georgeob1 wrote:I believe that as a general rule government management of the production and/or distribution of any products or services will eventually lead to scarcity and rationing -- that, after all is what governments do. However I suspect that the problem may well be more pronounced here than in Norway or any of the rather more monolithic and stable cultures of Western Europe. I'm not convinced that a low tolerance for taxes is the cause, although there may be common elements that contribute to both. The U.S. is a far more heterogeneous society than any European country, and it is, by long tradition a good deal more competitive economically, and socially. A continuing flow of immigrants at (with illegals included) over twice the levels that prevail in Europe contributes to the continuation of these qualities - this is how we have assimilated great numbers of people for a couple of centuries.
You say government management usually
fixed leads to scarcity, and claim to have experienced this. My experiences don't match up, I can percieve no scarcity of firefighters for instance. What exactly are your experiences with respect to government administration? And lets leave kleptocracies out of the equation, I think we can both agree that corruption is capable of fouling up any system.
In my own experience government rations neither fire coverage nor education.
Quote:Certainly the central management of resources in the USSR and the eastern European Socialist states produced scarcity of nearly everything, along with a lasting impact on the economic productivity of the people afflicted with this absurd system. In general the much less intrusive Social Democrat policies of Western Europe have avoided the worst of these effects, contributing to, or at least not yet impeding, vastly more productive economies and general prosperity. However the principal Western European countries now face serious challenges to the continuation of at least some of these programs. Demographic declines, high unemployment, relatively low growth, and rigid labor markets threaten their ability to continue without substantial reform. Norway appears to be insulated from the worst of this by higher birth rates and the North Sea oil revenues.
I don't think the practices of the soviets were efficient system as far as central planning go, and the system was ripe with corruption. Planning everything would also be a lot more complex than planning just a couple of unrelated activities. I don't think central planning is all that efficient, but I think it would be unfair to say that the Soviets displayed the best central planning has to offer.
Avoiding scarcity seems simple to me, simply adopt the practice that if no state hospital is able to offer treatment within a specified timeframe, set sepparately for each procedure, treatment is administered at a private facility at government expense.
Quote:Quote:In terms of research I think the market model works quite well. I would still favor governments buying up medical patents and retiring them though, allowing competition in production. Pre-pledged purchase sums for certain patents might be a good idea as well, as this would allow for incentives to be provided for medicines that don't have that big a market.
Sounds good but Government tends to set its own price when it is empowered to seize the property of others. Many governments threaten patent holders with the licensing of generic alternatives in their efforts to get major price concessions from the developers of new drugs. This leaves the countries that don't do this and continue with free markets paying a much higher price and. in effect subsidizing the nationals of other governments. We have that problem with Canada. I would favor legislation here that would prohibit any drug maker from charging a higher price to U.S. consumers than they offer to government purchasers in other countries. That would drive the prices back up in Canada and lower them somewhat here.
Government buying of patents should be a volountary free market transfer, although the government should aim at offering say 110% of the market price.
I think in the absence of such practices a law requiring at least a certain percentage of the surpluss generated from patented medicine be spent on research and development. Perhaps making medicine production a free for all, put allowing patentholder to add a fixed fee on top of the sales price would make such legislation more clear cut and easier to enforce. I really do think some action should be taken to restrict spending on comercials for patented medicine. I would not favor this more generally due to free speach issues.
I think I saw statistics once showing pharmaceuticals spending more on adverticing than on research, and almost as much on lobbying.
I agree with your point that Canada might (depending on the prices they negotiate) not be contributing sufficiently to medical research. That said, I fail to see how it would be possible to have a certain portion of medical costs paid by government to reduce costs for the consumer without either opening for competition or fixing the price. Othervice the money would just be a subsidy to the pharmaceutical, and have no impact upon costs to the consumer.
I still think the model allowing pharmaceuticals to volountarily sell their patents to government at a slightly inflated price offers the best solution. Government could then distort the market by the usual means if they decided that this was desireable.
