January 10, 2004

Ignoring Socialism's Failure

Flitters is currently having a debate over the necessity of reforming Canada's healthcare system to inject more private enterprise into the system. Ikram Saeed posted an interesting link which I respond to below. The article is an apologia excusing Canada's medical system from its faults and trying to explain away some of the complaints about it.

What the good doctor doesn't seem to understand is that these complaints are endemic to socialist systems and that he's reinventing the wheel, bringing out arguments that have been long debunked in other circumstances many times in the past. But, of course, the socialist conceit is always that this time it will be different. In the humanities, as Steven Den Beste recently pointed out this is a lot easier than in the sciences.

A couple of things to remember. Socialist systems lose their innovators, their go getters, and their ambitious and retain and gain time servers, comfortable folks who tend to work only as much as necessary. Any concept of a vocation (in this case healing vocation) gets watered down and largely disappears over a few generations.

Socialist systems also tend to underinvest in seed corn. If full operational funding is $8B and fully reinvesting to replace depreciation and keep up with new innovation raises the figure to $10B, socialist systems will usually invest somewhere between the two, say $9B. In a financial squeeze (as apparantly Canada has suffered), you might get temporary drops down below $8B. Of course doctors and other personnel complain so "full funding" of $9B is restored. Complaints only partially die down because, unnoticed by the general public and the politicians, a slow downward spiral has set in and equipment is older, breaks more often, isn't as good as the current state of the art, etc. The scene is set for an ever growing, nastier fight between ham handed, uncaring regulators and greedy doctors.

There is a long period of time before these trends show up and the unsustainability of the system is demonstrated where it is possible to show accounting savings with no loss of care and kick the can down the road so the next generation has to pay for it. That's how I read this doctor's analysis. He's making excuses and kicking the can down the road. Minimize and hand wave (18% is really 10% you know) really does work, especially with people who are unaware that this sort of system has been tried many times before to universal long-term failure, the only exceptions being when it was also a universal short-term failure.

Posted by TMLutas at January 10, 2004 10:18 AM