[extropy-chat] Futurist priorities was ex-tropical

[Technotranscendence]

On Monday, March 01, 2004 10:08 PM Harvey Newstrom
mail at HarveyNewstrom.com wrote:
>>> I must respectfully disagree with this.
>>> Markets are the most efficient at
>>> maximizing profits.  But the most
>>> profitable product is not necessarily
>>> the best one.  Most people can't afford
>>> the most expensive, best PC.  So the
>>> most profitable PCs are the cheapo
>>> ones that are "good enough" for
>>> "most" purposes.  But as for the goal
>>> of what a PC should be, I do not find
>>> the market acceptable.
> >
> > The market here is affordable PCs.
>
> You redefined my goal from "best PC" to
> "affordable PC".  The market might be
> the best at making your "affordable PCs".
> But I am still not convinced that the market
> produces the "best PC" using criteria other
> than price.

You want the best PC?  If you can afford it, you can get a lot.
However, most people set limits on how much they will pay for a PC.
They are willing to settle for less options or whatever if the price is
lower.  This is because they don't have infinite resources and costs
matter.

This is also an illustration of the paradox of freedom.  If you allow
people to be free to make their decisions -- decisions like buying a
PC -- they will make choices you disagree with -- even choices you feel
are stupid, wrong, suboptimal, unhealthy, etc.

>> An HMO is not a market. If healthcare was
>> market driven we would have greater
>> availability and lower prices. As it is there
>> is heavy govt regulation.
>
> I thought HMO's were the market's answer
> to healthcare.  I thought they provided the
> cheapest healthcare as per market desires.
> That's why I suggested them as an example
> where the market maximizes money over quality.
> If you can point out any other examples of
> market-driven health-care, I will try to consider
> that.  But I still am not convinced that the
> market produces the "best" quality of health-
> care rather than the most "cost-effective"
> health-care.  Health-care seems to be the
> obvious example where price is NOT
> the most important criteria.

HMOs are really a response to government intervention in the market.
Before the 1960s in the US, the government's subsidies in healthcare was
much smaller, amounting mostly to VA hospitals.  After that, though,
Medicare, Medicaid, etc.  This subsidized healthcare had the unintended
(but predictable to anyone who knows the law of supply and demand)
consequence of raising healthcare costs.  Since then, heathlcare costs
have continuously exceeded inflation.  (Even before the 1960s, there was
still a lot of government intervention in healthcare -- the FDA, the AMA
monopoly, doctor licensing, nurse licensing, etc.)

In 1973, the Congress passed the HMO Act.  This law subsidized HMOs and
mandated that any company providing employee health insurance had offer
an HMO option. Though this requirement was repealed in the mid-1990s,
the privileged status had alreadt made HMOs dominant in employer health
plans.  That's not the free market in action, but government
intervention distorting the market.

Also, in the US, employer health plans are fully tax deductible to the
employer, while the self-employed and others who seek to pay for
individual plans are not allowed the same deductibility.  This biases
the market toward employer plans, which again biases it in favor of
HMOs.

>> It would be pretty nice if we had full
>> information on healthcare and heavy
>> competition.  Alas, we don't (yet) so the
>> US has the bloated system that we
>> have. It could be a lot more efficient.
>
> More efficient at what?  Controlling costs?
> Or extending lifespan?  I am not convinced
> that these are the same goals.  What
> happens if we want maximum availability,
> effectiveness and quality instead of best cost,
> effectiveness, and quantity?

Therein lies the rub.  You look at these as all or nothing choices.
Either there is one monolithic system that is cost efficient or there's
one monolithic system that extends lifespan.  A true free market
approach would just be for people as individuals (or even collectively)
to bargain for healthcare services, drugs, approaches, etc.  The outcome
would probably vary a lot.  Some people would prefer low cost health
care.  E.g., a 20 year old college student in good health probably
wouldn't require more than just regular checkups and the rare emergency
care.  A 45 year old bread winner with three kids, a spouse, etc. might
be more risk averse in this area.  So she or he might want more
extensive coverage.  A religious person who doesn't want to live past
the time God has ordained might choose no healthcare.

Also, people will balance costs regardless.  Price competition merely
makes it easier for people to figure out the costs than through barter
or other means.  Yes, some people will choose to spend money on things
other than lifespan increase.  Look at how people live now.  Not
everyone who can afford it is on a life extension plan.  Heck, I know
many individuals who are quite well off -- certainly rich by my
standards -- who don't spend anything on life extension, eat crappy
food, don't exercise, etc.

Regards,

Dan
http://uweb.superlink.net/neptune/MyWorksBySubject.html