Why Are We Moving Toward Socialized Medicine?

By Yaron Brook

Government intervention in medicine is wrecking American health care. Nearly half of all spending on health care in America is already government spending. Yet President Obama’s “reforms” will only expand that intervention.

Prior to the government’s entrance into medicine, health care was regarded as a product to be traded voluntarily on a free market–no different from food, clothing, or any other important good or service. Medical providers competed to provide the best quality services at the lowest possible prices. Virtually all Americans could afford basic health care, while those few who could not were able to rely on abundant private charity.

Had this freedom been allowed to endure, Americans’ rising productivity would have afforded them better and better health care, just as, today, we buy better and more varied food and clothing than people did a century ago. There would be no crisis of affordability, as there isn’t for food or clothing.

But by the time Medicare and Medicaid were enacted in 1965, this view of health care as an economic product–for which each individual must assume responsibility–had given way to a view of health care as a “right,” an unearned “entitlement,” to be provided at others’ expense.

This entitlement mentality fueled the rise of our current third-party-payer system, a blend of government programs, such as Medicare and Medicaid, together with government-controlled employer-based health insurance (itself spawned by perverse tax incentives during the wage and price controls of World War II).

The resulting system aimed to relieve the individual of the “burden” of paying for his own health care by coercively imposing its costs on his neighbors. Today, for every dollar’s worth of hospital care a patient consumes, that patient pays only about 3 cents out of pocket; the rest is paid by third-party coverage. And for the health care system as a whole, patients pay only about 14 percent.

Shifting the responsibility for health care costs away from the individuals who accrue them led to an explosion in spending. In a system in which someone else is footing the bill, consumers, encouraged to regard health care as a “right,” demand medical services without having to consider their real price. When, through the 1970s and 1980s, this artificially inflated consumer demand sent expenditures soaring out of control, the government cracked down by enacting further coercive measures: price controls on medical services, cuts to medical benefits, and a crushing burden of regulations on every aspect of the health care system.

As each new intervention further distorted the health care market, driving up costs and lowering quality, belligerent voices demanded still further interventions to preserve the “right” to health care: from regulations mandating various forms of insurance coverage to Bush’s massive prescription drug bill.

The solution to this ongoing crisis is to recognize that the very idea of a “right” to health care is a perversion. There can be no such thing as a “right” to products or services created by the effort of others, and this most definitely includes medical products and services. Rights, as the Founders conceived them, are not claims to economic goods, but to freedoms of action.

You are free to see a doctor and pay him for his services–no one may forcibly prevent you from doing so. But you do not have a “right” to force the doctor to treat you without charge or to force others to pay for your treatment. The rights of some cannot require the coercion and sacrifice of others.

Real and lasting solutions to our health care problems require a rejection of the entitlement mentality in favor of a proper conception of rights. This would provide the moral basis for breaking the regulatory chains stifling the medical industry; for lifting the tax and regulatory incentives fueling our dysfunctional, employer-based insurance system; for inaugurating a gradual phase-out of all government health care programs, especially Medicare and Medicaid; and for restoring a true free market in medical care.

Such sweeping reforms would unleash the power of capitalism in the medical industry. They would provide the freedom for entrepreneurs motivated by profit to compete with each other to offer the best quality medical services at the lowest prices, driving innovation and bringing affordable medical care, once again, into the reach of all Americans.

Health Care is Not a Right

Health Care Is Not a Right

Washington, D.C., July 27, 2009–President Obama’s push for universal health care rests on the premise that people have a right to medical care and medical insurance. “This is wrong,” said Yaron Brook, executive director of the Ayn Rand Center. “This notion of some sort of entitlement to health care is a distortion of the concept of a ‘right’ and is ultimately what’s behind all of the problems with today’s medical system.

“Philosopher Leonard Peikoff explained the basic point in a 1993 speech (view the video or PDF) given in the context of HillaryCare. It applies equally to Obama’s ‘reforms.’ Peikoff argued that ‘all legitimate rights have one thing in common: they are rights to action, not to rewards from other people. The American rights [to life, liberty, property, and the pursuit of happiness] impose no obligations on other people, merely the negative obligation to leave you alone. The system guarantees you the chance to work for what you want–not to be given it without effort by somebody else. . . . Under the American system you have a right to health care if you can pay for it, i.e., if you can earn it by your own action and effort. But nobody has the right to the services of any professional individual or group simply because he wants them and desperately needs them. The very fact that he needs these services so desperately is the proof that he had better respect the freedom, the integrity, and the rights of the people who provide them.”

For more information on the Ayn Rand Center’s position on health care, please visit our Web site.

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There Is No Right to Health Care

There Is No Right to Health Care

July 23, 2009

Washington, D.C.–President Obama’s health care reform is being driven by the idea that people have a right to health care and health insurance coverage. “This is wrong,” says Yaron Brook, executive director of the Ayn Rand Center.

“There can be no such thing as a ‘right’ to products or services created by the effort of others, and this most definitely includes medical products and services. Rights, as our Founding Fathers conceived them, are not claims to economic goods, but to freedoms of action.

“You are free to see a doctor and pay him for his services–no one may forcibly prevent you from doing so. But you do not have a ‘right’ to force the doctor to treat you without charge or to force others to pay for your treatment. The rights of some cannot require the coercion and sacrifice of others.

“A real and lasting solution to our health care problems requires a rejection of the entitlement mentality in favor of a proper conception of rights.”

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Record Number of Students Enter the Ayn Rand Institute’s "Fountainhead" Essay Contest

Record Number of Students Enter the Ayn Rand Institute’s “Fountainhead” Essay Contest

Irvine, CA, July 7, 2009–More than 7,000 high school students, a record number, have entered the Ayn Rand Institute’s annual “Fountainhead” essay contest, which will award the winners a total of $43,250 in prizes.

First published in 1943, The Fountainhead tells the heroic and fascinating story of Howard Roark, an intransigently independent architect who stands against society’s conventions and refuses to compromise his standards in work and in life.

Open to 11th and 12th graders, the “Fountainhead” essay contest requires contestants to write on one of several topics dealing with the characters and themes in the novel. The contest is designed to promote critical thinking and writing skills. Essays are judged on both style and content.

According to Marilee Dahl, ARI’s education manager, “Judges look for writing that is clear, articulate and logically organized. Winning essays must demonstrate an outstanding grasp of the philosophic meaning of The Fountainhead.”

Since 1985 more than 200,000 high school students from around the world have entered ARI essay contests and received more than a half a million dollars in prizes.

The first prize winner for the “Fountainhead” essay contest this year will take home $10,000; 5 second-prize winners will receive $2,000 each, and 10 third-prize winners will receive $1,000 each. In addition, 45 finalists will get $100 each and every one of the 175 semifinalists will get $50.

More information about this year’s competition can be found at http://aynrand.org/contests.

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To interview Ms. Marilee Dahl or for more information on ARI’s educational programs, please contact media@aynrand.org

 

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Record Number of People Are Listening to Atlas Shrugged

Record Number of People Are Listening to Atlas Shrugged

Washington, D.C., June 22, 2009–The Ayn Rand Center for Individual Rights and the media have been reporting on the surge in sales of Ayn Rand’s classic novel Atlas Shrugged over the last six months. Not surprisingly, sales of the Atlas Shrugged audio book are also making impressive gains.

According to Blackstone Audio, one of the publishers of the full text audio edition of Atlas Shrugged, 16,000 audio copies of the novel were sold in the first five months of 2009, compared to around 20,000 in all of 2008. “This is a huge increase,” noted Dr. Yaron Brook, executive director of the Ayn Rand Center for Individual Rights. “This year audio copies of Atlas Shrugged are selling at about twice the rate as last year.”

Reports from trade sources have indicated that book purchases of Atlas Shrugged have also spiked recently, having tripled in the first four months of 2009 compared to the first four months of 2008. “The tripling in sales of Atlas Shrugged is remarkable,” said Dr. Brook, “especially considering that in 2008 a new all-time record in annual sales of the novel was established with more than 200,000 copies sold in the United States.”

More than 6,500,000 copies of Atlas Shrugged have been sold to date.

“Given the striking similarities between the plot-line of the book and the events of our day, more Americans are reading and listening to Atlas Shrugged than ever before,” said Yaron Brook. “Hopefully, they will find in Atlas Shrugged the principled solutions to the problems we face today.”

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Punishing Google for Its Success

By Alex Epstein (Investor’s Business Daily, June 4, 2009)

The Obama administration’s Department of Justice recently announced that it will dramatically increase enforcement of antitrust laws against successful, dominant companies who allegedly harm competition by wielding too much “market power.” What sorts of companies? Experts agree that the first targets might include one of America’s most beloved. “This will be bad news for heavyweights in the tech industries,” a leading scholar told the New York Times, “companies like Google.”

But wait: Isn’t Google a company whose products and services, centered around its fabulously popular search engine, benefit millions of Americans and businesses? Shouldn’t Americans be celebrating Google, and shouldn’t the government be leaving it alone?

No, antitrust enforcers say. Google has become too “dominant” in the search engine market–that is, too many of us choose to type in http://www.google.com/ instead of http://www.yahoo.com/ or http://www.live.com/. This allegedly gives Google too much power over those who wish to buy its coveted, keyword-based advertising. In an influential article on leading technology blog TechCrunch, Wharton professor Eric Clemons argued that “Google enjoys monopoly power over corporations that participate in its keyword auctions” and “Google is abusing its monopoly position by overcharging corporations for access to consumers.”

But what does it even mean to have “abusive monopoly power?”  Well, consider what the “power” of Google–a company no one is forced to deal with and anyone is free to compete with–really amounts to.

Through incredible technical innovation and brilliant management and marketing, Google has created by far the most popular search engine on the planet, attracting hundreds of millions of users. Through additional innovation, it has created the AdSense program, which offers advertisers the ability to reach users whose searches contain keywords associated with the advertisers’ products. Millions of advertisers eager to reach that Google user-base are willing to pay substantially higher rates than less-popular search engines can charge. Google even holds expensive auctions for top keywords.

Google’s prices and terms, often denigrated as “overcharging” and “unfair,” are in fact earned. And Google’s power to attain them exists only as long as it continues to offer superior value to its advertising customers. The minute AdSense’s rates stop making financial sense to advertisers, Google will see its dominance disappear. Critics bemoan the difficulty faced by competitors trying to overtake Google in search and advertising revenue–but that just proves how much value Google brings to the table, relative to anyone else. This is grounds for admiration of a superior competitornot prosecution for being “anticompetitive.”

Google has no power to force consumers to use its products and no power to prevent competitors from offering products of their own. Consequently, it can pose no threat to anyone’s rights or to the competitive process. (If Google ever does use coercion, as is alleged in a copyright case against the company, it should be prosecuted–but this has nothing to do with antitrust.)

There is, however, one player in today’s market that can thwart competition: the government. By using the vast and arbitrary political power given to it by antitrust law, the government can forcibly control successful companies such as Google and Microsoft, telling them what products they cannot sell, what markets they cannot enter, what prices they cannot charge. Obama’s new push to “protect competition” is the real threat to competition. Under the reign of antitrust, any superior company can be stopped in its tracks because some bureaucrat, company, or academic decides that the prices in its voluntary contracts are too high, or its voluntary terms are too onerous, or evento take another common accusation against Google–that its stable of free products is too large! In other words, Google is to be shackled so that future competitors can catch up to Gmail, Google Maps, and Google Books.

Success earned in a free, competitive process is an achievement. Our Department of Justice regards it as a crime. Thus, we may well see Google undergo the fate of Microsoft, which has been tortured, drained, and shackled by more than a decade of antitrust persecution–for adding a web browser to its fabulously successful operating system. Google famously encourages employees to devote 20% of their time to creative projects of their own choosing. An antitrust case could effectively force much of that precious time and energy to be devoted to mollifying and obeying Washington’s economic little Caesars. Let’s challenge this travesty-in-the-making, along with its underlying theory that successful companies possess “monopoly power,” before America commits yet another sin against capitalism.

He’s No Rand Disciple

By Alex Epstein (Published in American Banker, May 20, 2009)

In a recent story about former BB&T CEO John Allison’s support of Ayn Rand’s laissez-faire ideas, including a gold standard, (“Allison Shrugs”) American Banker repeats an unfortunate misconception about Rand, one that is often used to undermine anyone who agrees with her: “Even former Federal Reserve Board Chairman Alan Greenspan, Rand’s most famous student, has backed away from her ideas as the financial crisis has deepened.”

But Greenspan can’t “back away” from something he hasn’t believed or supported for decades. Remember, this is a man who for two decades reveled in wielding the manipulative power granted to him as Fed Chairman–a job he once (rightly) argued should not exist. The New York Times called him “the infallible maestro of the financial system.” Free markets don’t have “infallible maestros”; they liberate us from such “maestros”–the central planners who have time and again falsely claimed the ability and the right to orchestrate (dictate) millions of economic lives.

Greenspan long ago degenerated into another central planner–and a particularly bad one, both because of his highly inflationary policies (a fundamental cause of the crisis) and because he implemented them under the banner of laissez-faire. If one wishes to understand or argue with the laissez-faire ideas of Ayn Rand, Alan Greenspan is the last person to look to. He stands for free markets about as much as a Chinese censor stands for free speech.

CO2 Restrictions Threaten Human Life

CO2 Restrictions Threaten Human Life

Washington, D.C., April 30, 2009–The Environmental Protection Agency’s “finding” that carbon dioxide emissions endanger “the health and welfare of current and future generations” is absurd, said Alex Epstein, analyst at the Ayn Rand Center for Individual Rights. According to Mr. Epstein, the real danger to Americans’ “health and welfare” is policies designed to fight global warming by throttling energy sources that emit CO2.

“Carbon energy has been and remains vital to the industrial society that has doubled human life-expectancies, and, among a million other benefits, enables us to cope with all manner of changes in climate.

“Right now,” Mr. Epstein pointed out, “carbon-based sources of energy produce the most, cheapest energy, period—while sunshine and wind gusts, despite decades of subsidies and propaganda, produce an expensive 1 percent of our energy.

“If scientists and entrepreneurs can discover and implement superior sources that happen not to emit CO2, at better prices than today’s energy sources, great. But whether that happens or not, we need to recognize that our ‘health and welfare’ depend on free markets producing industrial-scale energy above all else—and that anyone who tries to shut down life-giving coal plants and oil rigs, in the name of avoiding bad weather, is an enemy of humanity.”

 

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Supreme Court Abets the FCC’s War on Free Speech

The Supreme Court Abets the FCC’s War on Free Speech

Washington, D.C., April 28, 2009–Today the Supreme Court ruled in FCC v. Fox that the FCC can continue to fine broadcasters for “fleeting expletives.” According to Don Watkins, a writer for the Ayn Rand Center for Individual Rights:

“The Court failed to address the basic constitutional question in this case: are the non-objective ‘indecency’ laws that permit the FCC to dictate what Americans can say and hear on the airwaves consistent with the right to free speech? The answer to that is: absolutely not.

“The Supreme Court has defined ‘indecency’ as speech that ‘depicts or describes sexual or excretory activities and organs in terms patently offensive as measured by contemporary community standards.’ But which Americans count as part of the community? Why are they king? And how are broadcasters to divine the community’s supposedly shared standards?

“As the history of the government’s anti-indecency regime has shown, these questions are unanswerable. The only way for broadcasters to play it safe is to engage in self-censorship, cutting any material regulators might declare indecent.

“And once the government becomes the enforcer of ‘community standards,’ no speech is safe. How long until the courts start rubber-stamping the Bible Belt’s efforts to suppress the theory of evolution on the grounds that it many find it offensive, or that it supposedly corrupts young minds and undermines community values?

“The government must stop telling Americans what we can say and hear on the airwaves. Sadly, the Supreme Court failed to take this opportunity to protect our constitutionally guaranteed right to free speech.”

 

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How to End Piracy in the High Seas

How to End Piracy in the High Seas

Washington, D.C., April 20, 2009–In a dramatic rescue operation a week ago, U.S. Navy Seals succeeded in freeing Capt. Richard Phillips from captivity by Somali pirates.
 
According to Elan Journo, analyst at the Ayn Rand Center for Individual Rights, even though the operation was successful, it did not teach the pirates the appropriate lesson, as evidenced by news of a pirate attack on another American-flagged ship, the Liberty Sun.
 
“The pirates have not been deterred,” said Mr. Journo, “because we have emboldened them for years through an entrenched policy of passivity and accommodation–and the freeing of Capt. Phillips was unfortunately just one halting step in a better direction.
 
“What we need–in response to piracy as well as other foreign threats–is an across-the-board reversal in U.S. policy. When, for example, it became clear more than a year ago that the waters off the coast of Somalia are a playground for pirates, the minimum that Washington should have done was to lay down an ultimatum to the pirates to leave Americans alone or else–and lived up to it.
 
“The substance of that warning: if any American vessel is captured by pirates, we will use military force to destroy every last pirate base in Somalia. When such a threat of retaliation is made fully credible, it can be sufficient to deter would-be aggressors. If any dare test us, then we must unapologetically respond with force.
 
“When America has once again earned a reputation as a power that none dare cross,” Mr. Journo concluded, “we won’t have to worry about pirates.”

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