By Monty Pelerin, on February 11th, 2010
Image via Wikipedia
Image via Wikipedia
Milton Friedman on Socialized Medicine. From a talk given at the Mayo Clinic in 1978.
Although over 30 years old and focused on the medical industry, there are lessons here beyond the obvious. The semi-alert and above will recognize the process as a general one that applies to any industry in which the government becomes involved.
The video provides a prescient framework for where we were heading in 1978 and where we are in 2010. There is nothing new in this video in the sense that the insights were unique to Friedman. Economists have known these truths since before Adam Smith. What is unique is the clarity and force with which Friedman delivers the message. But that was not unique to this topic for Friedman. It was a staple of his discourse on any subject.
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What Milton Friedman Actually Said About Campaign Finance (blogs.hbr.org)
Free to Choose with Milton Friedman (kottke.org)
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By Monty Pelerin, on January 29th, 2010 As expected, the State of the Union (SOTU) speech was delivered with the usual élan from the gifted orator, President Obama. Unexpected, for most, was the content of the speech. President Obama “doubled down” on policies soundly rejected by the American people.
For a candidate who was so politically adept, his tone deafness in office is startling. From Jonah Goldberg:
Since taking office, Obama has continued to see the presidency as the perfect perch from which to campaign for a job he already has. The solution to every problem the White House runs into is “more Obama.” Much of this stems from Obama’s own arrogance. When people disagree with his health-care proposals, it is because they don’t really understand them or because they are misdirecting their anger at him. When Rep. Marion Berry, D-Ark., warned the president that the 2010 midterms were shaping up to be a replay of the 1994 Republican tsunami, Obama reportedly told him that there was one important difference between then and now: “Me.”
Voters soundly rejected Obama’s programs in Virginia, New Jersey and Massachusetts. Additional support for this verdict continues in the form of declining poll numbers for both the President and Democrats in general. Yet, “like a drunk in a bowling shirt at the craps table who insists his losses don’t disprove his ‘system’ for winning, Obama stands behind his bet.”
The State of the Union was a chance for Obama to regain his mojo and demonstrate the political savvy he showed
Continue reading Obama Denied Parole
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By Monty Pelerin, on January 27th, 2010
Herbert Hoover
I don’t know what President Obama will try to sell tonight in his State of The Union speech. I do know that what he says will have no relation to reality. But that could be said of any President in recent years with respect to this occasion. This particular President has speech-making skills that few of his predecessors had. He has an unusual ability to turn nothing into a great sounding speech.
Tonight will be little different. Talking heads, still in his camp, will rave about the speech after it is delivered. You will hear how he has regained his mojo and is now going to solve the economic problems. That, of course, will be nonsense. As any number of people have observed, what sounds like a great speech from this President does not read like one. Once removed from the pomp and circumstances associated with his stylistic delivery, his words wobble and usually collapse. That is why reading, as opposed to listening, is the better way to understand what has been proposed.
To put tonight’s speech into perspective, there is only one question that should be asked: “Why Mr. President did you squander an entire year on your fraudulent health care reform at the expense of dealing with the problems of Main Street?” That question should be crawling across every television screen in this country while he speaks.
The real State of the Union, as opposed to what you will hear, is captured by Michael
Continue reading President Hoover’s State of the Union
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By Monty Pelerin, on January 27th, 2010 Healthcare destroys a presidency and jeopardizes a political party.
In the fledgling days of the personal computer industry, software vendors frequently announced products that were not yet ready for release. The term “vaporware” was coined to describe such software. Most of these products never reached the marketplace. Some that did should not have.
The recent health-care reform effort was nothing more than a modern-day, political version of vaporware or, more aptly, VaporCare. The VaporCare bill never reached a point where it was ready for “release.” In software terminology, the legislation was nothing but “spaghetti code.” It was written by dozens, all of whom brought their own coding styles, wants and objectives. There was no guiding objective to the legislation other than “we must pass something, quickly.”
No one, including the various writers of the bill, the Congress or President Obama, had a comprehensive understanding of the legislation. The bill was a “moving target,” changing whenever criticisms arose, decision-makers met or vote-buying was required. Few of the ad hoc changes had anything to do with improving the quality of health care. As stated in The Legend of Bagger Obama:
At the end, there was no discernible logic behind the plan. Inconsistencies, deals, falsified data and outright lies were evident to anyone willing to look. Despite the problems and unpopularity, healthcare moved forward not unlike an ancient pagan ritual. Congressional Democrats [were willing to sacrifice] the best healthcare system in the world and the American taxpayer to their God, Bagger Obama.
No
Continue reading Healthcare Vaporizes Obama Presidency
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By Monty Pelerin, on January 15th, 2010
One of the simplest economic concepts to understand is the theory of demand. As the price of a good to users decreases, demand or use of that good will increase. As the price of a good approaches zero, theoretically the demand or use of the good will approach infinity. Nowhere is this principle better demonstrated than healthcare.
Here are some simple anecdotes from my past. In the 1950s, doctors made house-calls and charged nominal amounts for their services ($10 seems about right).
In 1962 I dislocated my shoulder in a charity alumni football game and was whisked to the hospital by ambulance. X-rays and re-positioning the shoulder were required. My father paid all the fees out of pocket. I am not sure what the cost was, but my father did not carry around great amounts of money. My guess would be in the $40 – $50 range.
In 1976, our four-year old son was awake all night with an ear problem, which ended with bleeding from the ear. My wife and I were panicked, especially because we had located to a new city only that week. The next morning (Sunday), we called a neighbor and received a recommendation for a pediatric practice. The doctor made a special visit to the office at 2:00 that afternoon and saw our child. The cost was $15.00.
So, what happened to our healthcare system? Medicare and Medicaid were instituted and that separated the price from the actual cost of the service. Government involvement soon expanded to the
Continue reading Free Healthcare
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Friedrich von Hayek
Friedrich von Hayek founded the Mont Pelerin Society.
“Monty Pelerin” is a pseudonym chosen by this blogger to convey general agreement with the philosophy, goals and spirit of the Mont Pelerin Society. No other connection exists between the blogger and the Society.
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