Ever met an Ethiopian farmer? No? Could be because there aren’t any. What? Seriously, how could you farm in Ethiopia when your competition is free food? Folks are all around you starving to death but waiting on the next “foreign aid” shipment with free food. They’re not about to buy food from a farmer when with just a little more waiting they can get it for nothing. Many economists over the years have written about this. If you want to stop starvation, end food subsidies, as these destroy the market for growing or producing food in the target area. After all, how does a food producer compete with “free?”
I had dinner one night last week with a new friend in Washington, D.C. He, like me, has a high deductible health plan and mostly pays as he goes, the high deductible saving him lots of money in the form of lower premiums. He, like me, is probably going to be declared a criminal once this wonderful new health law goes into effect. You see, our idea of pay as you go and buy the catastrophic policy for something really bad is soon going to be a crime. We will have to pay a fine if we continue to operate this way. If we don’t pay the fine…well…you know where the government takes it from there. My new friend said, “I’ll just drop my insurance and go with the guaranteed issue policy.” He means the government policy. Because it’s “free.” Why wouldn’t he do this? Why wouldn’t everyone do this? And if you are an insurance company that is providing health policies and you are not connected with Uncle Sam to administer this insanity, how are you going to compete with free?
Of course, our fearless leaders know this and know that you can’t compete with free and know that all but the huge insurance companies will go out of business. The big boys will be left to administer this plan and will…well…you know the rest of the crony capitalism story by now, don’t you?
G. Keith Smith, M.D.
