Freedom for whom?

I wanted to post a thought about the current health care situation.

Unsurprisingly, the debate has been reduced to ignorant bickering about “socialism.” Obviously the mild reforms under discussion in Congress don’t approach actual government control of anything, but I’m more interested in how the concept of free markets and liberated enterprise have entered the debate. One gets the impression that most of our countrymen accusing Obama of "destroying" our nation believe that the Constitution mandates neo-liberalism. The concept is thus worth thinking about.

I remember hearing a theory about why the United States of America was responsible for almost every significant technological achievement of the first half of the twentieth century even though that economy was dwarfed by Britain's. The Second Industrial Revolution, beginning at the end of the nineteenth century, was dominated in England by financial capitalists and massive corporations. It was a time of unimpinged mergers, acquisitions, and monopolies.

The United States had its fair share of Robber Barons and massive corporate entities during this era, but there was an intense progressive backlash. Laws regulating railroads, interstate commerce, and monopolies were passed in the 1880's and enthusiastically enforced by Teddy Roosevelt when he became president as the century turned.

The result was an American economy that promoted entrepreneurship while the British monopolies squashed their smaller competition.

So which system was a free market? The British system had less government interference, so in the terms of our modern debate, its system was more free. Yet the cancerous swelling of monopolistic companies crushed any sort of innovative freedom. America, on the other hand, advanced significant regulation, but that was the very thing that allowed new ideas to flourish. Strict regulation plowed the hardened soil, allowing entrepreneur's ideas a chance to grow. Thus, the notion of freedom is more a matter of perspective than an absolute dictate: promoting freedom in one area of enterprise will necessarily squash it in another.

This same reciprocal relationship exists in health care. The astonishing explosion costs have created a situation where a huge percentage of Americans are afraid to tinker with their employment situation for fear of losing health insurance. Perhaps a fellow citizen has several kids, is a smoker, has diabetes, or is suffering from some type of chronic condition that makes purchasing new, affordable health care a virtual impossibility. Someone in that situation cannot take risks, cannot venture out on their own, and is generally denied anything resembling freedom in the employment market. A society is best served by eliminating or, at least, reducing all factors unrelated to ability barring employment (race, gender, sexual preference...etc). Forcing people to stay in untenable, un-challenging, or unsatisfying employment merely to cover health care costs is a horrible way to run a society.

The case is even more clear when dealing with small and medium sized businesses. Creative, daring decisions are often constrained by the practical. That reality cannot be escaped, but as much risk unrelated to a business's quality should be controlled. Imagine if a start-up had to invest in a private police system or buy free-lance firefighting. No enterprise could flourish under such a regime. A quality, cheap government option for health care, like municipal police and firefighters, lowers the bar for prospective businesses and allows existing enterprises to focus their energy on production. It is a freeing policy.

In fact, the only group at all constrained by a potential government option would be the insurance companies that currently control the market.

And this brings us to the actual decision: do we want freedom of insurance companies to profit, or do we want to increase the freedom of employees to determine their work and the freedom of businesses to innovate?

That's obviously a loaded question, but it accurately represents the real choice. It isn't a decision between absolute freedom and Stalinistic control, it's a choice of how to prioritize our society. I, for one, see no long term advantage in giving that priority to the insurance companies. A system that eliminates as much business cost as possible, allowing, say, a new bio-tech firm to launch, will result in greater achievement, both technologically and economically.

We didn't outstrip the world by selling out to financiers and corporations, we charged ahead by controlling them.