A Plan to Replace the Welfare State

[Roxanne Appleby]

Charles Murray suggests that we eliminate the entire welfare state - Medicare, Medicaid, Welfare, Social Security, etc. - and replace it with a $10,000 annual stipend to every adult. This would increase social spending by $300 billion per year right now, but in 10 years the "lines would cross" and it would save money.

I find this a pretty darned exciting idea. What do you think?

Excerpts from "A Plan to Replace the Welfare State" by Charles Murray
http://www.opinionjournal.com/editorial/feature.html?id=110008142

Throughout history until a few decades ago, the meaning of life for almost everyone was linked to the challenge of simple survival. Staying alive required being a contributing part of a community. Staying alive required forming a family and having children to care for you in your old age. The knowledge that sudden death could happen at any moment required attention to spiritual issues. Doing all those things provided deep satisfactions that went beyond survival.

Life in an age of plenty and security requires none of those things. For the great majority of people living in advanced societies, it is easily possible to go through life accompanied by social companions and serial sex partners, having a good time, and dying in old age with no reason to think that one has done anything significant.

If you believe that's all there is -- that the purpose of life is to while away the time as pleasantly as possible -- then it is reasonable to think that the purpose of government should be to enable people to do so with as little effort as possible. But if you agree with me that to live a human life can have transcendental meaning, then we need to think about how human existence acquires weight and consequence.

For many (in the upper levels of professions), the focus of that search for meaning is bound up with vocation -- for some, the quest to be rich and famous; for others, the quest to excel in a vocation one loves. But it is an option open to only to a lucky minority. For most people -- including many older people who in their youths focused on vocation -- life acquires meaning through the stuff of life: the elemental events associated with birth, death, growing up, raising children, paying the rent, dealing with adversity, comforting the bereaved, celebrating success, applauding the good and condemning the bad; coping with life as it exists around us in all its richness. The chief defect of the welfare state from this perspective is not that it is ineffectual in making good on its promises (though it is), nor even that it often exacerbates the very problems it is supposed to solve (though it does). The welfare state is pernicious ultimately because it drains too much of the life from life.

Aristotle was right. Virtue is a habit. Virtue does not flourish in the next generation because we tell our children to be honest, compassionate and generous in the abstract. It flourishes because our children practice honesty, compassion and generosity in the same way that they practice a musical instrument or a sport. That happens best when children grow up in a society in which human needs are not consigned to bureaucracies downtown but are part of life around us, met by people around us.

The Plan returns the stuff of life to all of us in many ways, but chiefly through its effects on the core institutions of family and community. One key to thinking about how the Plan does so is the universality of the grant. What matters is not just that a lone individual has $10,000 a year, but that everyone has $10,000 a year and everyone knows that everyone else has that resource. Strategies that are not open to an individual are open to a couple; strategies that are not open to a couple are open to an extended family or, for that matter, to half a dozen friends who pool resources; strategies not open to a small group are open to a neighborhood. The aggregate shift in resources from government to people under the Plan is massive, and possibilities for dealing with human needs through family and community are multiplied exponentially.

The Plan confers personal accountability whether the recipient wants it or not, producing cascading secondary and tertiary effects. A person who asks for help because he has frittered away his monthly check will find people and organizations who will help (America has a history of producing such people and organizations in abundance), but that help can come with expectations and demands that are hard to make of a person who has no income stream. Or contemplate the effects of a known income stream on the young man who impregnates his girlfriend. The first-order effect is that he cannot evade child support--the judge knows where his bank account is. The second-order effect is to create expectations that formerly didn't exist. I call it the Doolittle Effect, after Alfred Doolittle in "My Fair Lady." Recall why he had to get to the church on time.

I love that last, but most people I've shared this with did not get it. The song Alfred was singing was "I'm getting married in the morning . . ." LOL!

 

[BlackShanglan]

Charles Murray suggests that we eliminate the entire welfare state - Medicare, Medicaid, Welfare, Social Security, etc. - and replace it with a $10,000 annual stipend to every adult. This would increase social spending by $300 billion per year right now, but in 10 years the "lines would cross" and it would save money.

I find this a pretty darned exciting idea. What do you think?

His ideas on the guaranteed income leading to different expectations as to responsibility are interesting, although I do wonder this. Everyone in America already has one free resource theoretically designed to provide liberty, responsibility, and the ability to advance in life: a free public education. We don't often see to actually expect people to have done much with it or to look at it in the way that Mr. Murray expects people to look at the 10K stipend. What will prevent the 10K stipend from being similarly swept under the rug?

I also do very much query where his "lines will cross." 10K is really a decent chunk of money; it's enough that one could eke it out working half time and never really have to do much of anything if one's expectations were low enough. If everyone has that option, who will be out earning the money to pay for the 10K each?

Shanglan

 

[she_is_my_addiction]

Jesus Christ...I can just see the problems already...

On the otherhand, I can see the appeal...

 

[Colleen Thomas]

I'm not a welfare bum. I worked most of my adult life, from the time I was fourteen with summer jobs, to the time I was fired because of medical problems that prevented me from doing the job I was trained to do or holding any job for that matter. I even worked through college.

I get less than 700$ amonth now in disability, but I do have the benefit of being eligible for medicare.

So this plan is basically going to give me 1600 dollars more each year, while taking away my healthcare coverage. Do you suppose I could get a private carrier to give me similar coverage for 133 per month, with my medical history?

What does Dick Cheny or Kenny Ley need with an extra 10K a year?

I would say it's a pipe dream of a plan. Without any real connection to reality. In NY alone, ten K per month woun't even cover rent on a small place unless you are out in the boonies upstate. It has the same basic flaw of any of a dozen blanket plans. Too many people have situations where the blanket dosen't fit. And the people who get hurt worst, are usually the people who least deserve to get hurt.

I don't walk around with the illusion the government or anyone owes me a living. I hate drawing disability and have tried any number of medical options as well as looking for work I can do that is within the parameters of my disbaility. This plan would pretty much mean starvation, no home or death due to simple illness I couldn't aford to get treated. My only real hope is to find work writing, since that fits with my problems, but I'm not sure I have the talent for it. So where does that leave me?

It leaves me depressed that I am forced to accept help, but grateful that the help is there.

I don't believe in welfare as a way of life, but I am even more convinced it's a neccissity as a last option for those who find life dealing some pretty shitty cards. If you play blackjack, no amount of skill will help if you can't land so much as a face card from any given shoe.

I face a simple option now, draw my benefits or move back home and let my folks pay for me. they worked all their lives and they are pretty comfortable, but if you added me, with just my medical bills, they would be living a very meagre existance. Do they deserve that? Do i?

10-K a year to every person means a huge percentage of people will be getting money they don't really need, while an equally huge number will not be getting enough to get by on.

It might be more "fair", but if life were more "fair" I wouldn't be in need of the insurance and benefits I am dependant on in the first place.

 

[she_is_my_addiction]

I'm not a welfare bum. I worked most of my adult life, from the time I was fourteen with summer jobs, to the time I was fired because of medical problems that prevented me from doing the job I was trained to do or holding any job for that matter. I even worked through college.

I get less than 700$ amonth now in disability, but I do have the benefit of being eligible for medicare.

So this plan is basically going to give me 1600 dollars more each year, while taking away my healthcare coverage. Do you suppose I could get a private carrier to give me similar coverage for 133 per month, with my medical history?

What does Dick Cheny or Kenny Ley need with an extra 10K a year?

I would say it's a pipe dream of a plan. Without any real connection to reality. In NY alone, ten K per month woun't even cover rent on a small place unless you are out in the boonies upstate. It has the same basic flaw of any of a dozen blanket plans. Too many people have situations where the blanket dosen't fit. And the people who get hurt worst, are usually the people who least deserve to get hurt.

I don't walk around with the illusion the government or anyone owes me a living. I hate drawing disability and have tried any number of medical options as well as looking for work I can do that is within the parameters of my disbaility. This plan would pretty much mean starvation, no home or death due to simple illness I couldn't aford to get treated. My only real hope is to find work writing, since that fits with my problems, but I'm not sure I have the talent for it. So where does that leave me?

It leaves me depressed that I am forced to accept help, but grateful that the help is there.

I don't believe in welfare as a way of life, but I am even more convinced it's a neccissity as a last option for those who find life dealing some pretty shitty cards. If you play blackjack, no amount of skill will help if you can't land so much as a face card from any given shoe.

I face a simple option now, draw my benefits or move back home and let my folks pay for me. they worked all their lives and they are pretty comfortable, but if you added me, with just my medical bills, they would be living a very meagre existance. Do they deserve that? Do i?

10-K a year to every person means a huge percentage of people will be getting money they don't really need, while an equally huge number will not be getting enough to get by on.

It might be more "fair", but if life were more "fair" I wouldn't be in need of the insurance and benefits I am dependant on in the first place.

I agree.

If I could word things like Colly, my life would be complete.

 

[BlackShanglan]

Excellent point on cost of living. That had crossed my mind as well; 10K in NYC or San Francisco won't keep a dog in shelter, let alone a human.

 

[cloudy]

Excellent point on cost of living. That had crossed my mind as well; 10K in NYC or San Francisco won't keep a dog in shelter, let alone a human.

Exactly.

And how many of those receiving that stipend would actually be able to stretch it out over a year? I probably couldn't make it last, and I'm pretty damn good at making a dollar go a little further.

And then, we're right back where we started.

It's a nice dream, just not very realistic, I'm afraid.

 

[R. Richard]

Charles Murray suggests that we eliminate the entire welfare state - Medicare, Medicaid, Welfare, Social Security, etc. - and replace it with a $10,000 annual stipend to every adult. This would increase social spending by $300 billion per year right now, but in 10 years the "lines would cross" and it would save money.

Actually, they tried it in the Roman Empire. It didn't work. The vast majority of the Romans took the dole and tried to strech it into a living. The result was grinding poverty, disease and crime.

 

[gauchecritic]

Charles Murray suggests that we eliminate the entire welfare state - Medicare, Medicaid, Welfare, Social Security, etc. - and replace it with a $10,000 annual stipend to every adult. This would increase social spending by $300 billion per year right now, but in 10 years the "lines would cross" and it would save money.

I find this a pretty darned exciting idea. What do you think?

It's as exciting as the NHS and goverment pension schemes in the UK. It's based entirely on present day criteria and leaving future governments to deal with it as best they can.

Future governments don't or won't support ideas that they didn't create. Come to that they don't or won't support ideas they did create.

The NHS was created in order that disease could be eradicated and the population would all be available for shit shovelling save the priveleged classes. Unfortunately and myopically they didn't take into account education, the take up of female liberation, vastly improved technology, the shorter working week, an ageing population and everything else that comes with prosperity.

10 years is far too long a distance for stop gap measures.

Sooner, rather than later, someone is going to come along and say 'guaranteed income? that sounds a bit like communism' which is exactly what it is. "From those who can..."

The haves need to support the have nots.

Just so long as everbody sticks to it, I'm all for it.

Entirely realistic while everyone accepts their place in the hierarchy.

And for as long as those that run multinational conglomerates realise they are worth no more than those that shovel the shit.

 

[Pure]

guaranteed annual income is an old socialist idea, but even they did not think that it should involve the Bill Gates's having to come down to 12,000 a year.

so it's purely a spoofl

 

[Liar]

I'm too drunbk to read that article right now. What does it say about how to handle people who will buy booze for their ten grand?

And does filthy rich people get ten grand too?

And if so, why?



Oh, don't bother replying if it's in the article. I'll read it tomorrow.

 

[Roxanne Appleby]

I meant to post another excerpt earlier that would have preempted many of the problems cited above, but a dinner reservation pulled me away.

. . . Health care is more complicated in its details, but not in its logic. We do not wait until our 21-year-old is 65 and then start paying for his health care. Instead, we go to a health insurance company and tell it that we're prepared to start paying a constant premium now for the rest of the 21-year-old's life. Given that kind of offer, the health insurance company can sell us a health care policy that covers the essentials for somewhere around $3,000. It can be so inexpensive for the same reason that life insurance companies can sell generous life insurance cheaply if people buy it when they're young--the insurance company makes a lot of money from the annual payments before eventually having to write the big benefit checks. Providing access to basic medical care for everyone is easy for a country as rich as the U.S.--if we don't insist on doing it through the structure of the welfare state.

. . . Many questions must be asked of a system that substitutes a direct cash grant for the current welfare state. Work disincentives, the comparative risks of market-based solutions versus government guarantees, transition costs, tradeoffs in health coverage, implications for the tax system, and effects on people too young to qualify for the grant all require attention in deciding whether the Plan is feasible and desirable. I think all of the questions have answers, but they are not one-liners; I lay them out in my book.

. . . The Plan confers responsibility for dealing with human needs on all of us, whether we want it or not. Some will see this as a step backward, thinking that it is better to pay one's taxes, give responsibility to the government and be done with it. I think an alternative outlook is wiser: The Plan does not require us all to become part-time social workers. The nation can afford lots of free riders. But Aristotle was right. Virtue is a habit. Virtue does not flourish in the next generation because we tell our children to be honest, compassionate and generous in the abstract. It flourishes because our children practice honesty, compassion and generosity in the same way that they practice a musical instrument or a sport. That happens best when children grow up in a society in which human needs are not consigned to bureaucracies downtown but are part of life around us, met by people around us.

So "the plan" will not leave Colly and others to live on $32 per month to live on in New York: The transition will not happen "cold turkey," but will take place over many years, and no doubt will be expensive. But, "the place to start is a blindingly obvious economic reality that no one seems to notice: This country is awash in money. America is so wealthy that enabling everyone to have a decent standard of living is easy. We cannot do it by fiddling with the entitlement and welfare systems--they constitute a Gordian Knot that cannot be untied. But we can cut the knot. We can scrap the structure of the welfare state."

And yes, some people will fritter away the stipend and find themselves in need, but, "a person who asks for help because he has frittered away his monthly check will find people and organizations who will help (America has a history of producing such people and organizations in abundance), but that help can come with expectations and demands that are hard to make of a person who has no income stream." That last is really important. It offers a point of "leverage" to fix the broken person that does not exist under the current system, which instead treats its wards as cattle.

What I started to write before rushing out is this: Stipulate that the kind of transition issues cited by all of you can be dealt with. If true, isn't this exciting? It would supercharge "civil society" as described by Tocqueville and others, that network of private institutions, community associations, schools and religious organizations, families and friends and coworkers, and all their voluntary, from-the-heart interactions. It is hard to imagine that the results could be worse than the current system, and this also offers the possibility of re-invigorating our very civilization, and giving our lives meaning.

 

[TheEarl]

Surely that idea goes against the very principles of the welfare state itself? The idea of the government handing out money is so that the poor and the needy get more than the rich and thus things balance better. To hand out the same money to everyone is ridiculous, not least because you'll be giving them their own money back again! You tax them $12,000 and give them back $10,000, with the $2,000 being used to cover the administration in giving them money that they've just given you!

This is one of the occasions where Amicus's simplistic economic theories can be applied. The free market is the best method of allocating resources. The only reason the government needs to intervene is when there are significant negative externalities (eg, Colly starving in a pure free market and even then, it should attempt to minimise that intervention. To have it faffing around in the market and changing everything is silly.

The Earl

 

[zeb1094]

A pipe dream just like the flat tax schemes. It will never even be looked at by congress. Any President that signs a bill like this will have to be out of his mind.

Then again, there are probably a few Democrats out there who would.

 

[Roxanne Appleby]

Hmmmm . . . I detect a lack imagination here, and an unwillingness to escape from a (shrinking) box. Not one person has been willing to look beyond the first order effects (we all get $10k) to the "cascading secondary and tertiary effects."

Try not to think in terms of atomistic individuals, and recall that man is a social animal:

"What matters is not just that a lone individual has $10,000 a year, but that everyone has $10,000 a year and everyone knows that everyone else has that resource. Strategies that are not open to an individual are open to a couple; strategies that are not open to a couple are open to an extended family or, for that matter, to half a dozen friends who pool resources; strategies not open to a small group are open to a neighborhood. The aggregate shift in resources from government to people under the Plan is massive, and possibilities for dealing with human needs through family and community are multiplied exponentially."

Don't forget, the welfare state in its present form is unsustainable:

"No serious student of entitlements thinks that we can let federal spending on Social Security, Medicare and Medicaid rise from its current 9% of gross domestic product to the 28% of GDP that it will consume in 2050 if past growth rates continue. The problems facing transfer programs for the poor are less dramatic but, in the long term, no less daunting; the falling value of a strong back and the rising value of brains will eventually create a class society making a mockery of America's ideals unless we come up with something more creative than anything that the current welfare system has to offer."

So you are defending an unsustainable system against a plan that could not just accomodate human needs much better than the current system, but could reinvigorate our society and make our lives more meaningful, instead of less.

 

[3113]

*Raising hand*
Maybe I didn't read the article carefully enough but...does every individual getting 10K include kids? And how will the government assure that the kids get the money and the parent don't spend all that money wastefully?

And if the kids don't get the money um...I'm confused.

 

[Roxanne Appleby]

*Raising hand*
Maybe I didn't read the article carefully enough but...does every individual getting 10K include kids? And how will the government assure that the kids get the money and the parent don't spend all that money wastefully?

And if the kids don't get the money um...I'm confused.

LOL - Sorry for coming off as pretentious and acerbic. Based on work I have done in the past I am used to thinking about civil society and the implications of man as a social animal. I forget that this way of thinking is somewhat alien after almost a century of turning social problems over to bureaucracies.

To repeat, the key to understanding the revolutionary, transformative power of this plan is to stop thinking of humans as atomistic individuals, and consider the "cascading secondary and tertiary effects." Use your imagination - it's really great fun to contemplate the possibilities of a system where not just each "lone individual has $10,000 a year, but everyone has $10,000 a year and everyone knows that everyone else has that resource."

Society would look very different. There would be no "I gave at the IRS" and turning problems over to bureaucracies: social welfare would become a community effort, and for the first time in history there is enough wealth to make it really work.

"The Plan does not require us all to become part-time social workers. The nation can afford lots of free riders. But Aristotle was right. Virtue is a habit. Virtue does not flourish in the next generation because we tell our children to be honest, compassionate and generous in the abstract. It flourishes because our children practice honesty, compassion and generosity in the same way that they practice a musical instrument or a sport. That happens best when children grow up in a society in which human needs are not consigned to bureaucracies downtown but are part of life around us, met by people around us."

 

[elsol]

Politician A: My people if you vote for me... I'll increase the dole.

Politician B: Oh yeah... well, I'll increase it MORE!!!

Sincerely,
ElSol

 

[3113]

LOL - Sorry for coming off as pretentious and acerbic. Based on work I have done in the past I am used to thinking about civil society and the implications of man as a social animal. I forget that this way of thinking is somewhat alien after almost a century of turning social problems over to bureaucracies.

But do kids also get the $10K or not?

Right now, people pay less if they have kids--because they have to have more money to support those kids. If they get $10K for every kid to help support those kids...then wouldn't they have more kids to have more money? And if they don't, then the $10K goes less far because they pay out the same but have to spend more because they've got kids.

And yes, Aristotle was right about kids learning virtue by seeing it practiced by others around them...funny thing about Aristotle's time, but people usually practiced that kind of generosity with a loaf of bread to a starving neighbor, and helping each other repair roofs and wagon wheels. By assisting an old man across the street or a hurt child to their mother.

It's disingenuous to try and apply it to $10K of pure money that a person gets--that check is going into the bank. And they'll spend it or not, but I really doubt they're going to give it to help their starving neighbor if they're not already inclined to bring that neighbor some soup. All I see is money horded...or rapidly spent on what the family needs. NOT given to charity or neighbor kids or helping out each other. So how is this a lesson in "generosity," etc.?

If someone buys a new car made in another country...what good does that do anyone in this country? How does that teach the kids to help each other?

 

[BlackShanglan]

Ah. That's the thing that was bothering me. I have managed to track it down. Here's what I was thinking:

(1) If everyone knows that everyone has 10K per year, the merchants and sellers of goods know that everyone has 10K per year. This seems likely to increase inflation, as many people suddenly have more money to spend without producing any more goods or services. That means that for some types of goods - basic daily living items that might be bought by a family with an extra 20k - there is suddenly more money available to be spent but no real increase in supply. This isn't quite as dangerous a situation as simply printing more money to cover debts, but it has got the potential to skew prices and wipe out any real spending power in the 10k.

(2) This problem seems likely to be exacerbated by the fact that this program would not address the root causes of poverty. Poverty may itself involve the lack of money, but the cause of poverty is not the lack of people giving one free money. The causes of poverty are lack of skills, lack of means of production, lack of marketable products, or similar systemic problems that prevent people from participating in the economy as a whole. Giving them 10K per year will not solve those problems; it may keep food on their tables, but in the old "give man a fish / teach him to fish" metaphor, it's giving the fish.

(3) While recognizing the theory that underlies Mr. Murray's assumptions about the eventual resolution of social problems - i.e., the community will band together and apply their newly-given wealth to those problems and solve them - it seems unlikely that people who lack all of the things needed to participate successfully in the marketplace will somehow solve that problem themselves armed only with a quite modest yearly stipend. Surely people who have the knowledge, skills, and opportunities to succeed must concentrate on supplying others with those things and not simply with cash if they are to succeed. Cash is easily gotten rid of; I could burn through 10K in a week if I chose to. Skills, knowledge, and marketable talents are not so easily squandered, and they do more real good in the long run than cash handouts. They encourage the practice of virtue, including the connection of one's labor to one's reward.

Shanglan

 

[amicus]

I suggest Roxanne Appleby may be having a mid-life crisis.

I suggest it is not economics or social irrelevancies that pertain here, but, indeed, the nature of man.

Money, however you measure or name it, is a symbol; the symbol of the productiveness of the individual.

It is the nature of man to gain self esteem and thus self worth, from providing for himself.

It is the nature of man to feel secure in his existence by his acquisitions of the means to survive.

Those means of survival have changed with the ages.

It is no longer the hunter or the 'strong man' that ensures survival and prosperity, rather the one who 'thinks'.

The psychological necessity of a man to provide for himself and those he chooses to support, is engrained in his psyche, much as in a mama lion, a walrus or a robin protecting her nest and eggs.

The purpose and function of life is to survive and prosper and, and...procreate, continuate the genetic line, be it reptile, man, or plant. It is inherent in life, as Roxanne tried to prove in an earlier post.

It is also functional in the equasion that some will fail to survive. The weak will perish, not at the function of the strong, but at the will and function of evolution and survival of the fittest.

This does not mean the Colly's and rGraham's of this world are left to perish, only that they are not the defining characteristics of the evolutionary trend.

No, that is not harsh or cruel or unfeeling. In the animal world, you would easily understand and agree. In the microbiological world, you would also easily understand.

But we are sentient and knowing. A blind or a deaf child requires special considerations if it is to survive.

Only in the 'human' world do we assist them, freely, without concern to cost.

But when this concern is 'institutionalized', within social or governmental edicts, does it become problematic.

That is why we consider such issues.

amicus...

 

[TheEarl]

Hmmmm . . . I detect a lack imagination here, and an unwillingness to escape from a (shrinking) box. Not one person has been willing to look beyond the first order effects (we all get $10k) to the "cascading secondary and tertiary effects."

Try not to think in terms of atomistic individuals, and recall that man is a social animal:

"What matters is not just that a lone individual has $10,000 a year, but that everyone has $10,000 a year and everyone knows that everyone else has that resource. Strategies that are not open to an individual are open to a couple; strategies that are not open to a couple are open to an extended family or, for that matter, to half a dozen friends who pool resources; strategies not open to a small group are open to a neighborhood. The aggregate shift in resources from government to people under the Plan is massive, and possibilities for dealing with human needs through family and community are multiplied exponentially."

Don't forget, the welfare state in its present form is unsustainable:

"No serious student of entitlements thinks that we can let federal spending on Social Security, Medicare and Medicaid rise from its current 9% of gross domestic product to the 28% of GDP that it will consume in 2050 if past growth rates continue. The problems facing transfer programs for the poor are less dramatic but, in the long term, no less daunting; the falling value of a strong back and the rising value of brains will eventually create a class society making a mockery of America's ideals unless we come up with something more creative than anything that the current welfare system has to offer."

So you are defending an unsustainable system against a plan that could not just accomodate human needs much better than the current system, but could reinvigorate our society and make our lives more meaningful, instead of less.

Where is the $10,000 coming from? The people, right? So you're taking money, only to give it back in equal measures?

I'm not a fan of wealth redistribution for the sake of it as it goes against market principles, but I can understand the use when there are people who really need it. Giving everyone $10,000 is just shuffling money around for the sake of it and it's inefficient.

The Earl

 

[Liar]

To repeat, the key to understanding the revolutionary, transformative power of this plan is to stop thinking of humans as atomistic individuals,

But they are. Even if you shut your eyes to the idea, they will still be. In generation after generation. You'd not oily have to reshape a society to get rid of that. You'd have to reprogam a spieces. Best of luck.

Aristotele's greatest contribution to mankind was imo the introduction of an hermeneustic, intermediate thought philosophy, saying that you have to take all angles into account, and make a phronetic judgement from it. You can not choose to overlook one perspective of reality, or your ideas will be futile, other than as pretty thought experiments.

 

[Colleen Thomas]

I meant to post another excerpt earlier that would have preempted many of the problems cited above, but a dinner reservation pulled me away.



So "the plan" will not leave Colly and others to live on $32 per month to live on in New York: The transition will not happen "cold turkey," but will take place over many years, and no doubt will be expensive. But, "the place to start is a blindingly obvious economic reality that no one seems to notice: This country is awash in money. America is so wealthy that enabling everyone to have a decent standard of living is easy. We cannot do it by fiddling with the entitlement and welfare systems--they constitute a Gordian Knot that cannot be untied. But we can cut the knot. We can scrap the structure of the welfare state."

And yes, some people will fritter away the stipend and find themselves in need, but, "a person who asks for help because he has frittered away his monthly check will find people and organizations who will help (America has a history of producing such people and organizations in abundance), but that help can come with expectations and demands that are hard to make of a person who has no income stream." That last is really important. It offers a point of "leverage" to fix the broken person that does not exist under the current system, which instead treats its wards as cattle.

What I started to write before rushing out is this: Stipulate that the kind of transition issues cited by all of you can be dealt with. If true, isn't this exciting? It would supercharge "civil society" as described by Tocqueville and others, that network of private institutions, community associations, schools and religious organizations, families and friends and coworkers, and all their voluntary, from-the-heart interactions. It is hard to imagine that the results could be worse than the current system, and this also offers the possibility of re-invigorating our very civilization, and giving our lives meaning.

I have the feeling, the author has never tried to purchase health insurance before. When I was 21 I couldn't get a policy for 3K a year. In fact, when I left one job and went to another, I couldn't even aford the Cobra payments to keep my old insurance going the ninety days it took to get vested with my new company's plan.

No provaye company is going to insure just anyone for 3K per year. They might insure a fraction of people, those they deem low risk. But they wouldn't insure most kids until they reached 24 or 25, if you had any preexisting problem, no way, if you smoked or drank or lived in a dangerous neighborhood or were employed in a dnagerous occupation.

He's making an ovious mistake in his thinking. Health insurance isn't like life insurance, because with health insurance, you have to pay out on a more or less constant basis every time someone gets sick. lIfe insurance you only "crap out" if the insured dies.

In NY for example, an office visit runs between 60 and 70$ a whack. Antibiotics, decongenstant and cough syrup for a typical sinus infection runs about 85$. That's 155$ for s a simple sinus infection that requires no blood work ups, no tests, and no lab work. Your typical emergency room visit, is 90$ of the top, plus 40 to 60 for the doctors fee, plus Well be charitable and say 50$ for the cost of a simple treatment and medicine. Or about 205 plus another 80 or so in med prescriptions. Say 300$ for something simple like acute bronchitus.

Blood work ups run around a hundred for a simple battery of triglycerides, blood oxygen level, and screening for whatever bug may have you down. If you need an MRI or a CT you're talking about 400 to 500$. X-rays? another 110 to 230, depending on what they are x-raying.

Three K per year, is therefore, an absolutely atrocious gamble for an insurance company. An HMO or PPO can cut some costs, by disapproving some tests and insisting on use of plan providers. Even so, if you cost them 5K your first year and 7K your second, they will drop you. Private insurers simply won't carry someone who routinely exceeds in pay out what they are paying in. In NY, you're a health person indeed if you don't go well over 3K in a year in medical expenses. Before I was disabled, i budgeted for at least 5K in medical/medicine each year. My group insurance rate was 140$ each pay period, or 280 a month. that plan,. however, caried a 500$ deductable and didn't cover medicine, dental or glasses.

Realistically, you can't use a private insurer to cover the majority of people who are legitimately on disability. their expenses simply outstrip premiums bu too much for the insurer to turn a profit. And no private insurer will pick up a kid with downs, or congenital birth defects, or one who has suffered some sever trauma before reaching 21. Is the governemnt going to dmenad that health insurance providers take anyone and everyone for the 3K rate? If so, theinsurers will go bankrupt quickly. Or is the government going to subsidise them for the losses they incur insuring high risk people?

Private insurance, be it helath, life or auto, is the closest you can come to legalized gambling outside of Vegas. Insurer (well call him the house) figures risk to the nth degree. He then computes what the risk level will likely incur in cost and charges that, plus a percentage over the prospective costs (We'll call that the house edge). Now your insured (well call him the shooter) steps up to the table and plunks his cash down on the pass line.

If he makes no claims that year, the house wins big and he looses, he spent X dollars for nothing. If he makes claims only up to his assigned risk value, he wins and the house wins. He's covered and the house still makes it's odds profit. If he has to use more than his passline bet, he wins. But if you win, you loose, beause the house will recompute your assinged risk, and incrase the premiums. And if you win two or three times in a erow, they'll ask you to go play at a nother casino and drop your policy.

Perhaps you could cover the average 21 year old with a 3K policy. But as soon as he exceeds his assgined risk category, the policy premium will increase. Am I paying that increase out of my 10K? or is the governemtn picking it up? Or do we just demand the insurer shoulders it?

I would say comparing health insurance to life insurance shows an egrigious lack of understanding of how insurance works. As an office manager, I had to handle our group insurance claims, plus our unemployment insurance coverage and I have a pretty good grasp of how it works. A life policy will follow his general outline, simply because the only reasom you as insurer has to pay out is death. He can, over time, accumulate enough in premiums that he has turned a profit on the wager by the time you croak off. Illness short of death, makes no impact on your margins. For health insurance, there is a constant payout, a payout that severly cuts into the profits you make on each annual premium. Because of this, you do not run your profits nearly as high as you do on a life policy. And when the payouts start in earnest, you drop the policy before the margin you have earned is gone.

 

[oggbashan]

The UK's National Health Service was designed to take the risk away from profit-seeking insurers. Any insurance, life, health or whatever, is designed to make a profit for the company. Bad risks have to pay more and if the risk is too high cannot be insured at all.

The National Health Service took money at a flat income-adjusted rate from everyone and originally provided health care free of cost at point of delivery. The health of the nation improved dramatically over the first few years of the NHS. People were still reluctant to go to doctors for minor problems because they had been used to going to a doctor only when essential - because they had to pay.

As the population gradually realised that free actually meant 'free', they started going to doctors for problems they would never have taken before - colds, slight cuts and bruises etc.

A couple of generations on, the expectations from the NHS are infinitely greater. What is 'health'? The population expects that any medical condition should be treated with the best available care, whatever the cost. The demand is greater than any possible funding. The real problem with the NHS is that the government has not admitted that resources are finite and demand is infinite.

What is still good about the NHS is emergency care for life-threatening accidents or illnesses. What is getting worse is care for continuing conditions that cannot be cured, and can only be managed. The ageing population of the UK is fitter and healthier than previous elderly generations but there are far more of them as a proportion of the population and the cost of their care in extreme old age is increasing rapidly.

No government since the NHS was initiated has grasped the nettle that there has to be some rationing of medical resources for the NHS to survive. It would be political suicide to admit that the NHS cannot meet people's expectations. People know that it can't - the government won't say it.

People who have a poor quality of life because of disability, illness or accident recieve care from the NHS and the Welfare State as a whole. Their existence is protected but the expectation that they can be improved to a near normal life with all the choices open to an employed person on a reasonable salary cannot be met.

We have a safety net that works. However those saved by the safety net may be condemned to a relatively poor and marginal existence by comparison with their neighbours. It is no use telling them that they are much better off than people in sub-saharan Africa. Their comparisons start next door.

That is the problem with a flat rate income in the US. It wouldn't meet the needs of those who are highly dependent on medical and social care; it wouldn't meet the expectation that people needing care should live as normal US citizens who have a good income.

Og