[lbo-talk] high U.S. health costs: because we're too fat?

Wojtek Sokolowski sokol at jhu.edu
Tue Oct 2 08:27:44 PDT 2007


Doug quoted:

[Health Affairs article is at <http://content.healthaffairs.org/cgi/ content/full/hlthaff.26.6.w678/DC1>.]

Obesity may push U.S. health costs above Europe: study

[WS:] May be. But I think there are systemic incentives that reward the health industrial complex (hospitals, big pharma, and insurance companies) for costly and often unnecessary procedures instead of less costly (nut often more effective ones.)

Cf. Consumer Reports: http://www.consumerreports.org/cro/health-fitness/health-care/medical-ripoff s-11-07/overview/medical-ripoffs-ov_1.htm

A more general point - American capitalism thrives on transaction costs, it not only turns inefficiencies to profit making opportunities, but artificially manufactures them to further boosts corporate profits. This is quite evident in the health business, but it is not limited to it. Other examples include transportation, housing, consumer protection (via litigation rather than regulation), education, and even social work - where the unholy alliance of big business and government the most costly (but not very efficient) solutions available.

Without those inefficiencies, many of them artificially created, the US GDP would be going south, and unemployment rates would be in two digits.

The US-style capitalism ceased to be the engine of development long time ago. Currently it is confined mainly to old shakedown schemes: manufacturing inefficiencies and ripping off the public by pretending to solve them.

Wojtek



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