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American exceptionalism and health care


When considering Elizabeth Warren’s newly released health care plan, it’s important to keep in mind that as of now Americans are stuck with what is clearly the worst health care system in the developed world, as measured by the relationship between cost and results. This is for two reasons:

(1) Our political system is extremely biased toward the status quo, because it’s dominated by veto points that are exploited by those who profit the most from maintaining that status quo, no matter how inefficient and unjust it may be.

(2) People have no idea what they actually pay for health care, because that cost is disguised by the way they pay for it.

It’s completely normal for people with middle class jobs to have a third or more of their compensation go to what are for all practical purposes health care taxes. They don’t see this is the case, because most of those taxes are routed by their employer to a third party insurer without ever being counted as a formal part of their salaries, even though, as an economic matter, those payments are just an invisible tax the employees pay on their actual compensation.

None of this is particularly complicated or obscure: anybody can figure it out in a couple of minutes by looking at their pay stub. Yet recently I had to explain at length to a friend of mine — a tenured history professor at a research university — that he was paying $25K per year for health care. He literally couldn’t believe it. He ended up asking, “you mean my salary is really $110K rather than $85K?” Yes — that’s how he should think about it. He is getting ripped off egregiously by a completely indefensible system.

Of course if people in, say, Denmark paid twice as much as we do for worse medical care that would be the most definitive possible proof that “socialism” [sic] doesn’t work, that we must let the market do its magic, etc.

But Americans are brainwashed from a very early age to believe in American exceptionalism, even in the face of the most compelling evidence to the contrary. Or rather, we do have an exceptional medical system: an exceptionally poor one, unless you happen to be rich, in which case it’s just great.

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