America Completes Collection of Welfare State Essentials With Health Care System

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What is this health care bill? Is it a new way of making the future better? Or is it an old solution to an old problem? The feds first considered a takeover of the health care industry during the Roosevelt administration. They’ve been working, planning, plotting their way towards the same objective ever since – for 80 years.

And what they’ve finally gotten is yesterday’s bad solution to yesterday’s problem.

The nation state was invented by the French at the beginning of the 19th century. By the middle of the 19th century, Otto von Bismarck added the refinements that we know today as the modern welfare state.

And now…as every welfare state in the world faces decline and bankruptcy…America has completed its collection of welfare state essentials – with a national health care system.

Why are the old welfare states going broke? Because the payoffs to the past have become too great. There are too many old people who expect pensions and health care. There are too many old industries that, like patients in a mental hospital, need to be cared for. There are too many bailouts…too many subsidies…too many protections…too many safety nets.

Every society is a pact between the future and the past. A new society looks to the future. An old one looks back at the past. As a successful economy matures it owes more and more for things that have already happened. China builds new high-speed railways, for example, while in the US we’re still paying Amtrak’s losses of the last 40 years.

Over time, more and more special interests, anglers, parasites, leeches and lobbyists get a grip on a financial system. They find ways to take advantage of it…to exploit the system for their own ends. Trade unions, business groups, the rich, the poor, the middle classes – everybody wants a benefit.

The health care act is not a bold new initiative that will lead the country forward into a new era. It is 2,400 pages of payoffs to old interests – payoffs to senators and congressmen for supporting the bill, payoffs to the pharmaceutical industry, payoffs to organized labor and insurance companies…payoffs to groups that were set up many years ago.

The benefits go to the past; the costs go to the future. Even if the economy were running at normal speeds, the deficits of the world’s leading welfare states would still be increasing. Only 10% of current deficits are related to “stimulus” efforts. The rest is payoffs… To organized interests representing the past.

In the US, Federal debt is expected to reach 140% of GDP by 2014. In the G7 countries as a whole, debt-to-GDP will go over 100% just two years from now.

The welfare state model is no longer the model for the future. It’s a model for the past…that will soon be defunct.

Regards,

Bill Bonner
for The Daily Reckoning Australia

Bill Bonner

Bill Bonner

Best-selling investment author Bill Bonner is the founder and president of Agora Publishing, one of the world's most successful consumer newsletter companies. Owner of both Fleet Street Publications and MoneyWeek magazine in the UK, he is also author of the free daily e-mail The Daily Reckoning.
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Comments

  1. The biggest mistake the West ever made was creating the welfare state in a naive attempt to compete with communism.
    The free enterprise system that lifted the West of out of history’s greatest slums to global dominance has now been destroyed.

    Reply
  2. “The benefits go to the past; the costs go to the future. Even if the economy were running at normal speeds, the deficits of the world’s leading welfare states would still be increasing. Only 10% of current deficits are related to “stimulus” efforts. The rest is payoffs… To organized interests representing the past.

    In the US, Federal debt is expected to reach 140% of GDP by 2014. In the G7 countries as a whole, debt-to-GDP will go over 100% just two years from now.

    The welfare state model is no longer the model for the future. It’s a model for the past…that will soon be defunct.”

    So that is the problem with the system… not the public health system itself..
    the associated parasites of government spending..
    I am a capitalist but I also have a social conscience.. I believe in a public education system and a public health system.. the US is not a “public system” in the sense I perceive one should be…

    An education to High School standard and public health care I believe are a right of a countries citizens..
    A reasonable standard of education gives better prospects for employment.
    A healthy population can only be a good thing too.

    The debate always then reverts too… where do you draw the line at governmnet funded…
    Everyone has different ideals from the nothings to the everythings…

    I had back surgery in the middle of Feb as a public patient, have yet to see a bill. I had a nurse come to the house daily to change my dressing for the first 3 weeks, I now go to the doctors every second day to have it done… I am yet to see a bill.

    Stillgotshoeson
    March 25, 2010
    Reply
  3. Shoes: “…have yet to see a bill. … I now go to the doctors every second day to have it done… I am yet to see a bill.”

    Jeez, mate, I’d complain. I see a Bill daily, I reckon…! :)

    Biker Pete
    March 25, 2010
    Reply
  4. i’m all for AN OBJECTIVE THEORY OF PROBABILITY and an universal insurance pool…

    spread the risk and lower the premiums….. it’s the only good way to run an insurance racket….

    on the other hand, there’s a problem with the pills. is it for the greatest good for the greatest number ?

    wrong ! Any Rand did prove that utilitarian theories are morally wrong and make no sense in a factory civilization.

    Reply
  5. Stillgotshoeson,

    I also believe in a free education system. I do not believe in kids/young adults entering the work force with a lifetimes debt saddled around their necks.

    Our current crop of political and industry leaders did not have this incumbering their professional careers and personal asperations. Surely it is an indictment on them and an illustration of their failings that they cannot provide to the following generations the benefits and privelage that they had. Shame on you all.

    The real core of the issue with education is this ‘education for all’ approach to being seen to have ‘improved the education system’ whilst you (as a politician) are in office.

    It is and has become a lie.

    In the 80’s the proportion of the school leaving age intake to Higher Education was about 30%. From there, University beckoned for a further 15%.
    So each year the Uni intake from the feeder school year was about 15%.
    Government policy in the 90’s in the UK was to improve this. They wanted 50% leaving education with a degree. Any degree. 1st class honours in Budgie trimming … anything.
    This has devalued the merit of the degree. In order to allow lesser talent through the door required a dumming down of the intake criteria. As a consequence, the standards of higher education drifed because they did not need to struggle to reach such a high mark.

    To get more kids into college, the standard school learning standards were dropped. Instead of pure subjects, the cirriculum was amended to cross disciplines and provide work based qualification, rather than test based.

    So, now in the UK, to do some of the base academic degree courses, the Universities have to take a year out to teach their intake the stuff they should have learnt at sixth form college.

    So, now in the UK, you want a job of any real purpose, the pre-requisite is a degree. Pragmatic talent is ignored.

    And for this piece of paper, the workforce now has so much debt to balance, in a World were housing affordability has been decimated, they will never afford a house or they will be consigned to a lifetime of debt.

    Now this I believe is an example not of the ineptitude of socialism, but of social programs. Both forms of government in the UK have systematically levered the education system apart until it is not fit for purpose.

    If a degree is no longer an elite qualification, then it is no good as a measure of excellence.

    Reply

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