I saw Cory Booker answer another question at his CNN town hall that was actually worse than his gun control question.
Yeah, really.
“This is a broken system and we must fix it … Health care is an American right and the current system is definitely wrong. I believe the best way to get there is by having Medicare for all," Cory Booker says. #BookerTownHall https://t.co/8If7Lkd89C pic.twitter.com/Ve2BbE2tg7
— CNN (@CNN) March 28, 2019
Most of the people on the internet criticizing Booker are pointing out that this woman is already on Medicare and supplementary private insurance and Booker is saying that the solution to her issue is Medicare for all.
First, from an economic perspective, while I feel for this woman, if she is on Medicare, supplementary insurance, and because she said she is disabled (presumably) SSDI, than her medical needs are so extreme that policy can barely touch that.
This is a rule borrowed from engineering applied to politics, but a policy that does the best for the 95% of people within two standard deviations of the mean won’t work for the outliers, and a policy that works for the outliers isn’t optimized for the 95%.
To put it bluntly, you can’t make car that has enough cab room and seat travel to fit both Verne Troyer at 2’8″ and Yao Ming at 7’6″ and still have it be affordable for your average consumer. That’s why design engineers design things to fit the 95% percentile and Shaq has to have his cars modified for him.
Any one-size-fits-all policy that is designed to help this woman in her extreme need is going to be unreasonably expensive for the rest of the population that doesn’t go through $100,000+ a year in health care.
Second, he says that part of the problem with our “broken system” is that “all that money doesn’t go to patient care, doesn’t go to support folks like you.”
So he wants a big, bloated government bureaucracy to manage healthcare because government is so effective in eliminated needless overhead and inefficiency?
Somebody remind Booker of the Iron Law of Bureaucracy. Go ahead and create Medicare for All. Within five years Medicare will be the largest branch of government by far, with more federal workers pushing papers in the Medicare offices than doing everything else combined.
But I digress….
No, the point that stuck out to me was how Booker plans to tackle drug prices.
“If you raise your drug prices higher than that in other countries… we’re going to take away your patent and let the generics come in and undercut those prices.”
WOW, Booker just killed drug and medical device R&D in the United States, and the rest of the world.
See, as the Wall Street Journal puts it “Other Countries Freeload on U.S. Drug Research.”
Across Europe, the government monopoly on the drug market allows them to price fix, which drives down profitability forcing the drug companies to up the cost in the US.
When it comes to R&D, the United States is responsible for 57% of new drug development.
So we spend more money and develop more drugs in the US than all of Europe combined.
Now factor in that it takes about $2.5 Billion to develop a new drug.
Booker saying that if US prices for drugs are higher than Europe’s price fixed prices for drugs, Booker will yank these companies patents and give them to generics.
That will destroy the financial impetus for drug R&D in the Unites States.
Not just that, it will effectively destroy the non-generic drug manufacturers.
I get it, nobody liked it when drug prices went up in the closing years of a patent.
Here is the problem, American insurance companies prefer generics because they are cheaper. As a drug is coming close on patent protection, the drug company has to try and recoup its billions in investments. They may raise prices accordingly, knowing that soon as the drug comes off patent and goes generic, insurance companies will switch to the generic and their sales will drop.
Booker’s response to this is to understand the reason for the cost increase but to become a price fixing Socialist son-of-a-bitch fucking asshole and strip a company of their intellectual property.
This is no different that Maduro’s nationalizing of businesses if he deemed prices to be too high.
Being a free market guy and R&D engineer, my solution would be to extend the patent protection and create a licencing scheme that would allow drug companies that do R&D to capture more money by licencing production generic manufactures over a longer period of time.
Booker is going to kill drug R&D and then the US drug industry, all in the name of reducing costs.
Countless people will suffer because of this plan to help the poor, which is the history of socialism everywhere.
If Booker gets elected, stock up on your drugs before he wipes out the pharmaceutical industry.
Update:
I was reminded of something by one of the comments to this post.
It’s shocking just how similar Booker’s solution to the cost of healthcare is to Directive 10-289.
As the Democrat primary heats up, I swear this could easily be a speech given during a DNC primary debate.
Interesting that the only other significant source of medical innovation is Switzerland, which isn’t part of the EU great socialist experiment.
So it’s not just a matter of current drug supply, although that’s a definite concern. The bigger question is future improvement. The unavoidable consequence of socialism is stagnation (at best). If you aren’t interested in future improvements in health care, go ahead and push these notions. If you DO want the future to be better, you must encourage people to create that future.
Some time ago I started calling this Dem notion “VA for all”. I think on second consideration a more accurate designation would be “IHS for all”.
Guess where all those generic drugs come from. Yes, our great trading partner in China. Currently I have had to switch to three different calcium blockers, for blood pressure control, in the last six months because the FDA has recalled several of the generics from China, due to contamination of the process stream.
The other thing these “Medicare for all” folks don’t tell you is that the “free” portion of medicare is quite limited in what it covers, you need supplemental insurance to cover much of what is actually needed. Although subsidized by the government, I still pay premiums for Medicare Parts B. D and G. Unless you’re a masochist, you also need an advisor (paid by the insurance companies) to help you sort through the options initially and every year at renewal time. I expect that with “Medicare for all” my supplemental premiums and deductibles will go up and my access to care will go down, it’s the big government way.
I keep bringing up the fact that Chinese consumer protection law protects (nominally) only people within China. Making poisonous products is perfectly legal so long as you only export them. This was revealed by the melamine in milk scandal some years ago.
(Of course, being a communist dictatorship, the alleged protections of the law within the country often don’t apply, not if the perps are communist officials or their owners and the victims are ordinary people, but at least the letter of the law protects Chinese residents.)
Where have I read about this before…. Oh yeah fiction; Atlas Shrugged!
Yeah, but after Hickenlooper there is no chance in hell that it’s going to be a secret valley in Colorado where everybody goes to escape Directive 10-289.
True story unfortunately
I should also say, we really should disabuse ourselves of the notion that this insurance. Nothing about how health insurance is used on a daliy basis is insurance; it isn’t meant to protect for extreme situations in our current society it is used to pay less. We should start calling it discount clubs or something similar to be more realistic.
I don’t know what the solution is but disabusing ourselves of the notion it is actually used like every other type of insurance and thus treating it differently is a good start
Absolutely correct.
Insurance serves one purpose. It protects your financial health against catastrophic events. You have home insurance because replacing your home after a fire is prohibitively expensive. You have auto insurance because replacing a car, or paying medical expenses is prohibitively expensive following an accident.
And, you have health insurance because an extended illness can be bank account draining.
However… people in the US today think they have medical insurance so that they never have to pay a bill. “What do you mean I have to pay for my drugs? Why should I pay for my glasses? The insurance company should pay for my fillings.” Etc…
Imagine what your car insurance would cost if you wanted it to pay for routine maintenance and cleaning. Imagine what your homeowners insurance would cost if you wanted that to pay for replacing light bulbs and cutting the grass.
Like all good socialists, Booker is of the belief that all items are finite in nature. (OK, technically that might be true…)
He talks about healthcare like there is only so much out there, and if the rich guy gets to it first, that means the poor guy dies. The only solution is to make it “equal” for everyone. (Remember, equal does not mean fair, it means equal.)
Same with wealth. If guy A has more than guy B, that means he must have taken it from guy B. That may have been true prior to the industrial revolution when your wealth was directly tied to a truly finite resource, land.
It is a fundamental failure in the education and experience of these people that they think in such colonial terms.
That failure is even more apparent in their belief that somehow Government is the answer.
And, jkb, your analogy about designing to the 95% really struck a cord with me. I was thinking along those lines for ages, but was never able to put it into words. Well done, and absolutely 100% spot on. One size fits most is a good way to design, one size fits all means everyone will be upset with the fit.
Like all good socialists, Booker is of the belief that all items are finite in nature.
I always liked the term “zero-sum game”. It’s how socialists see the world. There’s only so much of everything, production can’t be increased or expanded, and if one guy gets it, someone else does without.
“Zero-sum”: nothing left over, nothing can change, nothing can replenish. It’s a ridiculously over-simplified view of the world; if things can change or replenish, then you have to factor that into your economic calculus — it quickly becomes REAL calculus! — and we all know how Leftists are with math. It’s MUCH less headache to start with the baseline that things can’t change or replenish.
In reality, there’s very little that is a real zero-sum game. Land and real estate, and maybe fossil fuels, but even that is becoming less true with the development and improvement of various bio-fuels. Things like food, commodities, and medicine, when properly managed are constantly replenishing and improving. If it’s going to run out, make more! If it’s not selling or not needed, make less! Supply and demand are far better motivators for industry efficiency than government mandates.
But letting the free market make the decisions means relinquishing centralized control, which is something Leftists like Booker fundamentally cannot and will not do.
It’s shocking just how similar Booker’s solution to the cost of healthcare is to Directive 10-289.
I’ve yet to meet a committed Leftist who didn’t read any of the dystopian fiction novels (1984, Animal Farm, Atlas Shrugged, etc.) and think, “Gee, that’s a great idea! I bet the author intended this as an instruction manual to build utopia!”
I’ve also yet to meet a committed Leftist who finishes anything they start, which is probably why none of them seem to remember how any of those novels end. Alternatively, they think themselves so much better that they can avoid the “bad” ending.
Hubris walking on two legs.