.

    The current problem with health care is the failure of the market to regulate itself. The main reason we need to implement universal health care is due to the inability of the private sector, evidenced through the current policy prices, the ability for companies to drop policy-holders due to illness and the lack of over-site that allows the companies to discriminate against the ill.

  2. The main purpose for cash for clunkers (CfC) may indeed have ostensibly been to “save” the auto industry, but one of the major selling points of the program was indeed the annual fuel savings and long term savings the new cars would supposedly generate. As is just about always the case with any liberal legislation (democrat and republican), it has the direct opposite of it’s stated intent. As for “saving” the auto industry, all they have done is subsidize failure and likely ensure the ultimate failure of the industry unless we subsidize it forever. The problems that got the American auto industry into the crisis that brought it to the point of failure have not been solved. It is the labor costs, read UAW, that have led the automakers down an unsustainable path. The shutdown over Christmas was a perfect illustration of the point. Due to the idiotic pay structure they have set up with the UAW, it costs the automakers more to produce their products than it does to let their factories sit idle. That is unsustainable.

    Beyond the UAW, it is government interference that has made it difficult for the automakers to make a profit. Rather than letting the market demand decide what kind of cars automakers produce, the government imposes laws in an effort to drive a specific SOCIAL outcome which forces the car makers to produce things that society doesn’t want. When forced onto this playing field, the Detroit automakers have absolutely no hope of competing with automakers that do not have a unionized work force. This is where the big problem with the government ownership of GM and Chrysler comes into play. Now there is a huge conflict of interest that is clearly illustrated with with the recent recall of many Toyota models. There have been many, many recalls of Detroit cars in the past, several of them recently, that were just as massive as the one affecting Toyota now. But they barely made a ripple in the media or elicited as much as a grunt from the government because they weren’t vested in these companies. Now they have political and financial motive to promote the Detroit companies and are using government power to influence private business outcomes. The government via the media is stirring up a frenzy against Toyota with the goal of either bringing down Toyota as a competitor to GM/Chrysler, or of forcing them to unionize to make all the attention go away (extortion). If you believe in our constitution, and support a free market, this should outrage you.

    The same government interference is the very reason the health care private sector is having the difficulties that it now experiences. The government passed laws saying that emergency rooms could not refuse care to anyone (which dispels the myth from the left that millions can’t get health care), they pass laws making it impossible to compete (competition drives down prices) across state lines, and they refuse to support tort reform to eliminate frivolous lawsuits that play a huge part in driving up the costs of health care. Rather than truly making health care more affordable and providing consumers more choice by eliminating the problems that make it more expensive, government chooses to eliminate our choice and make health care more expensive for all of us by taking over health care, making it more expensive through the inefficiencies of government, taking money from those who have earned it to pay the way for those who have not, and mostly wasting the revenues they get in the inefficiencies and black holes of government waste and abuse.

    So, your assertion that self regulation is the cause of our health care problems are very short sighted. It is the contradictory intervention of government that does not take into account natural market forces or human nature that are causing the problems we are seeing today. And contrary to popular liberal belief, NO ONE has a RIGHT to insurance or health care. They are both products or services provided at a price. That price is determined by market demand, and by how much it takes to cover the COSTS of providing that service. Those are costs such as paying employees, buying MALPRACTICE INSURANCE (which cost individual doctors upwards of a million dollars per year in some cases), and buying supplies and equipment.

    If you claim that health care is a RIGHT, do then claim that doctors don’t have a right to get paid for providing health care? If you say “That’s silly. Of course they have a right to get paid for providing that service,” then are you saying that the person receiving health care has a right to take your money to pay for it? Then you get defensive and say that I’m missing the point. Oh, really? That IS the whole point. God is the only one who can give a RIGHT. When man declares something as a right, it has a cost. That cost has to be paid by someone. So, declaring health care to be a right is great for those who don’t have to pay for it, but not such a good deal for those of us left paying the bill.

  3. “The government passed laws saying that emergency rooms could not refuse care to anyone (which dispels the myth from the left that millions can’t get health care)…”

    No, people have to pay for that service, or it is delegated to the tax payers. Emergency rooms stabilize the person but do not provide the extended care that a person with cancer needs. This is but a single aspect of the health care crisis.

    “…they pass laws making it impossible to compete (competition drives down prices) across state lines…”

    Actually, the laws you speak of are in relation to what the insurance company in that state has to cover, rather than what the allowing the company to choose what to cover. The change you that Republicans are calling for would provide the companies, not the consumers, with the ability to choose the policy through the state of their business’s location. This would create an inferior product that helped the business, not the people.

    “…and they refuse to support tort reform to eliminate frivolous lawsuits that play a huge part in driving up the costs of health care…”

    Tort reform has been tried in a few states and has done nothing to change the cost of insurance.

    “…government chooses to eliminate our choice and make health care more expensive for all of us by taking over health care…”

    The Democrats’ plan would create a public option along side the private options, thereby creating another choice for consumers, not fewer.

    “…making it more expensive through the inefficiencies of government…”

    The current price of a health care policy is rising annually under the capitalist system, showing that the market is unable to keep the prices down.

    ” It is the contradictory intervention of government that does not take into account natural market forces or human nature that are causing the problems we are seeing today…”

    The concept natural market forces does not take into account the fact that the nations of Scandinavia have a better standard of life than the citizens under the capitalist system of the US, creating a question of “market forces” as a viable solution. As for “human nature”, that is a definition that changes through each generation. The definition of human nature is, therefore, not static.

    • “… or it is delegated to the tax payers. …”

    There’s the key. I have been into the ER with myself or family members countless times for varying levels of problems and many times had to wait hours behind people who had no insurance and were using the ER as their “primary care.” They know they can’t go to a doctor’s office for continuing care, so they just go to the ER because they know they can’t be turned away.

    • “… The change you that Republicans are calling for would provide the companies, not the consumers, with the ability to choose the policy through the state of their business’s location. This would create an inferior product that helped the business, not the people.”

    Even though the left denies it, when companies are doing better, we do better. When a company is healthy enough to offer more options at lower prices and make money doing it, we all benefit. When wealth is CREATED it spreads out through the economy and brings up everyone’s standards. When wealth is redistributed, it only brings down those who had the wealth that is being redistributed, and the redistribution can’t be sustained. As for choice, it is the government who is primarily responsible for the choices we have. If left to the free market, the insurance companies would offer what consumers wanted as long as the demand was high enough, and it was profitable. Government has mandated various restrictions on insurance that are not commercially profitable and cause the companies to operate at a loss in these areas. To stay in business they have to drop marginally profitable coverage offerings and up the fees on the more profitable ones to cover the loss on the mandatory coverage. It’s the same thing as a “loss leader” in a retail store.

    • “Tort reform has been tried in a few states and has done nothing to change the cost of insurance.”

    We must have different sources on this one. From the people I have talked to in states where serious tort reform was enacted, prices went down. It just makes economic sense. When your cost for doing business goes down, and you don’t pass at least a portion of that savings along to your customers, they go elsewhere unless you are a monopoly, which is the case with government run entities. When government subsidizes a business rather than making it compete, they don’t have to be efficient and other businesses can’t compete with a company that doesn’t have to earn a profit. This speaks directly to your assertion that a “public option” will create more choice. It will run private insurance out of business because they aren’t being subsidized.

    • “The current price of a health care policy is rising annually under the capitalist system, showing that the market is unable to keep the prices down.”

    Again, you are ignoring the influence of government regulation in the insurance market. Because of all the people burdening our health care system who DON’T pay for the services, most notably illegal aliens, those costs have to be passed on to SOMEONE or the hospitals close their doors. Without tort reform, doctors are forced to practice defensive medicine by performing tests and procedures that they are sure are not necessary, but should they be sued, in our modern legal environment they would likely lose because they didn’t do EVERYTHING in the book to treat a problem. Doctors also spend large percentages of their income defending themselves against ridiculous lawsuits. As for the insurance companies, when they are forced to pay out a huge amount of money following a legal loss, they must raise their rates to cover the loss, or go out of business. You must remember that insurance is designed around the concept “reasonableness.” That principal has been increasingly under assault in recent years. For example, a reasonable person knows that coffee is supposed to be hot. When a person gets a cup of coffee and spills it on themselves due to their own clumsiness and gets burned, it should end right there. But when that person sues the restaurant because the hot coffee was actually hot, and wins a multi-million dollar settlement, you have abuse of the system, and the reasonable person standard breaks down. A reasonable person buys insurance to cover extraordinary circumstances. It is not intended to provide coverage for everyday needs. When you buy car insurance, it doesn’t cover gas, wiper blades, oil changes, and new tires. The mandatory part of car insurance that the democrats like to latch onto is the liability part. We buy liability insurance in case we harm someone else. If you choose not to buy insurance to cover yourself or your own vehicle, that’s your choice. So if you follow the money trail in the insurance business, you will find that mostly the problem of high insurance prices originates with government intrusion and abuse of the legal system.

    • “The concept natural market forces does not take into account the fact that the nations of Scandinavia have a better standard of life than the citizens under the capitalist system of the US, creating a question of “market forces” as a viable solution. As for “human nature”, that is a definition that changes through each generation. The definition of human nature is, therefore, not static.”

    You have to understand that as much as you like to demonize capitalism, we haven’t been a capitalist economy for quite a while. The government interference creeping into every aspect of the legal system and business has seen to that. For the areas in this country that are simply disasters, I challenge you to tell me why and who got them there. California, Detroit and most of Michigan, Chicago, New Jersey, and every other economic disaster area in this country is that way because of their political leadership, which is and has been liberal for a long time. They raised income and business taxes to the point they drove away their tax base, and continued the socialist plan of giveaways funded by taking away money from those who earned and deserve it and giving it to those who didn’t. Those areas with the highest standard of living have the lowest taxes. It is a proven fact. Pick any one state, I don’t care which one, and lower the income and corporate taxes, and make it a better place to do business and keep more of what you earn, and I guarantee you than in a year’s time that state would be far better off than they are today, and far better off than those states like New Jersey with their high tax rates. As for your definition of “better standard of life,” when you have a standard of living set for you by the government that you can’t rise above, everything is provided for you, but at a lower standard than you could achieve or provide for yourself, and all of your income is taxed away to provide this standard not only to you, but to those who do nothing to earn it, is that what you want for a standard of living? You’re willing to sacrifice your freedom and opportunity to achieve a better life for a small measure of false security and slavery to a system and the government? That’s what the Scandinavian and essentially all European nations have today. They are all failing. Greece is the most visible current example, but the UK, France, Spain, and Germany aren’t far behind. That’s why France and others are balking at any sort of bailout for Greece. They know it will drag them down as well.

    You’re also wrong about human nature. It is natural for humans to first do what will take care of your needs. You acquire food, clothing, and shelter (your basic needs) before you seek out other improvements. Once your basic needs are met, you seek ways to make acquiring those needs easier, you then seek to improve your own environment. Once you have satisfied your NEEDS, and provided yourself a measure of excess, you are more willing to share that excess with others. It is basic human nature to take care of oneself first before taking care of others, and it makes sense to do it that way. Just like when a flight attendant briefs you that in the event of loss of cabin pressure you should put your own oxygen on first, then help others, if you are unable to take care of yourself, you won’t be able to care for others. It is not human nature that changes with time, but how some people try to manipulate human nature to get a desired outcome. Socialism ignores human nature with the deceptive promise of everyone being equal. It sounds good in theory, but never works in practice. When people work hard and produce wealth, but continually have that wealth taken from them, they lose the motivation to work hard. The lazy stay lazy and complain when their handouts don’t come on time. The government continues to take and take, and doesn’t do anything to contribute to PRODUCTION of wealth. The producers give up in frustration, resulting in the elimination of the source of wealth from which the government plunders. The government continues its social spending with no revenue and eventually collapses the system. The story of the college professor failing an entire class illustrates this manifestation of human nature quite well.

    An economics professor had a class that insisted that socialism worked and that no one would be poor and no one would be rich, a great equalizer. The professor decided to have an experiment in this class on socialism.

    All grades would be averaged and everyone would receive the same grade so no one would fail and no one would receive an A. After the first test the grades were averaged and everyone got a B. The students who studied hard were upset and the students who studied little were happy. But, as the second test rolled around, the students who studied little had studied even less and the ones who studied hard decided they wanted a free ride too; so they studied little. The second test average was a D! No one was happy. When the 3rd test rolled around the average was an F.

    The scores never increased as bickering, blame, name calling all resulted in hard feelings and no one would study for the benefit of anyone else. All failed, to their great surprise, and the professor told them that socialism would also ultimately fail because when the reward is great, the effort to succeed is great; but when government takes all the reward away; no one will try or want to succeed.

    THAT is human nature.

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