Obama speaking to kids

All the news that's new and approved. We want your opinion, no matter how wrong it is.

Moderator: EG Members

Obama speaking to kids

Postby dialdfordesi » Wed Sep 09, 2009 7:41 pm

If you've been following the news, you know that Obama gave a speech to the schoolchildren of America. This speech has been the source of a lot of outrage. Parents are saying that they don't want their kids to be brainwashed by Obama's political agenda.

This is straight from CNN:
"Thinking about my kids in school having to listen to that just really upsets me," suburban Colorado mother Shanneen Barron told CNN Denver affiliate KMGH last week, before the text of the speech was released.

"I'm an American. They are Americans, and I don't feel that's OK. I feel very scared to be in this country with our leadership right now."

Florida Republican Party Chairman Jim Greer accused Obama last week of trying to "indoctrinate America's children to his socialist agenda."


What the hell was Obama's speech about? Urging kids to work hard in school. This stupidity makes me lose faith in humanity.
Trust me, I'm a doctor!
User avatar
dialdfordesi
n00b eater
 
Posts: 899
Joined: Sat Jul 02, 2005 9:52 pm
Location: Bumblefuck, Midwest.

Re: Obama speaking to kids

Postby papasith » Wed Sep 09, 2009 8:26 pm

these are the same parents that blame their horrible parenting skills on video games, ect.
User avatar
papasith
Augh! Bright sky fire burn eyes!
 
Posts: 391
Joined: Sat Dec 06, 2008 7:07 pm
Location: baton rouge, la

Re: Obama speaking to kids

Postby War Machine » Wed Sep 09, 2009 11:35 pm

They were boycotting his speech long before he made it. As soon as it was known that Obama would be speaking, some parents were already announcing that they would keep their kids at home. Here's a video on the whole situation about 5 days before the speech happened:
"Clearly my escape had not been anticipated, or my benevolent master would not have expended such efforts to prevent me from going. And if my departure displeased him, then that was a victory, however small, for me." - Raziel
User avatar
War Machine
Tastes like burning!
 
Posts: 1457
Joined: Sun Apr 08, 2007 7:30 pm
Location: San Diego now

Re: Obama speaking to kids

Postby DrPepperPro » Thu Sep 10, 2009 1:46 am

I like that guy's voice.
User avatar
DrPepperPro
Dirty Sennin
 
Posts: 2209
Joined: Mon Aug 20, 2007 5:16 pm

Re: Obama speaking to kids

Postby Starnum » Fri Sep 11, 2009 2:02 am

Stupid ass ignorant republicans. I'd be honored to have the president speak to my daughter if she were in school. Being a republican is fine, but being a paranoid hate-mongering fucktard is unacceptable. They should at least know what they're talking about first before they start throwing a fit. "Oh noes, I didn't vote for him, I don't want him talking to my kids." What happened to the days when the president was a great and respected man, that the whole nation respects, regardless of their political views? Oh yeah, Bush ruined that for everyone. I'm sure these same people would be fine with Bush talking about his policies and promoting the war and shit, but Obama didn't even talk about politics and they start throwing a fit before they even know the facts. It's sad really.
User avatar
Starnum
Elven King
 
Posts: 8272
Joined: Tue Jan 11, 2005 3:38 am
Location: Hynneth Kore

Re: Obama speaking to kids

Postby The Prince » Sat Sep 12, 2009 7:47 am

Starnum wrote:Stupid ass ignorant republicans. I'd be honored to have the president speak to my daughter if she were in school. Being a republican is fine, but being a paranoid hate-mongering fucktard is unacceptable. They should at least know what they're talking about first before they start throwing a fit. "Oh noes, I didn't vote for him, I don't want him talking to my kids." What happened to the days when the president was a great and respected man, that the whole nation respects, regardless of their political views? Oh yeah, Bush ruined that for everyone. I'm sure these same people would be fine with Bush talking about his policies and promoting the war and shit, but Obama didn't even talk about politics and they start throwing a fit before they even know the facts. It's sad really.


LOL...chill nancy.

How original....."Lets turn this topic into another I hate Bush rant".

"paranoid hate-mongering fucktard is unacceptable."....Where were you during 2000-2008?

Actually you should be blaming Bill Clinton, for allowing a culture of disrespect toward the president to become an acceptable norm. Clinton jokes carried SNL through the late 90's.

In regards to the president addressing kids, the democrats (ex. congressman, Washington Post) were all up in arms when Bush 41 did the same thing....its called politics.

FYI.... Obama went back and did revise his planned talked, only after hearing that the public had concerns about his address.
Image
Let's put a smile on that face...............
User avatar
The Prince
Tastes like burning!
 
Posts: 1147
Joined: Tue Sep 18, 2007 5:31 am
Location: Near a computer

Re: Obama speaking to kids

Postby Starnum » Sat Sep 12, 2009 8:25 am

Ah well, don't take any of that too seriously. I was just ranting because I was in a bad mood when I wrote that and needed to let off some steam. I don't really care either way. I liked Clinton though, even if you're right. Though comedians have been making fun of the president and politics for a long time, since before Clinton, I'm sure. There's a difference between making fun of the president, and outright hating him, meh. I'm not terribly political, but I tend to lean towards the left. From what I've seen you post about, you seem to be a republican. Maybe not, but either way, that's fine as well. Personally I think Bush should be tried for war crimes, but I don't feel like getting into all of that, and I have no desire to start another hate thread against Bush. The guy's gone now, that's good enough for me. So don't worry about any of that, and please don't take any offense to anything I've said. No reason we can't agree to disagree, if we must. I never had any problems with Bush senior either, of course I was a kid when he was in office, so what would I know, heh. I'm just saying, I don't hold anything against a candidate or a person based on their political party, it's all about what they do, and how they act. Anyway, I just think it's silly when people make a big deal over nothing (Even though we all do it from time to time, no one is perfect.), like when some parents get upset that other children are allowed to pray at school, or something like that. I mean, I believe in separation of church and state as well, but as long as the teacher isn't teaching a particular faith or something, then the other children should be allowed to practice whatever beliefs they like. *shrugs*
User avatar
Starnum
Elven King
 
Posts: 8272
Joined: Tue Jan 11, 2005 3:38 am
Location: Hynneth Kore

Re: Obama speaking to kids

Postby War Machine » Sat Sep 12, 2009 9:57 am

The Prince wrote:
Starnum wrote:Stupid ass ignorant republicans. I'd be honored to have the president speak to my daughter if she were in school. Being a republican is fine, but being a paranoid hate-mongering fucktard is unacceptable. They should at least know what they're talking about first before they start throwing a fit. "Oh noes, I didn't vote for him, I don't want him talking to my kids." What happened to the days when the president was a great and respected man, that the whole nation respects, regardless of their political views? Oh yeah, Bush ruined that for everyone. I'm sure these same people would be fine with Bush talking about his policies and promoting the war and shit, but Obama didn't even talk about politics and they start throwing a fit before they even know the facts. It's sad really.


LOL...chill nancy.

How original....."Lets turn this topic into another I hate Bush rant".

"paranoid hate-mongering fucktard is unacceptable."....Where were you during 2000-2008?

Actually you should be blaming Bill Clinton, for allowing a culture of disrespect toward the president to become an acceptable norm. Clinton jokes carried SNL through the late 90's.

In regards to the president addressing kids, the democrats (ex. congressman, Washington Post) were all up in arms when Bush 41 did the same thing....its called politics.

FYI.... Obama went back and did revise his planned talked, only after hearing that the public had concerns about his address.
Did he insult your boyfriend or something? Why are you so pissed that he trashed Bush? It's not like we haven't done this with other presidents before him, hell you just did it with Clinton. This is not about disrespect, it's about partisan politics eroding the minds of people (or at least people with eroded minds banding together). Some republicans are so frustrated about no longer being the majority in Congress that they resort to blatant fallacies in an attempt to gain some power back. But what sickens me more is the sympathizers, people who give the aforementioned idiots power by listening to them, defending them and treating them like martyrs. I've always felt that people who side with a political party make a mistake when choosing to affiliate with one of the two main political parties in the US because no matter how much they want to, neither of them will truly reflect their interests, and when anyone in the party is under any kind of trouble, the whole party gets attacked and the sympathizers do nothing but apologize and defend them. They are your representatives, not your goddam boyfriends.

And by the way, Obama revised his speech because the message might be misconstrued (more specifically, just that one question mentioned in the video I just posted), not because it was controversial necessarily. Not that it mattered though, those nutjobs don't listen to reason.
"Clearly my escape had not been anticipated, or my benevolent master would not have expended such efforts to prevent me from going. And if my departure displeased him, then that was a victory, however small, for me." - Raziel
User avatar
War Machine
Tastes like burning!
 
Posts: 1457
Joined: Sun Apr 08, 2007 7:30 pm
Location: San Diego now

Re: Obama speaking to kids

Postby Starnum » Sun Sep 13, 2009 3:03 am

War Machine wrote:Did he insult your boyfriend or something? Why are you so pissed that he trashed Bush? It's not like we haven't done this with other presidents before him, hell you just did it with Clinton. This is not about disrespect, it's about partisan politics eroding the minds of people (or at least people with eroded minds banding together). Some republicans are so frustrated about no longer being the majority in Congress that they resort to blatant fallacies in an attempt to gain some power back. But what sickens me more is the sympathizers, people who give the aforementioned idiots power by listening to them, defending them and treating them like martyrs. I've always felt that people who side with a political party make a mistake when choosing to affiliate with one of the two main political parties in the US because no matter how much they want to, neither of them will truly reflect their interests, and when anyone in the party is under any kind of trouble, the whole party gets attacked and the sympathizers do nothing but apologize and defend them. They are your representatives, not your goddam boyfriends.

And by the way, Obama revised his speech because the message might be misconstrued (more specifically, just that one question mentioned in the video I just posted), not because it was controversial necessarily. Not that it mattered though, those nutjobs don't listen to reason.


Very well put, thank you. I totally agree, and should and do strive to have such an "outside the box" way of thinking about it all. ;)
User avatar
Starnum
Elven King
 
Posts: 8272
Joined: Tue Jan 11, 2005 3:38 am
Location: Hynneth Kore

Re: Obama speaking to kids

Postby The Prince » Sun Sep 13, 2009 10:11 am

War Machine wrote:
The Prince wrote:
Starnum wrote:Stupid ass ignorant republicans. I'd be honored to have the president speak to my daughter if she were in school. Being a republican is fine, but being a paranoid hate-mongering fucktard is unacceptable. They should at least know what they're talking about first before they start throwing a fit. "Oh noes, I didn't vote for him, I don't want him talking to my kids." What happened to the days when the president was a great and respected man, that the whole nation respects, regardless of their political views? Oh yeah, Bush ruined that for everyone. I'm sure these same people would be fine with Bush talking about his policies and promoting the war and shit, but Obama didn't even talk about politics and they start throwing a fit before they even know the facts. It's sad really.


LOL...chill nancy.

How original....."Lets turn this topic into another I hate Bush rant".

"paranoid hate-mongering fucktard is unacceptable."....Where were you during 2000-2008?

Actually you should be blaming Bill Clinton, for allowing a culture of disrespect toward the president to become an acceptable norm. Clinton jokes carried SNL through the late 90's.

In regards to the president addressing kids, the democrats (ex. congressman, Washington Post) were all up in arms when Bush 41 did the same thing....its called politics.

FYI.... Obama went back and did revise his planned talked, only after hearing that the public had concerns about his address.
Did he insult your boyfriend or something? Why are you so pissed that he trashed Bush? It's not like we haven't done this with other presidents before him, hell you just did it with Clinton. This is not about disrespect, it's about partisan politics eroding the minds of people (or at least people with eroded minds banding together). Some republicans are so frustrated about no longer being the majority in Congress that they resort to blatant fallacies in an attempt to gain some power back. But what sickens me more is the sympathizers, people who give the aforementioned idiots power by listening to them, defending them and treating them like martyrs. I've always felt that people who side with a political party make a mistake when choosing to affiliate with one of the two main political parties in the US because no matter how much they want to, neither of them will truly reflect their interests, and when anyone in the party is under any kind of trouble, the whole party gets attacked and the sympathizers do nothing but apologize and defend them. They are your representatives, not your goddam boyfriends.

And by the way, Obama revised his speech because the message might be misconstrued (more specifically, just that one question mentioned in the video I just posted), not because it was controversial necessarily. Not that it mattered though, those nutjobs don't listen to reason.



You seem so caught up in trying to draw conclusions about me and pidgeon-hole me for arguing from a POV you're not comfortable with, you were too caught up in your emotional ire to even notice that our premise is the same.

I don't know why you are quoting me because your little rant seems to be accusing me of being partisan, when my rationale was to point out a double-standard (just the opposite). And that in politics the pendulum swings in both directions....

Which makes your words seem all the more ironic considering you want to come off as above the fray in all of this, yet you're the one that seems to have the agenda. Where you're basically chastising me for making a point, that in fact coincides with those you are attempting to make......

Starnum wrote: Very well put, thank you. I totally agree, and should and do strive to have such an "outside the box" way of thinking about it all. ;)


As shall I. I am humbled in your humility. :wink:
Image
Let's put a smile on that face...............
User avatar
The Prince
Tastes like burning!
 
Posts: 1147
Joined: Tue Sep 18, 2007 5:31 am
Location: Near a computer

Re: Obama speaking to kids

Postby War Machine » Sun Sep 13, 2009 8:11 pm

The Prince wrote:You seem so caught up in trying to draw conclusions about me and pidgeon-hole me for arguing from a POV you're not comfortable with, you were too caught up in your emotional ire to even notice that our premise is the same.

I don't know why you are quoting me because your little rant seems to be accusing me of being partisan, when my rationale was to point out a double-standard (just the opposite). And that in politics the pendulum swings in both directions....

Which makes your words seem all the more ironic considering you want to come off as above the fray in all of this, yet you're the one that seems to have the agenda. Where you're basically chastising me for making a point, that in fact coincides with those you are attempting to make......

I only called you out for defending Bush, the rest of my post is on the topic at hand disagreeing with you that the problem stems from disrespect, not that you were being partisan or anything (I went on a tangent there and I wasn't very clear about the change, sorry).

My ire comes from people who think everything is black and white, and live their life on the side of a coin not realizing life is not a coin. Testament to this was a quote made famous by Bush several years back when he was asking for support to invade Afghanistan where he says: "You are either with us or against us." In this case the false dilemma is support for the war, not the two main political parties, but you get the idea of how that way of thinking is absurd and childish.
"Clearly my escape had not been anticipated, or my benevolent master would not have expended such efforts to prevent me from going. And if my departure displeased him, then that was a victory, however small, for me." - Raziel
User avatar
War Machine
Tastes like burning!
 
Posts: 1457
Joined: Sun Apr 08, 2007 7:30 pm
Location: San Diego now

Re: Obama speaking to kids

Postby Eldo » Tue Sep 15, 2009 1:18 pm

This is an immensely interesting conversation but unfortunately I don't have all the facts (I'm not up to date with current affairs, too many things on my plate at the moment).

From what I've read about the Washington Post, it was more about how Bush should have taken action at 9/11 when he was reading to the kids. But meh, again, my facts might be wrong.

And I seriously doubt that disrespecting the President is due to Clinton. Come on, why don't you blame it on Nixon for Watergate? It's more about the individual's action, then soiling an 'image branding'.

Right now, Obama isn't getting much love from the conservative because: he's black; he holds some socialist views, etc. Obama thinks EVERYONE should have the same kind of access to services (let's say for my example, health care), while conservatives are saying, 'hey hold on, I'm scared of change. I worked hard to earn my private health care and goddamn it you lazy punk asses ain't gonna have it handed to you'.

Well, that's my views anyway. Like I said, I don't have all the facts so I dare not make any further assumptions/opinions about this.
Image

I don't think half the toilet seats in the world are as clean as I should like; and only half of those are half as clean as they deserve. - tsubaimomo, July 26, 2010 3:00 am
User avatar
Eldo
Of The Abyss
 
Posts: 7435
Joined: Tue Jan 11, 2005 9:10 pm
Location: Yours or mine?

Re: Obama speaking to kids

Postby The Prince » Fri Sep 18, 2009 5:58 am

Eldo wrote:This is an immensely interesting conversation but unfortunately I don't have all the facts (I'm not up to date with current affairs, too many things on my plate at the moment).

From what I've read about the Washington Post, it was more about how Bush should have taken action at 9/11 when he was reading to the kids. But meh, again, my facts might be wrong.

And I seriously doubt that disrespecting the President is due to Clinton. Come on, why don't you blame it on Nixon for Watergate? It's more about the individual's action, then soiling an 'image branding'.

Right now, Obama isn't getting much love from the conservative because: he's black; he holds some socialist views, etc. Obama thinks EVERYONE should have the same kind of access to services (let's say for my example, health care), while conservatives are saying, 'hey hold on, I'm scared of change. I worked hard to earn my private health care and goddamn it you lazy punk asses ain't gonna have it handed to you'.

Well, that's my views anyway. Like I said, I don't have all the facts so I dare not make any further assumptions/opinions about this.


I am always interested in hearing what you have to say.

Though I wouldn't exactly agree that opposition over health concerns are over the issue of "picking up the tab" for the "35mil" who don't have healthcare, so much as giving the government complete control over it. Under a single-payer system (which will be inevitable with the government option....for reasons I won't go into) there will be government rationing, with beurocrats making decisons on who and what kind of treatment citizens get, based on cost concerns and a limited budget.

But this is a debate that we could go on for hours over......

And in regards to my statement about George H. Bush speaking to school children and the Democrats raising hell about it. I was taking about something that happened back in the early 90"s with the former Bush.

http://pqasb.pqarchiver.com/washingtonp ... rtising%27
Image
Let's put a smile on that face...............
User avatar
The Prince
Tastes like burning!
 
Posts: 1147
Joined: Tue Sep 18, 2007 5:31 am
Location: Near a computer

Re: Obama speaking to kids

Postby War Machine » Fri Sep 18, 2009 7:05 am

The Prince wrote:Though I wouldn't exactly agree that opposition over health concerns are over the issue of "picking up the tab" for the "35mil" who don't have healthcare, so much as giving the government complete control over it. Under a single-payer system (which will be inevitable with the government option....for reasons I won't go into) there will be government rationing, with beurocrats making decisons on who and what kind of treatment citizens get, based on cost concerns and a limited budget.

Unless we cut military spending, there will be some budgeting problems that's for sure, but you can't forget the health insurance companies, they are the real opposition to healthcare reform. They're the ones that pay Republicans and Democrats alike to slowdown and stop healthcare reform (aside from lobbyists).

It's true what you say that, whether the reform comes in the form of SIngle Payer (government pays for everything) or Public Option (government competes against insurance companies) there will be a significant shift in power towards the government, but truthfully, I'd much prefer a bureaucrat who is forced to abide by the law trying his best to provide as much healthcare with the limited budget he has doing the rationing, than a faceless corporation whose primary focus is to please investors and raise profits by denying coverage and gouging its clients.
"Clearly my escape had not been anticipated, or my benevolent master would not have expended such efforts to prevent me from going. And if my departure displeased him, then that was a victory, however small, for me." - Raziel
User avatar
War Machine
Tastes like burning!
 
Posts: 1457
Joined: Sun Apr 08, 2007 7:30 pm
Location: San Diego now

Sorry about length, but this is a very important issue

Postby The Prince » Fri Sep 18, 2009 8:20 am

Military spending has nothing to do with any of this.

And if you're talking about the recent wars in Afghan/Iraq, then consider the fact that the current "stimulus" packages in the past year alone could have afforded war for the next century. But like i said that is neither "here nor there".


- One problem with the current Insurance company framework, is that there is a restriction from out-of-state insurance coverage thus reducing the potential for competition in local markets. Where at a state level one or two companies may have a local monopoly. But it is the government (from the pressure of lobbying and special interests) that has passed such regulations to allow this. Why not allow companies to compete for these contracts nationally?

If you believe in the free-market it is competition that will drive down costs while providing and the best quality possible. Because in the end it will be those companies that provide the best and most services for the money that will thrive, forcing the competition to follow suit. Though the public option is being advertised to address the competition instead, in fact it will destroy it. The current model would involve the government issuing taxes on private policies used by individual's and companies, while providing tax incentives for those choosing the public options. The fact that the government has an infinite source of revenue and can set the rules and anyway they see it in their favor, competing against the government in the marketplace by defintion destroys free-market competition. In time employers will go with the public option, dropping previous options simply because its cost-effective from their standpoint (regardless of quality or employee preference) and because most people are insured through their employer people will be forced into taking the public "option" (option in name only).

- I know you want to think that these companies are pure evil and can't be trusted, and I'm sure there are instances where I would agree. BUT what exactly has the government ever done that gives you so much faith, as to allow yourself to accept giving even more of your hard earn money (due to the significant increase in taxes that such a program will inevitably require), but more importantly........control over your health (and that of your family's). When, literally, the most important decisions in the lives of your family will be made, not by you, but by some pencil pusher beaurocrat who's only job is "whether providing the necessary level of care, in ur case, is worth it to society as a whole".

And since when can we expect beaurocrats to abide by the law? Just look up the name Charlie Rangle...only in government can a person be in charge of the same commitee leading his own investigation. Where else would we have the head of the IRS be brought up on tax evasion charges and still be confirmed after the fact? And these guys are probably saints by Capital Hill standards....

- Once again....I'll ask on what basis do you leave so much trust in government?

Consider..the "pawnsy" scheme know as social security/ Hurricane Katrina/ the Uniteds States education system/ scathing mis-management of the mortgage industry prior to collapse/ billions of dollars in bailouts to the same companies whose greedy framework were hugely responsible for the market collapsing in the first place/ using our tax-payer money for "cash for clunkers"....why not just give the money back to the taxpayers instead of just another "bail-out" of another mismanaged (now government-controlled) insititution/ over $500M of our own money funding G5 corporate jets for members of Congress......etc
Image
Let's put a smile on that face...............
User avatar
The Prince
Tastes like burning!
 
Posts: 1147
Joined: Tue Sep 18, 2007 5:31 am
Location: Near a computer

Re: Obama speaking to kids

Postby Eldo » Fri Sep 18, 2009 1:03 pm

The Prince wrote:Though I wouldn't exactly agree that opposition over health concerns are over the issue of "picking up the tab" for the "35mil" who don't have healthcare, so much as giving the government complete control over it. Under a single-payer system (which will be inevitable with the government option....for reasons I won't go into) there will be government rationing, with beurocrats making decisons on who and what kind of treatment citizens get, based on cost concerns and a limited budget.


I can understand your concern about equity/equality of the an national healthcare insurance scheme in America. I was going to add that Australia currently has one of the best healthcare in the world (in my opinion), but then I realised that governments, politics are a completely different beasts. If it was only based on the 'government rationing' part, I would try to alleviate your concerns by showing how well the system is working in Australia (although not without its problems). However, due to the nature of America politics and the influence of pharmaceutical companies, I don't think that example would work. Perhaps if the pharmaceutical companies didn't exert that much of an effect on the American public, then we can consider an uncomplicated framework in which the healthcare would be based on. But unfortunately, Americans would always get screwed by the branding and transparency of the pharmaceutical companies and the subtle or overt influence they exert.
Image

I don't think half the toilet seats in the world are as clean as I should like; and only half of those are half as clean as they deserve. - tsubaimomo, July 26, 2010 3:00 am
User avatar
Eldo
Of The Abyss
 
Posts: 7435
Joined: Tue Jan 11, 2005 9:10 pm
Location: Yours or mine?

Re: Obama speaking to kids

Postby War Machine » Fri Sep 18, 2009 6:22 pm

How can I put so much faith in government? Who do you propose I put my faith in instead? Free market? The same unstable market that has brought about several economic recessions? At the very least I can protest the government, if there's something the I believe the government is doing wrong, I can protest, but if I try to protest a company all they gotta say is "you don't have to buy from us" and they're free to go about their day, and if none of the competition provides what I'm looking for, I'm stuck in limbo where nobody provides what I'm looking for.

Competition doesn't always increase quality, most of the time it only drives down costs, just look at the computer hardware industry, aside from Apple, they're all competing to sell the cheapest crap they can make, not the best. How many years did it take for music industry to provide music downloads? The people obviously wanted it for years, but the idiots were fucking afraid of it or something till Apple pushed them to it. And it was a fucking battle to get to the point that it is now, cause when it started they had to do a shitload of deals and talks to convince those idiots that music downloads were a good idea.

What you were describing about some bureaucrat deciding who gets healthcare and who doesn't is the idea of the "death panels" that some idiots began to propagate, they're simply not true. By law, according to the reform, the only person in charge of who gets certain treatments and who doesn't is your doctor and no one else. In our current system, the decision maker is the doctor as well, if the treatment is accepted by the health insurance company.

Look at England, France, Italy, Denmark, Canada, Australia, etcetera, who have the government providing some sort of healthcare and notice how the economy hasn't collapsed as you thought they would. Look at Germany, who has an array of private insurers providing the healthcare directly competing against the government and notice the market is still going. Practically every other country (even those in a worse economic status than the US) has done it without it turning into a goddam apocalypse and all of them are in a much better situation than us because of it, why the fuck shouldn't we strive for that?
"Clearly my escape had not been anticipated, or my benevolent master would not have expended such efforts to prevent me from going. And if my departure displeased him, then that was a victory, however small, for me." - Raziel
User avatar
War Machine
Tastes like burning!
 
Posts: 1457
Joined: Sun Apr 08, 2007 7:30 pm
Location: San Diego now

Re: Obama speaking to kids

Postby The Prince » Sat Sep 19, 2009 8:42 am

My intention was not turn this into a capitalism is "good" or "bad".
I used my free market example simply to pose a solution to a problem that doesn't involve the public option. Thus countering those justifying the public option on the basis of providing more competition, when if fact, government impedence (regulation) is what has inhibited compeitition in the first place.

On the topic of "death panels" I never heard of the term till recently. I would consider that whenever you put into place a system of individuals presiding over the "end of life care" options/decisions available to you or your family, it constitutes something towards a death panel. Seemingly everyone has their definition, so the point of whether the current health care bill has one is pointless.

But do you really think a doctor is going to ever consider treatment A, when he is told he'll only be reimbursed for treatment B.....do you at least acknowledge these issues will factor into his decision? The fact is publicly rationing health-care (assuming the government has some kind of budget) health-care decisions will always be based on cost effectiveness. Do you think criteria for people that get hired into auditing these services is that of "compassion".....or business background?

War Machine wrote:
Look at England, France, Italy, Denmark, Canada, Australia, etcetera, who have the government providing some sort of healthcare and notice how the economy hasn't collapsed as you thought they would. Look at Germany, who has an array of private insurers providing the healthcare directly competing against the government and notice the market is still going. Practically every other country (even those in a worse economic status than the US) has done it without it turning into a goddam apocalypse and all of them are in a much better situation than us because of it, why the fuck shouldn't we strive for that?


That's why they all come over here.

Though I like your passion....

I don't know where even to begin with this.....I can sit here and write a book on the why I believe nationalizing healthcare is something we should avoid. The simple fact that you are trying to use England's healthcare system as some standard to strive for, suggests to me that such time and effort may be better spent somewhere else.....some other time.

Something I came across.....perhaps somewhat relevant.
Free people can treat each other justly, but they can't make life fair. To get rid of the unfairness among individuals, you have to exercise power over them. The more fairness you want, the more power you need. Thus, all dreams of fairness become dreams of tyranny in the end.



Good day.
Image
Let's put a smile on that face...............
User avatar
The Prince
Tastes like burning!
 
Posts: 1147
Joined: Tue Sep 18, 2007 5:31 am
Location: Near a computer

Re: Obama speaking to kids

Postby War Machine » Sat Sep 19, 2009 10:09 am

The Prince wrote:My intention was not turn this into a capitalism is "good" or "bad".
I used my free market example simply to pose a solution to a problem that doesn't involve the public option. Thus countering those justifying the public option on the basis of providing more competition, when if fact, government impedence (regulation) is what has inhibited compeitition in the first place.
Yeah, I'm not talking about any socioeconomic system in general, they're too broad topics for what we're discussing right now, but I disagree with your statement that government regulation is what's kept the market from working, rather I'd say that it has stopped it from turning into chaos. This is by no means an absolute situation and there are many instances where that you said is true, but I argue that it's the same the other way, not every government intrusion is impeding market (and obviously, I believe our current situation with insurers demands regulation). The way I see it, a truly free market will never work in the same way that libertinism wouldn't work. Without any established boundaries it would all turn into chaos when certain groups make a grab for power (or market share).

Taking your example into consideration, I have only one question, would that plan immediately grant health insurance to the approximately 25 million US citizens who are currently uninsured? If the answer is no, then it simply isn't a viable option (for the time being at least). You could say the public is being too rash, but with so many uninsured people, don't you think they have a very legitimate reason to be wanting a solution now?

The Prince wrote:On the topic of "death panels" I never heard of the term till recently. I would consider that whenever you put into place a system of individuals presiding over the "end of life care" options/decisions available to you or your family, it constitutes something towards a death panel. Seemingly everyone has their definition, so the point of whether the current health care bill has one is pointless.
I mentioned that term because you seemed to be on the same idea, but call it what you will, what I was trying to say is that there will be no board that determines the worthiness of individuals to receive care. I'll level with you in that there might be (I haven't heard otherwise, but I haven't checked either) a board that says "so much money can go to these kinds of treatment" for example, but there will definitely be no board that does this on a case by case basis.

The Prince wrote:But do you really think a doctor is going to ever consider treatment A, when he is told he'll only be reimbursed for treatment B.....do you at least acknowledge these issues will factor into his decision? The fact is publicly rationing health-care (assuming the government has some kind of budget) health-care decisions will always be based on cost effectiveness. Do you think criteria for people that get hired into auditing these services is that of "compassion".....or business background?
They're already being rationed by insurance companies, why can't you see that? We are already in that nightmare you're describing, only that the perpetrators are faceless companies who can't be held accountable for anything. Besides, even to a greedy company, a worker is worth more alive than dead, the driving force doesn't have to be compassion, only reason. Also, as a small example that it can be done, the English healthcare system actually encourages doctors to get their patients healthier (having their patients quit smoking, exercise more, etc) by giving them incentives according to the progress they're making.

And by the way, I keep hearing people dismiss other countries' healthcare systems entirely with that same argument you just made, but I have never seen any examples of massive immigration or travel to the US for the purpose of healthcare they couldn't get at their country of origin. In fact, I've only heard the contrary, where people go to countries other than the US for looking for healthcare they couldn't get here.

The Prince wrote:I don't know where even to begin with this.....I can sit here and write a book on the why I believe nationalizing healthcare is something we should avoid. The simple fact that you are trying to use England's healthcare system as some standard to strive for, suggests to me that such time and effort may be better spent somewhere else.....some other time.
Humor me, what could be so atrocious that it's worth keeping the lives of 25 million people at risk? Having the fire department and the police department seem like good ideas to me.

PS: I liked that quote you posted, I'd argue against it, but it's still pretty good. Who said it?

PPS: Fuck, it's 3AM... :? If there's any portion of my post that I left mid sentence, I apologize, but I gotta get to bed.
"Clearly my escape had not been anticipated, or my benevolent master would not have expended such efforts to prevent me from going. And if my departure displeased him, then that was a victory, however small, for me." - Raziel
User avatar
War Machine
Tastes like burning!
 
Posts: 1457
Joined: Sun Apr 08, 2007 7:30 pm
Location: San Diego now

Re: Obama speaking to kids

Postby Eldo » Sat Sep 19, 2009 10:46 am

The Prince wrote:But do you really think a doctor is going to ever consider treatment A, when he is told he'll only be reimbursed for treatment B.....do you at least acknowledge these issues will factor into his decision? The fact is publicly rationing health-care (assuming the government has some kind of budget) health-care decisions will always be based on cost effectiveness. Do you think criteria for people that get hired into auditing these services is that of "compassion".....or business background?


Actually, that's not ALL that the government thinks about.

Here in Australia, there's a number of factors that's considered, cost effectiveness being one of them. There's also cost benefit, cost ministration, cost utility, where these parameters also factors in clinical data as well. So you can see there's a lot of pharmacoeconomics, economic evaluation, and clinical data, etc.

Let's use your example of treatment A and B. If treatment A and B are considered to be similar in efficacy and but treatment A is much more expensive, then treatment B is provided.

Another scenario, if treatment A treats the patient faster than treatment B, but the outcomes are the same, yet treatment A is much more expensive, then treatment B is reimbursed.

One more scenario, if treatment A is better than treatment B in every clinical parameter, but is much more expensive than treatment B, then treatment A has to be considered thoroughly to decide if it is worth putting it in the extra cost so that it is used to treat it.

Now, I'm going to pose other scenarios that are cause for rejecting treatment, but aren't as cut and dry.

Let's pose another scenario. If a treatment already exists to treat an incredibly rare, non-fatal but affects quality of life and occurs in a few people (let's say a couple of hundred people in Australia), then a new one comes along that is much costly, but offers better outcomes, would you as a taxpayer/government/health care professional be willing to add this treatment into the healthcare system? Possibly not, since there's better drugs for more fatal conditions that could be placed in the system. This is a cause for rejecting the application.

And another one: memantine for Parkinson's. While it works, it doesn't work THAT well (in fact, it's actually quite a shit drug and offers really minimal benefits, but offers PD sufferers 'hope' and more 'options'). It hasn't been on the healthcare system until recently in Australia, and even then it's under a lot of restrictions (only PD sufferers with a specific MME score could get it). That's normally a cause for rejection, but when the drug companies play politics, they do try to get their way somehow. It's a better good compromise though. Of course, the better drugs like levodopa is much more easily accessible and could be available to every PD sufferer because it damned well works. Not to people who could only afford it because they have private health insurance. EVERYONE WHO IS PRESCRIBED THEIR MEDICATIONS CAN AFFORD IT IN AUSTRALIA UNDER THE SYSTEM.

So there's a lot of decision making that's involved, and that some nefarious 'it all comes down to money'. To some extent, yes, it is true. But the people who decide also factors in account such as if the drug is effective clinically, and is it much better than the current treatment. So there's a lot of maths involved. The research are done by healthcare professionals or those with that sort of background (essentially an separate entity to the government in a way), but the final say is the government.

Let's not forget how the pharmaceutical companies have influence over prescribing patterns, people's drug taking behaviour, etc in AMerica. This is why in Australia, drug companies ARE NOT able to advertise drugs publicly, or be allowed to promote their products through pharmacies and doctors. They can be clever and subtly do it, but not overtly. There are no advertisements for Lipitor or Seretide on TV. Remember, if the drug company says their new treatment is million times better and shows you the data for it, it doesn't necessarily mean that. They're great at fudging the maths. But people would always claim that they're denied their better drug, when in actual fact, the drug is not that much better at treating said condition than existing drug.

And finally, who's to say that you can't get private health insurance even if there's a public one available? Sure, the prices would be different, but the choice is still there. The private one would probably also cover the treatments that governments won't (like your marginally better treatment A).

The Prince wrote:That's why they all come over here.


Can you say with all certainty that people move to America because they are dissatisfied with their current healthcare system? Other factors might be playing a role here, like more advanced treatments that aren't available in their country, or work related issues. So I have to agree with War Machine's point there. I can also counter your claim by telling you of some examples of Americans driving several hours to Canada to get their medications dispensed there. Hey, it costs less than America.

Your worries with the national healthcare system having the ability to blow up are not completely unfounded. But there are ways to combat this, such as the switch to bioequalvant generics and educating the public. It's worked very well for Australia right now. If you don't want to use the England healthcare's system as a template, then use Australia's (since I know more about it as I live here). As someone living in a country who has the national healthcare insurance in place (PBS) I'm trying to offer you all the information I can to help you come to a more balanced view to factor in your conclusions. I'm taking a step back here and trying to examine both sides of the debate. If you have any more questions, I'm here and I'll try to answer them.
Image

I don't think half the toilet seats in the world are as clean as I should like; and only half of those are half as clean as they deserve. - tsubaimomo, July 26, 2010 3:00 am
User avatar
Eldo
Of The Abyss
 
Posts: 7435
Joined: Tue Jan 11, 2005 9:10 pm
Location: Yours or mine?

Re: Obama speaking to kids

Postby The Prince » Sun Sep 20, 2009 3:07 am

This response is to Eldo:

My "That's why they come here" statement was regarding those, who can afford to, coming to the United States seeking treatment or procedures only available to them here. Even the experts would argue that the US offers the best health-care in the world, the issue lies in its accessibility.

Your post is very interesting to me. At least in principle the process of your health-care seems (actually) very feasible. The assessment process involved in reimbursement protocol based on standardizing "efficacy" seems to leave somewhat of a grey area (how do you determine efficacy in palliative care, how would you assess novel innovations in care that have yet to establish a track record...etc), though this is always going to be an issue within both the public and private sectors. But one benefit of private insurances, is that the individual has the oppurtunity to expand his coverage that would allow him to choose costly innovative care where the issue of "cost vs. benefit" is a decision that they can make for themself. Even standard policies allow the insured to choose treatment outside their normal coverage, if they are willing to pay premiums that require higher out-of-pocket expenses. Though this is not a perfect system (in the case of those unable to afford the premiums), it at least provides the individual a certain degree of choice in the matter.

I'm a pharmacist by trade, though I'm currently going back to school to recieve my doctorate. But during my days working in retail there were times that I felt my job was to be nothing more than an intermediary between doctors and the insurance companies. From my experience doctors are relatively ignorant of how insurance companies work, often prescribing new name brand medications that some young drug representative (sold a bill of goods to) that most insurances are never going to cover. So between being yelled at by patients for not being able to get them the medication prescribed to them, I have spent hours upon hours on the phone between doctors and insurances trying to compromise on alternative strategies for treatment within the framework of what the insurance is willing to cover. So I feel I do at least have some idea how insurance companies work and though these companies are businesses looking to make a profit they are no more (or less) greedy than "Mom and Pop" selling produce at the corner farmers market.

To this day my biggest issue with national healthcare is the tremendous power it gives the government over its citizens at the cost of a bunch of promises that the government will never live up to, with a track record to prove it. But that is something I will get into at a later time.....perhaps in my response to WM's last post.

Though I must say I am pleasantly impressed with how you guys run things down under.

Cheers Mate!
Image
Let's put a smile on that face...............
User avatar
The Prince
Tastes like burning!
 
Posts: 1147
Joined: Tue Sep 18, 2007 5:31 am
Location: Near a computer

Re: Obama speaking to kids

Postby Eldo » Sun Sep 20, 2009 4:08 am

The Prince wrote:My "That's why they come here" statement was regarding those, who can afford to, coming to the United States seeking treatment or procedures only available to them here. Even the experts would argue that the US offers the best health-care in the world, the issue lies in its accessibility.


Seeing how you guys 'pioneer' some of the treatments/procedures, the lack of availability in the other countries is not surprising. But that said, people do go away from their country of origin and to other countries that could offer the therapy (not necessarily US). And yes, pretty much accessibility is what War Machine and myself are concerned about.

The Prince wrote:Your post is very interesting to me. At least in principle the process of your health-care seems (actually) very feasible. The assessment process involved in reimbursement protocol based on standardizing "efficacy" seems to leave somewhat of a grey area (how do you determine efficacy in palliative care, how would you assess novel innovations in care that have yet to establish a track record...etc), though this is always going to be an issue within both the public and private sectors. But one benefit of private insurances, is that the individual has the oppurtunity to expand his coverage that would allow him to choose costly innovative care where the issue of "cost vs. benefit" is a decision that they can make for themself. Even standard policies allow the insured to choose treatment outside their normal coverage, if they are willing to pay premiums that require higher out-of-pocket expenses. Though this is not a perfect system (in the case of those unable to afford the premiums), it at least provides the individual a certain degree of choice in the matter.


They evaluate efficacy through clinical trials and other medical journals. The third party essentially evaluates the pharmacological treatment through research, makes it into a number, etc, sends it off to the health minister and goes to make a decision. If a 'novel' innovation have yet to establish a track record... well, it's not really novel at the moment, is it? Is it novel because the drug companies give you data saying it is (when they mess with the maths), or is it endorsed by several health care professionals and no clinical trials to make it up? With my PD example, memantine was considered a 'novel' treatment for PD. But it's actually a shit drug. However, with your palliative care example, like if opiod A is better than opiod B, that too, is based on data from clinical trials (and yes, it is hard to make a assessment to the evaluator and also to the people who conducted the trial) and additionally evaluating quality of life.

Similarly, War Machine does make a point about how insurance companies makes a similar decision in rationing and deciding if they should reimburse the treatment. But with insurance companies, they only see profit, whereas the government will probably see differently.

The Prince wrote:I'm a pharmacist by trade, though I'm currently going back to school to recieve my doctorate. But during my days working in retail there were times that I felt my job was to be nothing more than an intermediary between doctors and the insurance companies. From my experience doctors are relatively ignorant of how insurance companies work, often prescribing new name brand medications that some young drug representative (sold a bill of goods to) that most insurances are never going to cover. So between being yelled at by patients for not being able to get them the medication prescribed to them, I have spent hours upon hours on the phone between doctors and insurances trying to compromise on alternative strategies for treatment within the framework of what the insurance is willing to cover. So I feel I do at least have some idea how insurance companies work and though these companies are businesses looking to make a profit they are no more (or less) greedy than "Mom and Pop" selling produce at the corner farmers market.


I'm actually studying pharmacy at the moment, and in my final year so I have a more in-depth understanding of my country's health care. I understand your fears and that it is a completely different system. So if your above system applied in a national health care system, if that new name drug was prescribed by the doctor, then you'll only have to communicate to the doctor to get that changed. The doctor would know if that drug is covered by the health care system via computer systems, and the choice of that treatment would be up to the patient. No more talking with insurance companies about how that drug should be covered or what not. Seriously, is that new name drug that much better than your standard therapy? Is this new ACEI-A better than ACEI-B?

The Prince wrote:To this day my biggest issue with national healthcare is the tremendous power it gives the government over its citizens at the cost of a bunch of promises that the government will never live up to, with a track record to prove it. But that is something I will get into at a later time.....perhaps in my response to WM's last post.

Though I must say I am pleasantly impressed with how you guys run things down under.


To be honest, I'm not sure if you're not placing enough trust in the (current or previous) government, or if you're saying it's a failed system altogether. Let's say you have the Australian health care system put in place in America. Would you have any problems with it? If everyone could have accessible and affordable health care, why is that a bad thing exactly?
Image

I don't think half the toilet seats in the world are as clean as I should like; and only half of those are half as clean as they deserve. - tsubaimomo, July 26, 2010 3:00 am
User avatar
Eldo
Of The Abyss
 
Posts: 7435
Joined: Tue Jan 11, 2005 9:10 pm
Location: Yours or mine?

Re: Obama speaking to kids

Postby Starnum » Sun Sep 20, 2009 9:52 am

Wow, we should start a thread about health reform, heh. Well, I don't know a lot about this, like you guys seem to. What I do know is that my insurance is kind of expensive, and my deductible is really high. About the only thing it seems good for, is getting a physical. I get it through my employer, as I can't afford good personal health insurance. However, since the deductible is so high, I still can't afford to get sick. If my wife or I were to have any serious health issues, we'd pretty much be screwed. Thankfully my daughter is completely covered. Since we're a low income family, we at least qualify for a government program that covers her health expenses. I can't help but wonder why we pay for our own insurance every month though, when the deductible is so high, it's almost like we're throwing our money away. The only reason we have it in the first place is because it's affordable, but what good is it really, if they don't even pay anything until we cover more than we can already afford first. This is why I'm for health reform. It's not a huge deal right now, while we're still young, but I still have to hope neither of us has any serious health problems. This is why I hate insurance in general, it's like gambling, and I feel like I'm throwing my money away. Where is it going, and how is it actually helping me? What are the physical applications of each dollar? It's not like buying a hamburger, where I give them an amount of money that makes sense to me, and I actually get something back. It feels like I'm paying for nothing, and if I get in trouble, I might receive help, but probably not enough to matter. Unless it's really really bad, and then I'm already seriously fucked, so I'm still in a bad situation, heh. It's just like car insurance. I give them all this money, and hope nothing bad happens, because all I can afford is liability, which does me no good. I understand why it's necessary, because of course every one wants every one else to have car insurance, in case they run into you. So I get it, I just don't like it very much. I wish it all worked better, made more sense, was more beneficial, and I wish it cost less, because for me at least, it's still pretty expensive, even for liability and basic health care.
User avatar
Starnum
Elven King
 
Posts: 8272
Joined: Tue Jan 11, 2005 3:38 am
Location: Hynneth Kore

Re: Obama speaking to kids

Postby Rolos » Sun Sep 20, 2009 10:03 pm

Personal experience should not, cannot, be used as basis for the development of country-wide policies. People should read a little about the problem before jumping to support one course of action or the other.
I am no expert, but I have read a little. I have to confess I know absolutely nothing about the clinical part, but I'm pretty confident about my understanding of the economic side of the issue.

Here's a little introduction:

An extract from Tim Harford's "The Undercover Economist: Exposing Why the Rich Are Rich, the Poor Are Poor—and Why You Can Never Buy a Decent Used Car!":

Spoiler:
Jerome K. Jerome’s nineteenth-century comic travelogue Three
Men in a Boat begins with Mr. Jerome flipping through a medical
dictionary in the British Museum:
"I came to typhoid fever—read the symptoms—discovered
that I had typhoid fever, must have had it for months without
knowing it—wondered what else I had got; turned up St
Vitus’s Dance—found, as I expected, that I had that too—
began to get interested in my case, and determined to sift it
to the bottom, and so started alphabetically—read up ague,
and learnt that I was sickening for it, and that the acute stage
would commence in about another fortnight. Bright’s disease,
I was relieved to find, I had only in a modified form,
and, so far as that was concerned, I might live for years.
Cholera I had, with severe complications; and diphtheria I
seemed to have been born with. I plodded conscientiously
though the twenty-six letters, and the only malady I could
conclude I had not got was housemaid’s knee.
"
If you were Mr. Jerome, what would you do? He decided to go
for a trip up the river, but then he was not an economist. My
advice in such a situation would be to pick up the phone and buy
yourself some really generous medical insurance. After all, since


Spoiler:
you know for sure that you will be making expensive claims, why
not pay the premium for the best possible care?
Yet this raises a question. If people like Mr. Jerome could rush
to buy health insurance if and only if they knew they were ill,
who would want to insure them?
Inside information
This is more than an idle question. Economists have known for a
while that if one party to a deal has inside information and the
other does not, then markets may not work as well as we would
hope. That makes intuitive sense. But it wasn’t until an American
economist named George Akerlof published a revolutionary paper
in 1970 that the profession realized quite how profound and
dramatic the problem might be.
Akerlof chose as his example the market for used cars and
showed that even if the market is highly competitive, it simply
cannot work if sellers know a lot about the quality of their cars
and buyers do not. To take a stark example, let’s say that half the
used cars on sale are “peaches,” and half are “lemons.” The
peaches are worth more to prospective buyers than to sellers—
otherwise the buyers wouldn’t be buyers—say, $5,000 to prospective
buyers and $4,000 to sellers. The lemons are worthless pieces
of junk. Sellers know whether the car they’re selling is a lemon
or a peach. Buyers have to guess.
A buyer who doesn’t mind taking a fair gamble might think
that anything between $2,000 and $2,500 would be a reasonable
price for a car that has a 50-percent chance of being a peach, and
a 50-percent chance of being a lemon. The seller would also think
this was a fair deal for a 50/50 prospect, but the seller doesn’t
face a 50/50 prospect: the seller knows for certain whether the
car is a peach or a lemon. The problem is that a seller with a
lemon would bite your hand off if offered $2,500, but a seller
with a peach would find it rather insulting. Wandering around
offering $2,500 for a car, you quickly discover that only lemons
are for sale at that price. Of course, if you offered $4,001 you


Spoiler:
would also see the peaches on the market—but the lemons won’t
go away, and $4,001 is not an attractive price for a car that only
has a 50-percent chance of running properly.
This isn’t just a trivial problem around the fringes of the market.
In this scenario, there is no market. No seller is willing to sell
a peach for less than $4,000, but no buyer is willing to offer that
much on a car that has a 50-percent chance of being a lemon.
Sellers don’t offer peaches for sale, buyers know that they won’t,
and in the end the only cars that are traded are worthless lemons,
which get passed around for next to nothing. Less extreme assumptions
about the problem lead to less extreme breakdowns
of the market, but the conclusions are similar: if some people
know more than others about the quality of a product, then
some high-quality products may not be traded at all, or not be
traded very much.
Anyone who has ever tried to buy a secondhand car will appreciate
that Akerlof was on to something. The market doesn’t work
nearly as well as it should; secondhand cars tend to be cheap and
of poor quality. Sellers with good cars want to hold out for a
good price, but because they cannot prove that a good car really is
a peach, they cannot get that price and prefer to keep the car for
themselves. You might expect that the sellers would benefit from
their inside information, but in fact there are no winners: smart
buyers simply don’t show up to play a rigged game.
Let’s be clear about how dramatic and how worrying this problem
is. What Akerlof described is not a market where some people
get ripped off; it’s much more serious than that. He described a
market that should exist and simply doesn’t because of the corrosive
force of inside information. Sellers with good cars should be
trading with buyers—each trade produces $1,000 of value, because
that’s the difference between the value to the seller and the
value to the buyer. If the price is close to $4,000, the buyer gets
more of that value, and if it is close to $5,000, the seller gets
more. But Akerlof showed that none of those value-creating trades
happen because the buyers will not buy without proof, and the
sellers cannot offer proof.


Spoiler:
The market for used cars is not the only one affected by inside
information. Think about furniture in a rented apartment—why
is it never built to last? Akerlof ’s model provides an answer. Apartments
have many noticeable, even obvious, attributes that can
influence our decision whether or not to rent—size, location,
interior design, and so on. But there are also qualities that are
difficult to observe—for instance, whether the furniture is durable.
The landlord has little incentive to provide expensive, hardwearing
furniture, since this is not one of the features that
potential tenants can recognize before they move in, and so not
one for which they are willing to pay. (Of course, the landlord
might also go for cheap, fragile furniture because he expects the
tenants to trash whatever he puts in the flat. But that fear is equally
an argument to get in more durable stuff.) As a result, there is a
market for rental apartments with flimsy furniture but not a market
for rental apartments with durable furniture.
Inside information also means that you can’t get a decent meal
in a tourist trap like London’s Leicester Square, Times Square in
Manhattan, or the Plaka in Athens. With few exceptions, the
hungry visitor will pay a lot for mediocre cuisine. Tourists are
willing to pay high prices because they have no sense of where
better alternatives, even just a few streets away, might be found.
But the tourist-trap phenomenon is not just about high prices. If
it was, we would see a wide range of restaurants, charming little
bistros, and downscale pasta or burger joints, all kinds of food
from superb to disastrous, all charging a premium. Instead, we
see a truncated market—high-quality places, whether the good
food is fried chicken or fine dining, are simply not to be found.
The reason is simple enough; tourists will only be making a single
visit and will find it hard to pick out the great food from the bad.
Good restaurants all locate where they are more likely to be appreciated
by more informed locals. The bad ones remain . . . the
“lemons” of the restaurant trade.
It’s worth emphasizing that Akerlof is not describing universal
ignorance but a situation where one side knows more than the


Spoiler:
other. If buyers and sellers were both ignorant about whether a
car was a lemon or a peach there would be no problem: buyers
would be willing to pay up to $2,500 for a car that had a 50/50
chance of being a peach; sellers, equally ignorant, would be willing
to accept any offer over $2,000. Of course they will strike a
deal. It’s only when one negotiator knows too much and the other
too little that agreement becomes impossible. Because the problem
is caused by an uneven grasp on the facts, economists tend to
call it “asymmetric information.” Ripping the “world of truth”
apart, this imbalance in information can completely destroy perfect
markets.


Spoiler:
Inside information and
health insurance

Akerlof’s “lemons” problem would be troublesome enough if it
applied only to secondhand cars, furnished accommodations, and
dubious restaurants in the world’s beauty spots. Unfortunately,
it also damages the market for more important goods—most
notably, health insurance.
Health insurance is important because illnesses are extremely
unpredictable and sometimes cost a lot to treat. Not only can
some medical treatment be very expensive, it is often impossible
to postpone it until a more convenient moment. It can also coincide
with periods of low income because people are more likely
to need medical care after retirement, and because those who
need medical care may also be too ill to work.
So health insurance is a valuable product. If the health insurance
market doesn’t work well, the results will be excessively high
premiums and a large number of uninsured people. This will
sound very familiar to readers in the United States, where markets
do not, in fact, do a good job of providing medical insurance,
precisely because of Akerlof’s “lemons” problem.
Let’s say that people who are likely prone to sickness are “lemons”;
people who are likely to stay healthy are “peaches.” If, like
Jerome K. Jerome, I suspect myself to be a lemon, I’d be well


Spoiler:
advised to buy all the medical insurance going. On the other hand,
if you feel fine and all your ancestors lived to be a hundred, then
perhaps you will buy medical insurance only if it is extremely
cheap. After all, you hardly expect to need it.
Thanks to Akerlof ’s proof that markets whose players have
asymmetric information are doomed, we know that the insurance
market may disappear just as the market for good-quality
used cars did. You, whose body is a succulent peach, will not find
the typical insurance package a good deal; while Mr. Jerome and
I, whose bodies are bitter little lemons, will embrace the typical
insurance package with open arms. The result is that the insurance
company only sells insurance to people who are confident
they will use it. As a result, the insurer loses clients who are unlikely
to make claims and acquires the unwanted clients who are
likely to make costly claims, and then the insurer has to cut back
on benefits and raise premiums. People of middling health now
find the insurance is too expensive and cancel it, forcing the insurance
company to raise premiums even higher to stay in business.
More and more people cancel their policies, and in the end
only the most sickly of the lemons will buy insurance and at a
price that will be nearly impossible to afford.
The insurance companies will, of course, try to repair the insurance
market by finding out more information about their customers.
Do they smoke? How old are they? Did their parents die
of hereditary diseases at the age of thirty-five, or in sports car
accidents at the age of a hundred? With more genetic information
becoming available, insurance companies will be able to gain
an increasingly accurate picture of the costs of providing medical
insurance to particular individuals. Previously the insurance market
was constrained by the presence of inside information: insurers
knew less than those they were insuring. But if insurance
companies can continue to close that information gap, they will
be willing to provide insurance to more people.
This might sound like the price targeting used by Starbucks
and Wholefoods in chapter 2, but in fact it’s a different game.


Spoiler:
When Starbucks tries to price-target, it knows its own costs and
is simply trying to find out whether it can get away with a higher
price for some customers. The health insurance companies face
a more fundamental task: they don’t know how much it will cost
to cover the claims of each customer, and if they can’t work this
out with more accuracy than the customer can, they will simply
go bust under the burden of claims. The effects are different,
too: price-targeting is a way of getting a larger slice of the pie by
squeezing more money from customers, while finding out about
insurance customers can create a new pie by making trades possible
when previously there were none.
Unfortunately, the insurance market would be saved at some
cost: what we would find is that lemons, like Mr. Jerome and me,
would be able to buy insurance only at enormous rates. Peaches
like you could pick it up for a nominal sum. Both premiums would
reflect an actuarially fair rate, which means a rate that covers no
more and no less than the likely medical expenses. If companies
had really accurate information, perhaps obtainable from the
genetic tests of the future, then someone who was likely to get ill
would pay hundreds of thousands of dollars in premiums; but
this would hardly be insurance at all.
By assessing our individual backgrounds and predicting the cost
of providing benefits to each of us, the insurance industry manages
to stay afloat; if companies did not raise prices for lemons
like me and Mr. Jerome, they would soon go out of business.
The problem is that people who expect to have expensive medical
needs—the elderly and the chronically ill, for example—will
find that their insurance company does not really give them much
insurance at all. Because their premiums are adjusted to take these
expenses into account, they will pay more for insurance than they
would for the out-of-pocket medical costs they would face without
insurance.
The curious conclusion, which is obvious in retrospect, is that
an insurance policy depends on mutual ignorance. An insurance
company can only insure me against an event like a burglary, a
fire, or a medical bill if neither of us has any idea whether it will


Spoiler:
happen. If we could predict the future, insurance would be meaningless.
If my insurance company could predict fires much better
than I could, it would sell me insurance only if I didn’t need it.
And if I knew that my house would burn down, the insurance
company should be calling the police rather than selling me fire
insurance. Since insurance depends on mutual ignorance, then
any advance in medical science, which pushes back the boundaries
of ignorance—whether for the insurers, the insured, or both,
will weaken the basis of insurance. The more we know, the less we
can insure. This is a worrying prospect if we want to give people a
chance to protect themselves against the high costs of bad luck.


Spoiler:
Making lemonade
A slightly vexing aphorism recommends, “If life deals you lemons,
make lemonade.” How can we make lemonade out of
Akerlof ’s lemons? To return to Akerlof ’s original example of
the market for secondhand cars, both buyers and sellers have an
incentive to try to fix the problem: sellers want to get a decent
price for their peaches, and buyers want to buy peaches. If inside
information is wrecking the chance of a mutually beneficial deal,
both sides will want to find a way to bridge the information gap.
Akerlof won the Nobel Prize in 2001 for his work on the problem
of asymmetric information; he shared it with two economists
who proposed partial solutions. Michael Spence argued that
the person with the information might be able to communicate
it in a way that the person without the information could trust.
Joe Stiglitz looked at the problem in reverse and explored ways
in which the person without the information might uncover it.
Spence realized that it wasn’t enough for a seller of peaches simply
to say, “All my cars are peaches,” because talk is cheap. A seller
of lemons can also say, “All my cars are peaches.” The buyer
wouldn’t know who was telling the truth, so the claim itself doesn’t
carry any information. Spence realized that a real signal of quality
would be one that a lemon-seller could not make, or at least, could
not afford to make.


Spoiler:
An example would be buying an expensive car showroom, an
investment affordable only by a businessman who plans to stick
around for the long term. A peach-seller expects satisfied customers
to return, and to tell their friends about his reliable, trustworthy
cars. Over the years the sales would pay for the showroom.
A lemon-seller couldn’t operate like that; instead, he would sell a
few overhyped lemons and then have to move someplace where
his reputation for dishonesty could not follow.
It’s for this reason that banks always used to build such impressive
buildings. In the days before government oversight, who knew
whether they were depositing their money with a fly-by-night
operation? Customers realize that crooks planning to run off with
the money do not first clad their branches with bronze and marble.
This is one reason, too, why you will pay more at an established
store than at a market stall if you buy a product about which you
lack inside information about quality and durability. The established
store will still be there to refund your money in the case of a
complaint, and that very possibility gives you an assurance that a
complaint is less likely to be necessary.
Other economists have used Spence’s theory to explain enormously
expensive advertising campaigns with no informational
content. What, after all, is the information contained within a
soft-drink advertisement? “Coca-Cola. Real.” Pardon? The only
information that potential customers can glean from such an advertisement
is that it was expensive to make, and that therefore
the Coca-Cola company plans to stick around with the same commitment
to high-quality products that it always had.
Spence himself first used his insight to show why students might
choose to pursue a degree in philosophy, which is difficult but
does not lead to specific career opportunities, like an economics
degree or a marketing degree. Assume that employers would like
to hire smart, diligent workers but can’t tell from an interview
who is smart or diligent. Assume also that everyone has to work
hard to obtain a philosophy degree, but lazy, dumb people find it
particularly troublesome.


Spoiler:
Spence then shows that smart, diligent people can prove they’re
smart and diligent by going to the trouble of getting a philosophy
degree. It’s not that lazy, dumb people can’t get that degree
but that they wouldn’t want to: employers will pay philosophy
graduates enough to compensate them for the trouble but not
enough to persuade lazy, dumb people to bother. The employers
are willing to do this despite the fact that the philosophy degree
itself does not improve the candidate’s productivity at all. It is
merely a credible signal, because a philosophy degree is too much
trouble for lazy, dumb people to acquire. Since Spence himself
majored in philosophy at Princeton, perhaps there is something
in his idea.
Spence proved that one way to bridge the information gap in
markets previously hindered by inside information is for trustworthy
vendors to find ways to signal their reliability. High-quality
job applicants, banks, used-car salesmen, and soft-drink manufacturers
may find it worthwhile to spend excessive amounts of time
and money (by pursuing a degree that does not really add to one’s
qualifications, paying for lavish decorations, buildings, and advertising)
simply to distinguish themselves from low-quality job applicants,
banks, used-car salesmen, or soft-drink manufacturers.
Spence’s ideas suggest that the lemons problem is not insoluble,
but they are not particularly reassuring. In some variations of
Spence’s model, everyone would be better off if the wasteful signal
were impossible. If studying philosophy was banned, employers
would be unable to distinguish between lazy workers and smart
workers and would pay both the same wages, an average of their
expected productivity. The lazy workers would be better off; the
smart workers might also be better off if the new, lower, wage is
more than the old wage minus the cost of getting a philosophy
degree. And the employers don’t mind; they employ worse workers
on average but also have to pay less for them. Akerlof showed
that inside information could reduce people’s ability to find trades
that made both sides better off. Spence showed a way of making
those trades possible but also found that the social cost of doing so
can be too high.


Spoiler:
While Spence asked what the informed side could do to credibly
signal information, Stiglitz studied what the uninformed side could
do to uncover it. He explicitly considered markets for insurance
and concluded that the uninformed insurer was not completely
helpless in the face of customers who could predict the likelihood
of needing to file insurance claims. The insurer could offer different
deals, for instance, reducing the premium but increasing the
deductible. This has the effect of reducing the level of insurance:
the low premium makes the insurance cheaper, but the higher
deductible, which is the amount by which any claim is reduced,
means that any claim would pay out less. Low-risk customers would
be attracted by that kind of deal, because the insurance is cheaper
and they don’t expect to claim very often anyway, but high-risk
customers would rather pay the higher premium because they expect
to claim frequently, so a high deductible will cost them a lot.
So insurers could persuade different types of customer to reveal
their inside information. This is a little like the self-targeting strategy
used by coffee bars in chapter 2. Starbucks offers frills like
whipped cream and flavored syrup to persuade customers to reveal
whether or not they are price conscious. Aetna Insurance offers
four different packages to individuals, with deductibles ranging from
$500 to $5,000, to entice policy buyers to reveal their predictions
for how many insurance claims they will file. But again, Stiglitz
did not conclude that Akerlof ’s lemons problem could be costlessly
solved. On the contrary, he showed that in response to inside information,
banks might deny loans to whole sections of society,
firms might prefer to pay high wages to privileged insiders rather
than lower wages to more workers, and insurance companies would
prefer to exclude high-risk individuals. Spence and Stiglitz both
showed that you can make lemonade from Akerlof ’s lemons—but
that you cannot get rid of the bitter aftertaste.


Spoiler:
Lemons, health care,
and the United States

The difficulty of solving the lemons problem may explain why
the American health-care system is malfunctioning so badly. The
United States relies upon private health insurance to provide much
of the financing for medical costs. This is unusual: in Britain,
Canada, and Spain, for example, health-care costs are largely paid
for by the government. In Austria, Belgium, France, Germany,
and the Netherlands, medical costs are paid for by a system of
“social insurance”: it is compulsory for most people to buy insurance,
but insurance premiums are tied by law to income rather
than to the risk of a claim.
The United States system makes it voluntary to buy insurance,
and premiums are linked to risk, not to income. But these
market-based principles, beloved of many Americans, do not seem
to be delivering health care that makes them happy. A recent
survey revealed that only 17 percent of respondents in the United
States were content with their health-care system and thought
no substantial reforms were necessary. Why the discontent?
The superficial reasons are simple enough to describe: the system
is hugely expensive, very bureaucratic, and extremely patchy.
The expense first: US health care costs a third more, per person,
than that of the closest rival, super-rich Switzerland, and twice
what many European countries spend. The United States government
alone spends more per person than the combination of
public and private expenditure in Britain, despite the fact that
the British government provides free health care for all residents,
while the American government spending program covers only
the elderly (Medicare) and some of the marginalized (Medicaid).
Most Americans worry about health-care costs and would be
stunned to discover that the British government spends less per
person than the American government but still manages to provide
free health care for everyone. In fact, if you figure in the
costs of providing health insurance to government employees and
providing tax breaks to encourage private health care, the US
government spending on health care, per person, is the highest
in the world.
Bureaucracy next. Researchers at the Harvard Medical School
found that the administrative costs of the US system, public and
private, exceed $1,000 per person. In other words, when you count


Spoiler:
all the taxes, premiums, and out-of-pocket expenses, the typical
American spends as much on doctor’s receptionists and the like
as citizens of Singapore and the Czech Republic spend on their
entire medical care. Both places are countries with health outcomes
very similar to those in the United States: life expectancy
and “healthy life” expectancy (a statistic that distinguishes a long
healthy life and a long life plagued by years of severe disability)
are a shade lower in the Czech Republic than in the United States;
and in Singapore they are a little higher than in the United States.
The cost of US bureaucracy is also more than three times the
$307 cost per person for the administration of the Canadian health
system, which produces noticeably superior health outcomes.
Then there is the patchy coverage of the system. Health insurance
is usually packaged together with a job, which reduces the
efficiency of the labor market; workers are hesitant to quit their
jobs without lining another job up first for fear of being uninsured.
Worse, 15 percent of citizens have no insurance coverage
of any kind—which should be a stunning statistic for the world’s
richest economy, but probably isn’t because it has been lamented
for so many years. Compare it to Germany, where 0.2 percent of
the population has no coverage, or to Canada or Britain, where
everyone is provided for by the government.
Given what we have learned from George Akerlof and his lemons,
the troubles of the US health-care system should be no surprise.
We should expect a voluntary private insurance system to
be patchy. A few people who have more pressing costs than health
insurance (for example, the young poor, who have little money
and rightly expect that they are unlikely to become seriously ill)
will drop out of the system. As a result, health insurance companies,
needing to cover their costs, will raise the premiums for the
average client, driving out more and more people. Unlike the
very stark lemons model, the market does not completely collapse;
this is partly because many people find that the risks of
having to pay for medical treatment are so worrying that they’re
willing to pay substantially more than an actuarially fair premium.


Spoiler:
As a result, the process of unraveling stops, but not before many
people have been excluded from the system.
Thanks to Spence and Stiglitz, we should also expect insurance
companies to devise ways to get around this lemons problem,
but that although the solutions may be effective they will
probably also be wasteful. The huge bureaucratic burden of the
US system is one of the results, as insurance companies struggle
to monitor the risks, behavior, and expenses of their customers.
The clunky linkage of health insurance with jobs is another result:
at first sight, there is no reason why a job should come with
health insurance, any more than it should come with a house or
free food. Employees are frequently forced to buy the health insurance
that is packaged with their job. This packaging compels
the healthiest members of society to buy insurance packages
and so helps prevent the unraveling of the market. But this solution
doesn’t come cheap: health-care plans are not chosen by
their beneficiaries, who would aim to get the ideal coverage for
the right price, but by human resource managers with other
priorities, such as making their own lives easy with a “one-sizefits-
all” bulk purchase. The result is likely to be further wasteful
spending.
Not every drawback of the US health-care system should be
blamed on Akerlof ’s lemons problem. Even without the diffi-


Spoiler:
culty of inside information, the system of insurance is problematic,
because patients are not always able to choose their treatment.
With the insurance company picking up the bill, choosing
the appropriate treatment is always going to be something of a
matter of negotiation. When you ask somebody else to pay for
your health care, don’t be surprised if you don’t get exactly what
you would have chosen yourself.
Nevertheless, it is striking that partial coverage, inefficiency,
and high costs are not only the defining characteristics of private
health insurance, they are also exactly what we would have predicted
armed only with the theoretical models of Akerlof, Spence,
and Stiglitz.


Spoiler:
Imperfect information—
the whole story

The lemons problem (“adverse selection” in the economists’ jargon),
when inside information guts a market because ignorant
buyers are unwilling to pay for quality they cannot observe, is
one example of the broader problem of inside information (“asymmetric
information” in the jargon). Inside information also produces
an obstacle called “moral hazard.” The concept is simple:
if you compensate people when bad things happen to them, they
may get careless.
If my car is insured against theft, I will park wherever I find a
space, even on a deserted street that doesn’t seem entirely safe. If
my insurance doesn’t cover theft I may choose to pay a little extra
to park in a lot with an attendant. If I lose my job and the
government pays unemployment benefit, I may not hurry to find
a new job quite as quickly as I would if I had no income whatsoever.
If the money in my checking account is insured against a
bank failure, why bother to check that the bank is financially
sound?
Moral hazard is an inevitable problem in the real economy.
While it is impossible for insurance companies (or anyone else)


Spoiler:
to avoid moral hazard altogether, they can take steps to reduce it.
For example, they do not offer insurance against being fired or
becoming pregnant, which is a shame, because it would be great
to have that kind of insurance. The reason is easy to see: it is easy
to arrange to be fired or to get pregnant. There are many people
who would like to leave their jobs and many others who would
like to have children, and such people would be particularly eager
to buy an insurance policy that would pay them handsomely
for putting their plans into action. As a result, moral hazard destroys
the market for private unemployment insurance.
On the other hand, public unemployment insurance still exists,
in spite of moral hazard. It is not polite to say so, but it is obvious
that paying people to be unemployed encourages unemployment.
Yet if a government scrapped unemployment benefit, there would
still be jobless people, and supporting the jobless is something that
every civilized society should do. The truth is that we have a tradeoff:
it is bad to encourage unemployment but good to support those
without incomes.
Both governments and private insurers will try to protect themselves
against moral hazard. One of the most common ways insurance
companies do this is by modifying the insurance policy to
provide incomplete insurance, in the form of a deductible. If my
car insurance deductible is $200, the fear of losing that money
probably won’t persuade me to take extravagant safety precautions,
but it should be enough to make me check that my car is locked.
Another way insurance companies can fight moral hazard is by
gaining access to the inside information. Health insurers will want
to know whether I am a smoker before they set my premiums.
Of course, I could lie, but it wouldn’t be too hard for insurers to
expose my lie; a simple medical examination would reveal that I
smoke. When most governments pay unemployment benefits,
they do so on the condition that recipients are actively looking
for work. Because the government cannot monitor people’s job
searches perfectly, it pays out only meager unemployment benefits.
Yet if the government could really tell how hard unem


Spoiler:
ployed people were looking for jobs, then it would be possible to
pay more generous benefits to genuinely deserving recipients.
The problems of imperfect information include adverse selection
(lemons) and moral hazard, but there are other, broader, and vaguer
issues. For example, my boss would like to pay me extra if I try
harder to do a good job, but because he has only a vague idea how
hard I am trying, my performance bonus is only a small part of my
salary. If my boss could observe my skill and effort perfectly, he
could make my entire salary performance-related. Another example:
let’s say I would like to eat at the best-value restaurant in town; I
don’t know what it is, so I look for a familiar brand name, where I
know I can’t go wrong. Knowing that customers won’t bother trying
to find the cheapest place around, established restaurants are
able to charge more than they should.
Do these information problems destroy markets completely?
They certainly don’t help, but it would be wrong to exaggerate the
problems. In spite of asymmetric information, markets do often
work well, because people produce ingenious solutions to improve
the quality of information—or to reduce the damage caused by
imperfect information.
When I buy complicated equipment like a camera, I talk to
friends and consult websites and consumer magazines, which I
hope will give me useful information about the products I am
trying to choose between. Expert reviews providing “inside information”
can be particularly helpful when we are ignorant about
what we’re buying. I rely on them all the time in another market,
which suffers from severe information problems: the market for
vacations. I’m the kind of person who likes to visit new places,
but often I have no idea where to go or what will be fun, where is
tacky and who offers a good deal, where is beautiful and where is
dangerous. If the problem were insoluble we wouldn’t bother to
take vacations at all. (Or we might demand that governments
provided them, which in my mind conjures up images of being
on a waiting list for years before enjoying organized team games


Spoiler:
and artificial cheer in an overcast concrete resort.) Instead, we
simply buy decent guidebooks and try to learn more on our own.
Health-care provision, yet again, provides a particularly acute
example of the problem. It’s one thing to check a guidebook to
find out what to do on vacation. It’s quite another to consult a
guidebook to find a heart surgeon. Yet the basic information problem
is the same as the one faced by vacationers. Heart surgery
patients try to learn more about which doctors have good reputations,
which procedures have the highest success rate, and which
hospitals provide the best recovery care. Still, most patients would
admit that they really don’t have much idea just how good their
doctor really is.


Spoiler:
Market failure versus
government failure

This is not exactly comforting. A health-care system based on private
insurance will be, as we have discovered, patchy, costly, and
bureaucratic. What’s more, it will offer patients choices, such as
the choice of heart surgeon, that they are not very well qualified to
make. So could the government do better? After all, every chapter
of this book so far—with the exception of chapter 3—has lamented
the causes and costs of market failures. It’s tempting to look to the
government to sort things out.
Unfortunately, while markets can fail, governments can fail
too. Politicians and bureaucrats have their own motivations. Scarcity
power, externalities, and imperfect information do not magically
disappear when the economy is run or regulated by
governments. When market failure and government failure are
both present, the choice is often between the lesser of two evils.
An intriguing case in point is Britain’s National Health Service
(NHS), which offers health care to all citizens. It is almost
completely free, although people with jobs need to pay a token
amount for prescription drugs. It provides universal coverage: if
you walk into any doctor’s surgery or any hospital in the country,
you will be treated free of charge.


Spoiler:
As you would expect, the system gets overcrowded, people often
have to wait, and patient choice is not a major feature of the
system: you accept whatever treatment the doctor says is appropriate,
or nothing. Overall, the medical outcomes are not bad,
but the waiting lines for treatment have been a major bone of
contention for many years. The same survey, which found 17
percent of American citizens approved of the US health-care system,
reports that only 25 percent of the British are happy with
their own system—better, but hardly a resounding endorsement.
If you were going blind in Britain, you would be well aware of
a recent example of the difficulties faced by such a system. The
Royal National Institute of the Blind, along with other organizations
representing people with vision problems, has been campaigning
vigorously against a ruling by the National Institute
for Clinical Excellence (NICE), an agency that evaluates treatments
and decides whether the National Health Service should
pay for them or not. Heart surgery is on the approved list; nose
jobs are not.
The controversy stems from NICE’s half-hearted endorsement
of a new treatment called photodynamic therapy. The therapy
uses a drug called “Visudyne” or verteporfin, combined with a
low-intensity laser treatment, to destroy lesions under the surface
of the eye’s retina, usually without damaging the retina itself.
If the lesions are not treated they can irreversibly damage
the center of the retina, called the macula. The resultant condition,
age-related macular degeneration (ARMD), destroys central
vision so that the victim cannot recognize faces, read, or drive.
It is the leading cause of blindness in the United Kingdom.
In 2002 NICE filed a report recommending photodynamic
therapy only in more extreme cases, only when both eyes are
affected, and only in the eye that is less seriously damaged. The
implication is that even treated patients will lose their sight in
one eye, while others whose sight might be improved are denied
treatment altogether.
It is easy to condemn NICE without appreciating its methods
and the situation it is in. The basic challenge confronting the


Spoiler:
National Health Service is that it has a limited amount of money
to spend and an unlimited number of ways of spending it. It is no
good asking patients, who pay little or nothing for treatment and
will as a result demand more of everything. So NICE must resolve
the inevitable dilemmas, determining who will get what
type of health care, and who will be left to fend for himself.
How can medical spending be decided under such conditions?
What would you do if you were in charge of NICE? It’s a nearimpossible
task, but you would probably work out the costs and
the effects of each treatment, and then you’d compare them to
each other. Sometimes this is quite simple: a treatment with a
20-percent chance of preventing another heart attack is better
than a treatment with a 10-percent chance of preventing another
heart attack. Under pressure to make decisions, you might go
farther and say the first treatment is twice as good, and should be
used if it is less than twice as expensive. Even to go that far would
be a stretch. How, then, would you compare a treatment that
increases the chance of walking again after an accident, with a
treatment that reduces the likelihood of going blind? Impossible!
But if you were running NICE you would have to try.
The way NICE does it is to calculate the impact of each treatment
in “Quality-Adjusted Life Years,” or QUALYs. A treatment
that saves ten years of life is better than a treatment that
saves five years of life; a treatment that gives somebody ten years
of able-bodied life is better than a treatment that gives somebody
ten years alive but in a coma. Evidently, the value-judgments
involved are extraordinarily difficult. Yet they must be made in
a system that provides health care free of charge.
As an example, think of the problems involved in judging the
QUALY impact of photodynamic therapy, which reduces the
chance of blindness. The best way for the Royal National Institute
of the Blind to get a higher priority for photodynamic therapy
is to argue that a year alive but blind is worth much less than a
year alive and fully sighted. If NICE accepts this view, treatments
curing blindness will become very valuable on the QUALY mea


Spoiler:
sure, which places years alive and fully sighted high above years
alive but blind.
But hang on. The strict logic of the view that “it’s bad to be
blind” would suggest that while that claim places a high priority
on vision treatments, it places a low priority on treating people
for other illnesses if they are already blind. If two people, one
blind and one sighted, simultaneously turn up in a hospital in
coronary arrest and there is time to treat only one, the QUALY
methodology offers a truly unpalatable conclusion; that it is more
worthwhile to help the person who can see rather than the blind
patient.
We could backtrack and argue that in fact there is no difference
in the value of life for the blind compared with the sighted.
That is certainly more comfortable. Unfortunately, in conjunction
with the QUALY methodology, this produces the conclusion
that there is no point in spending anything at all on
photodynamic therapy—or indeed on a pair of glasses. If treatments
do not improve the value of people’s lives then they are
not worth spending money on, particularly when there are many
causes, such as treatment for cancer. which certainly do improve
the value of people’s lives.
It is no wonder that the Royal National Institute of the Blind
steers well clear of even mentioning QUALYs. It simply argues
that photodynamic therapy is proven to improve vision and so
should be comprehensively available. I do not blame the RNIB.
But given the problem NICE is trying to solve—allocating finite
resources among an unlimited range of medical treatments—it is
easy to understand the position NICE takes: in particular the
apparently heartless ruling that treatment should be applied in
only one eye, leaving the other to go blind. The dispassionate
perspective of QUALY analysis argues that the difference between
having two good eyes and one good eye is less significant
than the difference between having one good eye and none at all.
Small wonder that the calculations tend to churn out embarrassing
recommendations. But a free service will always be in demand,
and it is hard to see a better way of rationing it.


Spoiler:
Fixing health care with
keyhole economics

Keyhole surgery techniques allow surgeons to operate without
making large incisions, minimizing the risk of complications and
side effects. Economists often advocate a similar strategy when
trying to fix a policy problem: target the problem as closely as
possible rather than attempting something a little more drastic.
How, then, can we fix health care? The insurance-based market
solution is misfiring badly in the United States, in large part
because of the problem identified by Akerlof ’s lemons model.
The result: expensive, bureaucratic care . . . and even that, only
for some.
The British approach has been to sweep away the market completely
and replace it with a system governed by the decisions of
bureaucrats like NICE rather than directed by market prices, as
though part of the old Soviet Union had been transplanted into
the hospitals and surgeries of the English shires. Fortunately,
political and bureaucratic decisions are much more accountable
in the United Kingdom than in the USSR, so the system works
fairly well. But this is a colossal and wide-reaching response to
the serious but rather specific problem of inside information. We
owe it to ourselves to ask: is there a “keyhole” solution, which
could fix health care without sacrificing the ability of patients to
decide how much they value their own eyes?
Keyhole economics would first identify the specific market failures,
which fall into three categories: scarcity power, externalities,
and imperfect information, plus the issue of fairness. Scarcity
power is a potential problem, but for most treatments not a significant
one. In the United Kingdom, for example, there are
roughly fifteen hundred patients per general practitioner (the
doctor who is the first port of call for most patients using the
National Health Service). So, a small town of nine thousand
people can support six doctors, probably more than enough to
encourage real competition, in a country where 90 percent of
people live in urban areas. Some special treatments will wield


Spoiler:
greater scarcity power—people fly from Australia and New
Zealand to Hawaii for treatment with the Leksell Gamma Knife,
a device for treating brain tumors. So there are some situations,
but few, where scarcity power is a concern.
Externalities, too, are important only in select cases: for instance,
for public health projects to restrict communicable diseases.
(If everybody else had been using condoms to protect
themselves from HIV/AIDS, I would not have needed to bother.)
Yet neither externalities nor scarcity power are so severe or widespread
that government provision becomes an attractive alternative.
The keyhole solution would be some light-touch regulatory
oversight to prevent the exploitation of scarcity power, coupled
with focused subsidies to boost inoculation programs.
Fairness is not, strictly speaking, a market failure; it is something
that even perfect markets do not necessarily provide. But
we care deeply about fairness when it comes to medical care, both
because we do not want the poor to be deprived, and because the
cost of health care can vary dramatically, depending on the luck
of each individual. In a civilized society we will want to make
sure that everyone can afford some standard of medical care. The
best way to do this is to tackle the general problem of poverty
(think back to the “head start theorem” discussed in chapter 3)
using redistributive taxes. After all, why spend so much to provide
free medical care to poor people while ignoring the fact that
they cannot afford healthy food or a safe house to live in?
That leaves inside information as the big obstacle to a wellfunctioning
health-care system. The economic analysis we’ve
done suggests that government provision is ineffective because
decision making is out of patients’ hands, and resources are rationed
by political processes. Meanwhile, the overwhelming problem
for the market provision of medical care is inside information,
and more specifically its tendency to destroy insurance markets.
This diagnosis suggests a two-part keyhole treatment.The first
part is to ensure the widespread availability of information: it
should be easy to get a second opinion, easy to call a help-line,
and easy to get information from libraries, clinics, the Internet,


Spoiler:
even supermarkets. In the United Kingdom, people do not pay
much attention to this information because doctors make the
decisions. If we were asked to take responsibility for our own
medical care we would pay much closer attention, and many more
resources (public and private) would respond to our demands to
know more.
The second part is to give patients an opportunity to use this
information. In a privatized, insurance-based system the insurance
company tends to make a lot of choices; in a governmentprovided
system the government makes the choices. In a
market-based system without insurance, the patient makes the
choices. Much better. But the patient also has to pay for unpredictable
and potentially catastrophic health-care costs.
How to give patients choice and responsibility without putting
an unbearable burden on them? The best system would be
one that compels patients to pay for many of the costs, thus providing
an incentive to inform themselves and to make choices
that are both in their interests and reasonably cost-effective but
which leaves the most severe costs to the government or insurance.
This might work, because most medical bills are not catastrophic
and so do not need insurance.
How might such a system work, in more detail? The aim would
be to give maximum responsibility and choice to patients, therefore
requiring them to spend their own money rather than that
of governments or insurers, but to make sure that nobody faced
catastrophic medical bills and to make sure that even the poor
had enough money to buy medical care.
These requirements suggest: people should pay for all medical
care; but insurance should cover the largest bills; and that everyone
should have a savings account dedicated to medical expenses,
to which the government would contribute in the case of the
poor or the chronically ill.
Catastrophe insurance, which pays out only when a particular
course of treatment is very expensive, is fairly cheap. The savings
are no problem either: simply reduce each person’s tax bill by,


Spoiler:
say $1,500 a year—this is very roughly the cost, in taxes, of both
the UK and the US public health systems—and make them put
the money in a savings account. For people who pay less than
$1,500 in tax a year, the government would contribute money to
make up the shortfall. Since the system is compulsory, no adverse
selection takes place.
If you participated in such a program, how would it work for
you? Your health-care savings would automatically go into a highinterest
bank account. They would build up gradually throughout
your life. For most people, medical bills are low in their younger
years. So you could expect to have thirty thousand dollars in your
account when you turn forty; more, if you’ve managed to keep
your spending low and watched the money earn interest. Thirty
thousand dollars buys a lot of medical care. Of course, it could all
be consumed by a single expensive procedure, except that catastrophe
insurance restricts your expenses.
If you reach retirement age with money still in your medical
savings account beyond some minimum, you can put the excess
toward your pension. When you die, you can pass the savings to
other people’s savings accounts (usually your spouse or children).
So at every point in your life, you would have an incentive to
spend money only on health care that you feel is absolutely necessary.
If you felt that the right treatment for you was a bit of
preventive maintenance—a course of shiatsu, say—then that
would be your choice. You might well consider giving up smoking,
given how much it would cost you in medical bills over the
years. The catastrophe insurance would still pay for your lung
transplant, of course, but no humane system can avoid moral
hazard completely.
If one day your optician told you that you were suffering from
age-related macular degeneration, but that a treatment with photodynamic
therapy would increase your chances of maintaining
your sight for a few more years . . . well, the choice would be
yours. The photodynamic therapy drug, Visudyne, costs $1,500
a treatment. It would increase your chance of keeping good sight


Spoiler:
from about 40 percent to 60 percent. No need to start talking
about QUALYs: it’s your money, and your choice.
The exception would be if you had a catastrophic expense, in
which case the insurance company would prefer to pay for the
cheapest treatment while you would want the best—a difficult
problem, but no different from the conflict of interest faced for
every single treatment in our medical systems today. The new
system simply means that that inherent conflict of interest happens
far more rarely.
It is common to provide goods and services on the private market,
but one of the main alternatives—certainly, the main ideological
alternative—has been to provide them using a political
market instead. Medical goods and services are among the most
difficult to distribute. We have tried using political markets, but
they have let us down badly, and for obvious reasons.
At first sight, the private market failures, exemplified by the
US system, are also obvious. But when we closely examine the
market failures, it’s the lack of information that is most serious,
and the insurance market suffers the most serious consequences.
American citizens receive much of their medical care through
the intermediation of this badly malfunctioning market.
With some imagination, and some economics, we can step back
from the troubles of our current systems and think about how to
fix them. In Singapore, the system sketched in the last few pages
has been successful for almost two decades. The typical Singaporean
lives to the age of eighty, and the cost of the system (both
public and private) is a thousand dollars per person—less than
the cost of the bureaucracy alone in the United States. Each
year, the typical Singaporean pays about seven hundred dollars
privately (the average American pays twenty-five hundred dollars
privately) and the government spends three hundred dollars
per person (five times less than the British government and
seven times less than the American government). Keyhole economics
works.


Spoiler:
The reason why Singapore’s success is uncommon is probably
that policy debates get stuck with one side claiming that we should
rely on the market, and the other side asserting that the government
would do a better job. So, government or market? We’ve
learned that the question doesn’t make any sense in isolation. To
answer it we need to understand why markets might work, and
how and why they fail.
We learned in chapter 3 exactly why markets work: because
our choices as consumers between competing producers gives
them both the right incentives and the right information to produce
the right amount of exactly what we want. And we’ve also
learned that scarcity power, externalities, and inside information
can each ruin the way markets do this.
In the case of health care, the market works poorly because
while we want the reassurance of knowing they can afford expensive
medical bills, inside information eats away at the insurance
by driving away low-risk customers and forcing premiums
to rise. Private companies have developed ways to get around the
problem, but they are expensive and bureaucratic. Singapore’s
government had the power to tackle the problem head on, by
using forced saving and catastrophe insurance to make sure costs
were manageable but keeping the power of patient choice at the
heart of the system. Governments can replace markets, but they
will often do better to try to fix them. They are unlikely to succeed
unless they appreciate exactly what the problem is in the
first place.


P.S: Sorry for the long ass post. If anyone is interested, here is the whole book.
One original thought is worth a thousand mindless quotings.
~Diogenes of Sinope
User avatar
Rolos
Tastes like burning!
 
Posts: 1001
Joined: Tue Jun 12, 2007 11:21 pm
Location: Los Angeles

Re: Obama speaking to kids

Postby The Prince » Mon Sep 21, 2009 9:49 am

But with all do the respect why are we "cut and pasting" entire chapters from a book in a discussion forum? If you have an argument or a POV you wish to share that adds to the discussion please feel free.

If you want to recommend a book, there are a lot easier ways.

Though I am familiar with some of Harfords work, I have never read any of his books. Admittedly books on economics, are not on the top of my list of things to read at leisure, but I have read a few articles here and now. Does this mean I'm not at business to discuss such matters?

I probably could post articles that go into detail criticizing Harfords for basing most of his arguments and conclusions off an assumption that correlation and causation are equivalent. But what would be the point, I'm sure you'd be more interested in what I had to say........
Image
Let's put a smile on that face...............
User avatar
The Prince
Tastes like burning!
 
Posts: 1147
Joined: Tue Sep 18, 2007 5:31 am
Location: Near a computer

Next

Return to Current Events & Politics

Who is online

Users browsing this forum: No registered users and 1 guest

cron