3.22.2010

Congratulations are in Order! [The Gentleman from North Carolina is recognized: "Question on a point of order--"

Well, a sincere congratulations to my pro-healthcare-bill friends. Honestly, three cheers. The truth is, I don't know enough to know how this'll turn out. Here's hoping it goes well.

Last night, I watched a new ABC series called "Jamie Oliver's Food Revolution," which will air weekly for a while at 10pm on Sundays (I think). Watch it, if you have time:



The most striking part of this episode is when Jamie shows up at the local elementary school, where students are being fed "Breakfast pizza" (i.e., pizza) for breakfast and chicken nuggets for lunch, with canned gross vegetables and a mandatory two servings of "grain" (i.e., white-bread rolls). Somehow, what these lunch ladies are feeding the students is the result of government (FDA) standards. If you watch nothing else, watch the part from about 34 mins.-35:30. He says, "The American regulations are all screwed. Why would you want to give kids rice and bread? It's gonna make 'em fat."

Now, obviously, the FDA has nothing but the best intentions for us and our children, right? Also, admittedly, it's hard to whip-up a fresh stir-fry for 240 students every day. But the fact is, this is a clear clear clear clear clear clear case of a well-intentioned bureaucracy gone horribly wrong. Why is that happening in the case of school lunches? As Jamie says, children in the townships in South Africa are getting much better food than these American children, and we should be upset by that fact.

And obviously, I mean this as a guiding question with regard to our new Healthcare plans. The answer, incidentally, as it relates to the school lunch problem, has to do with an incestuous lobbying relationship between "Big Ag" and the FDA. "We produce corn!" cry the farmers, "...so put it in your school lunches," they add.

So how can we protect public subsidies for healthcare from this kind of perversity in practice?

HINT: We can't. This is the nature of bureaucracy.

Just kidding. I know these seem like the same old Casey-concerns. But now that the victory is yours, whadda think? Do we just trust in Obama's beneficence?

8 comments:

pure_sophist_monster said...

All I would add is that if this is indeed a case of government going too far would could/should see it as government not going far enough to regulate the free market it in its midst. This is why, btw, calling Obama a socialist is way off point (i.e., actual socialists, near as I can tell, can't stand the guy or his policies).

Casey said...

I know I've lost this argument, but I just don't understand how anyone can call what has existed for the past century as a free-market... to blame the school lunch program on under-regulated markets just tangles my brain wiring.

The same goes for the healthcare problem, which as I understand it was absolutely caused by gov't interference into markets.

The same goes for the housing crisis, which was caused by interference.

The same goes for fiscal soundness, which was caused by interference.

But I admit, I know -- I understand -- that these are archaic and unpersuasive reasons. I admit that I haven't figured out a good way to make the case I'd eventually like to make here. I know that quoting Henry David Thoreau doesn't do the trick.

Which is why I'm blithely gliding along these days with whatever "reforms" come my way. :)

fenhopper said...

interference isn't the same as good regulation.

healthcare reform would have done best to either open it up completely to direct free market, including taking employer-paid completely out of it, or completely putting the gov't in charge, making it a one payer system. it's the half-ass gov't 'cooperative guiding' that produces the shitty middle ground that you're talking about.

the question now then is what ability does the gov't have to fine tune and adjust the regulations and supports it's proposing. because the argument that 'gov't will fuck it up when it touches it' relies too much on the faults of lobbying and myopic laws. your post conflates 'regulation' with 'shitty policies' and that's too simple. simplicity is good, and a fine principle to guide, but complexity is not automatically doomed to failure, it's just more difficult.

Kevin said...

Ah--haven't visited in a bit. Thought you might blog this.

Casey: why so apologetic? The arguments are there, whether or not they in fact persuade those with other, unmovable commitments. Three quick points:

What is made, not only 'harder' (fenhopper's term) but practically impossible, by centralized decision-making, is an individual's ability to calculate the true consequences of his choices. When X not only doesn't pay for X's decisions, but never sees the bill at all (typical under redistributive policies), it is simply not possible for X to make a rational decision, which takes into account the very costs and benefits it is the aim of redistribution to distort. Now multiply that distortion by everyone who never sees the bills for the care they receive, either in the form of straight bills or altered premiums, and you have just guaranteed irrationality will be multiplied and systematized. Hayek is the one to read here--a Nobel-winner in part for showing how centralization entails failures of information-flow, and so impairs rational decision-making. The fact that some elite are really, really smart has no bearing on his conclusion.

Second: the nonsense that's being pitched about cruel insurance companies is not non-sense because insurance companies are not, in a loose sense, 'cruel'. That is, they will hold you to the deal you struck. It is nonsense--as in not an argument for public take-over-- because when THEY back out on their deals with you, you have an objective arbiter in government. Government can regulate objectively that business it is not itself in. But now it is both in the business and regulating it. For notes on how fair this is in practice, see the Auto Industry.

Finally: your point about school lunches is on point...but not only in the way you think. For instance: if I am paying to insure YOUR health, what YOU eat now has consequences, not just for you, but for me and my family. YOUR grand slam breakfast is, so to speak, something for which I and my children will literally pick up the tab. You thus make decisions, once-private, which redistributionist policies make un-private--and give me the right to critique, resent, and perhaps make illegal (recall the salt-banner of a few weeks ago). Here is a very sad consequence of this sort of legislation, which erodes, not only private businesses, but the idea that I can eat and live as I see fit, and say to the busy-bodies MYOB. How can one say MYOB when the business has been forcibly made public? Socialists never quite get this connection between the attack on private enterprise and personal privacy. But the results are in, and they should.

Casey said...

Kevin, I'm glad you're back. My apologetic tone (it's more of resignation, really) comes from the fact that I've never succeeded in persuading anyone no matter how deeply I plumb the annals of economic history and/or theory. I guess I just reached a point where the dialectic seemed to have lost its effectiveness... I'm still a libertarian, but I'm growing more content to just vote in that direction, privately.

On the other hand, Fenhopper makes a reasonable point, for a communist. :)

I do think that I'd rather see a total gov't takeover than this perpetual process of moderate-intervention followed by what I think of as a shifting of the strike zone... that is, each time the gov't intervenes in market A, it fails to account for the way that market A is capable of being mediated by market B (or something like that). And so the wobbling tower grows taller, stilted and propped by more and more unstable corrections.

So I'd actually like to see a full public takeover, not only of healthcare, but of education and of transportation and everything else, because the genie is out of the bottle. There's no way America is ever going to hit the rewind button and remove these entitlement ("safety net") programs. That'll never happen. So let's give the controls to the confident amateur pilots and hasten the conclusion.

If they fly, so much for our "theory." If they don't, I'll have buried enough gold by then to be in a good position after the collapse. :)

Casey said...

Also, Kevin...

It's your first point that has always persuaded me. I swallowed it in the form of Mises ("Economic Calculation in the Socialist Commonwealth" -- 1920). It's available online. Maybe you've read it; but I'll post the link for my curious pinko friends:

http://mises.org/econcalc.asp

As far as I'm concerned that's a "final" argument. Let me let you in on the kinds of dodges I've heard from people on the progressive side, though:

Generally, if they read the Mises article, they acknowledge the central premise as relevant and convincing, but they say that health insurance and healthcare are "exceptional" cases. The reason, they say, is that there is no motivation to act irrationally with regard to your healthcare. So whereas being separated from prices in a market like, say, housing, might lead you to make irrational decisions (out of innate greed, or something), there is no reason to expect someone who does not need a given medication to go stock up on that medication just because they don't have to pay the bill.

Any thoughts?

Kevin said...

Ah--ok. I would only say that you are not losing an argument merely because you lose some particular audience. But it is discouraging to see folks up and leave--or even refuse to engage in good faith-- I grant you.

Not much time tonight, but quick reply re: fenhopper's 'full take-overs' and the uniqueness of health care as a good which somehow escapes Hayek's (F.A.'s, not Salma's) critique of centralization.

First, there never has been, and never can be, a 'full take-over' of anything by anyone. Von Mises shows (in "Socialism", and elsewhere) that this makes pricing impossible. There later arose empirical support for this. The U.S.S.R., at the height of its catastrophic policies, used foreign currencies, free-world commodity pricing, and its own black markets to make sense of questions about 'what is this worth?' Its policies were parasitic upon the very markets it hoped to overthrown. For us, it was easy: 'it' was worth what someone--or rather, many someones--privately thought it was worth. But once a full public 'take-over' occurs, and prices arise by diktat, the question does not make sense. In short, v.Mises gave, years ago, as near a knock-down analytic argument that government take-overs WILL 'fuck it up'--and this was nicely followed by several case studies around the world.

As to health care somehow dodging Hayek. First, it's just false that divorcing payer and service payed for does not distort cost-benefit analyses in health care. Talk to any doctor dealing with insurance companies and their response to this claim will be laughter--bitter laughter. Second, and perhaps more importantly, this kind of argument forgets the consumer is not the only 'rational decider'. Decisions can be distorted 'downstream' (consumer-side) and 'upstream' (supply-side)The 'upstream' provider is making decisions too--including the decision of whether to provide health care, or take up another line of work. Say we announce something ethically awesome-sounding--say, a big fat tax on medical devices (just passed). What might a rational reaction be from an investor, inventer--doctor, even (should we price-fix their fees)? Answer: flow to some other line of work, invention, investment. Now the distribution policy creates scarcity. Whoops. So now the govt. has to be the provider, not just the distributor...that is, it must, as Marx saw, take over 'the means of production'. If one thinks this is the answer...well...there's that twentieth century to consider...

Anyway: I don't think the objection you mention does much--except maybe call attention to another aspect of the original problem such objections were purporting to solve.

Kevin said...

And---- if you're really bowing out here, blog-wise, flag me on mine (I'll add content shortly) or get me on facebook (ask Monica). Have some contacts you may be interested in.

Oh--and thanks for the Hayek picture--if someone like her wrote books like "Road to Serfdom"--it'd be love. Not even foolin. I'd propose.