Healthcare: Innovation or Reform?

In a free-market system, rising costs demands innovation, reversing the trend of declining incomes, minimizing the probable effect of liquidity crisis.

In a non-free-market system, the consolidation of liquidity is added on command (Keynesian economics). The declining income, consolidated by the rising cost, is leveraged with a budget deficit, spread out over time, to be paid by the tax burden, maintaining the command price and the increasing cost.

The proposed reform is really an innovation to maintain the rising cost (and the illiquid distribution of income) without depriving the population of healthcare, which has a relatively inelastic demand (we need to have enough health to serve up the consolidated wealth and demonstrate power, as well as verify the noble beneficence of its accumulation).

The lack of elasticity is reasoned to be the cause of the persistently rising cost. The free market is reasoned to be an ineffective means of controlling the cost, otherwise it would, which begs the question.

What is to be reformed is this: a professional class and a business sector increases the cost, the government pays whatever is commanded, and the taxpayer with the highest tax burden, after all the exemptions and deductions, pays most the cost. The result, of course, is liquidity crisis, and a persistently overleveraged system.

The innovation occurring here, government-provided healthcare, is the means of maintaining the rising cost. It is a reinvention of the problem offered as the solution; just exactly what Obama supporters "hoped" would be pragmatically passe'.

The first thing the Obama administration and the Democratic delegation did was pass a regressive tax burden to finance expansion of healthcare insurance (SCHIP). It is a not-too-bright deflationary tax policy in the midst of recession, supporting illiquidity. That support is likely to continue. The current congress and administration simply does not have the will, or the understanding, to deter, but to innovatively abet, rising costs.