A False Choice

by Erick Erickson

Liberals keep saying that insurance companies need competition. 3% profit margins — and yes, that is the profit margin for health insurance companies in America — are too much for the left.

Competition, we all agree, will reduce prices, improve innovation, and give people more flexibility and choices.

So what do liberals want to do to foster competition? A “public option.”

A public option would be a government run healthcare plan.

Here is what liberals willfully ignore in their sales pitch and what we must point out over and over and over — there is no competition when the government is involved. Why? Because of two reasons:

The government operates on tax dollars.

The government writes the rules.

When the government uses tax dollars to fund its competition in the marketplace it is not the same as a company raising private capital.

Government bureaucrats lack responsibility and accountability to taxpayers in a way a company does not with shareholders, debt holders, and consumers.

It is unfair competition and unfair competition is no competition at all. Because the government can fund itself by, in the final measure, simply printing more money, a private business cannot compete. The private business will go out of business leaving only the government.

In the same way, because the government will write the rules, it will write the rules in a way to benefit the government. With no real accountability for the dollars it spends, the government can write rules oblivious to costs and constraints, thereby driving up costs on private businesses, putting them out of business.

People who say the government offering a public option in healthcare is merely a way to bring competition to the marketplace either do not understand the way the marketplace works or are willfully lying.

Given that the “public option” was first proposed as a way to bring about single payer healthcare while obfuscating the language, the odds are with “willful lying.”

Put it to you this way — I’ll support a single payer healthcare system when the government ends the post office’s monopoly on first class mail. After all, it’ll promote competition.