I’m extremely disappointed that one of our Senators, Lamar Alexander (R-TN), went along with nine other Republicans and all of the Democrats and voted against the straight Affordable Care Act repeal bill put forth in the Senate the other day. The repeal would have been phased in over two years, giving plenty of time for people to shift to new health plans (that would become available once the markets were freed to sell insurance plans that people wanted, rather than those mandated by the government) and for Congress to pass free-market measures that would reduce the cost of healthcare such as mandated Health Savings Accounts, transparent pricing, and portable health insurance, sold to individuals instead of through work.
When I wrote to Senator Alexander about the repeal of the ACA, he said that he would not vote for any bill that caused people to lose access to health insurance. Yet Obamacare is imploding as we speak, and it is likely that many insurance markets will have no providers, so people will lose coverage. Others will have only one or two providers, and those ones will charge so much that those who can’t afford standard health insurance won’t be able to afford the Obamacare plans anyway, so people are losing their health insurance even if Congress does nothing. And even if people have insurance, that doesn’t mean they have access to healthcare through their insurance. Many people right now need to pay thousands in premiums and thousands for their deductible even with the Obamacare plans, so they end up needing to spend $10,000 or more per year before their insurance covers anything. How is this helping them?
And what about Senator Alexander’s other constituents? How can he vote to protect a small subset of the people in Tennessee while forcing the majority to pay for their protection. I strongly believe that individuals should voluntarily provide for those who they find in need due to circumstances. Certainly we need to care for the 21-year old who gets brain cancer and needs expensive treatments. We need to help the young single mother who has a child who need round-the-clock care.
But think about what we’re doing by enacting forced welfare. We’re telling productive members of society that they must surrender a portion of their income to us to give to someone else, either through taxes or by forcing them to purchase subsidized health insurance on a sliding payment scale, or we will go to their homes and seize their property and/or throw them in jail. We are taking people’s money by force and giving it to other people, some who truly have no other way, some who simply choose not to produce, and some who are unable to take care of themselves because they always have made bad choices and continue to do so.
In many ways, forcing everyone to contribute to what is effectively a public healthcare system, which is poorly run, has an inferior product, and is way over-priced as all public systems are (see public schools for another example) is worse than simply having taxes and providing overpriced, poor quality benefits (see Medicaid) to those who qualify for them. At least with just taxes people can take whatever money is left over and maybe get better healthcare than what is available in the public system. By forcing people to buy into the public system (which is what you’re doing when the government fully controls the insurance offered and the prices that can be charged, even if private companies are providing the insurance), you take away that ability for all but the very wealthy to find better healthcare since they have no resources left with which to do so. Note the similarity with public education, where because people are already paying for the public system through property taxes, only the very wealthy are able to afford private schools, even in places where the private schools are far superior.
But what about the people being helped by public welfare programs? At least it is a good thing for them, right? Maybe not. Think about people in your family who could get a full-time job and take care of themselves, but choose not to. This is different from a family member who loses a job and needs to move in for a couple of months or needs some help with the rent until they get back on their feet. This is someone who always has an excuse about why they can’t work here or work there. Often there is someone in your family who is an enabler – a very sweet person who pays for the food, apartment, and lifestyle of the non-working family member. In doing so, the needy family member never gets a job or makes anything out of their life.
When we give through private charities, the charity is normally able to do a better job of figuring out who truly needs help and who would be better served with a kick in the pants. Public programs often give money out blindly, and often even encourage individuals to not work or do anything or the hand-outs would decline. Get a job, you see your housing allowance cut. Have another child, see your food stamps payments increase. If you’re religious, imagine needing to stand before God, having had two good arms, two good legs, and a good brain and having done nothing with the gifts He had given you. If you’re not, just imagine spending your whole life and doing nothing of value. How kind is it to encourage others to face that fate?
Contact me at firstname.lastname@example.org, or leave a comment.
Disclaimer: This blog is not meant to give financial planning advice, it gives information on a specific investment strategy and picking stocks. It is not a solicitation to buy or sell stocks or any security. Financial planning advice should be sought from a certified financial planner, which the author is not. All investments involve risk and the reader as urged to consider risks carefully and seek the advice of experts if needed before investing.