ARC's 1st Law: As a "progressive" online discussion grows longer, the probability of a nefarious reference to Karl Rove approaches one

Monday, December 17, 2007

Krugman - Tool of the Left

Or perhaps I could just title this one: "Krugman - Tool."

Paul Krugman has completely gone of the deep end. Each column, he makes idiotic statements which are extremely surprising coming from someone who is supposed to be a brilliant economist. This column is no exception:

December 17, 2007
Op-Ed Columnist

Big Table Fantasies
By PAUL KRUGMAN

Broadly speaking, the serious contenders for the Democratic nomination are offering similar policy proposals — the dispute over health care mandates notwithstanding. But there are large differences among the candidates in their beliefs about what it will take to turn a progressive agenda into reality.

At one extreme, Barack Obama insists that the problem with America is that our politics are so “bitter and partisan,” and insists that he can get things done by ushering in a “different kind of politics.”

At the opposite extreme, John Edwards blames the power of the wealthy and corporate interests for our problems, and says, in effect, that America needs another F.D.R. — a polarizing figure, the object of much hatred from the right, who nonetheless succeeded in making big changes.

Over the last few days Mr. Obama and Mr. Edwards have been conducting a long-range argument over health care that gets right to this issue. And I have to say that Mr. Obama comes off looking, well, naïve.
[...]
Mr. Edwards replied, “Some people argue that we’re going to sit at a table with these people and they’re going to voluntarily give their power away. I think it is a complete fantasy; it will never happen.”

This was pretty clearly a swipe at Mr. Obama, who has repeatedly said that health reform should be negotiated at a “big table” that would include insurance companies and drug companies.

On Saturday Mr. Obama responded, this time criticizing Mr. Edwards by name. He declared that “We want to reduce the power of drug companies and insurance companies and so forth, but the notion that they will have no say-so at all in anything is just not realistic.”

Hmm. Do Obama supporters who celebrate his hoped-for ability to bring us together realize that “us” includes the insurance and drug lobbies?

O.K., more seriously, it’s actually Mr. Obama who’s being unrealistic here, believing that the insurance and drug industries — which are, in large part, the cause of our health care problems — will be willing to play a constructive role in health reform. The fact is that there’s no way to reduce the gross wastefulness of our health system without also reducing the profits of the industries that generate the waste.
[...]
I'm sorry, but it's Mr. Krugman who is being completely naïve. If there is so much gross wastefulness in our health system, it's precisely due to government regulation and the cure is the profit motive, not more government regulation. If the drug companies or other healthcare providers had waste which they could actually control and minimize, it would behoove them to eliminate it since that would only mean higher profits (resulting in higher bonuses, stock prices, reinvestment in R&D, and potentially lower prices to attract more customers, etc, etc.)

That Krugman argues that businesses (which presumably operate in a competitive environment) have an incentive to generate waste is simply a ridiculous argument. While I might expect such an argument from some uneducated rube (Lou Dobbs, perhaps?), that it is being made by someone trained in the field of economics either means that Krugman is lying for political, social, or monetary gain or is simply too stupid to retain the designation oof economist.

The fact that theories such as Six Sigma, LEAN Manufacturing, and the on-going pursuit by businesses of strategies to reduce costs while increasing quality demonstrate this fact. Meanwhile, government bureaucracies are typified by mismanagement, waste, lack of innovation, and poor customer service.

As I've stated numerous times here on ARC, the problem with healthcare costs in the US isn't that there's too much free market activity - it's that there is too little. We can see that in other countries where governments are the sole provider (or payer) of health services that the costs for healthcare are growing just as rapidly as here in the US. If we were to remove the fact that much of US spending on healthcare (and especially drugs) subsidizes the rest of the world, the increasing costs would be very similar.

I just don't understand how any economist can reasonably propose that the government, with its army of bureaucrats and antiquated management techniques, can reduce the waste compared to a business with a profit motive.

Perhaps Krugman is merely hoping that Hillary!TM will name him as Secretary of the Treasury... While this column was an attack on Obama (in comparison to Edwards), the clear intended beneficiary of Krugman's comments are Hillary.

Your Co-Conspirator,
ARC: St Wendeler

Comments (2)
Anonymous said...

profit is his idea of waste

saintknowitall said...

You've been tagged.

http://saintknowitall.blogspot.com/2007/12/christmas-tag.html