Caller: Wouldn't TOTAL FREE MARKET Healthcare Solve Everything?

Let's go next to our caller from the nine
five one area code. A caller from nine one a. Where are you calling from? What's your name? Oh, okay. Um, is this for me? That is indeed you. Oh, hi. My name is Billy. I'm from California. Hey Billy. What's I have, I have two questions. Um, and Billy, we're not on speaker phone or we
were, I can't imagine we'd be on speaker phone right now. No, we're not. There's a fan in the building I'm in. Can you hear that? Is that what you're hearing? I don't know. It just, it sounded like you got very far
for a second there. It sounded like what? What's your question, Billy? We're ready for it. Okay. Sorry. Um, the first question is a coworker mentioned
that if we removed minimum wage hike, things would be better as a nation because, um, something
about, uh, floors, economic, artificial floors are bad. Uh, it prevents people from negotiating true
value. It increases unemployment, that kind of thing. Listen, all of those arguments, did those
strike you as good arguments? No. So that's part of where I'm kicked. Cause to me something about it seemed kind
of fishy. But I have coworkers who are like, hey, some
of this is sounding like it makes sense and I don't actually know anything about economics. So I figured, Hey, I might ask an adult who
does. Yeah. So the first thing I would do is go to Google
and type in debunking minimum wage price floor. Okay. And you will find a way, wealth of information
about that. It is true that in a classical economics framework
you can put a very convincing looking graph together, which will make it appear as though
that is the effect of a price floor. The reality is we are almost at full employment. We continue to be almost at full employment,
even in places that have 1112 and $15 minimum wages. And what you have to understand is that there
is a very particular in, well some people are maybe or are acting in good faith, but
there is a very particular bad faith incentive to make these arguments by people who just
don't want businesses regulated and they want businesses to be able to pay three, four,
$5 an hour. And the fact that you can have such an unequal
and problematic, uh, economy that people would be willing to work for three or $4 an hour
doesn't mean that it's the right thing to do or what we should be doing. And that's the important thing. Yes, if you remove the minimum wage, you will
see a company's paying less and people accepting it and being willing to accept that. But the longterm implications of that are
not good. The, the long term implications of that on
crime are not good. The longterm implications of that on government
benefits spending on welfare programs aren't good. So you need to zoom out in order to really
understand the context of those talking points. Oh, okay. Um, and then my other question was about health
care. One argument that was made is that because
we have health insurance, it allows companies to charge us really high prices and if we
didn't have like a health insurance base and instead people paid like out of pocket themselves,
um, it would drive prices down or something because these companies would still have to
sell their products to people and if they can afford less, uh, or something, it would
drive prices down. Yep. That's that, that's a total free market solution. And that might work, uh, when there, when
demand is not as inelastic as it is in healthcare, but healthcare is different than it. Healthcare should not be treated as a normal
market because basically if you don't need a hip replacement, you don't care whether
a hip replacement costs a dollar or $1,000 or $100,000. If you do need a hip replacement, you're in
a relatively small group, right? It's still not everybody needs hip replacements. And all of a sudden what it costs has no impact
whatsoever on how badly you need that hip replacement. And this is the reason why those sort of free
market lezafaire ideas simply shouldn't even be in the picture when we're talking about
healthcare. And most western developed countries have
already figured that out. Um, maybe I didn't quite communicate what
I'm trying to ask correctly. It's the idea is like if people can't afford
[inaudible] insulin at the current price, wouldn't healthcare industries or something
lower the price and that the only reason they can get away with charging like a high price
is because insurance companies can, no, that's not, that's not the only reason. And this is related to multiple different
levels that we've, we've analyzed in detail and this includes, uh, the fact that there
are, yes, insurance companies do negotiate certain rates for products and in order to
get a certain reimbursement rate that causes an incentive to make the sticker prices higher
and higher. But it's, it's far more complicated than this. Um, and uh, we've got a couple of videos on
it that I would, I would encourage you to check out. No problem. Thank you for your time. All right, appreciate the call.


  1. Nothing like fielding questions from people who don't know what they're talking about to "debunk" an economic theory.

  2. Total free market would “solve” the problem by getting rid of all the pesky unwanted “customers” aka sick people without money.

  3. Private health insurance would sell health insurance that covers very little there would be co-pays and deductable the insurance companies would pay out very little and their profits would soar

  4. Why the change in title format? Seems SUPER clickbaity and also why in tf does David always think people have bad lines when we all hear them crystal clear lol.

  5. Not sure if this caller identifies as libertarian but I hope they realize that universal healthcare would lead to economic freedom and individual freedoms allowed by not having to worry about being financially gouged by privatized healthcare corporations and having better health outcomes.

  6. Imagine China style sweatshops and cheap advise if you get ill.

  7. The implementation of minimum wage was literally a direct response to employers paying their workers slave wages. The history itself debunks the idea that no minimum wage would be better.

  8. Coworkers in the 951 area code tend to be total retards. Don't let them get you down Billy.

  9. Healthcare and caregiving is another good candidate for a "jobs guarantee". Especially for the elderly. The more we help the elderly the more elderly there are to help, and the less our lives will suck when we approach the end of our lives. You need things like high estate taxes to pay for it, but you need that anyway. It is a huge problem if you have money making money all by itself and congregating in just a handful of families who don't really produce anything, just live of the rents of their massive property investments.

  10. Free-Marketologists make me lol, they live in such la-la land 😀

  11. Free Market System potentially could provide healthcare at a cost LOWER than any other country .. single payer systems in UK, Australia, etc… are 50% cost per captia compared to USA, with better care … so a true capitalistic free market system could be ~ 1/3 the cost with equal care!!! At that price .. ALL HEALTHCARE major concerns go away! As a society we can then afford to charitably extend free healthcare to the very needy, we can only be charitable if we can AFFORD IT!!
    Sounds good, but HOW???… MY PROPOSAL: The Single Payer Money in Your Pocket Plan!!!… where consumers make all price choices, which spurs competition, efficiencies and cost reduction (supply/demand capitalism). The government would mandate all providers to advertise their prices openly, and clearly identify if that service is covered by the single payer system plan, no more hidden bullshit prices and coverages. With such financial incentives, and open price shopping ability.. consumers will make lower cost choices that save them money, driving down our inflated cost of healthcare. For each service rendered people would get a fixed amount from a government single payer system .. if they choose a lower cost provider, they pocket the extra money from that government plan reimbursement, conversely, if they stupidly choose a higher cost provider, they would pay the amount above the government rebate (ouch! very stupid).
    How would this ever get implemented?? .. LIKE THIS: Immediately implement it, at slightly below the median price for services / prescriptions, with set reductions per year for the next 15 years, where cost would be 50% of current median prices at 10 years, and 33% at 15 years.

    Today's system completely insulates consumers from prices… we go to CVS near our house for a $15 copay script that is billed at $200 more than Walmart charges your insurance plan .. because Walmart is a one more mile away…. no financial incentive to do others so we don't … drug & insurance prices just KEEP GOING UP, and why shouldn't they, this is NOT Supply/Demand Capitalism. This is the main issue with our healthcare system … it is an economically FLAWED SYSTEM, doomed to failure.

  12. Free market works best when all of the following are met.
    1. Dealing with luxurious goods, anything which falls into the category of "non essential" goods or services.
    2. Demand is drastically lesser than the goods an industry could potentially supply.
    3. More than one competitive entity could reproduce the same products or services.

  13. Kenneth Arrow famously explained why healthcare was unlike any other market way back in the 60's, and Pakman is right, it has to do with information asymmetries and relative differences in market power between healthcare providers and consumers. There's another problem too, the fact that people are not very good at pricing long term risks, so they habitually undervalue the worth of insurance. It's only when you need it that it suddenly becomes valuable to you–the rest of the time it seems like an enormous and unnecessary cost. Because so many people feel this way, many don't buy insurance, shrinking the risk pool and making premiums ever higher. The caller's solution–everyone pay out of pocket–is no solution at all since most people don't have $500 to spend on an emergency, let alone tens of thousands of dollars for a costly medical treatment that may leave them out of work indefinitely. The root of this is the belief that companies wouldn't try to screw you if they could. But we know they would, and they do: just look at the price of insulin, a medical necessity for millions of people, but out of the reach of anyone without insurance who isn't already very wealthy.

  14. search 'debunking minimum wage price floor'. making this comment so that I'll remember to do just that

  15. There are certain risk categories that are just uninsurable–namely disabled people, people with chronic illness, the elderly, and terminal (end of life) patients. Insurers simply can't design an insurance product that people in these risk pools would be able to afford, because their healthcare costs are so high that the premiums would be unaffordable for all but those with very high incomes. But if you're chronically ill, disabled, old, or at the end of your life, chances are you aren't earning much in the way of income, so only the wealthy, lucky few would be able to pay for their care. Whether a free market in healthcare could take care of the rest of society, I'm agnostic on, but since most of us eventually become old, could potentially become disabled, chronically ill, and need end of life care, it's reasonable for big daddy government to step in and socialize these risk categories–because the market literally can't do it.

  16. Theory verses practice is what people need to understand the most here. A lot of things sound great on paper. They're logical, they sound self evident, even reasonable. But, once things get put into practice, the negative consequences start rearing their heads. Our current system of healthcare was never meant to be a permanent solution. It was the result of WWII laws that forbade wage competition during war time, so companies started offering incentives instead of monetary increases to attract scarce labor. Part of that was the offer of health insurance. It worked for a time, but instead of improving the system or scrapping it in favor or something new, they just expanded it, and many systems don't scale well. Then band-aid solutions to fix issues created perverse incentives, and bam, here we are with one of the worst health-care systems of the industrialized world.

  17. You can respond to this question with basic economics. You "voluntarily" demand games at the market so they can never abuse you because games always compete with the grass around the corner where you can do cartwheels. So supply and demand determine prices. So when you have cancer what would be your maximum price you would pay to survive?

  18. Oh boy. That's the GOP fake argument to solve health care costs. More competition! Except there's no way to get real competition into the health care market. It's an oligopoly. Also, most of the time, people aren't price sensitive for health care. Gee, I'm having a heart attack, I think I'll shop around, compare insurers, hospitals and doctors to get the best deal. That ambulance is too expensive. Oops, too late.

  19. This is an education issue. This person has absolutely no understanding about market elasticity and is emerged in an enviroment that values hyperfocus on laize faire capitalism in broad opposition to educated debate. His response, "I dont think i conveyed my message." Thats the moment a Trump supporter realizes that its not so easy to make economic arguments with no education into economies. This is a person that is so sure of his idea that he thinks hes going to call in to a radio station and win a debate, without ever learning of market elasticity. We live in an idiocracy.

  20. American public need to get themselves an education as to what capitalism actually is. It's a model that actually accounts for market failures. It recognises things like public goods which are best provided by governments. It amazes me that people can accept paying taxes for police services or fire services but when it comes to healthcare they feel it should be every man for himself. But things can change even in usa. Bernie sanders was dismissed as a kook 4 years ago when running against hilary but now medicare for all is supported by a majority of the population. There needs to be more of a discussion of what such a system would look like.

  21. Cook enough meth and you can afford your cancer treatment. Who needs insurance?

  22. You can never have a free market with a stock market. To have a truly free market, replace stock manipulation with a true consumer demand.

  23. Oh yeah, they have that in countries with no health care.

  24. There must be regulation or else you would have snake oil salesmen popping up over night. Hell we practically have it now with a lot of homeopathic "natural" jackasses telling people to not get vaccines

  25. $15 in New York is not the same as $15 in Iowa. Maybe minimum wage should be a state decision, not federal.

    Opening state borders for insurance is a good idea. Not as good as Medicare for All, but if we have to pay for insurance, might as well make the insurance pool as big as possible to get the cost down. I mean, Medicare has the biggest pool, the entire country, and that’s what we want.

    The really annoying thing is Dump said “I think removing state borders would be good”. I wish he’d actually do it. At least if he’s wrong, then it would shut up those “free-market” people. But maybe he’s right, we don’t really know till we try.


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