Mr. Sparks is an executive of an Ohio manufacturing company and a frequent contributor to THE FREEMAN.
The old song proclaims that the best things in life are free — and specifically extols such romantic items as the moon, the sky, and the flowers in spring.
The composer of these popular lyrics doubtless earned his fame and royalties, though his philosophical sentiments might not win the plaudits of classical economists. The latter would point out that the best things derive their value from scarcity and are far from free.
A good house that may be free for the taking is extremely scarce — in fact, nonexistent. So are automobiles, automatic washers and dryers, stereophonic consoles, engineering services, the latest medical drugs, classical art, fur coats, and endless other items and services — all scarce at prices buyers would prefer to pay.
Much as we might wish to acquire freely these best things of life, a moment’s reflection shows why that is an impossible dream. None of these items is handed to us by nature. None comes into being without considerable effort by persons combining skills, years of training, and savings to produce desirable products and services.
These products or services exist only because they can command a price, a price sufficient to encourage productivity by those who have the inclination. The fact that some persons are willing to pay for new hats causes scarce and valuable hats to materialize.
Many individuals, working separately or grouped in companies, try to attract those who would buy heir scarce products and services. Some succeed. Some do not. And respect for the discriminating judgment of potential buyers does more to improve the quality and variety of goods and services “for sale” than does any other factor.
The composer quite properly listed love, happiness, and other intangible wonders among the best of things. It was doubtless intended that the individual respond by actions that would earn for him stirring soul satisfactions without an outlay of cash. Several decades later, however, the song’s promise has been stretched to cover not only the philosophically-desirable objectives listed by the song writer, but many economically-desirable products and services as well. Obsessed by desire to consume, prevailing political action attempts to by-pass the essential thought, saving, and labor that produce “the best economic things.”
Progress in Medicine
Successful performance of a scarce and valuable service is well illustrated in the field of medicine. A medical man of 1868, if given a glimpse of the parade of medical accomplishments to come in the century just now ended, could scarcely have believed such miracles possible. The description of such medical treatments, drugs, and procedures would have been a marvel to him, not to mention their blessings upon millions and millions of people. Life spans increased unbelievably; many common and formerly fatal diseases virtually wiped out; human lives blossoming that otherwise had no chance — miracles all!
Such outstanding service in saving lives and restoring health has brought substantial economic reward to many of these modern men of medicine. In addition to the monetary rewards, many have known the personal satisfaction of serving the unfortunate ones lacking the funds to pay the full price, or perhaps any price, for needed medical attention.
So phenomenal has been medical progress in the United States that one would hardly expect it to be the object of political attack. Yet, a strange brand of collectivist “logic” proclaims the “right” to free services of all kinds, including medical — not the volunteered services of generous physicians to those unable to pay — but the cold, impersonal, regimented service yielded by Federal legislation. By what logic do Americans of any age expect to receive free medical care under a system of compulsion?
Some may question the use of the word “free” to describe Medicare benefits. Does not each earner of income pay his own way through the Federal social security system for Medicare? Furthermore, the doctor’s care portion of Medicare is voluntarily chosen and paid for by the citizens. How can these be called “free”?
The answer, of course, is that no service of value can be free. Medicare is not free. It has to be paid for one way or another — or the service will not be forthcoming. But in the Medicare idea is a substantial element of something that to many of our countrymen appears to be a free benefit — or a partially-free benefit. They find it easy to assume that medical benefits are in unlimited abundance instead of scarce and costly. The service seems to be there for the taking. It is true that medical drugs, technical equipment, and skills are much more plentiful than in years past; yet, they do not grow on trees. Manufacturers spend millions of dollars to conduct research and develop new medicines. But their resources are limited by the amount stockholders are willing to risk in the uncertainty of researching and developing a new product. Not everyone is willing or able to endure the long years of study, expense, and self-denial to become a doctor. Doctors, therefore, are scarce. And so are the allied services such as nursing. Private and public hospital boards constantly need toraise funds for expanded facilities and improved equipment. And the difficulty in acquiring such funds accounts for the relative scarcity of hospital services.
So what? What if those who are covered under the Medicare program believe that medical services are virtually free and available in great abundance — rather than unfree and relatively scarce? What difference does it make? They will receive the benefits, won’t they —benefits they could not otherwise afford?
Consequences of Medicare
Medicare patients now receiving medical attention otherwise beyond their means will not easily be persuaded that Medicare is likely to downgrade the quality of medicine in this nation. Nonetheless, the advent of Medicare and its supplemental programs will tend toward that result.
The discipline of the market —that is, the exchange of values between persons willing to trade their scarce savings for scarce medical services — is lost, or severely impaired. Individual decision-making will be displaced by government compulsion. Tragic results are sure to follow.
Keep in mind that the cost of Medicare was estimated by its proponents on the low side to render it more palatable to wavering legislators. Costs of government programs seldom are estimated accurately. Medicare ran two or three times over its original estimate in the first year. Marginal illnesses that previously would have gone unattended now call for the doctor’s attention — and add to the cost of Medicare. Patients seek more frequent and more extended hospitalization — at added cost. Medical services and medical supplies will broaden in definition so that areas never intended to come under the program will be included — and add to the costs. Opportunists will flock into the program, in collusion with patients, with supplies and “semi-hospital” services and activities bordering on the fraudulent — all to become a part of the costs.
Another extra cost — overlooked by the proponents of Medicare —is the transformation of medical services, formerly performed free or at very low cost, into full price when eligible for government compensation. One doctor who “before-Medicare” spent one day a week gratis with the residents of a home for the elderly, now allows Medicare to pay him more than $1,000 for this day.
Beyond all this is the heavy cost of bureaucratic operation and the lost sense of frugality by all parties in the program — patients, doctors, hospitals, agents, and others. What incentive remains to keep the total cost reasonable? None whatsoever. The social security or other tax rates will continue to grow until they finally become unbearable to taxpaying salary and wage earners. Greater Federal deficits will bring further inflation.
Those to Be Blamed
And there will be scapegoats to be sacrificed. Doctors will find their fees first restricted, then fixed. Numbers of Medicare patients will be forcibly increased without regard for the number of non-Medicare patients the doctor may prefer to serve. And there will be a revision in policy concerning other doctors who originally refused to cooperate. They will be blamed for the shortcomings of Medicare, poor attitudes, and lack of uniform coverage —and will be forced to join the program.
Private hospitals also will be among the scapegoats when they seek equitable coverage of hospital costs not now allowable for reimbursement by the Medicare program.
The innocent bystanders will be those persons not covered by Medicare but in need of medical attention, attention they will not get because so much of the scarce professional time and effort has gone into red-tape, restrictions, and unnecessary “doctoring.” These “forgotten” people, the ineligible, self-reliant families, will have to pay twice, first for the Medicare of others, and then for the care of their own families, not to mention the disproportionate share of hospital overhead expense they will be charged. For such double outlay, they will receive minimum time and attention from regimented doctors. This excluded group could hardly be blamed if it were to petition legislators to make Medicare coverage universal.
A further consequence of Medicare will be noted by all too few. The rate of medical growth and discovery of the last hundred years will not be maintained. Bureaucratically fixed fees will discourage the development of new surgical procedures and concepts. Difficult, time-consuming, risky, tiring, exploratory efforts will not be worth the candle under Medicare. What fee should a doctor charge for the first heart replacement operation? And why not stick instead to $35 tonsillectomies, and $150 appendectomies? Advancement in medical science is seriously threatened by Medicare.
Since the program is now law, why point to the descending path it will follow? Why spell out the terrible price that all Americans —the young and the elderly — will pay in terms of lower quality the deterioration of medical science, reduced numbers of intelligent young men entering the field of medicine and scientific medical research? What good in predicting the gloomy future of medicine in the United States? The eggs have been broken, the scrambling under way. Will such portrayals of Medicare’s future return us to our senses? Will this discussion help bring economic understanding? Will anyone gain from this effort the courage to join in the struggle to restore freedom in this field of human activity so vital to man’s well-being? I do not know.
The Effort to Improve
The attempt must be made, however, regardless of the heavy odds against any quick rescue of medicine from the dismal detour it has taken. Some day, the collectivist idea will recede, as honest and intelligent human actions beat it into retreat. Such gains, however, do not come from wishful thinking or from dire predictions of socialistic evil. Nor is it certain that they will come from the actual misery of the adverse results. Human nature is prone to accommodate to adversity which arrives gradually — as might be expected in medical affairs under regimentation.
Only a fresh and better understanding of the achievements possible in a free society will wean support away from Medicare. Persons who think they are being practical in support of government medicine might well be persuaded to transfer their allegiance to the institutions of freedom. The search for a magic political formula that will produce the best economic things is doomed to failure. New formulas will be offered after each failure — “one more try” —which will fail in turn, until human gullibility is exhausted. Then a renewed understanding of the blessings of freedom will return to the people of our land.
To spread the understanding of freedom is our task. There is no other antidote for the regimentation of government control and interference dedicated to accomplishing the impossible. Only then will medical services and products be recognized as the best things in life, but far from free. Only then will freedom of choice and freedom of exchange return to the field of medicine. Only then will it resume its jet-like speed toward new miracles of the future.
The best things of life are not free. But human freedom is the best means to attain the most desirable “things” of our lives.
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Ownership Means Control
A man is free precisely to the extent that his property rights are intact, because the condition of freedom and the condition of slavery are distinguished on the basis of the right of private property. A freeman owns himself and whatever he comes by lawfully. A slave owns nothing…. Ownership, however, means more than the possession of formal legal title to things. It means control. Control means authority over use, and over disposition as well. It means the condition in which one has the authority to follow his own preferences.
SYLVESTER PETRO
From testimony before Senate Judiciary Committee on the 1966 Civil Rights Act
