Last week, Speaker of the House Nancy Pelosi delivered a rant against the insurance companies that help deliver health care to hundreds of millions of Americans. According to the Madame Speaker, the insurance companies have been “immoral all along” and “are the villains in this” current health care debate. Pelosi was talking about insurer’s opposition to a public option, but the point could be made more generally than the Speaker perhaps understands.
As Business Week explains in their cover story today, the health insurers have much to gain from the current Democrat legislation. Between mandates for individual and employer coverage, expanded mandates for procedure coverage, and the massive new health care subsidies, health care “reform” generates hundreds of billions of dollars of new business, both private and public, for the insurance companies. If Speaker Pelosi were really appalled at health insurance profits wrested violently from American taxpayers, she wouldn’t be supporting this legislation in the first place.
Whenever government regulates an industry and takes freedom from individuals, an opportunity is created for businesses to profit by government lobbying instead of market competition. This is profit without real gain, and society as a whole suffers from it. A “public option” fixes the wrong problem: it destroys the more efficient insurance market instead of removing the regulations that create the temptation for lobbying in the first place. The best way to “stick it to the insurance companies” is to “hand it to the consumers”. Free up the markets, peel back the mandates, and allow people to decide for themselves what kind and quantities of insurance they want to buy.
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