Category Archives: Free Trade

COVID-19 and the End of the Neoliberal Era in Health Care

The subject of neoliberalism has been discussed in this blog five times between 2018 and 2019, and is the focus of an article in The Milbank Quarterly, by John E. McDonough, professor of public health practice at Harvard’s TH Chan School of Public Health.

In the article, Professor McDonough points to a Commonwealth Fund chart (see below) that shows the growth in gross domestic product (GDP) for health care, comparing the US to 10 other high income nations. The chart shows that from 1980 to 2018, spending by the US was among the highest 40 years ago, but that in the early 1980s, US spending leapt above the others. and growing wider over four decades.

 

He then asks, “what happened to US health care in the early 1980s-and since then?”

McDonough responds by pointing to two New York Times columns by Austin Frakt, Medical Mystery: Something Happened to U.S. Health Care Spending After 1980 and Reagan, Deregulation and America’s Exceptional Rise In Health Care Costs.

McDonough suggested that a big part of the answer involves the broad economic and political trade winds of the late 1970s and 1980s, often called “Reaganomics” or “supply-side economics”, because Reagan ushered in a new era in the US. Some, like George H. W. Bush, running for President in 1980 for the Republican nomination, called it “voodoo economics.” However. as McDonough states, and as my previous posts on the subject calls it, it is “neoliberalism.”

This term evokes Adam Smith, but the 20th century version owes itself more to the works of Friedrich Hayek and Milton Friedman, among others. According to McDonough, the neoliberal agenda consists of cutting taxes, repealing regulations, shrinking or privatizing government (remember Grover Norquist’s desire to shrink government to fit in his bathtub and strangle it), suppressing labor, encouraging free-market trade, accepting inequality as price for economic freedom (something that has come under fire this year and since the 2016 election, making people receiving services and benefits pay as much as possible, and reorienting corporate thinking and behavior to promote return on equity as their only goal.

The New Deal era that was replaced by neoliberalism, McDonough states, lasted 48 years, from 1933 to Reagan’s inauguration in 1981. The neoliberal era, he points out, is 40 years old and showing signs of rust, cracks, and failing systems. Signs of this are Trump’s war on trade, deficit-exploding tax cuts for the wealthy and corporations,, anger over “deaths of despair” from opioid and other addictions and economic distress, awareness and revulsion about rising levels of inequality across society, and spreading rejection of absolutist “shareholder capitalism.”

In addition, recent protests over the deaths of African-American males at the hands of police, coupled with the Corona virus pandemic, are all signs that something is terribly wrong.

But what about health care, McDonough asks again?

Reiterating what he said above, US health care between 1980 and 2020 saw spending rise far above US economic growth, while growth in insurance premiums and cost-sharing increased well beyond advances in household incomes. On key indicators, he reports, the US performs worse than most nations on life expectancy, infant and maternal mortality, chronic disease mortality, levels of overweight and obesity, suicides, and gun violence, as well as glaring systemic health inequalities, as has been discussed during the BLM protests as one factor in people taking to the streets.

Despite the advances in technology and high spending, Americans give their system the lowest satisfaction ratings.

Yet, between 1965 and the 1980s, major infusions of investor capital has gone to all corners of our health care system, courtesy of shareholder-owned for-profit companies who often cut long-lasting ties with local communities, according to McDonough. It did not help that in 1986, the Institutes of Medicine, instead of convicting for-profits of “killing” health care, released a 600 page report on “For-Profit Enterprises in Health Care, that identified pluses and minuses that called for greater monitoring.

Finally, McDonough concludes that the US need to look outward, not inward, as is usually the case to solve big problems with health care. One such study, in 2018 from the William and Flora Hewlett Foundation, Beyond Neoliberalism, is a clarion call for a new policy sphere forming in think tanks, academia, advocacy and activist groups, and the legal community, as well as some Republican/conservative quarters as Marco Rubio, who rejects shareholder primacy. He says the search is on for a new paradigm, and hopes the election in November will bring it forth.

He doesn’t have to look far. Bernie Sanders, Elizabeth Warren, the PHNP, and others have the paradigm. It is Medicare for All/Single Payer. But first we have to rid ourselves of the baboon in the Oval Office and his economic minions, Mnuchin the Mieskeit, and Kudlow the Meshuggeneh.

Stay safe everyone.

Medicare Does Not Cover Retirees Overseas

A LinkedIn connection posted the following article yesterday from the Center for Economic and Policy Research (CEPR), and I thought that since it was a while since I wrote about medical travel issues, that this would be a good topic to discuss. In addition, it occurred to me that in all the talk of Medicare for All, there is no mention of retirees who retire outside of the US being covered by a MFA plan.

So the following article will have two functions: to stimulate interest in the medical travel industry for retirees who aren’t covered presently under Medicare as a new stream of revenue; and secondly, for those advocates of MFA to consider adding a provision in their plans to address this problem.

Here is the article in its’ entirety:

It’s Not an Accident Medicare Doesn’t Cover Retirees Overseas: No One in the Media Supports Free Trade!

Written by Dean Baker

Published: 18 July 2019

The New York Times ran a piece warning retirees thinking of moving overseas that Medicare will not cover their medical expenses in other countries. This is true, but the NYT piece never once pointed out that this is conscious policy, not something that just happened.

Readers of the paper may recall that it reports on trade agreements all the time. These trade agreements cover a wide range of issues, including things like enforcing patent and copyright monopolies and rules on Internet commerce and privacy.

If anyone in the United States in a position of power cared, then it would be possible to include transferring Medicare payments to other countries, to allow people to buy into other nations’ health care system on the list of topics being negotiated. This doesn’t happen because, unlike access to cheap labor for manufactured goods, there is no one in power who wants to make it easier for people in the United States to take advantage of lower cost and more efficient health care systems elsewhere.

While such a policy could potentially save the U.S. government an enormous amount of money on Medicare (costs in other rich countries average less than half as much per person), the health care industry would scream bloody murder if any politician attempted to implement free trade in health care services. “Free trade,” as it is conventionally used in U.S. policy debates, just means removing barriers that protect less educated workers from foreign competition.

The New York Times, like other mainstream publications will not even allow free trade to be discussed in its pages in contexts where it might hurt the interests of the wealthy.

http://cepr.net/blogs/beat-the-press/it-s-not-an-accident-medicare-doesn-t-cover-retirees-overseas-no-one-in-the-media-supports-free-trade?