PeteHappens

Favorite quote: “If conservatives get to call universal health care ‘socialized medicine,’ I get to call private health care ‘soulless vampires making money off human pain.’ The problem with President Obama’s health care plan isn’t socialism, it’s capitalism.”

Made me think:

An argument against non-market solutions to problems is that the lack of competition will lead to a lack of incentives to be better and more efficent.  This argument presumes that we take certain actions based on our incentives to act said ways (one of the central tenets of economics…a presumption quite sound).

So, if people are going to act on incentives, shouldn’t we have a problem with private industries who succeed based on: people being late on their payments (credit card companies); people getting sick and coming back (hospitals); continuous war (defense contractors)?

So, if you are going to act based on their profit-based incentives, we should expect that the credit card companies want people to be late on their payments, corporate hospitals want people to get sick and come back; and defense contractors to want continuous war.

“Presposterous!” shouts the corporations.  Well, its the same argument they use against government programs: “You don’t have the incentives to be efficient, so you won’t be.”  Based on their presumptions, the converse must be true: “Certain corporations do have the incentive to work against the public interest, so you will.”

Take-away point: People might act based on their incentives, but many times, those incentives are neither monetary nor selfish.  And I believe that there are great people and organizations out there with other incentives (“being known for working public interest”, “general caring,” etc.) that can be as efficient as their self-interested counterparts.

Take-away snark:  Wouldn’t it be great if we had organizations that are designed to (at their best) work in the public interest to serve needs that can’t be served by privately-interested players?  Oh, wait…they’re called non-profits (and I guess corporations with good ethics codes [Google “Google” if you’re interested in one example]).  Wouldn’t it be even better if we had an organization like that that had everyone involved, that everyone could participate in, with an equal stake in it?  Oh wait, it’s called the government.