I saw an argument on a blog against 'free' /Medicare for all and want to know your responses (LONG)

because I am curious as to how best counter this argument when I meet it in real life; face to face conversation. I hope it's ok if I forgo the three-paragraph rule just once..I don't post in here very often, so I do not usually abuse the privelige.

"..that’s what “free” does to people. “Free” throws the laws of economics out the window and encourages massive over-consumption. Normally, there’s an upside and a downside to any exchange. The upside of that big-screen TV is that you’ll be able to watch “Lost” in wide-screen, high-definition clarity. The downside is that you’ll have to part with a chunk of your income. The downside makes you think carefully about the purchase. But there’s no downside to free.

<snip an illustrative andecdote>

By making health care free to millions of citizens, Medicare ignited a huge increase in the demand for medical services. When demand goes up, so does price. That’s basic economics. The cost of health care didn’t outstrip inflation year after year until the advent of “free” Medicare completely skewed the supply-and-demand equation. Medicare created my grandmother’s post-retirement occupation.

Those of us who aren’t old enough to qualify for Medicare don’t have free health care, of course. We pay insurance premiums. But after employer-provided health insurance became the norm, many employees demanded and received first-dollar coverage. Once the premium is paid, everything else is free. Over-consumption is still the result.

<snip; another illustrative anecdote>

I don’t know whether to laugh or scream when politicians point to our out-of-control health-care costs and blame them on free-market capitalism. We haven’t had anything resembling a competitive market system since at least 1965. As with the mortgage crisis, we’re seeing the federal government rush in to spend billions of our dollars to “fix” a problem that was largely created by the federal government in the first place.

<snip again>

The health-care “reform” package being pushed through Congress by the Obama administration is currently estimated to cost a trillion dollars over the next ten years. That’s one hell of a lot taxpayer dollars to spend, especially when the country is already facing trillions of dollars in debt. And guess what? It won’t even come close to covering the eventual cost of ObamaCare.

When politicians budget for new programs, they look at current consumption and extrapolate the cost over the next several years. They conveniently forget that “free” will drive up consumption dramatically.

When Medicare was enacted in 1965, congressional budget-crunchers projected the cost in 1990 would be $12 billion. The actual cost was $107 billion. When George W. Bush demanded and received a prescription-drug bill from a (supposedly conservative) Republican Congress, the original cost projection for the next 10 years was $400 billion. Just over a year later, that projection was “adjusted” to $1.2 trillion. Surprise, surprise … people consume more drugs when they’re free.

The excuse for the “reform” bill is that 45 million Americans don’t have health insurance. As I explained in my last post, that number is bogus. It counts people who simply choose not to buy a policy they could easily afford, older people who are eligible for Medicare but haven’t enrolled, and illegal immigrants.

But apparently we’re going to soak the taxpayers - again - to cover those people. President Obama told Congress today that “the status quo is not an option.” Yes, the status quo is a mess. But the option he’s pushing will give millions more Americans a big ol’ Hershey’s Kiss … for “free!”

And unless all the laws of economics magically refuse to go into action, “free” will turn out to be the most expensive option of all."

Source:
http://www.tomnaughton.com/?p=244


SORRY again about the length, but I really want to know how to counter this well. Don't get me wrong, I'm none too thrilled withthe current idea of the public option that is being pushed by the Blue Dogs/administration/etc.; and am gung-ho on our month to get action on single-payer. But this smacks of over-generalization to me. However, I am not a college graduate and not always the brightest bulb in the box, so any clarification and refutation help would be great. Thanks for reading...; mods if this is in the wrong place please move.

There's a monthly premium of 96.40 for Medicare part B.
Medicare part B pays 80% after an annual deductible of $135.00, you pay 20%.

An inpatient stay will cost you a first day deductible of $1068.00.

http://questions.medicare.gov/cgi-bin/medicare.cfg/php/enduser/std_adp.php?p_faqid=2100

from a private company costs around $2500.00 per year and up for two people. We got the plan that covers the deductible from Medicare so we don't have any upfront costs. The part D premium costs every month plus there is a deductible on that and for many a "donut hole" that covers nothing after they've reached X amount of dollars on the part D. Tell them to forget saying that Medicare and part D is free. They are far from it, and our costs come at a time when our income is at a very low point..and my husband has a pension from his work. I really feel sorry for the ones who just have Social Security to live on and have those costs to cover out of their checks.

it's pre-paid for thru taxes.

Even in Sweden adults have something they pay, but it is capped on a yearly basis.

Medicare also has a copay and deductible.
http://www.house-call-physicians.com/medicare_info.htm
Like any other insurance, Medicare has deductibles and copays.

If a system has a cost, it will lower demand because of the economic formula you showed. But in a pure private system, the cost is so high, only the well off can afford good care, and the poor get no care, and the middle gets somewhere in between.

In a system with no government intervention then it is all based on market forces where having money means getting care.

In a regulated system a progressive element is added. If you are poor health care is cheap, but even that cheap price is alot for the poor person, so it does not spike demand.

A middle class person can also have lower price care because of a progressive tax on the rich.

The system that includes deductibles and copays makes it not free, and more importantly what cost 20$ as a deductable, to a poor person is even more of a reduction of demand then what cost 1000$ for a millionaire.


There is another factor, currently in the world production capability is far more then demand. This creates a mandatory unemployment, many people still think of economics in the way of 200 years ago, when production was lower then demand.

Because of demand falling below production, sectors of employment have to be created. Not just for their need, but also to give people some work to do, since work is a vital part of both individual and social well being.

One of the ways to do this is increase demand for different sectors, war and consumerism does this. But instead of creating demand just for throw away things. Why not create some demand for health care, then returning soldiers can get education in nursing field, or even doctors, and expanse to education facilities can create even more demand in education sectors.

And as you state, we do not have a free market health system, in Sweden Insurance companies are not allowed to also own health centers. In part that stops just elevating prices(when gov. paid for) for self profit, it also hinders lack of care as a motivator for profit reasons.

And if we had a non monopoly system, laws of supply and demand could be argued, but since both vertical and horizontal price fixing and monopolies exist, the effect is not supply and demand on care, this can be shown to be true because of increases in profits of companies in health industries while care has become more expensive and available for fewer people.

But many make the argument you speak of but actually have some similar thoughts as listed below. The thoughts listed are ones that are so unpalatable many things like bad arguments are given when actually the items here are the real thoughts on the issue.

A few arguments more centered around extreme think tanks that do not share their goals in public conversation.
(It should be noted that 5 years ago, in part because of Canada medical care, and fearing US medical care changes, schools that teach doctors lowered the amount of new people they allowed in, to add another argument to private health care. Or at least it was in the news.

Also those that want control over the work force want people to be in fear, if people fear going broke from an illness then they will not be able to leave job. That means they can not strike, they can not quit because of unreasonable demands or poor pay, and they can not start small businesses, that can challenge big corporate control. So for some it has nothing to do with making people healthier, it is about keeping people scared so they can be controlled.

There is also a fringe, but influential group that have many people, some in think groups. They fear good health care will help people live, and helping poor or middle class people live is against lower population goals of some groups. Also some think on lower classes as waste, and do not want them to replicate. Some of the anti health care, and even cost increase is a form of social warfare. There are many examples of some groups saying 'good' people as they define it should be promoted to have more and healthier kids, while lower people should be hindered from having healthy kids.

There are also some that really think driving people into poverty is a good thing, they believe it will make people more susceptible to control by a few masters. They consider loss of houses for medical care and things like that a good thing. Those people mostly think of things in zero sum gains, as people lose money they get it, so driving people into poverty is good for them. If they are forced to rent, then they can collect that rent, if they lose their house, then a well off person can buy it cheaper.)