Over at Suburban Guerilla, Susie describes talking to Arlen Specter about the wave of entrepreneurship that would be set off by Government-provided health insurance. After all, single (non-group) health insurance is extremely expensive, and freed of that expense everybody would be free to start their own company, right? By her account Specter agreed to think about it, and I suppose you should give him a little credit for trying something he isn’t really suited for. (via memeorandum.)
It won’t happen.
Entrepreneurship requires capital and the ability to operate. Specter, like all his buddies in the Big Government, regards any form of “capital” as a piggy bank they can (and will) smash for the contents at any instant. A small entrepreneurial business requires capital equipment — a building, a truck, a welding machine, something — and as soon as you get the money together for it somebody’s going to start shouting “Look! A rich person! Take that money for the Poor!” It’s the reason there’s no manufacturing in the United States. They’ve already gobbled up all the capital at the level of a GE or GM, and all that’s left is the small entrepreneurs. They have to get money from somewhere.
Commenter Mike Fennel, a contractor, fills in some details. Why, with free health care he could pay his people more and charge less for their services! Win-win for everybody!
Sorry, Mike, somebody is going to pay. The outgo is going to be the same — the doctors have to be paid, the hospital has to make mortgage payments and taxes, the drugs have to be paid for, the equipment still costs money. The money has to come from somewhere, and that “somewhere” is going to be you and your $17/hr employee. You’re going to see your taxes go up, and your employee is going to see his taxes go up, and the total collected is going to be about the same as what the insurance company is charging now plus the overhead for managing a gigantic Government department. (And if you think that will be less than what a private insurance company takes in profit, I invite you to investigate the finances of the Postal Service.)
Yeah, if health care were free a lot of the burdens of small business would be removed. So would a lot of the burdens of Big Business — and keep in mind, Big Business already has money to hire lawyers and lobbyists and pay for “campaign contributions”, so they’re relatively confident that they can shift their costs to somebody else. That “somebody else” is YOU. You don’t have a big-time lobbyist working for you, and you can’t afford to pay your Senator $50,000 for an exclusion, much less the $1 million your major competitors will be happy to fork over to the same end. So on top of all the inevitable costs that get moved from the “health insurance” account to the “taxes” account just to make the system work, you’re going to be subsidizing Kellogg Brown & Root’s provision of health insurance.
If health care were free we’d be better off. Yeah, and if a pig had wings it’d need a pilot’s license. This isn’t about cost saving, it’s about cost shifting — and contractors like Mr. Fennel, along with other small and medium size businesses, are the only ones left to shift the costs to.