Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The Hidden Cost of Privatization

ineteconomics.org

Post reply on HN
Print view View original

71–80 of 174 posts

Re: The Hidden Cost of Privatization

#71

Post by dragonwriter »

BoiledCabbage wrote: post #58
subverter wrote: post #46

The problem in Keynes thinking on "social services" is that it's impossible to gather all of the knowledge necessary to ascertain what those would be. That knowledge is dispersed among ~320m citizens (in the U.S.) who each have particular wants and needs. And even if you could somehow attain that knowledge in one place, the likelihood of finding consensus on how a particular "social service" should be offered is next…

Why don't we just let individuals choose if they want to have car insurance? If they want it, they can have it - if they don't, they don't have to. The same (very good) reason we don't allow that is the reason we don't allow this: a lot of individual decisions have social costs.

> Why don't we just let individuals choose if they want to have car insurance?

We do allow them to choose that: you don't have to have car insurance, not even if you own a car.

We don't, however, allow them to drive on public roads without liability insurance or (in some jurisdictions, like CA) posting a liability bond.

Re: The Hidden Cost of Privatization

#72

Post by subverter »

bjl wrote: post #65
subverter wrote: post #64

Earlier quoted context omitted.

Affordable for whom? It has become much less affordable for those who are healthy. How do you justify the healthy paying for the unhealthy? And is it really affordable, even for the unhealthy?

> How do you justify the healthy paying for the unhealthy? Because we live in a society, and in a society people help one another.

I absolutely agree that people should help one another. In fact, it's inherently built in to a lot of people. I'm not arguing against that.

I'm arguing against being forced to help others who I have no relationship with, live in far off places, hold different health standards than me, etc.

Believe me, if a family member of close friend needed help with medical expenses, I'd be the first to volunteer.

Re: The Hidden Cost of Privatization

#73

Post by subverter »

bjl wrote: post #69
subverter wrote: post #66

Earlier quoted context omitted.

What is the social cost of some not having car insurance?

They run over a pedestrian without insurance, now that pedestrian has no way to pay for their medical care.

What's stopping the pedestrian from either holding insurance to protect against that or suing the driver for damages?

Re: The Hidden Cost of Privatization

#74

Post by blahblab »

pizzetta wrote: post #8
yequalsx wrote: post #4

Earlier quoted context omitted.

Getting rid of unions will increase income inequality. Just compare for profit higher education with public higher education. The wages/benefits for workers former very much lag those of the latter. Private prisons pay way less too. But the people at the top get outsized pay. The cost savings to taxpayers are not sufficient to justify this inequity.

Imagine if unions were strong and IT were unionized. How would you imagine the progress we've seen in information technology? The impact on progress should not be discounted as an externality. Imagine if taxicabs or any livery service of any kind had to have a union member associated with it. Would autonomous cars make the same progress (for example, we can have autonomous subways/trains but they have to be "personne…

I don't have to imagine, I'm a unionized programmer. I've worked in private industry too and switching out an individual vs collective contract hasn't degraded my skills one iota.

I will say that Government is bureaucratic, but no more than any comparably sized corporation. Our only problem is that our shareholders are fucking morons.

Re: The Hidden Cost of Privatization

#75

Post by dragonwriter »

bjl wrote: post #48
subverter wrote: post #46

The problem in Keynes thinking on "social services" is that it's impossible to gather all of the knowledge necessary to ascertain what those would be. That knowledge is dispersed among ~320m citizens (in the U.S.) who each have particular wants and needs. And even if you could somehow attain that knowledge in one place, the likelihood of finding consensus on how a particular "social service" should be offered is next…

Because a lot of people (most, even) don't have the resources required to just up and move cities, let alone states. Your 'solution' would be massively regressive - what if Texas decides to rescind Medicaid? Are those people who cant afford to move just SOL?

> Your 'solution' would be massively regressive - what if Texas decides to rescind Medicaid?

Medicaid is a voluntary state-run program with federal participation standards. Texas could withdraw from Medicaid if it chose to, now.

All states have chosen to participate since 1982, but they are not required to.

Re: The Hidden Cost of Privatization

#76

Post by yock »

bjl wrote: post #69
subverter wrote: post #66

Earlier quoted context omitted.

What is the social cost of some not having car insurance?

They run over a pedestrian without insurance, now that pedestrian has no way to pay for their medical care.

You liquidate the assets of the at-fault party. If that is insufficient you garnish their wages.

Financial responsibility is something to be enforced by courts, not mandated by congress.

Re: The Hidden Cost of Privatization

#77

Post by bjl »

subverter wrote: post #72
bjl wrote: post #65

Earlier quoted context omitted.

> How do you justify the healthy paying for the unhealthy? Because we live in a society, and in a society people help one another.

I absolutely agree that people should help one another. In fact, it's inherently built in to a lot of people. I'm not arguing against that. I'm arguing against being forced to help others who I have no relationship with, live in far off places, hold different health standards than me, etc. Believe me, if a family member of close friend needed help with medical expenses, I'd be the first to volunteer.

But what about the millions of people with poor family/friends? Are they supposed to just roll over and die if they get sick?

And don't say 'but charity', we already know charity is massively insufficient.

Re: The Hidden Cost of Privatization

#78

Post by subverter »

bjl wrote: post #48
subverter wrote: post #46

The problem in Keynes thinking on "social services" is that it's impossible to gather all of the knowledge necessary to ascertain what those would be. That knowledge is dispersed among ~320m citizens (in the U.S.) who each have particular wants and needs. And even if you could somehow attain that knowledge in one place, the likelihood of finding consensus on how a particular "social service" should be offered is next…

Because a lot of people (most, even) don't have the resources required to just up and move cities, let alone states. Your 'solution' would be massively regressive - what if Texas decides to rescind Medicaid? Are those people who cant afford to move just SOL?

How is it more regressive than the status quo where you have to move to a different country? Moving states is less difficult, moving counties is even less difficult, moving cities is even less difficult, etc. The smaller you go, the less difficult it becomes.

Re: The Hidden Cost of Privatization

#79

Post by bjl »

dragonwriter wrote: post #75
bjl wrote: post #48

Earlier quoted context omitted.

Because a lot of people (most, even) don't have the resources required to just up and move cities, let alone states. Your 'solution' would be massively regressive - what if Texas decides to rescind Medicaid? Are those people who cant afford to move just SOL?

> Your 'solution' would be massively regressive - what if Texas decides to rescind Medicaid? Medicaid is a voluntary state-run program with federal participation standards. Texas could withdraw from Medicaid if it chose to, now. All states have chosen to participate since 1982, but they are not required to.

OK, so use any other example.

What if Florida decides to roll back gay marriage?

What if Alabama rescinds the Civil Rights Act?

Are those who can't afford to move supposed to just deal with it?

Re: The Hidden Cost of Privatization

#80

Post by rayiner »

subverter wrote: post #46

The problem in Keynes thinking on "social services" is that it's impossible to gather all of the knowledge necessary to ascertain what those would be. That knowledge is dispersed among ~320m citizens (in the U.S.) who each have particular wants and needs. And even if you could somehow attain that knowledge in one place, the likelihood of finding consensus on how a particular "social service" should be offered is next…

> Why do so many oppose such a solution where everyone can much more easily find a place where they agree with the "social services" offered (or not)?

Because it creates collective action problems. Countries can exercise their sovereign powers to control commerce and the flow of people so as to reinforce their chosen social welfare systems. If they offer universal healthcare, for example, they can control immigration to manage the burden on their system (and keep out people who only move in when they get sick or to retire). U.S. states are precluded by the Constitution from doing that. Say Marylanders decide to pay higher taxes to support generous social services, and Virginians decide to stick to lower taxes and no service. There is nothing Maryland can do about free-loading Virginians who cross the border as soon as they get sick.[1] Likewise, say Virginia decides to reintroduce child labor, which gives Virginia a competitive advantage in producing cheap consumer goods. There is nothing Maryland can do to stop the flow of trinkets from Virginia undermining good Maryland companies whose prices are higher because they don't use child labor.

It's helpful to view the Constitution's Commerce Clause and Privileges and Immunities Clause as a two-pronged economic construct. One prong says that the U.S. is a totally free market internally for goods and labor. The other says that the federal government can intervene to address any collective problem actions that creates. To the extent that the provision of social services has knock-on economic effects (and it has major knock-on effects), it comports with the Constitution's design for those things to get kicked up to the Federal government.

[1] See: http://www.washingtonpost.com/wp-srv/national/longterm/supco....

Post reply on HN