[ExI] those damn greedy workers

Stathis Papaioannou stathisp at gmail.com
Thu Jun 18 14:34:51 UTC 2009

2009/6/18 Mirco Romanato <painlord2k at libero.it>

> The UK system went out of the budget from the first year it was implemented. They (the Labour) publicized the saving and then it never saved any money at all. This is the same in Italy. I don't remember a year when the Health costs were not over the budget. This is because these health systems are always on a "reform" stage.
> Other health systems in the OECD are not very different.
> So, how is that they are not able to respect their budget but they are so more efficient? Maybe they are not. Or maybe the efficiency is obtained in some other way.

The total cost of all medical care, public and private, is about
double in the US compared to the rest of the OECD, while average
health outcomes are if anything worse in the US. That is what I mean
by efficiency: results for each dollar or euro spent.

> For example, Italy have a number of physicians double than the US.
> After taxes a family physician in Italy earn around 50K € where in the US he would earn 130k $. This is the double than in Italy.
> Do you want reduce health care costs?
> Having more physicians, so there is more competition.
> But if AMA artificially limit the number of physicians that can enter the profession, the costs will stay higher (like in all monopolies supported by the government power).
> So, you see, efficiency have costs. Someone must pay for it. Let it be the physicians, to start.

It's a fair enough observation that doctors get paid too much. Not as
much as investment bankers, and they are far more useful than
investment bankers, but probably still too much. Here in Australia,
the government has on occasion threatened the specialist colleges with
setting up alternative training programs to address doctor shortages,
but the colleges complain that this will reduce the high standards of
Australian medical care, blah blah blah, and in the end they get their
way, after compromising slightly and allowing a slight increase in
trainee numbers. Remarkably, the colleges use their prestige to
maintain a monopoly often *against* government wishes.

> Then, we could talk about the drugs purchased in the public systems.
> How the industries are forced to deal with a single buyer (a monopolist) that is able to force them is unequal deals. This have the consequence that the drug industries in the EU, for example, switched from research investments to generic drugs producers investments.
> So you see, the efficiency here come at the cost of research and development of new drugs. In a long time period this will make a large difference as the drugs that are not researched and developed will not benefit anyone.

Most medical research is funded by government or non-profit
organisations anyway. Drug companies cherry pick this often freely
provided research and develop drugs which they think have a high
chance of commercial success. they then complain if they can't squeeze
huge profits out of their drugs. The hard-working scientists in
universities, on the other hand, are lucky to get paid a pittance.

> Economy, you must compute what is seen and what is not seen.
>>> Governments and large bureaucratic companies like GM (without a real
>>> owner) have not the right incentives to manage rationally the costs and
>>> to plan rationally for the future. Their personal future horizon is 3-5
>>> years, not decades. Why do sacrifice today when the profits will be
>>> reaped by others? Why do not enjoy today and leave the bill to be footed
>>> by others tomorrow?
>> You have this the wrong way around: private enterprise generally only
>> looks a few years into the future, while governments undertake
>> projects that might not show a reward for decades.
> This depend if you believe what they claim is their aims or watch at what are the real gains they can have.
> Private firms owned by people with a large and long lasting stake on them often do  better.
> Maybe this is because Fiat was able to take over Chrysler and GM was not able to take over Fiat.
>> For example,
>> governments may take measures to mitigate global warming, assuming it
>> is believed to be a problem, which private corporations would have no
>> incentive to do anything about.
> In fact, they are acting without any hard proof, only "the consensus" (that don't exist) of the scientific community (not for sure of the climatology community).
> They are sure to destroy large parts of our wealth for, at best, nothing. The Kyoto Protocols told this. All of the proposed curbing of CO2 would had slowed down the warming 3 years over a century.
> This is scarcely a rational politics for the people, but it is very rational for the scaremongering politicians like Al Gore living in huge McMansion  and running around in private air planes.

Assume for the sake of argument that global warming is a real problem.
What would private enterprise do to prevent it happening?

>> At best, a private corporation may
>> invest in enterprises that would benefit from global warming, provided
>> that the investment was going to show a return in a few years;
>> otherwise, the shareholders would sack the board of directors for
>> wasting money.
> They would sack him if he went in this without their approval, and they would be right to do so.
> There are many investors interested in doing research, but:
> 1) They invest what they are able to lose, not someone else money needed to pay for the shoes of the children or the loan on the home.
> 2) They, often, ask for proof of the work done and proof of the results obtained. They are willing to take risks, not to give money away for free.

But they don't pay for basic scientific research. There's no money in
particle physics.

>>> Private markets punish people that don't plan well and reward people
>>> that planned well. The alternative is, like today, to punish people for
>>> good planning and rewarding people for bad planning.
>> It certainly looks like you are opposed to insurance. To the extent
>> that adverse events are under anyone's control, insurance consists of
>> the careful subsidising the careless.
> This is because insurances must be private enterprise not subsided by governments. So they will avoid to subside careless people and avoid to encourage careless behaviours.
> Usually the government subsides do the reverse. And I'm against government subsides and insurances.

Would you take out accident insurance if they were going to refuse to
pay if you had an accident?

Stathis Papaioannou

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