I woke up this morning and saw this headline: $634,320,919.
That, apparently, is the price tag of the new Healthcare.gov website, the centerpiece of Obamacare. It’s a stunning number: Facebook operated for six years before passing the $600 million mark, and served hundreds of millions of people during that time. The current website is based on old technology, doesn’t work correctly, and cost shocking multiples of what it should have cost.
If this had happened in a private business, it either would have gone bankrupt or the responsible parties would have been immediately fired. That is the basic difference between the free market and government. Government bureaucrats face no consequences for their choices, have no real ability to make economic calculation based on market forces, and so will always be an economic disaster.
But remember this: one man’s loss is another man’s gain. In this case, we the taxpayers have lost hundreds of millions while all the incompetent government contractors have made hundreds of millions. (Correction: They are highly competent at fleecing government money.)
Of course the problems are far deeper than just a website. The real issue is the countless regulations which are increasing premiums, decreasing competition, increasing bureaucrat jobs and decreasing real healthcare providers (as in the ones who actually help heal people, not fill out paperwork: the doctors, physicians assistants, nurses, etc.)
Most people don’t realize that the massive government healthcare experiment began in 1965 with Medicare. It is the iceberg that the US is headed toward that it will not turn away from: $100 trillion in unfunded liabilities. This is like saying you can jump over the Grand Canyon – it’s physically impossible, and anyone who tells you you can is either insane or a beneficiary to your life insurance policy.
And yet when it started, LBJ presented it as a solution to the healthcare problems of the elderly. It was a con job, and everyone who really understood what was being offered realized it. As one healthcare expert put it: no one knows what anything really costs because Medicare price fixes everything and has completely confused the market.
Obamacare is the big brother of Medicare, applied on a much wider scale. Economist Hans Sennholtz explained the economic problems with Medicare over a decade ago – it’s deja vu all over again.
Of course, the economic problems of government intervention in the economy don’t stop with Medicare. We explain the basic economic results when a nation begins to trust the government to take care of its welfare. Some people become rich and a lot of others become poor in the area the government is influencing. Corporate welfare is the flip side of the personal welfare coin. If Obamacare is not stopped soon, people will look back on 2013 as the year that American healthcare began to sink to a new low.
If you’d like to understand the basic problems of government intervention in the United States, you can watch Lesson 10 of Economics for Everybody: “The Welfare and Corporate States of America.”