Home > Politics (general) > Socialised health care as feasible utopia (crosspost from CT)

Socialised health care as feasible utopia (crosspost from CT)

September 8th, 2011

As I’ve mentioned a few times, I got a lot out of Erik Olin Wright’s Envisioning Real Utopias, and am still hoping our long-promised book event comes to fruition. The general idea of the book was in line with my thinking that technocratic rationality, of the kind offered by, say Obama or Blair, is not a sufficient answer to the irrationalist tribalism of the right – the left needs a transformative vision to offer hope of a better life, both for the increasing proportion of the population in rich countries who are losing ground as a result of growing inequality and for the great majority of the world’s population who are still poor by OECD standards[2]. So, Utopia matters.

But it’s just as important that utopia be feasible. Utopia as a dream may be comforting, but is unlikely to inspire effective political action. And attempts to implement a utopia that isn’t feasible are bound to end in failure, quite possibly disastrous failure, as the experience of communism showed us.

So, my idea was to think about what kind of transformative vision might be both feasible, and capable of inspiring effective action. I had a first go at this here and here, in relation to education.

Turning to health care, we could start with a utopian ideal where everyone got all the health care that could benefit them. But that would be utopian in the pejorative sense – the scope for expanding health services is effectively infinite, and the resources available to society are not.

Thinking about feasible utopia, on the other hand, it seems to me that the system of socialised health care in modern social democracies is not a bad model. That is, if all of society worked like the health care system at its best, we could regard the political project of social democracy as a success.

Perhaps no country gets it perfectly right. In Australia for example, the basics (general practitioner services, pharmaceuticals, critical hospital services) are covered pretty well, but we don’t do so well on mental and dental health, and there are lots of complaints about waiting lists for elective (=desirable, but not lifesaving) surgery. Still, outside the US, the big worry about going to doctors or hospitals is whether the treatment will be successful, not whether you will go bankrupt trying to pay for it.

The big question is whether this model can be replicated more broadly. Health care has the special characteristics that, on the one hand, there isn’t a big issue of consumer preferences (mostly, people want the treatment that has the best chance of a cure, though there is sometimes a risk-return trade-off) and, on the other hand, markets perform very badly.

The public provision model wouldn’t work for, say, motor cars. Still, it seems that it ought to be possible to limit the domain of inequality in such a way that no one was left without the basic requirements for a decent life and social participation while, at the same time, those who chose to work harder, or worked more productively, could still enjoy higher consumption of discretionary items like expensive cars and granite benchtops.

fn2. A billion or more of whom are poor by the absolute standard of not having enough food to eat, or access to basic housing and medical care

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  1. Chris Warren
    September 12th, 2011 at 12:55 | #1

    @TerjeP

    You need to take a reality check.

    The private sector DOES NOT feed and house the world. It only feeds and houses the rich. The rest are serviced by UN agencies, gifts from the West, or survive on food stamps in the US, and various other schemes in OECD economies. In Australia the private sector cannot feed and house workers on (or near) minimum wages, pensioners, or unemployed.

    Increasing the ” involvement of the private sector” within capitalism will automatically contract services due to higher profits required by capitalists.

    You misunderstand HECS. It is not a income contingent loan. The repayment is income contingent. There is no meaningful difference between “government funding” and “government financing”. HECS is funding matched by latter progressive taxation. The same as all government spending.

    The current level of state involvement is not autocratic, and private providers are secretative, autocratic, unaccountable, and often misrepresent quality.

    Price signals plus a privatised sector, result in overservicing and over charging in richer postcodes and service deprivation and cost-barriers in poorer postcodes.

    Price signals coupled with the anti-social function of profiteering, disperse services to where they DO NOT make the most sense. Poorer people get less dental, mental, preventative, and elective health services, and wait longer for non-elective services outside the emergency category (unless they have a Gold Card).

    In OECD economies, the private sector is a capitalist sector – a paradise for fools.

  2. Chris Warren
    September 12th, 2011 at 14:59 | #2

    @J-D

    “Transformative vision” is a post-modernist religious concept that I associate with the middle class ‘wannabe’ Left.

    In most cases it suggests that if ‘progressives’ argue their case well enough, a values revolution will occur and capitalist society will change. And they point to a whole raft of micro-reforms where social movements have changed slivers of society for the better. Women’s Liberation, the Vietnam Moratorium, anti-slavery, and reforms arising out of “identity” issues generally.

    I associate “transformative vision” with firstly the now debunked “Rainbow Alliance” but also with Dave McKnight a progressive academic imbued with New Left ideology and tainted with a misunderstanding of Western Marxism.

    It is utopian but in its modern guise, I suppose it all goes back to Charles Reich, and his Consciousness I, II, and III that was peddled in Western universities in the 70′s. It is continued today as “New Social Movements” theory but dressed-up with writings from such authors as Habermas. In essense ‘transformative vision’ is a love child of postgraduate students and upper middle class academics. It is only the 60′s ‘counter-culture’ dressed up for academic careers 40 years too late.

  3. may
    September 12th, 2011 at 15:57 | #3

    with for profit activities in high personnel engagement services, how can a profit possibly be extracted without reducing the engagement of those very services?

    good governance in a system provided from the public purse getting best value for the price paid

    vs

    good governance in a system geared to profit taking and market share enlargement,

    are two different kettles of fish.

    in the first, the point is best result for the money,with outcome measured by individual benefit,

    in the second,the point is best result in money,with the outcome measured by market share and dividend and individual benefit be damned.

  4. Ikonoclast
    September 12th, 2011 at 20:04 | #4

    For a change of pace, I will say that TerjeP shows courage commenting on this blog. He usually takes a lot of flak. I haven’t shown comparable courage and gone on a libertarian blog.

    Out of interest, I took a quick political quiz that a libertarian blog pointed me to. I came up as a left liberal (small “l” liberal in the American sense.) My PERSONAL issues Score was 90% and my ECONOMIC issues Score was 20%. I assume 100% in each case makes a perfect libertarian. I am sure my scores won’t surprise TerjeP.

    On personal issues, I lost 10% for indicating only a maybe for decriminalising all drugs. What I meant was maybe for some and probably not for others on a case by case basis. But the quiz did not really allow for that level of discrimination.

    On economic issues, I scored 20% for opposing corporate welfare. Predictably, I want a significant state presence in the other main policy areas.

    In the words of the site:

    “Liberals (small “l”) usually embrace freedom of choice in personal matters, but tend to support significant government control of the economy. They generally support a government-funded “safety net” to help the disadvantaged, and advocate strict regulation of business. Liberals tend to favor environmental regulations, defend civil liberties and free expression, support government action to promote equality, and tolerate diverse lifestyles.”

    TerjeP and I are often at loggerheads, but it’s probably good to remember that we don’t disagree on all matters. It’s important to note areas of agreement too.

  5. TerjeP
    September 12th, 2011 at 20:45 | #5

    A change of pace is occasionally appreciated. I suspect the quiz may have been like this one:-

    http://libertarian.org.au/quiz/

    Obviously such tests are simplistic but they are more useful than the typical left / right dichotomy.

    The difficulty with left / right is that it is used in so many different ways. It gets used to define cultural ideas, economic philosophy, social policy outlook, foreign policy positions etc. None of us fit neatly in boxes like that although there is a degree of tribal policing (sometimes self imposed). Anything that can broaden the possible ways to classify different thinking and yet still be meaningfully descriptive is generaly healthy.

    I comment here because I know I will encounter serious critics. You all help me to polish my arguments and sharpen my message. Nobody builds muscle without resistance. I certainly don’t expect many of you to adopt a libertarian outlook any time soon but none the less I hope I occassionally impart something of value.

  6. TerjeP
    September 12th, 2011 at 20:52 | #6

    May – I suspect you discount too heavily the role of incentives in delivering good governance and quality services. I suspect you also don’t sufficiently recognise what drives innovation. Profit is a price signal that keeps firms responsive to changing circumstances. If the world was static then we probably wouldn’t benefit much from such feedback mechanisms but the world isn’t static.

  7. Freelander
    September 13th, 2011 at 11:00 | #7

    Incentives are exactly what deliver bad governance. Who guards the guardians may be a problem without a solution.

  8. may
    September 13th, 2011 at 12:13 | #8

    suspicion torments my heart.

    nothing wrong with a good profit.

    it’s the lack of it that’s the problem,in a widget or service industry in the private sector going bust hurts no-one but the shareholders.

    for essential social infrastructure going bust and/or cutting costs means harm to more than somebodies bank balance.

    private profit seeking will always trump social benefit and a society without a well governed public purse is reliant on the whim, conscience and philanthropy of the inevitably small group that owns the most.

    being a courtier buzzing around the centre of power in whatever system you care to nominate is to be a part of and perpetuate the sweet pool of corruption.

    tough luck if you are not part of the system.

    innovation payed for from the public purse and taken up by private individuals,put through the wringer of a highly competitive market is the reason this discussion is taking place in this forum.

    the benefit of co-operation never gets the recognition that accrues to competition and it’s about time that it did,for without co-operation we are reduced to what is happening to the USA political process.

    it’s a dogs breakfast(all over the place).

  9. may
    September 13th, 2011 at 12:45 | #9

    and it seems that a conservative audience in USA think it’s a wonderful idea to leave others to die for lack of insurance.

    it’s a bit surprising there was no suggestion to line them up,sell tickets to kick them and then use what’s left as a resource for various industrial processes.

    did i say dogs breakfast?

    i’m reminded of the end of the mccarthy era, brought about by the words—

    have you no decency,sir,have you no decency?

  10. Jarrah
    September 13th, 2011 at 12:50 | #10

    “The private sector DOES NOT feed and house the world. It only feeds and houses the rich. The rest are serviced by UN agencies, gifts from the West, or survive on food stamps in the US, and various other schemes in OECD economies. In Australia the private sector cannot feed and house workers on (or near) minimum wages, pensioners, or unemployed.”

    It serves the rich the best, obviously, but not ONLY them. Most of the feeding and the housing of the poor happens through the private sector. Also, you are ignoring countervailing forces put in place by the public sector that work against the feeding and the housing of people by the private sector, ie regulations as to quantity, quality, who can do the providing, etc.

  11. TerjeP
    September 13th, 2011 at 13:44 | #11

    for essential social infrastructure going bust and/or cutting costs means harm to more than somebodies bank balance.

    For larger enterprises going bust usually means going into administration which hurts shareholders and managers. It is intended to help protect creditors but usually by that stage they suffer loses also. It isn’t a pleasant process but nor is it that common. And you make it sound like a private hospital that went into administration would be sending nurses home, turning out the lights and leaving patients to die in the dark. This type of image is a nonsense and we have enough private hospitals around to know it is a nonsense. They provide good care and good service.

  12. Chris Warren
    September 13th, 2011 at 14:07 | #12

    Why do these capitalist dogmatists always pop-up like this?

    @Jarrah

    Most of the feeding and the housing of the poor happens through the private sector.

    Where is the evidence, it is certainly not true in the ACT, but even a simpleton can get useful data for NSW.

    In NSW:

    Public housing
    Property and tenancy management of 128,000 public housing homes and tenancies

    Community housing
    Funding of not-for-profit organisations to provide property and tenancy management for more than 13,500 properties

    Aboriginal housing
    Property and tenancy management for more than 4200 properties owned by the Aboriginal Housing Office

    Rental Assistance
    We provide bond and rental assistance for families or singles on low incomes wanting to secure a property in the private rental market

    Affordable housing due to stimulus spending via public/private partnership is additional to this. Educational accommodation (Halls of College) is not included. Religious organisation provision is also not included.

    So if our dogmatist was right, then a figure for “most” would be in excess of 150,000 homes.

    So where in NSW does the private sector provide more than 150,000 units of housing for pensioners, unemployed, apprentices, young workers, and minimum wage workers.

    Fair rent is either 25% of gross or 20% of after tax income – so where can workers get over 100,000 homes for 20% of $570 [$114] each?

    Private sector search facility is on realestate.com.au or http://www.domain.com.au or allhomes.com.au

  13. Chris Warren
    September 13th, 2011 at 14:09 | #13

    Why do these capitalist dogmatists always pop-up like this?

    @Jarrah

    Most of the feeding and the housing of the poor happens through the private sector.

    Where is the evidence, it is certainly not true in the ACT, but even a simpleton can get useful data for NSW.

    In NSW:

    Public housing
    Property and tenancy management of 128,000 public housing homes and tenancies

    Community housing
    Funding of not-for-profit organisations to provide property and tenancy management for more than 13,500 properties

    Aboriginal housing
    Property and tenancy management for more than 4200 properties owned by the Aboriginal Housing Office

    Rental Assistance
    We provide bond and rental assistance for families or singles on low incomes wanting to secure a property in the private rental market

    Affordable housing due to stimulus spending via public/private partnership is additional to this. Educational accommodation (Halls of College) is not included. Religious organisation provision is also not included.

    So if our dogmatist was right, then a figure for “most” would be in excess of 150,000 homes.

    So where in NSW does the private sector provide more than 150,000 units of housing for pensioners, unemployed, apprentices, young workers, and minimum wage workers.

    Fair rent is either 25% of gross or 20% of after tax income – so where can workers get over 100,000 homes for 20% of $570 [$114] each?

    Private sector search facility is on realestate.com.au or domain.com.au or allhomes.com.au

  14. J-D
    September 13th, 2011 at 14:23 | #14

    Chris Warren:

    Thanks for the attempt. But since it turns out (although of course there’s no way you could have known this) that you have offered an explanation of one term I don’t fully understand in terms of other terms that I don’t fully understand either, it hasn’t helped me.

  15. Jarrah
    September 13th, 2011 at 15:11 | #15

    Chris, since you were talking in general terms, I did also. My point stands for the world as a whole.

    “Fair rent is either 25% of gross or 20% of after tax income ”

    Ah. A not-so-subtle attempt to move the goalposts. Now you want to introduce a new criterion of ‘fair rent’, which you seem to have made up on the spot (for example, the official line deemed to be affordable is 30% of income). But I won’t play your game. You specifically said the private sector “only feeds and houses the rich”. Probably realising you don’t have a leg to stand on regarding food, you’ve concentrated on housing, but even then you’re trying to change your tune.

    And you’re STILL ignoring the barriers to providing housing at affordable prices that governments put up. We have the ludicrous situation where policy decisions and innumerable regulations make housing more expensive, so the government has to subsidise housing!

  16. Chris Warren
    September 13th, 2011 at 16:00 | #16

    So the question remains – where are these 150,000 units the private sector supposedly provides?

    The so-called official line of 30% is a relatively recent fiddle by right-wing labor types. 25% is a suitable benchmark.

    So where does the private sector provide over 150,000 units at any reasonable rent – 30% 25% – whatever?

    So why switch attention to food. You only have to look at the cries from charity outlets to know the private sector has failed here too. Charities claim they are breaking under the strain of having to pickup the slack. In Melbourne there are special shops only for those with Centrelink healthcare cards. If these people had to pay private sector prices they would get less food. In US most poor only get food via food stamps and other welfare payments. The private sector has failed.

    Of course there are no barriers that are relevant unless there are some that also do not apply to social housing. Public housing should meet the same standards as other housing.

    Why would you winge about vague “barriers” without specifying a such thing, when the real task is to explain where are more than 150,000 of housing of the poor.

    So where is more than 150,000 units of housing for the poor in NSW?

    Pick whatever % of income you like, but where is there evidence of the private sector providing “most” of the housing for the poor?

  17. Chris Warren
    September 13th, 2011 at 17:11 | #17

    I suppose socialised housing is probably closer to a feasible ‘utopian’ concept than socialised health. Unlike health, housing obtains most of its inputs inside the national economy and there are comparatively fewer intervening steps from raw materials.

    Social housing only has to cover the real cost of housing without having to factor in opportunity costs (as if the same funds were invested elsewhere) or capitalist interest rates. Social housing is a capital expenditure similar to a main road or railway requiring nothing more than initial construction once only and 100% maintenance thereafter.

    So, on this basis, socialised supply of health, food, housing, transport and education will always provide cheaper services to a greater number. The capitalist private sector (by itself) supplies only to the rich but can be tempted to supply to the poor with massive subsidies to manipulate either demand or supply.

    In Australia the private sector supplies almost nothing ‘brand new’ to the poor, who commonly rely on a substantial second hand market for most serious consumables. However some private sector providers do offer ‘concessions’ to various categories of low income particularly if government hs set a CSO (community service obligation). The public sector provides concessions almost across all services.

    If you are supporting a family on the minimum wage you are unable to purchase decent food, decent housing, decent transport, or decent health care purely from the private sector. This missing access, a failure of the private sector, is made up only through government handouts. If you are on less than the minimum wage, not even this suffices. Dental care, mental health, social networking, clothing and housing are the first casualties. Food comes next.

  18. may
    September 14th, 2011 at 12:55 | #18

    @TerjeP

    leave them on the inside of a tax deductable/saleable asset?

    smelly old people?

    not likely.

    no administrators of any bankruptcy process would be able to justify that to creditors.

    the back stop is

    the public purse and the efforts of those whose rationale is not the profit motive.

    pretending market forces can and do meet all social needs makes as much sense as pretending communism or religion have all the answers.

    the market is a place to go to, no one in their right mind would want to live there.

  19. Jarrah
    September 14th, 2011 at 22:41 | #19

    “So the question remains – where are these 150,000 units the private sector supposedly provides?”

    All around you. Well, if you’re an inner-city dweller, not necessarily. Though you will have plenty of share houses nearby.

    “25% is a suitable benchmark.”

    Says who? When I was poor, I paid close to 50% of my income in rent.

    “So why switch attention to food.”

    Switch? You brought it up, then abandoned it.

    “Of course there are no barriers that are relevant”

    You wish. Severe restrictions on land releases, planning and development restrictions, stamp duty, levies, first home owner’s grant, etc, all push up the price of housing.

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