06 January 2006

Should food be free on eating?

Miss Sudha Shenoy comments on this post about the NHS at the Adam Smith Institute Blog;

1. “They are making huge savings...” Where? Where? Who benefits from these so-called ‘savings’? Have taxes been reduced?
You are not suggesting we should take money out of the NHS? The horror of it! You have to remember who the NHS is for, it has to think of the interests of it's employees first, obviously. Thus any surplus will naturally be consumed by increased salaries, especially of those smart civil servants who helpfully unburdened the government of the responsibility of healthcare (the private sector is always a good scapegoat when things go wrong), whilst simultaneously retaining control of the money and expanding the complexity of the bureaucracy required to manage these 'partnerships'.

2. “Taxpayers’ funds should be spent on cost-effective health care..” How cost-effective—when that same taxpayer simply stumps up whatever suppliers charge? Taxpayers don’t go bankrupt from unwise buying.
So elementary, and yet a fact that seems to escape the majority of people. Government cannot do cost accounting, ever, at all. It has no feedback mechanism for evaluating cost effectiveness as it is an enforced monopoly supplier.

3. Why not provide supermarkets on the same principle? The state pays all grocery bills, but the market provides the groceries. Surely this would result in cost-effective supply of groceries—wouldn’t it?
Because food isn't essential... uh... no... I'm confused! Socialism must be a synonym of cognitive dissonance.

A stronger point the statists might make would be to note that healthcare is essentially a service based on insurance (i.e. often costly treatment is required for short, unpredictable periods, whilst there may be long periods where no healthcare is required), thus they could try and make a case for compulsory insurance, arguing that without compulsion people would underestimate the costs and risk and fail to protect themselves adequately. However, even given this thesis (one which I would also contest, for reasons I will not go into right now) , the argument only goes that far and no further, giving no reason why any services should be directly run by the state. Indeed that state would only be requiring and monitoring insurance contributions.

However my digression is moot, the Adam Smith Institute is not arguing that the state should merely ensure individuals provide for their own health or even that it should subsidise the poor's healthcare insurance. The user of healthcare services will not benefit from "choice and the competition between new, diverse providers" if these services are still funded and administered through central government. The Adam Smith Institute is essentially arguing that the state should continue to control and administer healthcare from the centre, a dangerous line of thinking that has exactly the same repercussions as Miss Shenoy implies it would have (and has had) in relation to food production; at the minimum creating artificial shortages, as already occur, and potentially far worse. One need only look to the biggest famines in history - oddly enough a result of centrally planning and controlling food production.

Maybe this is a position that the Adam Smith Institute believes is pragmatic in the current politcal climate and, if it was their decision, would ultimately welcome wholesale privatisation of healthcare provision in the UK. One can only hope.

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