Government And Financing Health Care Coverage

A couple of weeks ago I discussed The Free Market Case For The Public Option. Andrew Sullivan picks up this topic, citing Hayek:

I keep coming back to Hayek on this – because government-sponsored health insurance is not government-run healthcare. Maybe it’s my British roots that make this so clear to me (if the British Tories proposed a universal health insurance scheme, with care provided by private doctors, nurses and hospitals, it would rightly be regarded as a major shift to the right.) Here’s Hayek’s discussion of why this is not heresy for libertarians and conservatives of the old school:

“Nor is there any reason why the state should not assist the individuals in providing for those common hazards of life against which, because of their uncertainty, few individuals can make adequate provision.

“Where, as in the case of sickness and accident, neither the desire to avoid such calamities nor the efforts to overcome their consequences are as a rule weakened by the provision of assistance – where, in short, we deal with genuinely insurable risks – the case for the state’s helping to organize a comprehensive system of social insurance is very strong… Wherever communal action can mitigate disasters against which the individual can neither attempt to guard himself nor make the provision for the consequences, such communal action should undoubtedly be taken,” – The Road To Serfdom (Chapter 9).”

Demanding and helping people insure themselves in a context where emergency care is already guaranteed is not socialism. It’s prudence.

One problem is that many people in the conservative and libertarian movements equate freedom with absence of government. As a general rule this might frequently work, but this logic often leads to fallacious results. We might be more free living on an isolated island without any government as opposed to living on Manhattan, but this type of change is not a sensible goal for most libertarians.

Other than for the most extreme, even most libertarians grant some role for government. There are some things which are just better handled by government than by the market. This includes police protection and national defense. Similarly most of the industrialized world has found that financing (but not necessarily delivery) of health care is either best handled by government, or at least requires considerable government involvement.

A situation in which insurance companies can collect premiums and then deny care when needed, as well as having a society in which tens of millions are uninsured or under insured, is not a more free society in any meaningful sense. Conservatives and libertarians who denounce any attempts at remedying the problem as “socialism” are both ignorant of the actual definition of socialism and have substituted blind fanaticism for a reasoned consideration of the role of government in society.


  1. 1
    Eclectic Radical says:

    I’m going to refrain, for the moment, from attacking libertarians. Instead I will just go after conservatives.
    ‘Conservatives’, as they brand themselves today, think that the only role for government is to provide a teat from which corporate entities can suckle cash and a military that can help those corporations get what they want overseas when it cannot be gotten by other means.
    Except they are fine with a government just small enough to fit into everyone’s bedroom.

  2. 2
    Mark says:

    There is a very fine line between the health care reform plan and the current system that is being stepped on. Without a doubt, the system needs help.

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