The Moral Paralysis of Obamacare

March 29, 2010

by Mario Rizzo  

The perceptive Alexis de Tocqueville argued that Americans are not as keen on “free speech” as it may first seem. Before an idea or proposal is passed into law they will argue, use invectives, claim that proponents or opponents are bad people, and so forth. But after a law has been passed and the dust settles much becomes unquestionable.  

This has happened with many controversial ideas including Medicare, Medicaid and even Social Security. There are many explanations for this. First, public choice economists suggest that when a redistributive legislation becomes law the various interest groups that benefit become even better organized to maintain it. Second, bills can be passed – in the limit – by simple majorities and presidential signature. Laws can be repealed only with supermajorities in both houses of Congress if the president vetoes. Third, losers often adjust to make a good thing out of bad. Doctors and hospitals, for example soon learned how to use Medicare to further the demand for their services.  

Some self-styled progressives will argue that this move from controversy to acceptance is because people see that the programs “work.”  

There is a lot to deconstruct with glib statements such as this one. For example, perceiving something to work is different from it actually working. And, of course, what does “work” mean? Relative to which alternatives? Surely these programs provide benefits to some, even many, otherwise they would probably vanish. This is Frederic Bastiat’s “the seen.”  

Yet as time goes on people become increasingly incapable of imagining any alternatives. This is the way things have always been done, they will think. (I once suggested to my students that if food had for a long time been provided by the government, people might have a hard time imagining how such a vital commodity could be provided by private individuals – after all wouldn’t much of it be poisonous?)  

The government provides and has always provided the necessities of life, future generations may say. 

There is also another problem. This is the “is-ought” heuristic (aka “fallacy”). People don’t like to keep revisiting issues because it is costly. Perhaps, even more, Americans want to live in a benevolent country with a benevolent government. So this deep desire leads them to think: If the law was passed by our elected representatives and by a smart president, it must be good. What is now becomes what ought to be.  

There may be a small window of opportunity to do away with some aspects of Obamcare, especially as many provisions take effect only in a few years. However, if it is perceived to be too expensive, if the nation’s debt situation worsens considerably, if inflation gathers considerable steam, the “crisis” might then be enough to overcome the usual post-legislation stasis.  

Yet in a “crisis” anything can happen. Perhaps the failure of Obamacare would be taken as evidence that we need to simplify the system and go to the Single Payer.  

Then, hat-in-hand, Americans will become even more dependent on the state.

7 Responses to “The Moral Paralysis of Obamacare”

  1. Richard Ebeling Says:

    What is important, it seems to me, is that when such a financial crisis finally, really, does arrive, and the quality and types of medical service have significantly diminished, that there has been enough market-oriented people to explain why this has happened that people may be persuaded that it is the government that is the problem and not the solution.

    In other words, it is Hayek’s idea that politics reflects the political-philosophical and ideoligical trends that began decades earlier.

    An understanding that it is the interventionist/socialist state that has created the crisis, and that only the competitive market can slowly but surely get the country out of the mess, will be crucial if the nation is to move, at that point, into a better direction.

    That is why we must not become dishearted or depressed into passivity. Now is the time that we need to start to re-double our intellectual efforts for the policy battles that will be ahead of us.

    Richard Ebeling

  2. Paul McMahon Says:

    I’d like to be as optimistic about this as Richard, but I’m afraid that by the time the crisis comes, the “this is how things always have been” phenomenon will dominate. The slow burn that the Obamacare program has put us on is perhaps its most devious — and cynical — feature. The tendency to settle in and forget how we got here will be overwhelming over the 10-15 years it will take for this additional straw to bankrupt the country.

  3. Richard Ebeling Says:

    If I may reply to Mr. McMahon. I don’t deny the difficulty of reversing, reducing, or abolishing elements of the welfare state in modern democratic society.

    But trends do change. At the beginning of the 20th century, those who made “predictions” of how the new century would develop did not anticipate two World Wars, a Great Depression, or the rise of totalitarianism. They thought the more or less prosperous and freedom “liberal” ideas and institutions of the late 19th century would just go on, and make things better for everyone.

    Then, the people in the 1930s were pursuaded and (fearfully) anticipated that democracy and the free society were soon to be gone forever in the “new world” of fascist and communist collectivism.

    Then, in the post-World War II era many were convinced that Soviet-style socialism would triumph all over the world. As late as 1983, Jean-Francois Revel wrote about “How Democracies Perish,” because they had lost the moral and political will to stand up to communism and Soviet power in the Cold War battle for control of the world. And many conservatives and libertarians wondered how the “evil empire” could ever be brought down without a terrible world war or a bloody civil war in Russia. In 1991, it was gone, with a wimper, rather than a bang.

    Now, we find it difficult to imagine how the modern welfare state can ever be slowed down or reversed, given the public choice logic of the workings of democratic politics, etc.

    But as Robert Nisbet once pointed out in a critical analysis of attempts to predict social, political and economic trends, we need to keep in mind that chronology is not causality. Just because “B” followed “A” and “C” followed “B,” does not mean that it was “inevitable” or that the trend has to continue.

    Ideas do have consequences. And trends can change. And that was what I was referring to in my previous commment.

    Richard Ebeling


  4. It is worth noting that many of the bad consequences of Obamacare are front-loaded. Taxes and premium increases come first and “benefits” years down the road. Steve Horwitz raises this issue over at Coordination Problem.

  5. Bob Murphy Says:

    I don’t want to be a Debbie Downer, and of course we have to try, but I don’t think there’s much hope that enough people will blame the trends in health care on Obama’s legislation.

    I mean, right now people blame “the free market” for cost explosions in medical care etc. Whatever the problems are, they will be generated by a mix of state/market. If someone wants to see “evil businessmen driven by the profit motive,” he will be able to see that.


  6. Ebeling is right — it’s extremely important that we make the case for liberty and free markets louder than ever. It might be a lot less than 10 years for national bankruptcy to hit, but regardless, there’s no substitute for telling the truth, and nothing better to do.

    I also think that there is a substantial share of Americans who don’t want to sit still for all this, and who need good ideas of the sort good economics can provide. Bob, you’re mistaken some people blame the free market, but there’s a large share that understand that government is to blame, and we need to make that share grow.

    And if you think Tea Parties are upset now, see what happens if Schumer & Lindsay manage to ram their national biometric ID scheme into law.

  7. Troy Camplin Says:

    There is little doubt that it will work. It will work to do what Obama wants it to: to make everyone dependent on and submissive to the federal government, create a crisis in insurance that will make a single payer the “only” option, create excuses for the further nationalization of companies as the economy is further damaged and more companies “too big to fail” require a “bailout” — i.e., nationalization. I suspect this legislation will work just fine.


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