Suppose you wanted to be a pharmacist when you grew up and you had the misfortune to grow up in Europe somewhere, let's say Italy. You'd go through school paid for by the government on a promise that you'd get a pension and no charge for the schooling if you worked until you were 66 (men) 62 (women) though as budgets shrink those numbers are subject to change. You have your degree and you complete an apprenticeship period in a pharmacy and you get the position because your father knows the pharmacist that owns the shop. Suppose you then want to open your own pharmacy, like all good ambitious young people are wont to do. The thing is the government won't give you a license because all the pharmacy licenses planned for your community are full. It doesn't matter if you see an opening or believe you can undercut an inefficient operation already on the ground. The government has planned X number of pharmacies for your area and they are taken. That's that.
.To an American that sounds crazy, but welcome to the world of social democracy Western Europe style. I kid you not, the land where central planning rules. It used to be a bit looser but even when the seminal French Revolution hit the streets central planning was the objective. The French Republic has always been about the state, with the people, in liberty, fraternity and equality, working together to benefit the central government which then takes care that no one falls off the apple cart. The American Revolution was also about liberty etc... bit it posited a system of free will and minimal central government to allow individuals to grow as they saw fit. The American system took a hit with the Great Depression when actual live suffering swept the land and regulations were laid down to prevent such catastrophes re-occurring. The French system got a nice reinforcement when World War Two brought catastrophe to France thanks to the weakness of government and the central planning and firm direction of France's perennial enemy Germany.
.
After World war Two Western Europe, a smoking ruin was rebuilt thanks to central planning and introduced cradle-to-grave welfare to prevent a repetition of such horrible suffering in any one's lifetime. In the US cheap abundant oil and a n industrial base untouched by war time bombing created wealth aplenty for everyone carefully regulated by the New Deal still in force.
.
The youth revolutions of 1968 created a demand for freedom in Europe that went largely unanswered so the War leaders were slowly discarded while in the US the civil rights riots slowly forced an unwilling and wealthy white population to yield. But the Depression was a long way behind us and people had forgotten starvation and catastrophe and the Reagan/Thatcher combo came to power and respectively dismantled the New Deal and the Inheritance structure of their countries. And so the house of cards grew in an atmosphere of fake wealth and the Ponzi scheme of useless regulation and no oversight. And now, here we are.
.
I have long held the opinion that short historical memories are what caused Americans to embrace Reaganism, a theory of economic freedom that would only work in limited fashion if overseen by tight government oversight. Instead the mantra that "government is bad and big government is worse" has brought about a catastrophe that is going to equal that of the Great Depression. On top of the conomic failures we have climate change still underway and the low cost of oil is likely to shrivel up the search for alternatives. If petroleum is being sold at $45 a barrel how can solar wind and geothermal compete? Will they need to? Will total economic collapse postpone climate change? I hope not because I don't want to suffer that much, thanks.
.
You know we have reached the end of the economic rope when the health insurance companies in the US are proposing their own national insurance scheme incorporating all those features that we have demanded for so long and have been stymied by them. My wife had wrist surgery last year brought about by the deterioration her rheumatoid arthritis. She has excellent health insurance through the school district yet our share of her bill was almost $7,000. And we still get paperwork and bills and and questionnaires a year later. My step mother died in England a decade ago of throat cancer after a lifetime smoking. She had her jaw surgically removed and when that failed she had round-the-clock home nursing and home visits by her doctor to administer pain medication until she died. Not only was there no cost, there was NO paperwork. So, as you stare into the abyss of economic destruction, which way do you want to go? Central planning or free market economics? Low taxes or VAT?
7 comments:
Interesting Quandary. The swedes are taken care of from cradle to grave, and they are reported to be the happiest people on earth. I think the mindset of Americans will be very hard to change. I think when push comes to shove, they will rally and change. However, I am unsure how bad it has to get before they do so, especially one that seemingly snuck up on most of them (not really, all the warning signs are there, but until they see shrinkage in their pay or 401Ks, people are not going to do anything... 90% of people are reactive).
VAT will go over like a fart in church, but unless people are willing to let go of a lifestyle, it probably has to happen.
As for the medical bills, I can empathize completely. I work for a large international company and have great insurance. In 2004 we had $69 worth of medical bills and had to pay $10K of them. That was not easy to swallow, but we had a "rainy day fund". I am still in the process of building that back. If there was a VAT, I guess I would not have had too. Bottom line is this, the money will either come from the front end or the back end.
Ermmm... a few points.
The smoking ruin in Western Europe at the end of WW2 was rebuilt thanks to the Marshall Plan, which was an American initiative (which Germany and France e.g. would do well to remember), and which asked beneficiary countries to produce a reconstruction plan. So central planning, a Soviet concept, was in effect required by the US.
The War leaders weren't discarded after 1968. They died. Churchill was already dead and de Gaulle died soon after.
Thatcher/Reagan faced down the Soviet Union. 'Upper Volta with Rockets' as it was described at the time. We need a new Thatcher in the UK now to take a grip on our crumbling economy.
We don't just pay VAT. We also pay National Insurance Contributions on top of income tax ostensibly to pay specifically for pensions and health but long since subsumed into the government's spending pot and variable according to the government's income needs.
But I would take our no paper-work medical system over yours anyday.
Great post! I know it's too complicated for simple answers. All I know is that my gut tells me I'd rather be growing out in the open than in a greenhouse.
We already have the VAT, and the National Health Plan, and we are taxed to death. We have Government operated car/motorcycle insurance and they can raise rates whenever they wish (think Monopoly). Taxes everywhere. Gas is still over Cdn$3.00/US gal even though the price of oil is falling everywhere else in the world. but alas, ours is a simple life, when the pressures of life get to the bubbling point, we can just hop on our bike and go for a ride
I have a hard enough time getting my seven year old to eat his peas. I don't worry about the state of the world.
Suspect no matter where you dwell, the government will be there, on your doorstep in one form or another. I as a resident in Ontario Canada am grateful for the Ontario Health Insurance Plan, as no doubt bobskoot is for his BC health Insurance.
With Lupus and Non-Hodgkins Lymphona and major treatments for both, very little if any paperwork, and very little direct from the pocket cost.
Yes, Canada has a form of cradle
to grave coverage, and am thankful to be here and not in the USA
where everything seems to be tied to a profit margin or a make money any way possible scheme.
I do however keep thinking back to
the post about young Mike committing suicide, and nobody seemed to react the signs he was having problems. No doubt the
canine to which he was part has reacted poorly. And of course I'd suspect that as Key West is a
relatively small police service
his suicide hit everybody quite hard. Having been there with others
can well understand the feelings;
none of us get over the shock, easily.
The thing is there ar eno easy answers, and I made a statement by prefering tolive in the US than Europe, though I've always had health insurance and have always been grateful for my free health care.
John-sorry if my precis of 150 years of history in three paragraphs was a bit skew-whiff but... I can only say I did my best! I firmly beleive that whatever happens now is rooted in the past and one of the big shortcomings in our modern world is too much peeking up celebrity skirts and not enough connecting the dots from the past to the present.
I write these economic thoughts partly to help clear my head, partly to leave myself a record of what i was thinking at the time and partly to see what others think. I purposely make them look different from the Keys photo essays so they should be easy to skip...
Post a Comment