Health care, free markets, and patents

What is it about the subject of the health care system that turns otherwise sensible bloggers into blithering idiots? I’ve been wandering around the blogosphere today and I’ve seen a number of posts about reforming the Medicare system. That’s a discussion we should be having and I’m sincerely glad the discussion is going on.

But whenever there’s the beginning of a discussion of commonsensical cost-control measures there’s an absolute deluge of anarcho-capitalist flapdoodle in praise of free markets and condemning socialized medicine. I’m not just creating a strawman here. Here’s a direct quote from a prominent blogger:

“Well,” the counterargument goes, “The Europeans and Canadians spend a smaller–some much smaller–portion of GDP on health care. That’s because they have all these cost-control mechanisms in place. All we have to do is copy their systems.” Ah, but here’s the rub: They can afford to do that because America still offers such a great scope for medical innovation. That’s why almost every single advancement in medical science comes from the US, and not from Canada or Europe. The Euros get to keep their costs down, and benefit from American led medical innovation. But that’s not a sweetheart deal that would continue if the US clamped down on innovation by implementing European-style price controls.

[…]

Absent the inovations that the free market system provides in the US, the whole world would suffer.

Emphasis mine. I’m not going to link to the post because I don’t want to call a blogger that I otherwise like and admire a blithering idiot in public.

Leaving aside for a moment that he presents absolutely no hard data to support his claims there’s another problem: we don’t have a free market in health care in the United States. Like the rest of the world we have a managed system with enormous subsidies granted to healthcare suppliers in the form of patents, licenses, the prescription drug system and so on that are offset somewhat by more enormous subsidies granted to healthcare consumers in the form of Medicare, Medicaid, veterans’ benefits, etc. I can point you to any number of prominent scholars who attribute the innovation that he’s praising to U. S. patent law. And a patent is a temporary govern-granted monopoly. There’s absolutely nothing natural or free market about it.

You can be a free market enthusiast or you can approve of the patent system in the United States. You can’t do both without cognitive dissonance because they are diametrically opposed.

Don’t get me wrong. There’s a perfectly good social benefit argument for patents. But for goodness sake don’t call your social benefit argument a free market while calling the other guy’s social benefit argument socialized medicine.