The American Freedom Network

The Next Bubble?

Now that Kipling’s “Gods of the Copybook Headings” are making the Masters of the Universe speak in tongues, as they confess their financial sins before the SecTreasury’s Great White House Throne, perhaps we might consider who’ll be next.  My nomination:  Healthcare.
Our system enables lifestyle diseases by funding their treatment.  If you choose to live foolishly – super-sized, chain-smoking, frequenting San Francisco bathhouses, abusing alcohol, etc., someone else pays for the treatment, even while your body pays in other ways.  Just as the welfare state is the enabler of single motherhood, as well as of corporate moral hazard, so is third-party payer healthcare the enabler of what Henry Ford called, “digging their graves with their teeth.”  Even if the rest of the economy was sound, this would be impossible to afford, given that there are few brakes on the potential demand for what someone else is paying for. 
Not only government-funded insurance programs are at risk, but the private welfare states are, too.  Witness General Motors’ backing away from health care for white-collar retirees.  Having a million retirees on the books is unsustainable in a competitive market.  This retreat from perpetual healthcare is just the beginning of what a friend calls, “The Era of Broken Promises.”  Just as manufacturing, IT, real estate and finance have been downsized, hospitals and pharmaceuticals will be, too.
It only begins here.  Next, consider the bubble in medical spending.  Pharma pushes pills with such fervor that most Americans are taking at least one perscription drug, with only a co-pay toward defraying the full cost of each pill.  They advertise their wares heavily, and encourage patients to ask for medicines, without letting their physicians first determine if they are truly sick, or in the drug in question is the best course of treatment. 
American is being colonized by Big Pharma.  Does your doctor tell you to eat soda crackers or use peppermint or ginger for a bad stomach?  Likely not.  but those were common treatments two generations ago.  There is scene in the original “The Parent Trap” (ca. 1965) that illustrates my point:  One of the twins buries her face in her Grandfather’s coat, “to make a memory” of how he smells – of peppermint, which he explains that he uses daily for his stomach.  (Vernors Ginger Ale played a similar role in our household when I was young.)
Flu vaccines are another example.  Originally only for the very old or the very sick, the recommended population expands every year – the “old” get younger, more children are included, etc.  That translates into more business, with the customers not having, in most cases, to pick up the full cost.  (To say nothing of whether the risks, side effects, etc. are fully understood, documented, and explained, before the needle enters your arm…)  Other vaccines, of questionable value, are added to the’mandatory’ list for children to recieve, yearly, until our little darlings are veritable pincushions.  A neurotic society thus tries to medicate all risk away, at the cost of risk unknown (or, at least unexplained), with someone else paying the bill.
This, too, shall pass, Lincoln said.  and it will.  The overexpansion of healthcare will end, as all malinvestment does, when the weight of it becomes unsustainable, compared to the (dubious) value delivered in return.  Ivan Illich foresaw this in “Medical Nemesis” decades ago:  Our system puts personal responsibility in the hands of a medical priesthood, and industrializes and commoditizes health.  That era is, mercifully, coming to an end.  let’s hope that no one gives them a bailout.