Friday, October 16, 2009

Government Regulation + Industry = Cartel

Government Regulation + Industry = Cartel

Cartel = Corporatism

Corporatism = Economic Fascism

This is the reality of how the US economy exists today. Some economists call it a "mixed" economy. A little bit of socialism here, a little bit of capitalism there...

...but let's still call it a "free market," than blame the absence of "regulation" or "de-regulation" as the culprit of the problems so as to encourage more Government regulation, changing the "mix ratio" giving us more socialism and less capitalism.

The latest example is the leftist's useful-idiot-Goebbels-wanna-be, Michael Moore, making a propagandumentary that highlights all of the problems and injustices caused by the Corporatist/Fascist system and blaming it all on "Capitalism." The worst part is that Moore's film was financed by the very same Banksters he supposedly exposes and criticizes in the film!

To people that still don't understand that we in fact do not live in a free market, capitalist system, here's the breakdown as simple as it can get:

"BIG" Business lobbies politicians in the Government.

The Government than passes legislation that "regulates" the industry of that BIG Business entity.

Typically, the regulation results in exorbitant costs for any business in the industry to comply with those regulations.

Thus, the "BIG" Business entity that already has a huge revenue stream or financial backing happily pays all of those costs associated with complying...while smaller companies who can't afford it go out of businesses, and entrepreneurs that want to enter the market of that industry are effectively barred from competing because they cannot both pay start up costs to enter the market AND all of the costs associated with "regulation."

In this way, the BIG Business entity is able to buy the Government's cooperation in creating a Cartel.

This is the essence of Economic Fascism. The Government/Industrial Complex, writ large, across many industries.

Anytime you here the phrase "BIG BUSINESS" you need to understand that the media and the leftists use of it to imply greedy, unscrupulous capitalist pigs - but the reality is NONE OF THOSE "BIG BUSINESS" entities they are excoriating or lamenting could have gotten that big without some form of Government action that gives them Cartel monopoly powers!

While Government Cartels have indeed become a huge portion of the overall economy, there is still thousands of small businesses that do manage to exist, and even profit in the sectors of the economy are still free from "regulation."

Yet everyday, the Government is actively working in cahoots with the Big Businesses that continue to ply them with campaign contributions and party donations to continue to expand the sphere of Big Government/Big Business monopoly.

This is the very essence of Obama's Health Care "REFORM." It's the blatant attempt by BIG Pharma and BIG Insurance to create a new and improved Cartel.

Sheldon Richman writes in his article Obama's Health-Insurance Cartel
exactly how Obama is using the exact same approach as Michael Moore, in claiming his reform will garner the benefits oft "competition" and "choice" when in fact his proposals are going to result with the exact opposite results:

President Obama and other advocates of nationalized health insurance have tried a variety of sales pitches, which indicates their difficulty in getting traction with the public. The latest is “competition and choice.”

Who could be against those things?

Well, Obama for one, followed by House Speaker Nancy Pelosi, House member Barney Frank, and everyone else who favors what is question-beggingly called reform. The word reform suggests not just change but improvement. Therefore, to call the proposals to nationalize the medical-insurance industry reform is to assume precisely what is in dispute and must be proved. The argument is — or should be — over whether the proposed changes indeed are reform. To call them reform before the debate has even begun is to rig the discussion. It’s an old — and sadly effective — bit of sophistry.

But let’s get back to competition and choice. I contend that what Obama favors would produce the opposite of competition and choice: cartel and restriction. This is so clear that it’s hard to believe an intelligent person surrounded by economic advisers wouldn’t know this.

Just like Michael Moore blames the problems of Bankers like Goldman/Sachs and their collusion with the Government to fleece the tax payers with a bailout on "FREE MARKET CAPITALISM, so to does Obama use the same tactics in pointing to the problems that were created by Government's involvement in the health care market, attributes it to the 'Free Market' and offers MORE Government in the market as the solution!

Apparently members of Congress and the administration don’t know about the Internet, which performs the same function for every other good and service. If there’s no health-insurance market on the Internet, it may be because government forbids interstate competition, in order to protect the states’ ability to burden their residents with coverage mandates for hair transplants, in vitro fertilization, and other things offered by privileged businesses.

Competition by many businesses results in a 'race' by businesses to get the most customers from their competition by continually working to offer the best service or product at a price that makes them more attractive to customers than all of the other competitors in the market.

But if Government intervention via "REGULATION" reduces competition, you lose the incentives of free market competition to promote competing businesses to innovate and improve their product or services...afterall, the Government's regulations have made sure they won't HAVE to because there is no competition to take away the customers by offering a better product or service than they are.

For all his talk about choice and competition, what Obama proposes is more of what we already labor under: corporate-state bureaucratic decision-making. The status quo is not the free market. It is a system of government-business collusion that, among other things, welds workers to their employers. Obama’s scheme would simply be more of the same. The reason Big Pharma and Big Insurance favor the scheme is that everyone would be forced to buy their products or coverage for their products, with the taxpayers picking up most of the tab.

Obama offers no radical break with the present but only a further application of the statism that brought us the current morass.

Unlike many right wing conservative Republicans who claim that Obama is a socialist, I don't believe he's a socialist per se.

He's a Fascist, the kind that supports socialist ideas to sell the masses on the benefits of implementing his fascist (corporatist) agenda.


Russ DoGG said...

Health insurance for profit, without extensive regulation, just doesn't work.

I had surgery to fix a herniated spinal disc. MY insurance company AETNA told me that the $1000 per year chiropractic limitation would apply- I got billed for hte rest. This bull-sh*t would have gone to court if it were not my employer's HR dept manager calling and issuing a verbal smackdown.

This is not the model of an efficient system. Insurers make it inefficient. Every other developed country gets better results for less money than US does.

Health Insurance companies try to cheat their customers. For profit. Its that simple. another way to cheat is called rescission in the individual marketplace. ITs called "rescission":

"Blue Cross of California encouraged employees through performance evaluations to cancel the health insurance policies of individuals with expensive illnesses, Rep. Bart Stupak (D-Mich.) charged at the start of a congressional hearing today on the controversial practice known as rescission."

I’d add that rescissions must be concentrated in the individual insurance market, since group coverage is, by law, not contingent on medical history.

It should be fairly clear that the people who do not file insurance claims do not face rescission. The insurance companies will happily deposit their checks.But that top one percent, the folks responsible for more than $35,000 of costs – sometimes far, far more – well there, ladies and gentlemen, is where the money comes in. Once an insurance company knows that Sally has breast cancer, it has already seen the goat; it knows it wants nothing to do with Sally.
then the probability of having your policy torn up given a massively expensive condition is pushing 50%. One in two. You have three times better odds playing Russian Roulette.

taiwan, France, UK, Germany, Japan, ITaly, Norway, Sweden, Switzerland, Canada, Spain, australia, Denmark, etc. all ahve better results with regulated systems.

Russ DoGG said...

When repubs say that the public insurance option will destroy the private insurance companies, what they don't realize is how much many people want that to happen.

I desperately want to see those lying scumbags from AETNA out of work, or starting new careers where they say "do you want fries with that?"
Why You Can't Trust Your Health Insurer:
Private insurance companies dump very sick claimants based on stupid technicalities. That's reason enough to support health reform. This is from congressional testimony, not obscure internet stories:

The health crisis doesn't get more gothic than this.
Robin Beaton, a retired nurse in Texas, was rescinded last year by Blue Cross and Blue Shield after she was diagnosed with an aggressive form of breast cancer. Blue Cross said this was because she had neglected to state on her forms that she had been treated previously … for acne.

My point is not merely that it is necessary to pass health care reform to outlaw this horrifying bait and switch.
The true remedy lies in the bill's public option, which would create a government insurance program to compete with and (at least to some extent) displace private insurance. Only a public option can ""keep private insurers honest,""

Talleyrand said...

At what point does the effective tax rate destroy the system?

You are exactly right HL that the goal of the healthcare overhaul isn't a better system, but better control and a death of small businesses.

Self employed individuals pay around 60% in taxes when you start adding up all the ways the government hides it by calling it something else.

Grim said...

Russ DoGG, just wondering, how much do they pay to spread those talking points? Is it a good paying job? I could use some part time work.

Grim said...

Great post HL. By the standard you list the GOP is almost as fascist as the dems are. Both parties are scum.

Anonymous said...

Great post.

Nothing explains this better than the tobacco industry. Its amazing that something so simple is cornered globally by about 4 companies.

The government mandated introduction of 'fire safe cigarettes' will see massive corporations owning patents on papers and states will legislate special licensing fees to kill smaller players and market entrants.

The funny thing is anyone who's smoked a natural tobacco or cigar knows tobacco extinguishes quickly when left alone.

Russ DoGG said...

NO Im not a schill. Im disgusted with this health insurance company bc the only time I needed the policy I had been paying for and ... they try to rip me off.

The other stuff isn't talking points. Its congressional testimony that was summarized / commented on by many (LA times / NY Times both). REal people described their experience in front of Congress. They were financially ruined bc of health insurance industry tricks- they weren't getting the coverage they paid for.

These companies aren't operating honestly, and they nearly killed some of the people they were petulantly denying care to... CAre that they had paid for and had a contract to receive. Its bad business to rip off your customer, but this business (health insurance) encourages cheating on the part of companies as the profit motive.

Socialized insurance (not the whole medical industry, just th insurance portion) is the only sensible approach to avoid combining profit motive & the incentive to withhold medical care to a human being. All the developed countries mentioned have come to this conclusion. They can't all be stupid!

So many countries get better results than we do. Only the most arrogant americans could think that the whole rest of hte world are ALL WRONG.

Remember- a 50% probability of rescission if you have a big medical problem. You want to stake your family's financial future on that?? You paid for insurance but don't really have any in the individual market.

Medicare runs in a non-politicized fashion and I htink the public option could do so as well.

Several HL posts decry the feminist tactic of ad-hominem attacks. GRIm you must be a feminist.

Anonymous said...

I just want to say I despise that fatass socialist piece of shit Michael Moore.

The Obots actually do pay shills to post their talking points on the net. Never seen it happen before, but there's a first time for everything.

Elusive Wapiti said...

"The worst part is that Moore's film was financed by the very same Banksters "

That doesn't shock me. Big Business often does things that superficially seem antithetical to its interests. Like participiating in the "Tobacco Settlement", or pursuing min-wage laws. But business depends on both.

Adam Smith called out merchants in The Wealth of Nations, making it clear that these guys will co-opt the government against the consumer while it can.

Good post.

Keoni Galt said...

Russ, you missed the entire point of my post...but rather thought your personal anecdote is somehow proof of the need for "reform".

You fail to realize that the very reason our system is screwed up in the first place is precisely because the Government regulation screwed up all of the benefits that come from true, free market capitalism.

"Health insurance for profit, without extensive regulation, just doesn't work."

You got it all wrong. Extensive regulation is precisely why it's not working right now.

Russ DoGG said...

Maybe you didn't read this.

The health insurance companies are cheatign their customers. ITs not just me.. 1/2% of policies rescissions (1/2 of the people who incur big medical bills getting coverage yanked or treatment denied) nationally have their coverage pulled. that's not personal anecdote. Those are the national level stats.

""Extensive regulation is precisely why it's not working right now.""
Bull. Every other country I mentioned saw the need for regulation, or the unworkability of unfetterred capitalism in health insurance. In that business, The incentives to cheat your customers are too great and the market isi too adversely selecting. every other industrialized country realized this and so the leadership rejected the idea of for-profit health insurance.

All those countries chose to do nationalized health insurance. It was hte most efficient,best outcome for everyone.

Could every last one be wrong?

Russ DoGG said...

Alright this should convinvce you

The health insurance company were comprised of fat hairy-legged misandric lesbians (miniorities of course) who refused to pay on the basis of my maleness and skin color. When I complained, I learned that they molested puppies for amusement at their office.

They should be out of business.

Keoni Galt said...

LOL - no Russ. You are not getting the gist of my argument.

But than you are shilling for nothing more than socialism, and I am an anti-government, pro-free market, unconstrained capitalism libertarian.

You say the problem is insurance company greed. I say the problem is government interference in the free market gives the big insurance companies cartel monopolies, which fails to put competitive pressure on them to treat people like you better.

If you were allowed to buy health insurance across state lines for much cheaper because all insurance companies were unregulated, you would have found a much different experience than what you went through in dealing with an insurance company that doesn't face such pressure.