I blog about free markets in medical care and transparent pricing.
“Germans can’t fathom US aversion to Obama’s health care reform.” That’s the headline on “Spiegel Online.” You can read it here if you are so inclined. To be fair, the article should have been titled, “Some Germans can’t fathom US aversion to Obama’s health care reform.” It’s easy to put people in an ideological box isn’t it? Assigning a belief system to an entire country’s residents makes it easier for our minds to grasp, doesn’t it? Some Germans understand and envy the vestiges of liberty in this country, including one’s right not to buy insurance. Some Germans are unapologetic socialists and communists. Some people in this country are ideologically with them.
But for Germans to express indignation is delicious. You see, Germany is the birthplace of Karl Marx and the beginnings of the death of individualism. His writings were instrumental in bringing a popularity of the primacy of the state, not the primacy of individual rights. This concept bonded the fascism of the Nazis with the politics of Lenin: central planning and individual subservience to the state. Stated otherwise, the individual’s purpose was the furtherance of state objectives. That this happened in Germany is ironic as some of the most radical individualist philosophers also came from there and immediately preceded this insanity.
So how did the Germans develop their current concept of health care delivery? The great libertarian writer Richard Ebeling, writing for The Future of Freedom Foundation wrote this about the birth of German health care:
The modern welfare state arose in Imperial Germany in the late 19th century. Under pressure of growing support for the Social Democratic Party in the 1870s and 1880s, Kaiser Wilhem II and Chancellor Otto von Bismarck attempted to preempt the appeal of radical socialism by establishing a series of socialized insurance programs for retirement, unemployment and medical care.
In the 1890s, Bismarck explained his rationale to American historian and Bismarckian sympathizer William H. Dawson: “My idea was to bribe the working classes, or shall I say, to win them over, to regard the state as a social institution existing for their sake and interested in their welfare.
Did you get that? Bismarck gave the national socialists (Nazi’s) “free” health care as a way to buy them off and politically destabilize their movement. It’s what the Nazis wanted, so he gave it to them. Current German health care and all “managed care” for that matter is one of their enduring legacies.
You can read the entire, three part brilliantly researched essay, “National Health Insurance and the Welfare State”, here. It was this German system that gave birth to eugenics and human experimentation (for the greater good, of course) that is all too well known now. This was the natural extension of the abandonment of the rights of the individual with the interests of the state taking central stage. Here is another excerpt from the article:
In 1885, a year after socialized health insurance began, the average number of sick days taken by members of the system each year was 14.1. In 1900, the annual average number of sick days per member had gone up to 17.6; in 1925, it had increased to 24.4 days; and in 1930, it was an average of 29.9 days. People also were noticeably sicker around weekends and Christmas and New Year’s Day, particularly in those occupational insurance funds that waived the four-day rule before receiving cash benefits (The cash benefits were also tax-exempt, so the take-home pay lost by not working was less than fifty percent.).
The ease with which an increasing number of insured workers were able to receive benefits from longer or more frequent periods of illness was not independent of the behavioral incentives at work on the physicians who were part of the system. Originally, the insurance funds set the fees for services rendered. But in 1913, a doctors’ strike almost occurred, and was only averted at the last minute. After that, the fee schedules were determined by a joint committee comprised of representatives of the medical profession and the insurance funds. An essential ingredient of the fee system was that similar fees were paid for similar services, regardless of the patient’s ability to pay. In other words, the frequent practice of private physicians to charge higher fees to wealthier patients as a means to earn higher income and to subsidize voluntarily the treatment they provided to poorer patients was outlawed. Hence, the determination of income earned by doctors in the system was purely on the basis of “quantity,” i.e., the number of bodies examined at the fixed fee per period, as opposed to the quality of the service provided.
At the same time, the tendency of a conveyor-belt view of patients resulted in workers insured under the compulsory system demanding freedom of choice in selecting a physician, rather than being assigned to a doctor participating in the system. This was established as part of the agreement of 1913. But it also meant that a doctor now had an incentive for greater leniency in diagnosing an illness and prescribing sick leave. A less accommodative physician ran the risk of losing his steady patients and suffering a decline in his income as fewer patients entered his examination room.
Sound familiar? This situation represented a heavy drain on the Nazi economy before and during WWII. What’s even more interesting is that this remains the situation in Germany today.
The Spiegel Online article made another point. Part of the outrage of the Germans was directed at the US as a religious country and how in the world could a religious country not have universal health care? How can we reconcile our religious beliefs with a lack of a health safety net for the sick?
This type of pretentious socialism used to make me mad. It is so ignorantly comical that I find it boring now. It isn’t that hard to draw the distinction between charity and theft, is it? The US is primarily a secular society, whatever the Germans think, but compared to the society in Germany, the US is a holy land. The utter rejection of private charity, primarily through churches, has occurred in Germany as the almighty “state” has taken its place. The institutionalization of “state worship” in Germany and other European countries has resulted in the dangerous slide toward the complete tyranny many deplored on the other side of the Berlin Wall not that long ago. Memories are short, aren’t they? The old and increasingly the new German government is what Lew Rockwell hilariously calls a pharaoh government, one where the government assumes the role of God as well. No wonder many Germans embrace cradle to grave government assistance.
German socialists have shown us over the years, that unopposed, their healthcare and welfare ideas lead to Dachau, with the interests and rights of the individual taking a back seat to the “state.” That they are disturbed by certain individual freedoms here is something to celebrate, I think.
G. Keith Smith, M.D.