Wednesday, October 24, 2007


We had a chemistry professor over from a Canadian university for a talk. During lunch with him, the talk inevitably turned to healthcare in Canada. The professor ascertained that healthcare in Canada is free. Where does the money come from? From taxes of course. The interesting thing is that the Canadians are taxed heavily (around 50%) yet nobody seems to complain. As much as libertarians complain about taxes, I think the reality is that most of us won't mind being taxed as long as the taxes are used for a good purpose, even for the purpose of helping other people. Very few people in Canada complain about the fact that their taxes are being used to help other people. Why is that? The reason seems clear; in the same process, the same help comes back to them when they need it. I cannot but help see this as a sort of inverse operation of the invisible hand; people contributing to the good of others when they are ultimately contributing to their own good. Of course Canada has problems of its own, but healthcare there really seems to be a well-structured and largely excellent system, and it's better than the US where taxes go into fighting the failed war in Iraq.

In the end, the professor could only shake his head and say, "The richest country in the world, and they cannot provide healthcare for 40 million of their citizens. It just doesn't make any damn sense". Whichever way you analyse it, in the end, it indeed does not.

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Blogger Patrix said...

That baffles me too. Incidentally, they do have enough to help set up infrastructure and instill democracy in other countries under the guise of national security. Priorities, I tell ya!

1:42 PM  
Blogger Ashutosh said...

Of course! There's nothing more important than asserting moral righteousness...

4:02 PM  
Anonymous Chetan said...

I can give you the other side of this argument. A libertarian or a conservative will defend it thus:

About Ashutosh's point: You are overlooking the opportunity costs. Read about the broken window fallacy. Had the taxes in Canada been around 30% instead of 50%, the savings accrued to the taxpayer would have offset the cost of government health insurance. This is because had they been paying a high deductible for expensive private health insurance or willing to pay directly for the health costs themselves, then they would have been more careful about their health. They would probably spend part of the 20% savings wisely in eating healthy food, paying for a good gym, regularly checking their cholesterol count, taking regular medical exams to detect cancer earlier.... in general they would be more responsible for their health.

The 20% less that they earn may force prevent them from buying a house in a good locality, would prevent them from buying a car that would give more mileage or purchasing a hybrid leading to increased pollution further adding to lung diseases overall. The standard Economist magazine argument says that the prosperous the community the more they are concerned with health and environment issues and hence we should focus on making the people wealthy so that they care more about their health and environment and less about how to buy the much needed car or about migrating from a crime ridden locality. This can be proven by observation. Environmental and health consciousness is more in developed countries rather than under developed ones. Therefore, the surplus money (20%) which the Canadian government earns and is spent inefficiently anyways (due to bureaucracy, wrong aligning of incentives etc.) is better employed in the hands of the citizens themselves who care about their own money more than a third party (read govt. ever will).

About Patrix's point: National security is a precondition for economic growth. The modern system of governance has evolved from times when agriculture made division of labour possible and security became a necessity in defending the land for steady agricultural production to sustain a complex society depending on division of labour. Even your lefty authors like Jared Diamond would corroborate that. Lack of security leads to stall in economic growth. Look at Kashmir. Why would anyone invest his/her money there? Look at what happened in USA after 9/11. The Economy went down drastically because the risk of not getting enough returns increased. So you see, you need the expenditure on war to maintain a healthy economy. Of course the anti-Iraq-war pussies amongst you might argue that Iraq was not necessary for the security of this country. But security is a feeling. By its definition it is abstract and not a rational state of mind. Look at the polls before the launch of the Iraq war. Apart from Susan Sarandon and a few 100 in California who are simple minded peaceniks, no one in the USA was opposed to the war. They were willing to commit the resources to 'feel' safer. We conservatives believe that government's responsibility lies only in protecting private property, maintaining law and order and managing the international affairs of the country. In so far as that George Bush has not betrayed us.

As such we believe that spending billions of our taxpayer dollars in Iraq is justified, so long as we feel secure. And in case you have a problem with 'feeling' secure, let me remind you that it is the necessary evil of democratic system with universal adult franchise.

Ok. I know I have exaggerated a bit and probably conservatives and libertarians may have much less virulent objections and supporting arguments than the ones I have attributed to them. However, there is a strain of truth hidden somewhere within them. If you were to borrow their lenses for a while and then look at the world through axioms such as preservation of property rights, individual freedom and responsibility and economic analysis such as opportunity costs etc. then it is not hard to empathise with their enthusiasm for their ideology. Consistency in arguments based on the following their axioms is what will always give them an upper hand over left-liberals.

Left-liberals generally think of solving the matter at hand and using the resources at hand, which are easily available in a prosperous society. But the problem is using a past precedent to solve a problem is that some other group tries to win privileges and funds for things 'they' consider to be important. For instance, (returning to your argument with Amit Varma) Unani or Ayurved funding may seem worthy goals. But using the same logic if some group asks for funds for researching Reiki or faith healing or transcendental meditation promising a potential benefit to the society then on what ground will you deny them those funds. As people coming from a science background we might be able to discern a difference between Ayurved/Unani/Homeopathy and Reiki/transcendental meditation. But do you think everyone who votes would? And if there is a current fashion where Reiki suddenly become popular in society just as Feng Shui once became, would politicians be able to resist the temptation to pander to the electorate. In that case would you not be infuriated if your taxes were funding Feng Shui or transcendental meditation.

What I have done here is merely put myself in a libertarian's shoe and argued against what you and Patrix have written. I myself am inclined to support your arguments but am not able to come up with a framework that will allow our ideals to be achieved without diluting them. I am still very much searching for the answers and the libertarians have not been able to convince me enough to go wholeheartedly in their camp.

Why? Here's one of the many reasons.

For those of you who are wondering about how a post on health care turned into libertarian/conservative Vs Left liberal argument: it is a continuation of Ashutosh and my discussion about libertarianism in an offline world.

6:49 PM  
Blogger Ashutosh said...

Chetan, great analysis! And I can see the same shades of argument in this analysis that we were ascribing to libertarians in our phone talk. I wonder if I should really pen some kind of an answer to your points here, or if we should discuss this offline.
For now, I just want to say that I am sure you realise the fallacy of equating consistency in arguments with their feasibility, a point which you would no doubt remember from our discussion. Like we said, the fact that property rights can be consistently invoked for solving most (if not all) of the problems in the world does not automatically make it feasible to do so.
I just want to make one more general point. In my opinion, there has to be a middle ground between private and goevrnment provision of healthcare for different people in different scenarios. I might actually think that injecting a mild dose of privatisation in Canada's healthcare system might do them good.
Let me know if you would like to discuss this online sometime.

1:40 PM  

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