The failures of the American healthcare system aren’t a symptom of government intervention or imperfect competition. They are a necessary feature of the capitalist system and profit-seeking in the private economy.
On Oct. 17, the Collegian published an Op-Ed by junior Trevor Vogel and a letter to the editor by Christopher Martin, associate professor of economics. Each decried government intervention is the fundamental reason why a market system is inadequate to address our healthcare needs. They used this defense to dismiss any other measures that involve the government.
Their basic logic goes: government intervention raises healthcare prices, so more government intervention will do the same. This argument commits the informal fallacy of equivocation. Martin uses an analogy, writing, “We wouldn’t help a poisoned patient by giving him more poison.”
Both articles fail to make a categorical distinction between different kinds of government intervention, falling into the trap of overgeneralization. For example, a government agency which regulates the price of medicines could just set lower prices. Similarly, a government firm could produce generic medicine and sell it at the cost of production.
Each of these solutions falls under Vogel and Martin’s definition of government intervention, even when they would do the exact opposite of what they claim. A more coherent argument would say: government intervention which limits competition raises healthcare prices, so more government intervention that limits competition will do the same.
“The system isn’t dysfunctional because of inherent problems with free markets,” Martin writes. But he misses the point that others and I, who are critical of capitalism, make. Rather than taking issue with an abstract concept of a “free market,” we consider the real, conscious act of profit-seeking in the healthcare industry as the cause of death for tens of thousands of Americans every year.
The system Martin references actually functions exceedingly well for those who control it. The implicit moral assumptions behind the concept of a “free market” tell us that profit-seeking is not only acceptable, but even productive and good.
Vogel and Martin’s mistake lies in trying to separate the capitalist system from what they term government intervention. This binary, dualistic distinction is arbitrary and unworkable.
Instead of reserving our critique to the private economy, critics of capitalism employ a holistic approach, which includes how the government is influenced by private capital. This debate on market healthcare exists not in market economics, but in ethics, and it questions why we perpetuate a system structured in a way that incentivizes deadly decisions.
The sad truth of our market economy is revealed. We unjustly defer to self-interested executives to control the production, price, and distribution of life-saving medicines. As economist Milton Friedman argued in a 1970 issue of The New York Times Magazine, a business’s only responsibility is to profit. They’re only interested in the lives of patients insofar as they can extract profit from them.
It might be difficult for some to envision what a decommodified economy would look like, but that only speaks to our lack of imagination. Examples exist all around us — roads, sidewalks, parks, drinking fountains, libraries, public restrooms, Wikipedia, and police and fire departments.
One case often overlooked is our education system. We’ve decided to control this sector democratically rather than exposing it to private domination. Communities can decide to spend more or less money on schooling; they elect boards and superintendents to enact changes they want; and, best of all, every single child is guaranteed a spot in the classroom.
Our education system is not perfect, but it’s oriented toward the purpose of educating children rather than manufacturing profit. The decision-makers of schools are directly interested in educating children whereas the decision-makers of large corporations hire executives and appoint boards that only work to maximize profit. If private interests controlled education, many thousands of children would be forced to go without one.
Notice how we measure value in decommodified areas. Where successful schools have test scores, grades, and college acceptance rates, successful for-profit firms have profit margins, dividends, and stock prices. Even a medicine manufacturer is lauded and rewarded for how much money it makes rather than how many patients it helps. Decommodification of the healthcare system could reverse this and set our priorities straight.
How can we incentivize decisions that favor people over profit? A market economist’s best reply is “competition”: we should still let profit-seekers control these firms, but more than one of them would compete for patients. But to really strike at the fundamental problem, we need to change the decision-makers. Instead of executives and profit-seeking shareholders controlling the production and distribution of medicine, we can put the means of production into the hands of those most concerned and directly impacted.
In the case of insulin production, the answer is simple: diabetics. If a nonprofit organization composed of diabetics democratically-controlled insulin production, it would be directly concerned with producing insulin safely and efficiently at a low cost. They could make decisions on manufacturing, research, and price based on helping patients rather than extracting the most profit.
It’s a simple task to explain the connection between patents and a lack of competition, but both Vogel and Martin failed to answer a tougher and more interesting question: Why should we trust profit-seeking individuals to make important decisions such as the price of medicine? These individuals aren’t accountable to the life-and-death implications of their decisions.
Each of the outlined problems can be traced back to one common theme: profit-seeking. In a different world, people could work in cooperation instead of competition to solve problems; we could measure our economy based on happiness, health, leisure, creativity, and progress rather than GDP and profit; best of all, nobody would die because they can’t afford healthcare.
Cal Abbo is a columnist on Democratic politics and a junior studying psychology. He is an assistant culture editor for The Collegian.