Health-care reform and the mixed economy — VOICES for REASONVOICES for REASON

Commentators on both the right and the left have griped about the many conditions in the Senate and House health-care bills that were added to win the support of special interest groups or specific congressmen. The right, for example, has decried the dealing as “cash for cloture,” while the left has assailed the individual mandate as an insurance industry coup.

And indeed, the bills are ripe with provisions that benefit some at the expense of others. Among those in the Senate bill alone (see this article for a more complete list):

• $300 million to Louisiana for the vote of Mary Landrieu
• $100 million to a Connecticut hospital to help the sinking poll numbers of Christopher Dodd
• A permanent expansion of federal Medicare payments to Nebraska (estimated value, $100 million) for the vote of Ben Nelson
• An excise tax exemption for longshoremen in exchange for the support of their union
• A 10 percent tax on tanning salons—added at the behest of the American Medical Association in place of a proposed a 5 percent tax on cosmetic surgery
• The exemption of Florida senior citizens from Medicare cuts for the vote of Bill Nelson
• $600 million in Medicaid benefits to Vermont for the vote of Patrick Leahy

Where does the money for these favors come from? From the only place it can—the pockets of U.S. citizens who have created that wealth in the first place. Despite the present outcry against it, this legalized plunder is not an anomaly, but the essence of the legislative process in a mixed economy. In a free society, where the individual rights to life, liberty, property and the pursuit of happiness are protected, those who create wealth are free to dispose of all of it as they see fit through voluntary trade. In a mixed economy, free trade is replaced by politicians laying claim to the wealth their citizens have produced and fighting with one another over how it is to be redistributed. The amount of wealth that citizens are allowed to keep depends on the level of freedom granted by the state, while the rest of it is divvied up by the politicians—each of whom has constituents, donors and political friends to satiate.

The scale of the health-care legislation has allowed the grappling for handouts to occur more openly and on a wider scale than usual, but it happens for every bill and is considered normal politics. This is why we see not shame from politicians for their greasy palms, but pride. As Senate majority leader Harry Reid put it, “There are 100 senators here and I don’t know that there’s a senator that doesn’t have something in this bill that isn’t important to them. If they don’t have something in it important to them then it doesn’t speak well of them. . . .That’s what legislation is all about. . . . It’s the art of compromise.”

Ayn Rand called it compromise too—only she didn’t view that as a good thing. As she said in her 1965 Ford Hall Forum talk “The New Fascism: Rule by Consensus” (available in streaming format over at the Ayn Rand Multimedia Library or as an essay in Capitalism: The Unknown Ideal):

A mixed economy is a mixture of freedom and controls—with no principles, rules, or theories to define either. Since the introduction of controls necessitates and leads to further controls, it is an unstable, explosive mixture which, ultimately, has to repeal the controls or collapse into dictatorship. A mixed economy has no principles to define its policies, its goals, its laws—no principles to limit the power of its government. The only principle of a mixed economy—which, necessarily, has to remain unnamed and unacknowledged—is that no one’s interests are safe, everyone’s interests are on a public auction block, and anything goes for anyone who can get away with it. Such a system—or, more precisely, anti-system—breaks up a country into an ever-growing number of enemy camps, into economic groups fighting one another for self preservation in an indeterminate mixture of defense and offense, as the nature of such a jungle demands. While, politically, a mixed economy preserves the semblance of an organized society with a semblance of law and order, economically it is the equivalent of the chaos that had ruled China for centuries: a chaos of robber gangs looting—and draining—the productive elements of the country.

A mixed economy is rule by pressure groups. It is an amoral, institutionalized civil war of special interests and lobbies, all fighting to seize a momentary control of the legislative machinery, to extort some special privilege at one another’s expense by an act of government—i.e., by force. In the absence of individual rights, in the absence of any moral or legal principles, a mixed economy’s only hope to preserve its precarious semblance of order, to restrain the savage, desperately rapacious groups it itself has created, and to prevent the legalized plunder from running over into plain, unlegalized looting of all by all—is compromise; compromise on everything and in every realm—material, spiritual, intellectual—so that no group would step over the line by demanding too much and topple the whole rotted structure. If the game is to continue, nothing can be permitted to remain firm, solid, absolute, untouchable; everything (and everyone) has to be fluid, flexible, indeterminate, approximate. By what standard are anyone’s actions to be guided? By the expediency of any immediate moment.

If you’re disgusted by the spectacle of wheeling and dealing that’s taken place throughout this health-care “reform” process, take cognizance that this is routine, run-of-the-mill “politics” in the United States today. The only way to end it is to repudiate the government’s claim to the wealth of its citizens and institute a full separation of state and economics.

Image: laura padgett on Flickr