[lbo-talk] Krugman: The Road to Romneycare

Wojtek S wsoko52 at gmail.com
Wed Apr 27 05:56:42 PDT 2011

Michael: " If you won't give up the premise that we have to keep private insurers, this is the only thing you can end up with to produce universal care."

[WS:] This basically sums up the difference between the US-style capitalism and Euro-capitalism. Euro-capitalism works predominantly to further interests of capitalism as a system, often against interests of individual capitalists. That is why they instituted public social welfare - it boosted stability of the capitalist system, as the lack of social safety net had been the main cause of discontent among grunts.

US capitalism, by contrast, works to further interests of individual capitalists, even if this undermines long term stability of the capitalist system as a whole. This is why the best we can hope for is a Romney/Obama care which is a gold mine for inscos but has the potential of bankrupting the system in a long run.

The main factor explaining this difference is the strength of political parties vs. that of government bureaucracy, much stronger in the US than in Europe. Party politicians are by definition whores doing tricks for monied interests (George Washington already warned about that in his farewell address http://en.wikipedia.org/wiki/George_Washington's_Farewell_Address#The_Dangers_of_Political_Parties ). Therefore, the overarching goal of partisan politics is to maximize the power of a party as a purveyor of government services to the party constituents, rather than the system as a whole. This is plainly visible in the politics of many Third World countries, where particularistic (mainly tribal) allegiances trump the interests of the state as a whole. In the US, particularistic interests are defined by business rather than tribal allegiances, but they work in a pretty much the same fashion. Business interests and politicians serving them do not mind throwing sand innto the machinery of the US state if pumping government largess to their pockets is threatened. So what that the system will eventually go bankrupt? Apres moi le deluge.

PS. I am back from Turkey - the country that seemingly has more public investment in infrastructure than the US.


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