Monday, July 21, 2008

Krugman Gets It All Wrong

Paul Krugman accuses libertarians who fail to see the alleged advantages of health care socialism of being like robots in science fiction movies who when faced with information incompatible with the assumptions of their programming simply says "does not compute".

I've dealt with the issue of health care systems extensively in the post "Myths & Facts About The American Health Care System", where I indirectly deal with Krugman's arguments. I will this time apart from linking to that post, comment on Krugman's obsession with the relative cost of health care in America to European systems.

As Bryan Caplan notes (See also Mark Perry on this issue), Singapore's health care system is arguably even more free market oriented than America's, yet health care costs are only about a quarter of America's- And it is less than half of any European system's. The same thing goes for Hong Kong's system. Neither Hong Kong's or Singapore's systems are pure free market, but neither are America's and their systems are at least and arguably more free market than America's. How does then the fact that their health care systems cost less than half of the European systems compute with Krugman's assertion "The basic facts on health care are clear: government-run insurance is more efficient than private insurance"?

As safely as California's cyborg governor can be trusted to say "I'll be back", Krugman's supporters can be trusted to simply think and say "that does not compute" when confronted with these facts....


Anonymous Fred Peters said...

The comment section on Bryan Caplan's blog by Singaporean's give some good remarks that the sun shines a little less bright in Singapore when you are disabled or have been determined with a cancer.

But to stick at the subject, the new health care system in The Netherlands, modelled after the Swiss system, looks closer to the Singapore system than the US, UK or Swedish system. It also has a lot of room for competitive private insurance, private provisioning and selection of no-claim and personal risk parts along public measures.

For those in the Netherlands who do not want to opt into the insurance system (that is mainly for religious reasons, some branches of Calvinism reject health insurance) the Dutch governments opens private health savings account that accumulate the (capped) employers fees just like Singapore. But, like Singapore it means that once you deplete your medical savings account you have to mortgage your home or find relatives/friends who pay high expenses for you. In some close knit religious communities that is then indeed effectively collected during church services.

2:33 AM  

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