Market Demand and Collective Action

A dynamic logic occurs when market participants seek to control costs.

Mancur Olson describes "The Logic of Collective Action." When, for example, the cost of health care becomes unaffordable, due to inelasticity, and incomes are accumulated into the hands of the providers, the reduction of demand (the ability to pay) logically prompts providers to seek another source of income to achieve the moral imperative of providing health care for everyone. The imperative is categorical (universal) because the demand (the need) is relatively inelastic.

President Obama, acting on that categorical, moral imperative is set to provide universal insurance coverage (thus demonizing insurers) while providers of care are seeking to source the funds that increase the ability to pay without redistributing the accumulated income (the retributive value). That source is government, providing in the name of the moral imperative.

Objecting to this system of finance is characterized as being anti-imperative (illogical), despite that it perpetuates what is wrong with it--burgeoning costs--which is the call for the reform. The public very clearly detects the "illogic" of this action being made in the spirit of collective action toward the public good.

Offering the problem as the solution is illogical in spite of the logical imperative of providing liquidity (the ability to pay in the form of government mandate and public finance) as soon as possible.

While the "public option" may be a point of departure for actually achieving the distribution of income necessary for health care to be universally affordable, the very striking lack of measure to control the cost suggests a willingness to design policy that keeps the income in a mode of continued consolidation that does not fit the imperative.

The consumer's imperative is to control the cost; $900 billion to start does not exactly fit the imperative.

The consumer's logic is to co-op, or organize, to collectively bargain to trust bust the power of the AMA. A doctor or hospital will have to disclose prices and be subjected to a free-market legitimacy to be economically successful, as opposed to the government being co-opted to pay undisclosed prices on command, if not now, sometime in the future (perhaps after everyone goes to the public option--the Wal Mart model of doing business).

The logic of collective action to counter organized monopolistic entities, like the AMA, for a fair and equitable price is a market mechanism concommittant with the "freedom" to act. The public option defies this logic. Once the option makes collective economic sense, the incentive to merge it with the provider to command, and collect, the price that caused the option will be overwhelming.

The probability the public option will not be corrupted is very low. The logic will then be to pluralize the system for a more direct and easily verifiable democracy to control the cost. The demand, without any encumberances to the logic of this action, will then be for a free-market system.