Perhaps I'm a cynic, but look at it this way. If you compare this year to next year, about the same number of people are going to get sick and hurt. The same number of people are going to show up in doctor's offices and ER's, and the same number are going to require hospitalization. Doctors are going to order the same tests and scans, and prescribe roughly the same therapies. The big question is "who pays for all this"?
The cure for bleeding is to stop the bleeding, not open the wound wider hoping that the body will have extra-incentive to stop bleeding on its own. Likewise, I just cannnot fundamentally believe that the solution to out-of-control costs is to make things more costly for individuals. Sorry, but the "trust us, costs will decline" line just doesn't fly. Doctors are still going to follow evidence-based guidelines for diagnosis and treatment, and without massive reduplication of services there will be no competition to speak of.
Unless I missed it, the authors of the site cannot point to any functioning free-market medical system in existence. I suspect there is a reason for this. I also suspect that the mantra to privatize and deregulate will yield the same results that it has in our little third world experiments.
Take
Chile, for example:
"In 1973, the year the general [Augusto Pinochet] seized power, Chile's unemployment rate was cut by 4.3 per cent. In 1983, after 10 years of free-market modernisation, unemployment reached 22 per cent. Real wages declined by 40 per cent under military rule. In 1970, 20 per cent of Chile's population lived in poverty.
By 1990, the year 'President' Pinochet left office, the number of destitute people had doubled to 40 per cent. Quite a miracle.
Pinochet did not destroy Chile's economy all by himself. He had the help of academia's most brilliant minds: a gaggle of Milton Friedman's trainees, the Chicago Boys. Under their spell, the General abolished the minimum wage, outlawed union bargaining, privatised the pension system, abolished all taxes on wealth and business profits, slashed public employment, privatised 212 industries and 66 banks and ran a fiscal surplus.
Free of the dead hand of bureaucracy, taxes and unions, the country took a giant leap... into bankruptcy and depression. After nine years of Chicago-style economics, Chile's industry keeled over and died.
In 1982 and 1983, GDP dropped by 19 per cent. Blood and glass littered the laboratory floor, yet the mad scientists of Chicago declared a success. The US State Department concluded: 'Chile is a casebook study in sound economic management.' It was Friedman who himself coined the phrase 'Miracle of Chile'. Friedman's sidekick, economist Art Laffer, preened that Pinochet's Chile was, 'a showcase of what supply-side economics can do'.
It certainly was. More exactly, Chile was a showcase of deregulation gone beserk. The Chicago Boys persuaded the junta that removing restrictions on the nation's banks would free them to attract foreign capital to fund industrial expansion. Pinochet sold off the state banks - at a 40 per cent discount against book value.
They fell into the hands of two conglomerate empires, controlled by speculators Javier Vial and Manuel Cruzsat. Using these banks, Vial and Cruzat bought up manufacturers, then leveraged these assets with loans from foreign investors panting for their piece of the state giveaway.
By 1982, the pyramid finance game was up. The Vial and Cruzat 'Grupos' defaulted. Industry shut down, private pensions became worthless, and the currency swooned. Riots and strikes by a population too desperate to fear bullets forced Pinochet to boot out his beloved Chicago experimentalists.
Reluctantly, the General restored the minimum wage and collective bargaining. Having previously decimated the ranks of state employees, he authorised a programme to create 500,000 jobs.
Chile was pulled from depression by dull old Keynesian remedies, all Franklin Roosevelt, zero Margaret Thatcher. (The junta even instituted what is today South America's only law restricting the flow of foreign capital.)
New Deal tactics rescued Chile from the panic of 1983, but the nation's long-term recovery and growth is the result of (cover the children's ears) a large dose of socialism."
All this said, I would be TOTALLY in favor if giving such a free-market system a 10 year trial. If I am wrong, then great! If not, then perhaps we can put the whole thing to rest once and for all.