A few good reads on health care matters this morning. In
National Review, Cato's Michael Cannon
exposes some of the pro-government fallacies underlying the
flaws in the current health care reform proposals. And in the
American Nobelist Robert Vogel
discusses the factors of increasing health care costs. An
excerpt:
Why is it that although the average age of onset of
disabilities has been delayed by ten years, and that these
disabilities have become milder than they used to be, the share
of GDP spent on health is rising? [...]
The main factor is that the long-term income elasticity of the
demand for healthcare is 1.6-for every 1 percent increase in a
family's income, the family wants to increase its expenditures
on healthcare by 1.6 percent. This is not a new trend. Between
1875 and 1995, the share of family income spent on food,
clothing, and shelter declined from 87 percent to just 30
percent, despite the fact that we eat more food, own more
clothes, and have better and larger homes today than we had in
1875. [...]
Consequently, there is no need to suppress the demand for
healthcare. Expenditures on healthcare are driven by demand,
which is spurred by income and by advances in biotechnology
that make health interventions increasingly effective.
And also from the American, James DeLong
explains why we should spend more on health care, not less.
