Healthcare Works in a Free Market

This article will argue that healthcare works just fine on a free market, in contrast to what many mainstream economists seem to think.

Let’s start with an outside source. Peter Klein is a big name Austrian and he discusses this subject in a solid video shown below:

Key highlights:

  • “Healthcare” is not a useful term because it is not a homogeneous thing. No one can sell you 1 healthcare.
  • When we analyze the discrete goods and services which healthcare represents there seems to be no reason that they would not work on a free market. Everything from medicine to surgery can be bought and sold on a market.

Other points I would add which Klein doesn’t make:

  • In scientific process, in particular in statistical process, the null hypothesis is that a particular pattern is the same as a more general or usual pattern. The alternative hypothesis is that they are different. Free market efficiency is the usual pattern. The onus of proof is on the group claiming that healthcare presents a deviation from the usual kind of thing. To assume such a fact without evidence is to commit a logical fallacy called special pleading.
  • Some economists make the claim that life or death transaction situations which sometimes arise in healthcare are different from regular economic transactions. The onus of proof is on them or else this is special pleading as well.
  • The above claim cannot be proven because it is false. The presumption that everyone wants to live is not true. Sadly, the fact that money is a major contributing factor in suicide is enough to prove this point, although we all know that economic thinking is tied strictly to finance. Social opportunity cost can have the same effect. Life itself has a value which, exotic or immoral as the idea may seem, often has a price, even if not a financial price. The preference to live, while usually a very strong preference, is in the strict sense no different from any other kind of preference. There seems to be no reason why a market would not coordinate preference for life just as optimally as it coordinates anything else.
  • Planned economies, of either the autocratic, communistic or any other type, don’t have a great record with healthcare coordination. Capitalists usually do also die off eventually, but we seem to hang in there a bit longer on average.
  • There are no examples of free market failure of healthcare, or free market failure of any kind for that matter.
  • Some of the most efficient government healthcare plans, like Germany’s healthcare system, use artificial markets where private parties form contracts, but form them in awkward ways which don’t reflect precisely how things would be done on a free market without government manipulation. Use of markets rather than fully planned healthcare systems indicates a clear appreciation for market benefits. If markets have clear benefits and no clear problems then they should preferred. The excuse is usually a political demand for fairness, but let’s use our brains for a minute, is it better to have a group of politicians decide the fair thing to do or for a free market to decide the fair thing to do? Money decides the distribution either way, but in one case the money is flowing through lobbyists to politicians and in the other case it is flowing directly between voluntary parties.
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