Let Us Rally to Protect the Delicate Flower of Rugged Individualism!

by Henry on March 11, 2009

Two recent versions of the same argument. First, the simplified 800 word version, from Roger Cohen.

To paraphrase Mauriac, I love France, but I don’t want there to be two of them, least of all if one is in the United States. … I think President Obama’s counter-revolution goes in the right direction. … Still, the $3.6 trillion Obama budget made me a little queasy. There is a touch of France in its “étatisme” — the state as all-embracing solution rather than problem — and there’s more than a touch of France in the bash-the-rich righteousness with which the new president cast his plans as “a threat to the status quo in Washington.” … You know possibility when you breathe it. For an immigrant, it lies in the ease of American identity and the boundlessness of American horizons after the narrower confines of European nationhood and the stifling attentions of the European nanny state, which has often made it more attractive not to work than to work. High French unemployment was never much of a mystery. Americans, at least in their imaginations, have always lived at the new frontier; French frontiers have not shifted much in centuries. Churn is the American way. … If America loses sight of these truths, it will cease to be itself.


Second, the lengthier and more sophisticated variant from Clive Crook.

I was hoping that Brooks would press Shields to say what exactly it is about France he objects to, what makes him recoil at the parallel. Where has France gone too far, in the view of an American liberal? … Presumably, liberals approve of the universal health care, the generous and extensive welfare state, the comprehensive worker protections, the stricter regulation, the vastly more-generous subsidies for higher education, the stronger unions, the higher taxes, and especially the higher taxes on the rich. … Perhaps some liberals privately long to make the United States over in the image of France, but the great majority, I imagine, are more interested in taking the things they regard as best in the European economic model—all the things I just listed—and combining those “socially enlightened” policies with the traditional economic virtues of the United States. Take French social policies and welfare-state institutions and add them to the American work ethic, spirit of self-reliance, and appetite for change. Et voila, the best of both worlds. Color me skeptical. Culture shapes institutions and vice versa. Culture—that bundle of traits of self-reliance, self-determination, innovation, and striving for success—underpins the American exception. … In ordinary times, this culture makes it hard for a government to push the United States in a European direction … But now, maybe, the time is ripe. This unusually severe economic crisis has called American capitalism into question, highlighting its weaknesses and making it easier to forget its strengths. Liberalism has a rare opportunity. … But the interaction between culture and institutions works both ways. Change the system and, with time, you will change the culture. How much you will change it is debatable, and so is whether change of that kind would be good, bad, or indifferent for the country’s economic and political prospects. But it would be an error to assume that the policy transformation that some liberals long for—and which Obama, if his budget is any guide, appears to be aiming for—would leave America’s unusual cultural traits unaffected.

… the American exception is alive and well, and that it is more than likely the secret of this country’s awesome success. … I would need to think long and hard before casting it for “transformation.” Repairs here and improvements there, of course, but transformation? It would be a shame to see America revert to the Western European norm. … The fact is, whether his programs work or not, taken together they represent the biggest and fastest expansion of government since the New Deal. Moreover, the tax increases to pay for this expansion, he says, are to fall entirely on high-earning households. So his plan to enlarge government is married to an uncompromising assault on economic inequality. And if all of this is not enough to remind you of Europe, Obama has also expressed strong support for the Employee Free Choice Act, arguing that bigger and stronger unions are a vital part of sharing prosperity more widely. To somebody who watched unions cripple the British economy, until voters elected Margaret Thatcher to sweep them away1, this is the part of Obama’s program that seems most in need of an international reality check. This promised transformation is not a move into unexplored territory, after all. The policies that Obama is proposing have all been tried elsewhere. Ideas that look bold and new in this country are old hat across the Atlantic. And we know something about how well they work.

There is something very, very strange in my eyes about this kind of argument. On the one hand. a notion of a healthy American culture of can-do entrepreneurialism, which has survived for centuries and caused America to prosper. On the other, the claim that the combination of broader-if-not-quite-universal healthcare, a slightly easier time for unions, and a return to the relatively mild form of progressive taxation we saw in the 1990s would very probably lead to the destruction of said robust culture. Something here Does Not Compute.

But even if we ignore the internal contradictions, the claim that America is going to become ‘France’ 2 if we’re not very careful doesn’t really hold up. If this kind of change were likely, then the US would no longer have a France to become like.

This may require some explaining.There is a thriving literature in political economy on the forces driving convergence and divergence in the world economy. Much of this work sought to discover whether or not countries were converging in the 1990s and the early years of this decade on a single Anglo-Saxon model, given international economic pressures and the success of the US. France was a case in point. Francois Mitterand’s efforts to revive and strengthen French social protections when he came to power in the early 1980s led to near economic collapse, and the momentous decision by the French socialists to accept the capitalist straitjacket of liberalized international markets. The succeeding two decades saw the steady erosion of the more social democratic (and socially protective Christian Democratic aspects) of the political economy in France, Germany and other European countries, the withdrawal of the state from ownership of large chunks of the economy and the spread of various more free-market oriented institutions and social practices.

France and other countries faced a profound crisis – a crisis which in some ways was even more profound than that facing the US today. They have faced continuing pressures to ‘reform’ institutions in a more market-liberal direction over the succeeding two decades. And they have indeed changed in some very important ways. But France did not converge onto the US model despite these pressures. If it had, presumably Crook’s and Cohen’s criticisms would be rather different than the ones that they are making Instead, it has reformed along a divergent trajectory to the US, with continued heavy state involvement in the economy but of a different variety than previously.

This reinforces a near-universal finding of the relevant literature in political economy as I read it. While there is some diffusion of policy lessons across states, it tends to have limited consequences. Different countries respond to common shocks in very different ways, because of their existing institutional structures. National economic trajectories are quite robust. Even in major crises, advanced capitalist countries tend to tinker around the edges of their institutional systems rather than opt for wholesale reform, let alone converging on a perceived ‘better national model’ elsewhere.

And this is what is happening in the US. The Obama proposals are not particularly radical departures from existing practice in the US. They are certainly nothing like traditional European social democracy. Even David Brooks effectively acknowledges this, when he says that they are potentially problematic in combination rather than individually. They aren’t going to set the US on a different national trajectory, let alone make it ‘French’ or ‘European.’ Some of us might like to see this happen, but it isn’t going to, even given the ideological trauma that the US is undergoing. And arguing that American individualism is likely to wilt if exposed to nasty foreign influences smacks more of a kind of capitalist-road José Bové-ism than any serious kind of intellectual analysis.

1 I leave this claim to Harry to respond to if he wants to.

2I note in passing that the claim is that America will become ‘France,’ not that America will become France. The ‘France’ of Cohen and Crook’s articles is less a country than a numinous state of being, consisting primarily of state-provided everything, laziness (both enjoyable and otherwise) and very good cheese. It has no actual inhabitants (excepting, perhaps, Peter Beagle’s imaginary Mr. Moscowitz who at the last became so French that France itself was no longer good enough for him).

{ 32 comments }

1

someguy 03.11.09 at 7:58 pm

“And this is what is happening in the US. The Obama proposals are not particularly radical departures from existing practice in the US. They are certainly nothing like traditional European social democracy. Even David Brooks effectively acknowledges this, when he says that they are potentially problematic in combination rather than individually. They aren’t going to set the US on a different national trajectory, let alone make it ‘French’ or ‘European.’ Some of us might like to see this happen, but it isn’t going to, even given the ideological trauma that the US is undergoing. “

Right.

But given that, why would so many people like to make the attempt to turn the US into a European Social Democracy?

I mean we know what single payer health care would probably look like in the US and it looks nothing like what it looks like in Europe. It is called Medicare. It doesn’t stink but doesn’t deliver better health care at a lower cost than the US private sector as Europe allegedly does.

And given a choice you would opt for private insurance for the same price.

So why?

2

Adam Kotsko 03.11.09 at 8:50 pm

Or it could look like the Veteran’s system, or like the insurance provided to federal workers. Or it could look like the actual existing Medicare instead of the version someguy just fantasized — you know, the one with really high satisfaction ratings compared to private insurance.

3

Peter 03.11.09 at 9:03 pm

I guess it just wouldn’t be an American system unless one in six dollars wound up in the hands of private industry.

4

JulesLt 03.11.09 at 9:13 pm

What fascinates me is the notion of the American exception as a permanent state – it strikes me that many economies have gone through periods of enormous growth and transformation, but few have maintained their exceptional status for more than a few decades.

In fact, if we have to discard most of the ‘growth’ over the last decade, it’s possible that the American exception actually came to an end sometime in the 90s – and I strongly suspect it’s actually been in decline since the 70s oil shock – whether that is a good or bad thing is another matter.

Do we want the Chinese exception to become permanent, for instance? Largely we see that as a transformation into an advanced economy where workers will eventually want to work less hours (as also happened in post-war Japan).

5

Uncle Kvetch 03.11.09 at 9:20 pm

It would be a shame to see America revert to the Western European norm.

“Revert”??

6

someguy 03.11.09 at 9:25 pm

Adam,

I very explicitly stated that I did not think that Medicare stinks.

I would be very interested any results you could provide for satisfaction levels of private insurance vs medicare that controlled for cost. Controlling for age would also be great but probably impossible.

Thanks for bringing up other examples. Certainly the costs for Medicare and the insurance provided to federal employees dwarfs the costs of European programs. I would guess the same is true of the Veterans system. That would be 3 examples instead of the one I provided.

Again, I am not claiming the government run healthcare = end times/horrible.

I am pointing out that current government run health care does not provide the alleged magic of European systems better care for half the cost. Socially Deomcratic programs in the US look much different than their European counter parts.

I don’t see any reason to see why if we expanded government coverage to those Americans not currently covered, what is the percentage between federal employees, medicaid, medicare and veterans of Americans covered by government provided insurance?, more than 1/2?, we should expect anything different than what those currently covered get.

I also feel that given a choice most people would opt for private coverage.

If not, why don’t we help balance the budget by selling Medicare premiums at a mark up to 19-64 olds?

I agree with Henry, I just didn’t think he took his thought far enough.

7

ejh 03.11.09 at 10:00 pm

which has often made it more attractive not to work than to work

At this point any further consideration of the argument becomes superfluous: it’s not an argument but an exercise in the prejudices of the affluent.

8

salient 03.11.09 at 10:10 pm

I also feel that given a choice most people would opt for private coverage.

I’ll disagree. Perhaps, at best, many healthy securely-employed people who don’t have to worry about a ‘pre-existing condition clause’ or ‘denial of coverage clause’ would opt for private coverage. Those who have been sick previously, or who have family members who have been sick previously, or who for a myriad of other reasons have discovered that a “private coverage” firm controls its costs by making each of its customers push inordinately hard in order to receive the coverage they’re due, will probably see benefit in a single-payer system. In a public system, there’s at least some chance the primary goal of the program won’t be profit at members’ expense, regardless of health outcome.

If not, why don’t we help balance the budget by selling Medicare premiums at a mark up to 19-64 olds?

Because this allows currently healthy people to stay out of the system until they get sick, and then buy in if/when they need coverage.

It’s kind of like balancing a city’s budget by charging people $1000/year for “fire truck insurance” and then refusing to send fire trucks to put a house fire out unless the owners have bought into the system: perhaps this sounds reasonable at first, but there are obvious social costs when a fire at Nonpayer X’s house starts spreading to neighboring houses.

Similarly, there are social costs to Person X being sick, and not having access to the health care necessary to get better. I believe these are basic, well-characterized problems. When Nonpayer X gets sick, and doesn’t have enough money to cover costs, do we let them buy in to Medicare? Either (yes) and we open ourselves to a major free rider problem, or (no) and we eat various social costs, since a substantial swath of the population will take the risk and not buy in to any voluntary program.

9

Uncle Kvetch 03.11.09 at 10:57 pm

Churn is the American way.

One man’s misery is another man’s “churn.” Especially when the other man is making 6 figures writing about how the first man needs to just suck it up, already.

10

Walt 03.12.09 at 1:01 am

Kvetch: Are they hiring?

11

someguy 03.12.09 at 1:41 am

salient,

Surely most people are fairly healthy and “don’t have to worry about a ‘pre-existing condition clause’ or ‘denial of coverage clause’” and so most people “would opt for private coverage.”

Given the choice.

I am not sure why you think we couldn’t sell Medicare premiums at small profit if Medicare provides better quality care at a lower cost than private insurance.

Surely your free rider problem exists even if we don’t sell Medicare premiums? I am not certain how selling Meciare premiums makes it worse. So why not sell and pocket the profit for the common good?

I am also not convinced of anything by your free rider argument. Essentially you are arguing that we must force the uninsured to get insurance because they are ripping us off. Surely most people with the means purchase insurance? There is no epidemic of upper middle class and the filthy rich refusing insurance and laughing at us suckers as they get treated any way? Ahh ha ha loser taxpayers, I am enjoying the social benefits of care without the costs!

It is true that we would need to make sure that the same set of rules apply to both private firms and Medicare. We could not let private firms reject those with pre-existing conditions and require Medicare to accept them.

I think the corect approach would be to require both to accept those with pre-existing conditions.

Even accepting the dubious notion that Medicare is superior it is still light years from delivering the European miracle of better care at half the costs.

12

Helen 03.12.09 at 2:16 am

As an Australian, which has a Medicare system, colour me satisfied. Last year, my son had a severe accident and needed multiple tests and surgery over several months, as well as the emergency visit. Cost to me: $0.00 I do pay a couple of hundred for another kind of test, there is a bit of randomness there, but all in all I’m not needing to lose the house as I probably would have to if I lived in the US.

13

Helen 03.12.09 at 2:17 am

I apologise for the terrible grammar there.

14

Ben Alpers 03.12.09 at 5:57 am

One of the many ridiculous aspects of the Brooks/Crook “argument” is that the U.S. has historically been much more wedded to progressive income taxes than has France and most other European countries (see this very interesting old CT post for more details on the history of this).

If there’s American exceptionalism in taxation, the American exceptionalist system is the progressive income tax, which has generally been a lot more steeply progressive than it has been in recent years. One further irony: it’s the U.S. right that presses, instead, for a European-style system with flatter income taxes plus a VAT.

(Incidentally, Nate Silver put a very interesting post up on Tuesday noting that all the talk about the historical drop in the top marginal tax rate tends to miss a key fact: we’ve also eliminated an entire additional bracket for the super rich. Today the top marginal tax bracket kicks in at $357,700. In comparison, in 1940, the top bracket (with a marginal rate of 80.1%), began at $5,000,000….or roughly $75,000,000 in today’s money. A great, and quite politically viable, way to increase progressivity in our tax system would be to create an additional bracket.)

15

Gabe 03.12.09 at 7:15 am

These discussions are all narcissisms of small differences. Generally the outcome of all these systems is a fairly evenly mixed economy, and whether an extra 10% or so of GDP is under government control or not, does not really make as much difference as this kind of punditry makes out.

16

yabonn 03.12.09 at 9:42 am

The ‘France’ of Cohen and Crook’s articles is less a country than a numinous state of being

Metoo. The mechanism here is “I’m proud of some virtue, which I think is a typically US virtue. Meaningfully, ‘France’, being not-US, lacks this virtue. Build around this. And, by the way, Vichy.”

At the same time they claim expertise on the subject (Cohen , you see, stayed at least two centuries in the country) and use their fantasy ‘France’ – an ego stroking device. But you’d like your experts to (i) know what they are talking about, and/or (ii) at least do no harm, and sell their readers ‘France’ for France.

Understanding between the two countries is not that vital after all, but I’m a little worried still that the ones in charge in the US are probably being fed this rubbish also.

17

mpowell 03.12.09 at 11:12 am


And arguing that American individualism is likely to wilt if exposed to nasty foreign influences smacks more of a kind of capitalist-road José Bové-ism than any serious kind of intellectual analysis.

Do we actually expect serious analysis from these people? We know what the goal is. It is the systematic attempt to undermine any movement towards a more fair system. These people could never acknowledge that there is an approrpriate balance, even if their arguments clearly imply it. This intellectual posture is necessary to provide the foundation to defend every advantage of the wealthy and powerful.

18

Ben Alpers 03.12.09 at 12:20 pm

“France” is also, still, about Iraq. It was only in 2002, when the French (along with most of “Old Europe” and half of the American public) took the absolutely correct position on Washington’s rush to war on Iraq, that our chattering classes decided that France was the ultimate bête noire liberty beast.

19

Richard Schrader 03.12.09 at 12:38 pm

American uniqueness is a fairly fragile concept. As a global market leader, our top of the charts run lasted from the end of WW 2 to the ripening of Watergate summer and the post-petro shock economy. Mostly, this great surge rose on the back of the broken European economies coming out of the war and unchallenged American military power. Not to mention the vast spending of the federal government in building roads and homes, lending money to vets to buy said homes and constructing a military apparatus that actually made it share of technological breakthroughs, like the internet. America’s difference, beside its rapaciously materialistic culture and lousy public schools, has been the ability of creative businessmen to take big ideas (and technology) and apply them to a mass commercial market. The era of financial casinos risking other people’s money is over, its superstructure in ruins. Let a public entity guide investment strategies for awhile — and put more resources in growing Medicare-like programs and institutions of higher education.

20

James Conran 03.12.09 at 12:49 pm

Further to Ben Alpers point (that America has tended to have a more progressive tax structure), I would also suggest a couple of points to counter (or at least complicate) cliche-mongerers such as Cohen:

1) from 1945 to 1970 (roughly) the US economy was not obviously more dynamic (taking growth and employment performance as metrics) than western Europe

2) How recent a phenomenon is the greater egalitarianism/social democracy of the French political economy compared to the American? It is very striking today to read RW Johnson’s (wonderfully written) book “The Long March of the French Left” (published in 1981 I think?) where he spills a fair bit of ink decrying the high level of income and wealth inequality in France compared to, among others, the US).

On the other hand the second point (and to a degree the first) would seem to contradict Henry’s confidence as to the robustness of “nati0nal economic trajectories”, no?

21

James Conran 03.12.09 at 12:52 pm

Oh, much kudos on footnote 2 by the way.

22

dave 03.12.09 at 1:12 pm

The ‘France’ of that footnote, while not being an actual place, is also the one inhabited by the leaders of many of the strikes that the French public sector is prone to. One need only listen to them for a few minutes to be reminded that there are people who continue to believe that the state should provide everything that they need, in return for a few hours of their time graciously accorded to some light duties, and for it not to do so represents a grievous affront to natural justice, deserving of direct and unequivocal opposition.

Of course what would be really interesting is to discover how many of the French think like this, and also voted for Sarkozy…

23

mpowell 03.12.09 at 2:00 pm


On the other hand the second point (and to a degree the first) would seem to contradict Henry’s confidence as to the robustness of “nati0nal economic trajectories”, no?

If I understand what Henry’s point was, I don’t think this was true. You are assuming that there is only one variable for these trajectories to move along. Obviously, this is not the case. It is quite possible for the American society to have followed a distinct trajectory, completely independent of what Western Europeans were doing that, that started with a low level of inequality in the 60s and 70s and built up to the extremely high levels that you see today. Also, there is a difference between substantially changing the institutional structure of a society and observing a significant shift in one of it’s outputs, like income inequality.

24

JM 03.12.09 at 2:29 pm

It was common, iirc, for African dictatorships after WWII to claim that democracy was a western imposition, and that their authoritarian regimes were a reflection of an African tradition of rule by consensus. Then, the rulers robbed their countries blind and brutalized their opponents. Same with “our socialism,” which briefly elicited such excitement on the right during the recent US election until, you know, they actually got the details.

For the last several years, Americans have been told how horrible, horrible, just plain awful life is in Europe, much as Soviet citizens were told about crime, poverty, violence, and drug dependence in the free west. It’s bad out there. You think it’s bad here, but it’s worse out there.

Trust me.

Good.

Now, obey me.

It’s all just advertising for the lifestyles of the ruling class, no matter how you slice it. Just look at all the disinformation out there on EFCA. Bimbos on FOX lie to the masses because their bosses see Americans as stupid and disposable.

At least in our system, the violence is mostly sublimated, but the result is the same. Consolidation of wealth at the highest levels with the rest of the population panicking over their shrinking slice of the pie and looking for someone to blame. Witches! Imperialists! Frenchmen! Look! Over there! Away from where I’m just robbing your dumb ass blind!

Made you look.

25

webegeeks 03.12.09 at 6:51 pm

The day I went on medicare was a very good day. My private insurer constantly denied claims and interfered with my treatment options (I had cancer), while medicare never gave me one bit of trouble. My private insurer refused to pay for an ambulance ride when I had a heart attack, medicare has paid for several with never a denial from them of any kind. My private insurer refused to pay for a hospital stay when I had to withdraw from pain medications I had been on for over two years, and medicare just paid over $20,000.00 for an intrathecal pain pump implanted in my gut like a pacemaker. My private insurer denied, denied, and denied claims to the point that it staying ahead of the medical bills was impossible, it ate up all of my savings, resulted in me having to sell a home I loved and had lived in for 15 years because I couldn’t pay for the medications their so called corrolary (sp) didn’t cover but I needed because of my cancer and heart condition and pay the mortgage too. My private insurer also made certain a stellar credit rating was ruined. Since going on medicare I have NEVER had a call from a collection agency, doctors office demanding payment, or hospital threatening me with legal action. I was in the railroad industry and covered by United Healthcare, so it is not as if I was on cheap insurance either. It is just that insurance companies first response is to deny everything and hope people are so sick they won’t fight them. These people are evil, and that is a fact, and it is sad that the American public is so damned stupid that insurance companies have effectively blocked universal healthcare since it was first proposed in 1952!

26

Phil 03.12.09 at 6:59 pm

what would be really interesting is to discover how many of the French think like this

It would indeed. Good luck drafting the questionnaire.

27

Peter Whiteford 03.13.09 at 12:26 am

Last year the OECD published a report that deals with income inequality, with a chapter (written by me) that looks specifically at income redistribution through the tax and benefit systems.
http://www.oecd.org/document/53/0,3343,en_2649_33933_41460917_1_1_1_1,00.html

I argued (like most other people in this field) that it is important to distinguish between progressivity and redistribution – progressivity describes the structure of taxes and benefits, but redistribution is determined both by the progressivity of taxes and benefits and the level of taxes and benefits. For example, a more progressive tax system may redistribute less than a less progressive system if the level of taxes is substantially lower.

The report actually found that the USA has the most progressive system of direct taxes in the OECD, which includes income taxes and employee social security contributions, but not employer social security contributions or indirect taxes. (Adding these in would be unlikely to change the rankings because indirect taxes are everywhere less progressive than direct taxes, and they are generally higher in Europe than in the USA.)

Progressivity is measured by looking at the share of total taxes paid by different income groups and calculating what share is paid by different deciles, but also by calculating the concentration coefficient (i.e. the Gini coefficient) for taxes.
In a number of countries, the richest 20% paid a higher share of their own income in taxes than in the USA, but their systems were less progressive because the middle and the poor also paid a (much) higher share of their income in taxes. The Nordic countries actually tend to have the least progressive systems of direct taxes, and the English-speaking countries the most progressive.

Nevertheless, the report also found that the USA is the only OECD country which redistributes more through the tax system than through the system of cash benefits.
Another way of putting this is that other countries reduce inequality more through paying social security benefits than through taxes.

So the USA redistributes less through social security (age and disability pensions) and unemployment payments etc. than most other countries. (Also most but not all other countries support families with children through cash benefits, whereas the USA mainly does this through the tax system.) Even though the US social security system overall is about average in progressivity, the overall redistributive effect is lower mainly because most other countries spend a lot more through their social security systems than the USA.

So when you look at the combined effect of taxes and benefits overall the USA redistributes less than most other OECD countries, despite the fact that it has the most progressive system of direct taxes.

The USA also starts off with one the highest levels of earnings inequality and inequality in capital income among OECD countries, so that when you look at household incomes “after” taxes and benefits, the USA is the fourth most unequal country in the OECD – after Mexico, Turkey and Portugal.

So my policy conclusions would be that increasing progressivity in the US system of taxes is not necessarily the most effective way of reducing inequality – although obviously it would help – but that increasing the level of taxes and spending the money on sensible social programmes would be likely to be more important.

28

John Quiggin 03.13.09 at 1:03 am

James Conran, you’re broadly right, but the period of US relative dynamism is much shorter than you suggest, and also much more limited. Western European countries were doing better on growth in output per hour into the mid-1990s, by which time many of them had surpassed the US. The US triumphalism of the mid-90s rested on a combination of higher than average employment/population ratios and extremely high average hours per worker.

The US did better on output per hour between about 1995 and 2005, but lost ground on the E/P ratio.

29

lurker 03.13.09 at 1:34 pm

‘which has often made it more attractive not to work than to work’ (quoted in post 7)
Somebody rather smarter than me pointed out recently that to make it always more attractive for everyone to work than not to work, you should make taxes on all other sources of income than work (e.g. property) highly punitive. Any chance of the US trying that?

30

mds 03.13.09 at 6:48 pm

you should make taxes on all other sources of income than work (e.g. property) highly punitive. Any chance of the US trying that?

Certainly. But Spock will have to grow a beard.

Meanwhile, even though it is largely Googling to the choir, I would suggest that anyone experiencing the least uncertainty about

It doesn’t stink but doesn’t deliver better health care at a lower cost than the US private sector as Europe allegedly does.

need merely look up “Medicare Advantage” on the interwebs. So strong is the Cult of the Private Sector in the US, that we currently pay insurance companies an average of ~12 percent extra to provide the same service as regular Medicare. And naturally, any attempt to cut these taxpayer subsidies for offering the same services at higher cost are attacked by the party of the “free market” and by the Cato Institute.

31

someguy 03.14.09 at 1:16 am

mds,

The should also go here

http://www.marginalrevolution.com/marginalrevolution/2008/07/democrats-proud.html

Money quote about the ME plans you are referring to

“That could be written more clearly but what they are saying is that Medicare pays HMOs 10 percent more than they would pay for an enrollee in traditional Medicare but the HMOs offer the enrollee 13 percent more worth of extra benefits and rebates. In other words, the HMOs pass on to the enrollee all of Medicare’s “extra payments” plus some. (Note that this is exactly what one would expect in a competitive market.)”

32

John 03.14.09 at 10:13 pm

No societies are perfect and at the end of the day you have to use as the yardstick the greatest happiness of the greatest number. You can’t base your opinion on the wealthiest 1% of a country any more than the poorest 20%. I’ve lived and worked in four countries:US, France, Britain, Germany and soldiered in a couple of others. If I had to nominate which of these had the best combination of lifestyle and a society that worked fairly well I would unerringly choose France with probably the Brits as second because it’s a nice lifestyle and they take themselves least seriously of any society I’ve known. I’m afraid our problem in the US is that we are the prisoner of all kinds of urban myths and misinformation much of it peddled for some political purpose or other. How anyone can talk about “small govt” with a straight face when the combined federal and state budgets of this country, even before the recent stimulus, totaled around $4.5 trillion is a mystery. This is several times larger than the govt spending of any other sovereign state in the world. And much of it is grossly inefficient. About 54% of national expenditure on healthcare, where we are as is widely acknowledged spending at twice the rate of our peer group, comes from govt. Our defense expenditures, greater than the rest of the world combined, are riddled with cost over runs and boondoggles. In short the small govt cow left the barn long ago. The challenge as we enter a period of relative decline over the next 50 years is manage this whole process more efficiently and that means getting rid of the urban myths and misinformation with which this original piece and many postings are riddled. I actually think this is Obama’s great challenge: to educate the country in reality.

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