The Entrepreneurial Mind

NFIB views Professor Cornwall as a good friend of small business. So I’d like to respond forcefully, but respectfully. I’m Bob Graboyes, a health economist who serves as NFIB’s Senior Health Care Advisor. Let me go point-by-point. In doing so, I’m expressing my own views, though I believe they represent NFIB’s views for the most part. (Prof. Cornwall’s words are in triple brackets; mine are not.)

[[[Realistic is generally a word policy people use when they plan to tweak the current system and engage in compromise. I have never understood the logic of tweaking a fundamentally flawed model. And it is often unwise to compromise on our principles -- that seems oxymoronic to me. A principle is a firmly held belief. I thought the NFIB stands for free enterprise as a fundamental principle. Why compromise that principle when it comes to health care?]]]

NFIB uses the word “realistic” in its strict dictionary sense: “interested in, concerned with, or based on what is real or practical” (dictionary.com). NFIB is not advocating “tweaking” the health care/health insurance system. That system, indeed, carries fundamental flaws, and they need to change sooner rather than later. With 80 million baby boomers sliding toward decades of infirmity, the status quo is not an option, and inaction is not a strategy.

NFIB is a lobbying organization. No one can lobby effectively without compromising on the institutional details embodied in law. There is a wide, deep chasm between this sort of compromise and compromising on fundamental principles, which NFIB will not do. No oxymoron here.

NFIB does stand for free enterprise. But the current health system is far from an example of free enterprise. It is riddled with price controls, regulatory strictures, trade restrictions, treatment mandates, tax distortions, incomplete information, and incomplete markets. Moral hazard and adverse selection are and will eternally complicate the system. Under such conditions, pure, unadulterated laissez-faire will never find its way into law, and the challenge is to craft a system that gets us as close to the free-enterprise ideal as we can get. In the economist’s parlance, NFIB seeks a second-best solution, which is better than the third- or fourth- or fifth-best that we have today.

[[[It is interesting that they chose to list universal as their first principle. Understand that the word universal has become a code word for a federalized system. They may try to hide that fact behind having private aspects to it, but universal in the world of policy means mandated. And for health care, that means a socialized system.]]]

Our use of the word “universal” is meant as a literary shot across the bow. As Prof. Cornwall notes, “universal” has been a code word for a federalized system, but NFIB intends to break that association. “Universal” is not a synonym for “single-payer,” and accepting this verbal equivalence hands the opponents of market solutions a large load of rhetorical grapeshot.

[[[Think I am reading too much into this? Here is what they have to say about their principle of private: ... ‘To the greatest extent possible, Americans should receive their health insurance and health care through the private sector.’ … ‘To the greatest extend possible’??? You can drive a freight train through that loop hole! Liberty is a foundational principle in our system. It is sad that we seem to be finding more and more convenient reasons to compromise on our freedoms, particularly our economic freedoms.]]]

Again, NFIB’s words are not dictated by someone else’s freight train. NFIB wants the maximum amount of health care spending to reside in the private sector. Currently, around 50% is privately funded, and we want market solutions to make it possible for that percentage to grow in the future. 100% private is not going to happen, and one is hard-pressed to find any market-oriented think tank that advocates total retreat of government from health care.

[[[I guarantee that their principle of efficient can never happen by "realistically" tweaking the system and making it a federally controlled and planned mandated system.]]]

NFIB thoroughly agrees. Hence, we do not advocate a federally controlled and mandated system. Quite the opposite.

[[[And while we are talking about efficiency, let's see how they intend to achieve efficiency: … ‘Health care policy should encourage an appropriate level of spending on health care. Laws, regulations and insurance arrangements should direct health care spending to those goods and services that will maximize health.’ … You got it. We will let the federal government regulate efficiency. I guess that makes sense. The federal government is bastion of efficiency, after all.]]]

Once again, what is important is NFIB’s words, and not someone else’s penumbras and emanations. NFIB’s principles do not call upon the federal government to “regulate efficiency.” We want policy to encourage efficiency by allowing consumers and producers wide leeway in shaping the system. In today’s health care markets, problems often result from too few consumer and producer choices, rather than too many. Our interest is in freeing up markets, but the path to that goal will involve compromise at the level of details.

[[[Generally I have been on the same side of issues with the NFIB. Their stand on regulatory flexibility is to be commended. Their stand on Kelo and property rights is also on the mark. Their approach to health care reform stands in stark fundamental contrast with those two positions.]]]

NFIB appreciates Professor Cornwall’s longtime encouragement. We disagree with his assertion that our health care position contradicts our other stances but salute the thoughtfulness of his comments. We encourage him and others to engage NFIB in a dialogue as we go through this critical period in American health care.

I will close with a question for Prof. Cornwall: We agree that the current health care system is fundamentally flawed. Given that, what proposals would you take to Congress and the state legislatures? We’re looking for specifics, and we’d be glad to listen.

Birdied by: Bob Graboyes | December 14, 2007 12:51 PM

This is classic government irrationale. Gut the plumbing instead of repairing the leaky faucet. But is Fixing liability issues and improving Medicare and Medicaid infrastructures irrational?

You hit the bull’s-eye! Universal is where the US is headed and not by accident.

Birdied by: G S Hart | December 15, 2007 07:59 AM

I don't understand how it will be that health care with be refered to private sector, but will be ruled and managed by the govermental sector. Just a sort of idiocy.

Birdied by: Ambulance Nurse | January 8, 2008 10:32 AM

I don't believe anyone can fix this in one term because of opposition, the fact is that we need a plan that moves into that direction, and maintain the course to change healthcare.

Birdied by: resveratrol | May 2, 2008 10:33 AM

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