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If Liberty Mattered — Once More, a Presidential Candidate’s Press Conference, Part 5

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The Candidate: Ladies and gentlemen of the press, now that it has become clear who my two leading opponents will be in this presidential race, I feel that my decision to run was the right one. There needs to be at least one voice defending a principled case for liberty in America today. And, unfortunately, that principled case is not coming from my opponents. Instead, what they are offering the American people are mere variations on the state interventionist and paternalistic theme that has brought us to the situation we are in today.

Let’s take the issue of health care. One of my opponents, the incumbent president, tried to impose a comprehensive nationalization of health care in the United States. Not one facet of health treatment and care would have been left out of the purview of the government. If his plan had passed, the issue of life and death would have been completely politicized. The state would have determined the types of tests, treatment, and life-preserving services that would have been distributed among the people of the United States. It would have resulted in the ultimate destruction of medical care in America.

Luckily, his plan was defeated. But what have the Republicans offered in its place? They have offered gimmicks and tricks that would introduce increased control or influence over medical insurance and services, while preserving the outward appearance of maintaining a private system of medical services. Under the Republican plan, insurance companies are to be compelled to supply health insurance to any worker, regardless of any medical preconditions that may exist, when that individual changes his employment.

Let us be frank: the political party that claims its allegiance to the principles of free enterprise is commanding compulsory contracting, whether or not both parties find this mutually advantageous or not. In addition, once the government has established this precedent, the path down the slippery slope of comprehensive state control of medical care will have been traveled even further than it has been so far. The New York Times understood this clearly when, in its article of April 24, 1996, reporting on the unanimous Senate passage of a national health-care bill, it pointed out that “if Washington can set rules on ‘portability’ and pre-existing conditions, then logically it could someday go further by requiring lifetime benefit limits of at least $10 million, requiring equal treatment for mental health, or acting on pricing, benefit packages and guaranteed access to insurance.”

But, it is claimed, America has been facing a growing health-care crisis, in which, over the last two decades, costs have been rising and the demand for health-care services have been increasing at rates that threaten the stability and reasonable availability of all medical care.

How has this crisis come about? Imagine what would happen if tomorrow people were to be told that every time they eat out at a restaurant, they were to tell the waiter that all or a large part of the bill was to be sent to Washington, D.C., for payment — that Uncle Sam was now going to foot the bill. What would we expect in terms of most people’s response? Let me suggest that it would not be surprising if more people started eating out — and eating out more frequently — or that they would start ordering more items — and more expensive items — on the menu. Also, restaurant owners would begin increasing the prices on their menus, and they would raise them more frequently. Why? Well, to begin with, the increased demand would require higher prices to ration seats in their establishments; furthermore, restaurant owners would not feel as constrained by the prices they charged because, now, part of the cost of the meals would be paid for by someone other than the consumers themselves and what their own wallets could directly afford to pay.

Over time, we would begin to hear about the danger of expenditures on restaurant meals becoming an increasingly larger and larger percentage of the nation’s gross domestic product. Restaurant demand and prices would be claimed to be “out of control.” There would be growing pressure for the government to step in and control menu prices and to set up guidelines for and limits on the types and quantities of foods that could be ordered by restaurant patrons. And, finally, there would be a call for a “national restaurant policy” to make sure that everyone had reasonably priced equal access to eating out. After all, isn’t everyone “entitled” to a night out rather than having to cook? Surely it should not be a privilege enjoyed only by “the rich.”

To assure “fair” pricing and a “equitable” selection of offerings on restaurant menus around the entire country, the case would be made for requiring restaurants to join regional restaurant cartels supervised by a government-approved commission. The Republicans, fearful of nationalization of the restaurant industry by the Democrats, would present legislation calling for mandatory “portability” of restaurant access for all Americans, so that they wouldn’t be afraid of changing their jobs and not being able to get into a restaurant wherever they may have moved around the United States. Since most patrons at restaurants would still have to pay a “deductible” on the restaurant meals they eat, some Republicans would start advocating RSAs — Restaurant Savings Accounts — to act as incentives for people to have enough money set aside for their evenings out.

This is exactly what has happened under Medicare and Medicaid. The government has been increasingly picking up the costs for various types of medical care for an expanding number of people over the years. As a result, the demand for these medical services has gone up and, with them, the costs of providing these services. Government intervention in the health-care industry has been the primary cause of the health-care problem in America.

The solution is to get government out of the health-care business and to stop the government subsidies that have acted as the stimulus for a good portion of these rising costs. It is also necessary for government, at the national and state levels, to deregulate the insurance industry to permit more flexibility and competition so insurance companies in a free market can better cover the insurance needs of the general public. And it is necessary to work towards repeal of medical-licensing laws that act as monopolistic barriers to greater competition and increased supplies of doctors, nurses, and medical specialists in the health profession.

In other words, what America needs is radical privatization and free-market reform of the medical profession and the health-care industry. Government intervention needs to be eliminated, not merely reduced or reformed, in the health-care sectors of the economy if real and lasting improvements are to be made in the availability and cost of medical services in America.

Now, ladies and gentlemen of the press, I’ll be glad to take your questions.

The Washington Post: Mr. Candidate, every enlightened society in the world considers it an essential task of the government to provide social services of the type you have just criticized. Are we to do less for our own people than the other democratic nations, say, of Europe, do for their citizens?

The Candidate: The dead-end of the European welfare state is exactly what I fear when I look at America’s future as we move towards the 21st century. Throughout the European Union, job creation during the last several years has been almost zero; the financial burden of welfare programs has brought several of those European governments almost to financial collapse. People have become so dependent on the state for their material well-being that they cannot even conceive of a world in which they, as individuals, would take responsibility for their own affairs. Your own paper, The Washington Post , in an April 20, 1996, article about the crisis of the European welfare state, pointed out:

“Europeans are appalled by the disparity between rich and poor, lack of protection for the weak and vulnerable, and other forms of social Darwinism they see as prevalent in the United States. . . . Despite their enormous costs, [welfare state] entitlements are so popular with voters that any American-style cutbacks in Europe’s extensive social “safety net” would be considered political suicide.”

Let us stop and think for a moment about what kind of worldview is captured in this interpretation of the European conception of America, freedom, and the welfare state. The most fundamental assumption is that a free society is one of inequity, hardship, and inhumanity in which people get ahead by eliminating the weak. The second idea is that the mass of the population will revolt politically in the face of any attempt to deny them the redistributive handouts and financial guarantees with which they have been provided by the state until now. And the third presumption is that America is a free society in comparison to Europe.

Let’s look at these in reverse order. First, America, unfortunately, is not a free society. What separates us from the Europeans is that they have traveled down the welfare-statist road further than we have in most areas of social life. But as I stated in my opening statement in my last press conference, there is, in fact, not one corner of American life not already regulated, controlled, and interfered with by the government. We are already victims of an intrusive state that refuses to leave us alone.

Second, having traveled in Europe, I can confirm, unfortunately, that for the vast majority of Europeans, the welfare state has become an addictive drug without which many cannot imagine life. After having become intergenerationally “hooked” on the welfare narcotic, many Europeans are ready to resort to social warfare rather than be denied their “fix.” After the French government announced extremely modest cuts in government spending in December 1995, France was rocked with strikes, violent demonstrations, and threats of further civil strife for almost six weeks. The French government backed down on practically all of its spending proposals. This spring the German government also proposed cuts in welfare programs, including national health insurance, and the German trade unions warned of warfare in the streets.

Third, in Europe, the conception of a free society has been lost for almost all practical purposes. The idea that individuals can manage their own lives — that the free market is in fact a social arrangement in which men can and do live in peaceful competition for mutual benefit — and that prosperity that freedom brings improves the opportunities and conditions of the poor and those less fortunate — have been erased from the European collective memory.

Rather than a model for America, I consider contemporary Europe to be an example as to what we Americans should do our utmost to avoid before we too reach the point at which freedom becomes something to be completely feared and dreaded; before we reach a point at which Americans become such dependent welfare wards of the state that they also threaten to revolt against any political step that would bestow on them any greater freedom and responsibility for their own lives.

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    Richard M. Ebeling is a professor of economics at Northwood University. He was formerly president of The Foundation for Economic Education (2003–2008), was the Ludwig von Mises Professor of Economics at Hillsdale College (1988–2003) in Hillsdale, Michigan, and served as vice president of academic affairs for The Future of Freedom Foundation (1989–2003).