Daily Archives: April 21, 2005

The glories of privatized medicine

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From Paul Krugman’s column in the New York Times…

In 2002, the latest year for which comparable data are available, the United States spent $5,267 on health care for each man, woman and child in the population. Of this, $2,364, or 45 percent, was government spending, mainly on Medicare and Medicaid. Canada spent $2,931 per person, of which $2,048 came from the government. France spent $2,736 per person, of which $2,080 was government spending. Amazing, isn’t it? U.S. health care is so expensive that our government spends more on health care than the governments of other advanced countries, even though the private sector pays a far higher share of the bills than anywhere else.

So the US spends more on health care. Is the population therefore healthier? Er, no.

Most Americans probably don’t know that we have substantially lower life-expectancy and higher infant-mortality figures than other advanced countries.

So why is the supposedly efficient private system so expensive? Answer: it’s hideously bureaucratic.

Above all, a large part of America’s health care spending goes into paperwork. A 2003 study in The New England Journal of Medicine estimated that administrative costs took 31 cents out of every dollar the United States spent on health care, compared with only 17 cents in Canada.

But hang on… isn’t it the state systems that are supposed to be hideously bureaucratic?

The world is flat

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If you read nothing else today, read the excerpt from Tom Friedman’s new book, The World is Flat: a brief history of the 21st century in the Guardian. Friedman had the brilliant idea of asking Dell to describe the process by which the laptop on which he wrote the book was made. It’s such a good idea that one hates him for having it. And it makes a very profound point in the simplest, most unobtrusive way.

Years ago, Friedman proposed “the Golden Arches Theory of Conflict Prevention”.

The Golden Arches Theory stipulated that when a country reached the level of economic development where it had a middle class big enough to support a network of McDonald’s, it became a McDonald’s country. And people in McDonald’s countries didn’t like to fight wars any more. They preferred to wait in line for burgers.

He’s now come out with a new, updated, theory: the Dell Theory of Conflict Prevention, the essence of which is that the advent and spread of just-in-time global supply chains in the flat world are an even greater restraint on geopolitical adventurism than the more general rising standard of living that McDonald’s symbolised.

The Dell Theory stipulates: no two countries that are both part of a major global supply chain, such as Dell’s, will ever fight a war against each other as long as they are both part of the same global supply chain, because people embedded in major global supply chains don’t want to fight old-time wars any more.

En passant: imagine the chaos there would be in the electronics and computer industries if China ever invaded Taiwan.

Later…Not everyone thinks of highly of Tom F, however. Here, for example, is a splendidly dyspeptic rant by Matt Taibbi which positively oozes bile from every participle. Sample:

On an ideological level, Friedman’s new book is the worst, most boring kind of middlebrow horseshit. If its literary peculiarities could somehow be removed from the equation, The World Is Flat would appear as no more than an unusually long pamphlet replete with the kind of plug-filled, free-trader leg-humping that passes for thought in this country. It is a tale of a man who walks 10 feet in front of his house armed with a late-model Blackberry and comes back home five minutes later to gush to his wife that hospitals now use the internet to outsource the reading of CAT scans. Man flies on planes, observes the wonders of capitalism, says we’re not in Kansas anymore. (He actually says we’re not in Kansas anymore.) That’s the whole plot right there. If the underlying message is all that interests you, read no further, because that’s all there is.