Koch thinktank inadvertently proves that America would save trillions by switching to socialized medicine

Originally published at: https://boingboing.net/2018/07/31/koch-addicts.html


Mercatus (previously) is part of the Koch Brothers’ network of thinktanks that allow the billionaires and their cadre of oligarchs to make it appear that their ideas are mainstream by all singing the praises of the wealthy in chorus.

More importantly, they give people parrotting the same old tired Libertarian talking points the ability to make fallacious appeals to academic authority (or at least attempt to: for serious and educated people the citation of a Mercatus study carries the same academic weight as the journalistic weight of a Breitbart article).

Corruption is when a bad system produces privatized, concentrated gains for a small number of people, and broad, socialized losses to a large number of people

That’s before you get to the bad outcomes caused by built-in inefficiencies and the additional costs incurred to the economy by the parasites and middlemen who exploit those inefficiencies for their own gain.

In any case, I’d like to think the MSM headlines on this report would be similar to yours (e.g. “Mercatus Institute Study Proves Medicare for All Proposal Most Cost-Effective”) but I doubt it. Besides, right now the bigger story about the Kochs is how they and Il Douche are feuding over the future of late-stage capitalism in America: will it be exploitation of cheap labour and transnational corporations over-riding national sovereignty or will it be xenophobia and brain-dead protectionism? Stay tuned!


A couple things here - we can assume that the $2 trillion is the absolute floor of potential savings, because of course the Koch-funded think-tank-wanks did their absolute best to inflate the cost-of-Medicare-for-All number as high as they could, using the highest-range estimates they could. So we should probably be saying “at least $2 trillion…”

Second thing: we can’t have healthcare reform without UBI in this country. Those absolutely have to go together. Why? Because the insane, balls-out crazy of our healthcare system in America is, by design or by accident, basically a make-work jobs program funded by middle-class payroll contributions (aka health insurance premiums). The second you remove all the horseshit administrative jobs (and we should!) created by all of our inefficiencies, we’re going to be dumping tons of Americans onto the unemployment rolls with no sector capable of absorbing them.

As of right now, healthcare has been sucking up a huge portion of the jobs that have been lost from other sectors. It was getting unsustainable until Obamacare/the ACA dumped a bunch more money into the system via mandatory insurance (although it was more than a little shitty to fund it through lower-income earners), but it was only a band-aid. We’re also on the cusp of the transport industry shedding an apocalyptic number of jobs when self-driving vehicles hit the road en masse in just a few short years; having both socialized medicine and a job-pocalypse in transport at the same time? Ooooh boy. It’s gonna be the Great Depression all over again unless we find a way to keep everyone participating in the economy.

Even for those few people on BB that say shit like “you can’t pay people to not work!!!1!” because they don’t understand economics, you need people to buy shit or the economy collapses, because then other industries take a massive hit, and they lose jobs, and then those people are unemployed, and then they can’t buy shit… And pretty soon the previously-wealthy realize that you can’t eat money, and a whole hell of a lot of people need to have incomes of some kind in order to sustain the whole infrastructure that keeps them at the top.


I’m surprised the report doesn’t seem to mention job losses from the consolidation of the insurance companies once they vacate healthcare insurance and payment processing. I’m not saying such a loss of jobs wouldn’t be significant but I think this means it’s not significant enough to be even noted in the GDP as by such consolidation of healthcare payments through the government would equalize the burden across all groups. At my current employer, the owners have berated us for making healthcare so expensive (well we had two folks with cancer and one didn’t make it and the rest of us are over 35 so yeah we use our health insurance…) but even they would probably be happier with marginally higher taxes over direct out of pocket purchases of group plans themselves. In my opinion, such a consolidation should lead to less costs for businesses on average rather than their fantastical complaints about taxes which if you really look at it would just be a fixed cost of doing business no different than paying for the damn sewage/drainage fees on your water bill. So I can’t imagine how the Mercatus Institute could think they would be able to outdo the purchasing power of a single payer system. It’s a monopsony so this follows as an obvious conclusion. They’re just sad that economics doesn’t swing their way yet again, I guess.


You’re right. Projected costs, if you apply the current growth rate, are $49 trillion over the coming decade. Mercatus is saying $32 trillion over the next decade if we move to M4A. That’s $17 trillion in savings. That’s the bulk of the current national debt right there.

Now, what we are really going to hear is M4A adds $32 trillion in evil government spending. We need to be very vocal about the fact that Medicare-for-All would save the NATION $17 trillion dollars.


stolen from reddit:

I think they intentionally do this. We hear the Republicans are in disarray narrative every election. Poll numbers will dip. But they then get to control what people criticize them about.

They focus the medias attention on the civil war over tariffs. Distracting from the GOPs shameless corruption and betrayal. Then as the election nears, Trump will makes concessions on tariffs, and the base will unite and happily all go vote R.

Not falling for it.


That was exactly the question I had when I first saw the BIG number. Nice to know my gut was right.


I’m not so sure those paper pushers would be out of jobs. Healthcare does take a lot of paperwork, regardless of whether it is private or public. Diagnosis and treatment generate a lot of data per patient, and under a universal system, there would be 310M+ patients. The one area for optimization of our system over other socialized systems is reduction of paperwork by practicing physicians and nurses. It will be fundamentally necessary from a workload standpoint, anyway, to keep the undersupply of clinicians entirely focused on the clinical, rather than the administrative; at least until we train 2-3 x the current number of care givers.


$2 trillion out of $34 trillion over ten years is nothing. I suspect that Mercator greatly exaggerated the cost of Medicare for all. Americans spend almost twice, per capita, than Canada and Europeans do, for equivalent care. If our current, for profit system projects to $34 trillion over ten years, and we can achieve something close to the savings of Europe and Canada by the end of that ten years, we should see $10 trillion or more in savings.


The Kock Bro’s? There’re still alive?

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But very old. I wonder if they have organ donors contracted to keep going into the late 21st century?


I wonder how many human lamp shades they have?


…Made with the finest, smoothest skin! After all they did sign agreements…


They could have saved a lot of think-tank money by asking somebody from another developed country - ANY other developed country. Or checked the Wikipedia. My own Canada spends just under $5K US per person per year on all healthcare costs (public+private). UK, France, Switzerland, etc, all come in between $5K and $6K though their systems are quite different (UK goverment-provided, France provides public insurance but you can have your own, Switzerland is all-private but required insurance, Obamacare on steroids…).

The US is between $10K and $11K. Not even close. Over the long run, as the old system is taken down and consolidated, you really should save nearly HALF your healthcare costs.

Honestly, guys, from the outside, it’s like you’re using a steam-engine car while the rest of the world has been driving internal-combustion engines for two generations. Periodically, you have a huge argument about tuning the steam engine and what type of steam engine is the best steam engine.


Sounds to me like we will have at least 2 trillion per year to spend on re-education and job training for those people. No UBI needed. That said, I’m a proponent of UBI.

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I’m guessing half is optimistic. We have a bunch of built in health issues that go to other policies than our health financing system. Land use patterns that discourage walking and subsidies for wildly unhealthy foods come to mind.

The biggest line item for cost savings (taken directly from Sanders’ published Medicare For All plan) is reimbursing medical providers at a rate 40% lower than what they get now.

Whether the providers are willing to accept 40% less is a question that seems pretty important to how much savings there are to be had.

It wouldn’t unemploy all of them, but it would sure as hell take a massive bite out of: a chunk of hospital billing (a lot of jobs exist purely because of what a pain in the ass it is to deal with private insurance), a toooon of insurance jobs across the whole spectrum, because now there’s not so many people pushing plans, a bazillion jobs having to do with managing/contracting insurance plans at your workplace, a ton more having to do with the compliance end of working with insurance companies, and even more in secondary and tertiary markets (e.g. billing software companies).

But there’s also secondary hits - if there’s 10 people competing for 5 jobs, the 5 that get the jobs will have to take a pay cut. So yet again money is getting sucked out of the middle and lower class jobs.

There will be some need for this stuff still, but it’s gonna be only a fraction of what exists now in our over-complex system. Oh, and then around the early-to-mid 2030s a bunch of direct healthcare jobs will start disappearing, because that’s (approximately) when the Baby Boomer healthcare wave will crest, dumping even more people out of the economy, and that’s really close in terms of “this is gonna be an incredible and unprecedented shift in our economy, and we need to start preparing right-fucking-now”.

Like, we’re currently closer to that shift point (12-15 years) than we are to the original theatrical release of Jurassic Park III (17 years ago). That’s gonna happen when almost everyone on these boards is a looooong way from retirement, and that’s gonna be one of the last massive shakeups on the horizon, with a lot more coming before, and a lot more to follow we don’t even know about yet.


Re-training for what? The only two sectors adding jobs are healthcare and “the service industry” (AKA Lyft drivers and other gig economy low-paying stuff). Transport is teetering on the edge because of self-driving vehicles. Modern “tech” companies only require a small number of employees because of the nature of the business, and very few people can be very good programmers or engineers, especially coming to it later in life.

If healthcare shrinks too, what industry is going to absorb them? And don’t say they can all become mechanics and plumbers, those wages will crater if we add only a tiny fraction of the displaced workers to any of these “pays well because few people do it, not because it’s exceptionally hard to do” sectors.

There’s a lot to tease out there. The big advantage to providers with M4A is that they don’t have to navigate hundreds of insurers to determine billing, see what’s covered for patients, get reimbursement, etc… Currently it’s damn near impossible anymore to operate a small practice because you need an entire billing department to figure all of that out. Having one insurer to deal with would streamline billing a ton and the lower reimbursement would coincide with providers not having to employee all these middlemen.

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