I have already commented on the mess in the health service industry and how government rules strictly limit competition within the industry between providers and heavily fund research which produces privately marketed products that soak consumers. I failed to mention the symbiotic relationship between insurance companies which aid in limiting competition to "licensed medical providers" and the medical providers and the similar relationship between government regulations and tax codes and the very same companies. Both relationships lead to nice tax preferences for consumers of health and life insurance - which especially benefit larger companies and those individuals who - due to higher incomes where more use can be made of tax exempt earnings - benefit from tax preferred treatment. On the positive side, there are measures being considered which would extend tax preferences on employer provided health care to smaller companies. Unfortunately, this will not improve the situation for the growing number of us who will have to pay for higher priced services without the use of "other peoples' money".
The problem with all the "inducements" used to encourage private companies to provide health care benefits for employees - combined with governmentally provided benefits to welfare and Medicare recipients - is that if puts a whole lot of money into the system to be spent by people with little incentive to hold down costs. This - combined with the health care unions' stranglehold on competition - just drives up the cost of health care for those who are solely responsible for cost. On a side note: while it is true that there are "gluts" of health care providers in certain locales these are invariably those areas where there are high concentrations of insured users - rural areas with smaller employers have even more severe shortages.
There is a similar problem going on in higher education. Billions of dollars of taxpayer guaranteed loans [usually at below market cost - subsidized by taxpayers] have flooded colleges and universities - and trade schools - with money to pay for education. What this has produced is more indebtedness for today's graduates, higher tuitions and -with a glut of grads in the job market - fewer real opportunities for graduates to earn enough money to repay these loans. The stereotype of a high paid professional defaulting on student loans is mostly crapola. The most likely person to default is someone who borrowed to the hilt for a degree [usually expecting to use it as a ticket to high paying employment] only to find that their prospects for employment have actually DECREASED due to their educational stint. Their degree is worthless and in the process they now have to compete with people their in their own age group who now have 2-6 years more "on the job experience" which rates higher with most employers.
Who benefits from these "semisocialized" industries? In the health fields, the doctors' unions and insurance companies who are now battling each other for the biggest chunk of taxpayer cash - with the rest of us as losers. The companies which still can benefit from tax preferences and their dwindling ranks of employees have the best of both worlds: good benefits with no tax liability and the increasing number of retirees and decreasing number of welfare recipients whose tabs are picked up by Uncle Sap. The cost of health care has risen so sharply that many companies just can't afford health care - even with the tax preferences. Health care costs are - along with the mass incarceration scams - the fastest growing component of government; maybe they should legalize drugs and use the tax money to fund healthcare? With the severe depreciation of college educations and the direct financing plan which cuts out "private" [with all the regulation and subsidies the financial lenders are hardly private!] lenders the clear winners in the higher ed subsidies are the faculties and education bureaucracies and employers who get a very well educated [and more subservient - with their high debt load] workforce at taxpayer expense.
This form of "semisocialization" benefits only a few. Either we socialize full scale or get the government regulators and taxpayer subsidies out of the mix. With both industries highly influential in the political debate -and without campaign finance reform [doctors' unions are the 2nd leading player in the campaign cash medley] serious reform is next to impossible.
7/1/97
