What Do Socialism and Capitalism Mean to You

[lostone]

My wife also died from cancer. Bill over $300,000, but medicare denied most of it.

OTOH, I have also had a case where I was billed for $72 for some medical test claim that medicare denied, and the provider turned it over to a collection agency, and after a long struggle, I paid it, since $72 was a small amount to argue over, rather than continue fighting it, to avoid hurting my credit rating. The irritation of having paid a bill that medicare had denied still rankles. Health care in the US is corrupt to the core.

 

[Emily Lake]

Scarcity of health care services, for one thing. Sure, it's nationalized and free to all... which isn't helpful when you can't get in to a doctor.

Which is a problem for all healthcare systems. The number of doctors is necessary limited by the very high and very necessary barriers to people who want to become doctors.

I don't agree that the barriers are unnecessary but that's dependent on what you mean by barriers.

I tend to think that the required training, residency, etc. is necessary. Medicine is both complicated and difficult, and the impact of getting something wrong can be someone else's death.

If you're talking about the cost... Well... I sort of agree. I don't think the cost needs to be so high - but I don't think the cost of ANY university education needs to be as high as it is. On the other hand, I end up taking a step back (in the US at least) and questioning whether the student loan debt is really all that crushing when the average doctor has a $750K+ house, kids in private schools, high-end cars, and memberships at private golf clubs. Yeah, yeah, I know, not all doctors. But a whole lot of them. I mean, a LOT. That whole trope about "marrying a rich doctor" isn't really fantasy.

I would expect, however, that if the provision of care were to be socialized in the US, then the government would also take on a material portion of the cost of training those doctors. I would expect the requirements for entry to medical schools to remain very high though.

The question is, should you resolve this unavoidable shortage by having all patients go through a triage process which leaves the non-urgent patients waiting for long periods; Or use a wealth based process that leaves the poor untreated regardless of how urgently they need attention, while the wealthy need not wait to have even their trivial needs met?

I don't think there's any way around the wealthy getting their needs met. Even if usage within a nationalized system is strictly based on medical necessity... There will always be private options available. I don't think there's any way around either concierge services being delivered privately, or medical tourism.

Anecdote - I have a friend in British Columbia, will a fully nationalized health system. The Canadian government paid to fly him down to Seattle for treatment, once a month for two years, because Canada didn't have the services available in a timely fashion. He wasn't wealthy. Sometimes it's the government itself engaging in medical tourism!

 

[Emily Lake]

And at throughout this past winter, I think a whole lot of UK citizens are less than pleased with the national services for heat and power.

The ones that were privatised by the Thatcher government in the 1980s? How are their failures supposed to illustrate the failure of socialism? Is socialism so evil that it still causes problems more than forty years after it's ended?

Did you think that these industries were still government owned? If you see Sid, tell him.

Yes, I thought they were still government owned.

 

[Emily Lake]

The wealthy can and do hire personal doctors in the US. The less wealthy have to rely on what their insurance allows.

And the uninsured?

In the UK, a homeless person who is hit by a bus will get the exact same medical attention as a wealthy businessman (or anyone else) who is in the same situation. Both will be provided with top quality treatment, not only in their urgent care (ambulance and on-scene paramedic services, Emergency department services at the nearest suitably equipped hospital), but also admission to a regular hospital ward from the Emergency department for whatever recovery period and medium term treatment is medically necessary, and post-discharge rehabilitation and follow-up services. No mention will ever be made of money throughout the process; No billing or invoicing will ever be brought to the patient's attention.

The uninsured are on their own. Live or die. They are outside the system.

No, not really.

At this point in the US, anyone who is uninsured is uninsured by their own choice - with a few states as exceptions. Only 12 states haven't expand Medicaid, which provides coverage for very low income as well as disabled individuals, and two of those are expanding this year. Those 10 unexpanded states are the only ones with a coverage gap.

In the remaining 40 states + DC, Anyone not eligible for Medicaid is eligible for ACA coverage, which is highly subsidized for low income people. Depending on the income level, people can have their entire premium fully subsidized by the government. At present, over 80% of the people in ACA are subsidized to some degree, even if not completely. 35% of ACA enrollees have premiums of $10 or less for their family. 92% of participants qualify for reduced point-of-service costs (deductibles, coinsurance, copays, etc) as well, although not all of those elect for Silver level plans that have those reductions. The average premium in the ACA markets (including state based exchanges) is $129 per month, which is nearly an 80% reduction from the list price.

In addition, all states have some level of uninsured care provisions. At the very minimum, Emergency Rooms are not allowed to turn patients away, even if they don't have insurance. They are required to stabilize all patients that show up. They don't treat for non-emergent conditions, though.

For non-emergent conditions, many states or counties have funds set up to treat or manage conditions for low income people. My biologicals father was enrolled in a county level diabetes management system, which provided check ups, blood glucose monitoring supplies, and drugs for him to manage his diabetes - free of charge, even though he did not qualify for Medicaid.

For the 10 states that haven't expanded Medicaid, there are gaps in availability for adults, definitely. It's not 100% perfect. But the notion that medical care is not available, and poor people are just left to die on their own is false. It simply isn't true. The vast majority of the remaining uninsured in the US are uninsured voluntarily.

 

[Emily Lake]

jut off of a casual google, I pulled up this:

17% of adults with health care debt declared bankruptcy or lost their home because of it. 66.5% of bankruptcies are caused directly by medical expenses, making it the leading cause for bankruptcy. As of April 2022, 14% of Americans with medical debt planned to declare bankruptcy later in the year because of it.Aug 30, 2022

First question from your unlinked search: What percentage of Americans have health care debt? 17% of an unstated number isn't helpful.

1 in 10 Adults Owe Medical Debt, With Millions Owing More Than $10,000

Americans Likely Owe Hundreds of Billions of Dollars in Total Medical Debt A new KFF analysis of government data estimates that nearly 1 in 10 adults (9%) – or roughly 23 million people &#821…

www.kff.org

10% have some degree of medical debt - that's $250 or more. So if 17% of those people declare bankruptcy, that's 1.7% of americans who declare bankruptcy due to medical debt. It's not great by any means, but it's also not earth-shattering.

Average American Debt

See where you stand in comparison to average American debt stats with our research on household totals and averages as well as debt across various age groups.

www.ramseysolutions.com

The average american has around $55K of debt, and 77% of US households have debt. The average medical debt is on the order of about $5K.

I agree that we need to address the underlying cost of care, and that in general medical care is too expensive. But let's not exaggerate the situation. Let's make sure we're addressing the right problems in the right way.

 

[lostone]

The wealthy can and do hire personal doctors in the US. The less wealthy have to rely on what their insurance allows.

And the uninsured?

In the UK, a homeless person who is hit by a bus will get the exact same medical attention as a wealthy businessman (or anyone else) who is in the same situation. Both will be provided with top quality treatment, not only in their urgent care (ambulance and on-scene paramedic services, Emergency department services at the nearest suitably equipped hospital), but also admission to a regular hospital ward from the Emergency department for whatever recovery period and medium term treatment is medically necessary, and post-discharge rehabilitation and follow-up services. No mention will ever be made of money throughout the process; No billing or invoicing will ever be brought to the patient's attention.

The uninsured are on their own. Live or die. They are outside the system.

No, not really.

At this point in the US, anyone who is uninsured is uninsured by their own choice - with a few states as exceptions. Only 12 states haven't expand Medicaid, which provides coverage for very low income as well as disabled individuals, and two of those are expanding this year. Those 10 unexpanded states are the only ones with a coverage gap.

In the remaining 40 states + DC, Anyone not eligible for Medicaid is eligible for ACA coverage, which is highly subsidized for low income people. Depending on the income level, people can have their entire premium fully subsidized by the government. At present, over 80% of the people in ACA are subsidized to some degree, even if not completely. 35% of ACA enrollees have premiums of $10 or less for their family. 92% of participants qualify for reduced point-of-service costs (deductibles, coinsurance, copays, etc) as well, although not all of those elect for Silver level plans that have those reductions. The average premium in the ACA markets (including state based exchanges) is $129 per month, which is nearly an 80% reduction from the list price.

In addition, all states have some level of uninsured care provisions. At the very minimum, Emergency Rooms are not allowed to turn patients away, even if they don't have insurance. They are required to stabilize all patients that show up. They don't treat for non-emergent conditions, though.

For non-emergent conditions, many states or counties have funds set up to treat or manage conditions for low income people. My biologicals father was enrolled in a county level diabetes management system, which provided check ups, blood glucose monitoring supplies, and drugs for him to manage his diabetes - free of charge, even though he did not qualify for Medicaid.

For the 10 states that haven't expanded Medicaid, there are gaps in availability for adults, definitely. It's not 100% perfect. But the notion that medical care is not available, and poor people are just left to die on their own is false. It simply isn't true. The vast majority of the remaining uninsured in the US are uninsured voluntarily.

Those are good points. I pulled up this about the uninsured, who they are and some of their financial issues. I wonder if this survey takes all the homeless into account.

Who Can't Pay for Health Care?

In an era of rising health care costs, many Americans experience difficulty paying for needed health care services. With costs expected to continue rising, changes to private insurance plans and public programs aimed at containing costs may have a negative ...

www.ncbi.nlm.nih.gov

 

[Bomb#20]

Healthcare is an excellent example of a product for which capitalism is poorly fitted - "customers" buy healthcare mostly because they have absolutely no option. They don't want to be in hospital having triple bypass surgery, they don't choose to be, and the cost of their operation is determined by their medical needs, rather than by anything they have control over.

Stuff and nonsense. There are a variety of reasons capitalism is poorly fitted for some fraction of healthcare, but those aren't them. Customers mostly do have options, because customers mostly pay for healthcare with insurance premiums instead of at point of service and customers can shop around for the best insurance policy for their needs before they get sick. And people don't want to be in the street watching their houses burn down, they don't choose to be, and the cost of their loss is determined by the severity of the fire rather than by anything they have control over. And yet in spite of those shared characteristics, fire insurance is an excellent example of a product for which capitalism is spectacularly well fitted -- so much so that when Adam Smith was going on and on about the general deficiencies of corporations, insurance was a service he singled out as one of the exceptions; it's something the early corporations of his era were actually good at.

You can't get a better triple bypass surgery because you're wealthy enough to buy a really top of the range one, either - the surgery either works, or it doesn't,

Stuff and nonsense. There are always complications to surgery and one surgery that works may have less severe complications than another surgery that works; likewise, one surgery that doesn't work may leave the patient as bad off as when he started and another may make the bad situation worse; likewise, two surgeons that both got it right may have had different odds of getting it right.

and if your surgeon gets it wrong more often, that shouldn't mean he is forced to lower his prices and appeal to a lower budget consumer; it should mean he's going to be fired and sued for malpractice.

Stuff and nonsense. That's just a lame excuse for saying the medieval coopers' guild members should have absolute authority to stop anyone else from being allowed to compete with them. When I had surgery a couple of years ago I shopped around and got it done by a surgeon who'd already performed the same operation hundreds of times. The results were excellent and my complications were at the 5th percentile. Well, how the heck is some other surgeon ever supposed to get to be that good at it if he's kicked out of the profession when he gets one wrong because his odds aren't as good because he's only done it a dozen times?

Nye Bevan hit the nail on the head with this one, when he created the National Health Service.

Of course it no more follows that, as socialism is the best way to manage healthcare, socialism is also the best way to manage the provision of everything else.

What Bevan said doesn't make any sense. Hunger is neither an indulgence for which people have to pay nor an offense for which they should be penalized, but a misfortune; but that's no reason the cost of that misfortune should be shared by the community if a hungry person is capable of earning a living and buying his own damn food like the rest of us. If Bevan's reason were a good reason to establish the National Health Service then it would be a good reason to establish the National Agriculture Service and force all the farmers onto collective farms. But as you note, socialism being the best way to manage one thing doesn't imply it's also the best way to manage something else. Collective farms are a disaster, whereas providing food is one of those services capitalism is spectacularly good at -- so good at it that obesity is a disease of the poor. If you want to justify a National Health Service, you need to show socialism is actually better at health care than alternatives, not just philosophize about whether illness is an indulgence or an offense.

There are some things that are clearly best managed by government, and some that are clearly best managed by the forces of supply and demand (in a market with regulations limited to the deterrence of cartels and monopolistic practices, and the arbitration of disputes).

And there are some things that are clearly best managed by supply and demand in a market somewhat more regulated than that and with government subsidies for the people who can't afford insurance/aren't able to earn a living/would otherwise fall through the cracks for some other reason. You're talking as though for each service we have to choose either laissez-faire capitalism or else having a National X Service where the means of production are collectively owned and the service providers are all government employees. That's a false dilemma -- obviously so, given the huge proliferation of services that are in fact provided by other models -- everything from free-market capitalism supplemented by food-stamps and government quality-control, to classic regulated utilities.

If you want to justify a British-style National Health Service, you don't need to show it's just better than a free market and better than the complete hash that America has made of its own chaotic mix of capitalism and socialism and medieval guild economy. You need to show it's better than a well-constructed mixed public/private system like France has.

As any big business can tell you, centralised government by a board of senior executives is a perfectly sensible way to operate. Some businesses do try to operate internal markets, with managers bidding for services from other departments within the organisation, rather than having budgetary controls imposed by the boardroom, but corporations that have made this work effectively are few and far between.

Tell that to Warren Buffett. He knows better than to try to govern from the top the many businesses Berkshire-Hathaway owns.

Even corporations know that a certain amount of central planning is a benefit to the common weal.

That's not central planning. That's decentral planning. It works because it's subject to the discipline of an external market, it has to compete with the planning of all the other planning decenters, it has to take care that every person its operations rely on benefits from participating, and it has to take care that what it produces is worth more to outsiders than what it consumes, or else it will go bankrupt and die. All that goes away when you operate a whole economy that way. The only way to centrally plan a whole economy and not have people climbing the fence to get out is to make sure the people on the other side of the fence don't have the benefits of decentral planning either. That's probably why world-wide revolution was so important to the Trotskyists.

 

[bilby]

Scarcity of health care services, for one thing. Sure, it's nationalized and free to all... which isn't helpful when you can't get in to a doctor.

Which is a problem for all healthcare systems. The number of doctors is necessary limited by the very high and very necessary barriers to people who want to become doctors.

I don't agree that the barriers are unnecessary

Well, as I clearly described them as "necessary", nor do I.

but that's dependent on what you mean by barriers.

I tend to think that the required training, residency, etc. is necessary. Medicine is both complicated and difficult, and the impact of getting something wrong can be someone else's death.

Yes, that's what I am talking about.

If you're talking about the cost... Well... I sort of agree. I don't think the cost needs to be so high - but I don't think the cost of ANY university education needs to be as high as it is. On the other hand, I end up taking a step back (in the US at least) and questioning whether the student loan debt is really all that crushing when the average doctor has a $750K+ house, kids in private schools, high-end cars, and memberships at private golf clubs. Yeah, yeah, I know, not all doctors. But a whole lot of them. I mean, a LOT. That whole trope about "marrying a rich doctor" isn't really fantasy.

As a non-American, none of the cost of education stuff even occurred to me. Student loans are now a thing in the UK, but when I was a student, they absolutely weren't - the Local Education Authority paid not only the entirety of all undergraduate tuition fees, but also provided a few thousand pounds per annum in cash to each student, to cover living expenses.

I would expect, however, that if the provision of care were to be socialized in the US, then the government would also take on a material portion of the cost of training those doctors. I would expect the requirements for entry to medical schools to remain very high though.

The question is, should you resolve this unavoidable shortage by having all patients go through a triage process which leaves the non-urgent patients waiting for long periods; Or use a wealth based process that leaves the poor untreated regardless of how urgently they need attention, while the wealthy need not wait to have even their trivial needs met?

I don't think there's any way around the wealthy getting their needs met. Even if usage within a nationalized system is strictly based on medical necessity... There will always be private options available. I don't think there's any way around either concierge services being delivered privately, or medical tourism.

There's no way to prevent it, and it's not necessary to do so. It basically stops happening for all but the mega-rich when healthcare becomes free at the point of use. Only fools and the ultra-wealthy would pay large sums of money to obtain something that they can pick up free of charge.

Anecdote - I have a friend in British Columbia, will a fully nationalized health system. The Canadian government paid to fly him down to Seattle for treatment, once a month for two years, because Canada didn't have the services available in a timely fashion. He wasn't wealthy. Sometimes it's the government itself engaging in medical tourism!

I'm not sure whether that's supposed to be a criticism of the Canadian system, or if so, what part of it you think is bad, wrong, or unwarranted.

 

[bilby]

And people don't want to be in the street watching their houses burn down, they don't choose to be, and the cost of their loss is determined by the severity of the fire rather than by anything they have control over. And yet in spite of those shared characteristics, fire insurance is an excellent example of a product for which capitalism is spectacularly well fitted -- so much so that when Adam Smith was going on and on about the general deficiencies of corporations, insurance was a service he singled out as one of the exceptions; it's something the early corporations of his era were actually good at.

Except that it's absolutely not good at it at all.

The only good fire department is the one that extinguishes all fires, regardless of the insurance status of the owner or resident of the property where the fire is currently occurring, because fires spread, and big fires are FAR harder to control than little fires.

I note that fire departments are almost never privately owned in modern times, and that this strongly hints that private fire insurance wasn't found to be fit for purpose.

 

[bilby]

There are always complications to surgery and one surgery that works may have less severe complications than another surgery that works; likewise, one surgery that doesn't work may leave the patient as bad off as when he started and another may make the bad situation worse; likewise, two surgeons that both got it right may have had different odds of getting it right.

And the amount the patient (or health authorities) paid for the surgery has exactly zero impact on these complications.

Expensive surgery by a qualified surgeon isn't better than less expensive surgery by a different qualified surgeon; It's not less likely to have complications, unless it's only cheap because the surgeon isn't qualified.

 

[Emily Lake]

Those are good points. I pulled up this about the uninsured, who they are and some of their financial issues. I wonder if this survey takes all the homeless into account.

The homeless population is an issue in and of itself, and general health care access might be on the lower end of the problems that need to be tackled. I could go on an on for this topic, probably better suited to a different thread completely. I'll be brief and say that there is a massive problem with mental health issues and substance abuse among the homeless. The mental health issues for the long term homeless population tends to be strongly skewed toward conditions that involve hallucinations and delusions - schizophrenia, psychosis, extreme PTSD, etc. Addressing those issues is going to take some degree of involuntary commitment... and that something I don't think any party in the US is willing to tackle.

Who Can't Pay for Health Care?

In an era of rising health care costs, many Americans experience difficulty paying for needed health care services. With costs expected to continue rising, changes to private insurance plans and public programs aimed at containing costs may have a negative ...

www.ncbi.nlm.nih.gov

I try to avoid my own jargon-laden field... but this is more focused on the point-of-service cost (deductibles, copays, etc) than on the cost of insurance coverage (premiums). And this is an area where there's frequently not enough consideration. It's one of the things that ACA actually got right. On the Silver level plans, people with low incomes get not only a reduction in their premium level from federal subsidies, but they also get lowered point of service costs. Many carriers have offered plans with $0 deductibles, $0-$5 primary care visits, $0-$5 generic drugs, and $20-$50 brand name drugs.

Employer coverage, on the other hand, very often has point of service costs that are, in my opinion, absurd. Hell, I'm well compensated, and even for me the fact that I have a $10K deductible for my family is frightening. I'm lucky enough to have a health savings account that has amassed a fair bit over the last 15 years... but still. It's a terrifying amount. For all intents, I have no insurance, I just have a savings account that gets funded from pre-tax dollars, and access to a slight discount from billed prices when I see a doctor.

 

[Emily Lake]

Healthcare is an excellent example of a product for which capitalism is poorly fitted - "customers" buy healthcare mostly because they have absolutely no option. They don't want to be in hospital having triple bypass surgery, they don't choose to be, and the cost of their operation is determined by their medical needs, rather than by anything they have control over.

Stuff and nonsense. There are a variety of reasons capitalism is poorly fitted for some fraction of healthcare, but those aren't them. Customers mostly do have options, because customers mostly pay for healthcare with insurance premiums instead of at point of service and customers can shop around for the best insurance policy for their needs before they get sick.

Well actchooalleee....

First off, health care in the US is NOT a free market system at all. Insurance makes it not a free market, it doesn't follow the patterns of supply and demand... like at all. But we'll leave aside how badly having a cost-redistribution middle-man in the mix destroys any sort of microeconomic tendencies for a different discussion. Instead, let's address some of your other items from this first couple of sentences.

1) Customers have options because they shop around for insurance

Most people in the US do NOT shop around for insurance - they get whatever their employer gives them. The premiums for employer sponsored care are usually very heavily subsidized. Most people in the US have no idea at all how much health insurance would actually cost if it weren't subsidized - either by their employer or by the government. The average cost of medical care for people under 65 in the us is around $700 per month. For some people, it's a whole lot higher than that. For someone with employer coverage, they usually contribute $50 per month (give or take, some industries are better some are worse). For ACA coverage, that's more like $130 per month.

2) Customers don't have material cost at the point of service

Sometime in the early 00's there was a push to "Consumer Driven Health Plans" under the misguided notion that patients would shop around for the most cost effective doctors. This wasn't driven by insurers, btw, it was driven by the government, paired with Health Savings Accounts (HSAs). The problem is that people don't shop around. Maybe, to a small degree, people might shop around for a Primary Care Doctor... but even then, most people are more interested in finding one that is conveniently located, or with whom they feel comfortable than the actual cost. And since PCPs have some of the lowest costs, the impact is really small. When it comes to big things, customers don't have the knowledge to be able to determine which specialist, or which imaging facility, or which physical therapist is the "best value". Most customers wouldn't even know how to begin defining value in that context. And realistically, most people don't want the cheapest care either. And that's only touching on situations where there customer has a reasonable degree of squish in timing. For things that involve surgeries, or are time sensitive, people aren't going to shop around - they're going to go wherever a doctor tells them to go.

This is even true for those of us who work within the health industry. I know a lot more than the average person when it comes to health care (not nearly as much as a doctor or nurse though). I definitely know more about the costs than the average person. And when I needed surgery... I went to the surgeon my doctor told me to go to.

Anyway, the point is that a really large number of health insurance plans have deductibles that can be a material barrier to accessing care. Even a $500 deductible is nothing to sneeze at, and that's on the lower end of the Deductible spectrum.

3) People can pick the right plan for themselves before they get sick

This is technically true... and realistically false. Even if we set aside the entirety of my first point above, this is like saying "people can shop around for the right automobile before their sister dies and they end up with three unexpected kids". The right plan for a healthy person is generally going to be one that has a relatively low premium with moderate fixed-dollar copays for PCP visits and generic drugs. Because a healthy person doesn't really use medical services much - an annual check up, maybe a cold or a bout of strep throat, some basic antibiotics, maybe some stitches and a pain killer. Basics. The problem is that when something unexpected goes wrong... that plan is no longer the right plan for them. People shop based on what their expected costs are going to be, with some mind to something going wrong.

Maybe people should shop for things that might happen. But after 25 years in this field, I still haven't figured out how to convince them to do that - and that's for people who actually have an opportunity to shop in the first place.

 

[Emily Lake]

Well, as I clearly described them as "necessary", nor do I.

Lol, I need to read more better! I totally stuck an "un" in there for no good reason at all!

 

[Emily Lake]

I'm not sure whether that's supposed to be a criticism of the Canadian system, or if so, what part of it you think is bad, wrong, or unwarranted.

Not sure it's any of them, so much as funny.

That particular friend had previously had very strong opinions about how horrible the US system for health care was, and how far, far superior the Canadian system was in every aspect... and then he got sent to the US for health care that his own country couldn't provide.

Realistically, I don't think either Canada (or UK) or the US has it right. I'm far from expert in all the different approaches taken to health care in different countries. In my limited knowledge, it seems like Switzerland has a pretty good balanced approach. But they're also a relatively small, relatively wealthy, relatively culturally homogenous country... all of which might result in their system working very well for them, but not working well in other countries.

 

[Emily Lake]

And people don't want to be in the street watching their houses burn down, they don't choose to be, and the cost of their loss is determined by the severity of the fire rather than by anything they have control over. And yet in spite of those shared characteristics, fire insurance is an excellent example of a product for which capitalism is spectacularly well fitted -- so much so that when Adam Smith was going on and on about the general deficiencies of corporations, insurance was a service he singled out as one of the exceptions; it's something the early corporations of his era were actually good at.

Except that it's absolutely not good at it at all.

Generally speaking, insurance is not very capitalist at all. It's redistribution of risk, it's one of the earliest types of communistic endeavors. Everyone shares the cost up front for an essentially unpredictable scenario with very low likelihood and very high cost.

I mean, insurance in and of itself is a very good idea... I just don't think it's something that can be considered "capitalist" in nature.

The only good fire department is the one that extinguishes all fires, regardless of the insurance status of the owner or resident of the property where the fire is currently occurring, because fires spread, and big fires are FAR harder to control than little fires.

I note that fire departments are almost never privately owned in modern times, and that this strongly hints that private fire insurance wasn't found to be fit for purpose.

I will point out that Bomb #20 is talking about fire insurance, not fire departments.

Fire departments put out the fires - and they do so regardless of whether a person is insured or not.
Fire insurance compensates the property owner for the financial loss that they incur if their stuff burns down.

In the US, fire insurance by itself is not common. It's usually bundled into a blanket property insurance policy (homeowners, renters, building insurance, etc.) that provides financial security in the event of many different potential catastrophes. There might be specific fire insurance riders in certain industries or situations where the fire risk is materially higher than average. I could see a grain farmer having a specific fire insurance policy that is separate from their blanket property insurance, given the higher than average likelihood of a fire, and the amplified damage that a grain fire might cause. But I'm speculating, it's not my area of practice.

 

[bilby]

I'll be brief and say that there is a massive problem with mental health issues and substance abuse among the homeless. The mental health issues for the long term homeless population tends to be strongly skewed toward conditions that involve hallucinations and delusions - schizophrenia, psychosis, extreme PTSD, etc. Addressing those issues is going to take some degree of involuntary commitment... and that something I don't think any party in the US is willing to tackle.

Of course there bloody is.

Being homeless is inevitably going to drive people to drugs (including alcohol) and/or send them crazy.

This is mostly a symptom of homelessness, not a cause; And it's absolutely not an excuse to put the problem into the "too hard" basket and declare that you cannot possibly do anything to resolve it.

The vast majority of homeless people don't have any substance abuse or mental health issues that couldn't be largely solved by the provision of a home, a job, and a return to full membership of a society that cares enough to protect its most vulnerable members.

The tiny number who are beyond help are not , and should not be made out to be, an obstacle to assisting the rest.

But they always are, because it's a lot easier to declare the problem to be intractable than it is to recognise our own lack of compassion.

 

[bilby]

I will point out that Bomb #20 is talking about fire insurance, not fire departments.

The two were synonymous for a long time. When people bought fire insurance in eighteenth century England, that entitled them to firefighting assistance from the insurance company, who were the only people with specialist firefighters and firefighting equipment on-call.

This wasn't a very effective way to manage the fighting of fires, for the reasons I gave earlier.

 

[Bomb#20]

And people don't want to be in the street watching their houses burn down, they don't choose to be, and the cost of their loss is determined by the severity of the fire rather than by anything they have control over. And yet in spite of those shared characteristics, fire insurance is an excellent example of a product for which capitalism is spectacularly well fitted -- so much so that when Adam Smith was going on and on about the general deficiencies of corporations, insurance was a service he singled out as one of the exceptions; it's something the early corporations of his era were actually good at.

Except that it's absolutely not good at it at all.

The only good fire department is the one that extinguishes all fires, regardless of the insurance status of the owner or resident of the property where the fire is currently occurring, because fires spread, and big fires are FAR harder to control than little fires.

I note that fire departments are almost never privately owned in modern times, and that this strongly hints that private fire insurance wasn't found to be fit for purpose.

I will point out that Bomb #20 is talking about fire insurance, not fire departments.

The two were synonymous for a long time. When people bought fire insurance in eighteenth century England, that entitled them to firefighting assistance from the insurance company, who were the only people with specialist firefighters and firefighting equipment on-call.

This wasn't a very effective way to manage the fighting of fires, for the reasons I gave earlier.

Are you seriously doubling down on your careless reading?

When I make an argument about surgeons are you going to make believe I said something about barbers, tell me I'm "absolutely not" right, based on something you know about barbers, and then when somebody inevitably points out your error to you, double down on account of barbers and surgeons having been the same people for a long time? The correct response from you when Emily pointed out your error would have been "Never mind![/gildaradner]".

Let's try this again. Fire -->>> insurance <<<-- is an excellent example of a product for which capitalism is spectacularly well fitted, even though it has the same characteristics you pointed out healthcare has. Therefore those are not the characteristics that make healthcare ill-suited to capitalism. The fact that firefighting does not fit capitalism well has a great deal to do with firefighting and fire insurance having become separated out into two lines of business, and nothing whatsoever to do with fire -->>> insurance <<<-- being something capitalism is good at.

 

[bilby]

Are you seriously doubling down on your careless reading?

My apologies. When you said:

And yet in spite of those shared characteristics, fire insurance is an excellent example of a product for which capitalism is spectacularly well fitted -- so much so that when Adam Smith was going on and on about the general deficiencies of corporations, insurance was a service he singled out as one of the exceptions; it's something the early corporations of his era were actually good at.

I should have realised you were lauding Adam Smith for his prescience in discussing the characteristics of fire insurance as it would be from the late nineteenth century onwards, and not discussing fire insurance as it was in his lifetime.

It was most careless of me to assume that you understood the context of what you were writing about, and I should have read it with your lack of knowledge in mind

 

[Bomb#20]

And people don't want to be in the street watching their houses burn down, they don't choose to be, and the cost of their loss is determined by the severity of the fire rather than by anything they have control over. And yet in spite of those shared characteristics, fire insurance is an excellent example of a product for which capitalism is spectacularly well fitted -- so much so that when Adam Smith was going on and on about the general deficiencies of corporations, insurance was a service he singled out as one of the exceptions; it's something the early corporations of his era were actually good at.

Except that it's absolutely not good at it at all.

Generally speaking, insurance is not very capitalist at all. It's redistribution of risk, it's one of the earliest types of communistic endeavors. Everyone shares the cost up front for an essentially unpredictable scenario with very low likelihood and very high cost.

I mean, insurance in and of itself is a very good idea... I just don't think it's something that can be considered "capitalist" in nature.

If it isn't capitalist, how did Warren Buffett make so much money selling it? It's not like his customer is the government and he's paid from taxes. No, not everyone shares the cost up front. Only those who make a bargain to have their risks covered share the cost up front. If everyone paid and everyone got covered whether he wanted to or not, that would be a communistic endeavor.

It isn't sharing that makes something communist rather than capitalist. Capitalists share all the time -- it's why the portions of the capital they own and the profits they collect are called "shares". What makes something communist is compulsory sharing.

The insurance business is a garbage disposal business, like Waste Management, Inc. Economically, risk is just another kind of garbage -- it's something people have and don't want so much that they'll pay somebody who's less averse to it to take it off their hands. Just as the widget business consists of trading a widget from people who like one less than the widget price to people who like one more than the widget price, the garbage disposal business consists of trading garbage from people who like it less than paying the disposal fee to people who like it better than losing out on the disposal fee, and the insurance business consists of trading risk from people who like it less than paying the premium to people who like it more than losing out on the premium. The economic difference between a normal widget business and a garbage/insurance business is merely the minus sign in front of the price people are willing to pay for the item being sold.