In the news lately I have seen more and more reports on the affordable care act (a very interesting name to give this law) or otherwise known as Obamacare. The Obama administration has tried to fix America's healthcare problem with government intervention. Now I think there could be much debate on whether he and his administration has done this with the best intentions or not, notably Gruber the MIT economist. Was this law the result of some misguided attempt to help the American people or to simply enrich rent seekers or some combination of the two? But whatever the administration intentions were I think the results we Americans will see based on my understanding of Austrian economics and the study of human action and the political economy will not be beneficial to the American people.
For starters if the government intervenes it means that it is limiting voluntary human action and thus interrupting the market system and as a consequence the discovery process that is so vital to finding the best result in almost every if not every other industry. The government must think that the healthcare industry suffers from an externality and/or a market failure. As Larry mentions in his class economist seem to think that everything is a market failure and needs government intervention to fix it. They (economists) are prone to jumping on the normative economic bandwagon and wish to touch the force. They wish to direct the economy in the most “efficient” direction that they can. Some of them however might just be rent seekers. Though I believe many of them are sincere in their belief that the American people should not be left to their own actions to get the “right” outcome. They believe that voluntary human action will not get the proper results so they choose to use force to get the correct results. We can see the true nature of the government and how it thinks and operates by the action of Gruber. He thinks the American people are too stupid to act in their best interest. So he has to act for them so they get the “best” possible result. He is acting as if he has a pretense of knowledge that he knows what will create the “best” possible outcome possible for everyone, without the market system working as the discovery process. My guess from listening to other professors is that he is using a benefit cost analyst to figure out what actions to take on the behalf of the American people.
The government seems to think the only way to fix a problems is with government action but never with human action, the market system, and the largest network in the world. They beg to believe that the answer is no, the problem can only be fixed with the help of force. What it (the government) doesn't seem to realize is that the government interventions will require more and more government interventions, or maybe they do realize this! We can see this clearly with Obamacare already, with people losing their doctors. The government already has had to fix this problem with and another bill (aka another government intervention) that grandfathers people in. But that doesn’t fix any of the new problems. If we look back into history many of the problems we face today are the results of government action in the past. So I don’t hold out much hope that Obamacare will fix the problems we now face in the healthcare industry.
But I do think there is hope, Many Americans are upset that they have been lied to about Obamacare and wish to act. To stand up and show the government that voluntary human action and the market process is the best discovery method we have to finding out what works best. I wish the government will catch up to what the American people are finding out and what Austrian economists have known for a while. I wish that they would take a cue from the world of Austrian econ and learn that the best way to fix a problem is let people fix it and for the government to stick to what’s its best at, protecting property rights.