Public Healthcare Myths Debunked

There will now follow a series of popular Canadian myths about why public healthcare is essential and superior, along with the refutation of them.

#1: Healthcare is an essential service. It can’t be entrusted to private industry.

Food is a still more essential service than healthcare. However, those nations where the State controls food production and distribution are those that still routinely suffer famine and malnutrition, such as Cuba, North Korea, and so forth. Nations whose food industry is private (albeit with small pockets of interventionism, such as farm subsidies), such as Canada, the USA or the UK, cannot even remember famine or hunger. Indeed, the main problem in nations with a free food industry is an overabundance of food, leading to endemic obesity. In the USA, hunger was last known during the Depression, when various New Deal authorities stepped in to take control of the food industry.

#2: Private companies just want to make a profit - they have no actual interest in our health.

Private companies do indeed want to make a profit. The best way for a private healthcare company to do this is to offer the best healthcare service for the cheapest price, so that consumers will flock to them instead of their competitors. They also need to keep their patients alive, since the patient who survives his illness can be sold more healthcare products in the future, whereas the patient who succumbs will not consume ever again.

Public industry, however, treats its consumers as a nuisance. Private industry directly links revenue to customer base, therefore, a private company wishes to expand its clientele as much as possible. Public industry completely divorces revenue from customer base, therefore, every customer is a drain on limited resources. The best thing that you can do for public healthcare is to crawl off and die, so you don’t waste their limited funds. Public industry wants fewer customers, not more.

#3: Doctors and medical treatments are just too expensive. There’s no way most people could afford them without public funding.

By 1930, the numbers of American workers who were members of a fraternal aid society had swollen to 30% of the workforce. These societies provided life insurance, medical services, education and unemployment insurance, and the price of this could be as low as $1 per year (about $11 in 2003 dollars), including coverage for one’s family.

This was before government got involved. Doctors lobbied the government to fix their wages, and after this was done, only the wealthy were able to afford medical care. Then began the clamouring for public healthcare, to alleviate this government-created problem.

#4: How would the poor and destitute afford healthcare?

How do they now afford food, housing, clothes and shoes? There are a great many charities and programmes dedicated to providing the destitute with the goods and services they need. Private organisations solicit donations and companies donate largess to gain the goodwill of their potential customers. The steadily falling prices that free markets bring would also bring healthcare within the financial reach of an ever-swelling number of people.

#5: Outlying, rural areas wouldn’t get the same quality of healthcare that big cities receive.

Modern technology is increasingly making this notion obsolete. The technology whereby doctors assist other doctors by telemetry is now old hat, and these kinds of operations are performed routinely. There is nothing to stop a surgical team in Toronto directing and assisting a surgeon treating a rare disease in a remote town in rural Yukon. Drugs have long shelf-lives, and there is nothing to stop a pharmacy in a small town carrying a small stock of just about any drug. In dire need, helicopters and fixed-wing aircraft can evacuate a serious case to a major hospital in a matter of minutes.

#6: Private companies are greedy. They’d just drive the prices up.

The overwhelming tendency in the free market is for prices to go down, not up. The two main ways in which a company may attract more business than its competitors is to offer better goods and services, or cheaper goods or services. If it can do both, all the better. The company that attempted to gouge healthcare prices would be quickly driven out of business by the companies that did not.

It is also noteable that public management of healthcare seems to be driving the prices up. The cost in tax dollars for our healthcare services steadily increases, and this is combined with a stagnant or even declining quality of care.

#7: Some company would just achieve a monopoly and gouge everybody.

The only monopolies in history were guaranteed by government action, like Canada Post. Even if a monopoly were to arise in a free market, because there is no guarantee that it will be preserved, even the threat of potential competition is enough to deter gouging. Nor can a monopolist simply hope to “buy out” any new entry into the market. My favourite illustration of this is in videogame consoles. The big players Sega and Nintendo were powerless to prevent the entry of first Sony and then Microsoft into the market, because these new entrants were too big and too powerful to be simply bought out. Now Sega has abandoned the hardware business altogether, and Nintendo is definitely in third place. Consider too that A&P was once the largest retailer in North America, with far more stores than Wal-Mart now operates. Again, through purely free-market action, they are now just bit-players in the retail industry.

Readers are invited to contribute their own myths.