Mises Daily by Yuri N. Maltsev | Posted on 8/21/2009

In 1918, the Soviet Union became the first country to promise universal “cradle-to-grave” healthcare coverage, to be accomplished through the complete socialization of medicine. The “right to health” became a “constitutional right” of Soviet citizens.

The proclaimed advantages of this system were that it would “reduce costs” and eliminate the “waste” that stemmed from “unnecessary duplication and parallelism” — i.e., competition.

These goals were similar to the ones declared by Mr. Obama and Ms. Pelosi — attractive and humane goals of universal coverage and low costs. What’s not to like?

The system had many decades to work, but widespread apathy and low quality of work paralyzed the healthcare system. In the depths of the socialist experiment, healthcare institutions in Russia were at least a hundred years behind the average US level. Moreover, the filth, odors, cats roaming the halls, drunken medical personnel, and absence of soap and cleaning supplies added to an overall impression of hopelessness and frustration that paralyzed the system. According to official Russian estimates, 78 percent of all AIDS victims in Russia contracted the virus through dirty needles or HIV-tainted blood in the state-run hospitals.

Irresponsibility, expressed by the popular Russian saying “They pretend they are paying us and we pretend we are working,” resulted in appalling quality of service, widespread corruption, and extensive loss of life. My friend, a famous neurosurgeon in today’s Russia, received a monthly salary of 150 rubles — one third of the average bus driver’s salary.

In order to receive minimal attention by doctors and nursing personnel, patients had to pay bribes. I even witnessed a case of a “nonpaying” patient who died trying to reach a lavatory at the end of the long corridor after brain surgery. Anesthesia was usually “not available” for abortions or minor ear, nose, throat, and skin surgeries. This was used as a means of extortion by unscrupulous medical bureaucrats.

“Slavery certainly ‘reduced costs’ of labor, ‘eliminated the waste’ of bargaining for wages, and avoided ‘unnecessary duplication and parallelism’.”

To improve the statistics concerning the numbers of people dying within the system, patients were routinely shoved out the door before taking their last breath.

Being a People’s Deputy in the Moscow region from 1987 to 1989, I received many complaints about criminal negligence, bribes taken by medical apparatchiks, drunken ambulance crews, and food poisoning in hospitals and child-care facilities. I recall the case of a fourteen-year-old girl from my district who died of acute nephritis in a Moscow hospital. She died because a doctor decided that it was better to save “precious” X-ray film (imported by the Soviets for hard currency) instead of double-checking his diagnosis. These X-rays would have disproven his diagnosis of neuropathic pain.

Instead, the doctor treated the teenager with a heat compress, which killed her almost instantly. There was no legal remedy for the girl’s parents and grandparents. By definition, a single-payer system cannot allow any such remedy. The girl’s grandparents could not cope with this loss and they both died within six months. The doctor received no official reprimand.

Not surprisingly, government bureaucrats and Communist Party officials, as early as 1921 (three years after Lenin’s socialization of medicine), realized that the egalitarian system of healthcare was good only for their personal interest as providers, managers, and rationers — but not as private users of the system.

So, as in all countries with socialized medicine, a two-tier system was created: one for the “gray masses” and the other, with a completely different level of service, for the bureaucrats and their intellectual servants. In the USSR, it was often the case that while workers and peasants were dying in the state hospitals, the medicine and equipment that could save their lives was sitting unused in the nomenklatura system.

At the end of the socialist experiment, the official infant-mortality rate in Russia was more than 2.5 times as high as in the United States and more than five times that of Japan. The rate of 24.5 deaths per 1,000 live births was questioned recently by several deputies to the Russian Parliament, who claim that it is seven times higher than in the United States. This would make the Russian death rate 55 compared to the US rate of 8.1 per 1,000 live births.

Having said that, I should make it clear that the United States has one of the highest rates of the industrialized world only because it counts all dead infants, including premature babies, which is where most of the fatalities occur.

Most countries do not count premature-infant deaths. Some don’t count any deaths that occur in the first 72 hours. Some countries don’t even count any deaths from the first two weeks of life. In Cuba, which boasts a very low infant-mortality rate, infants are only registered when they are several months old, thereby leaving out of the official statistics all infant deaths that take place within the first several months of life.

In the rural regions of Karakalpakia, Sakha, Chechnya, Kalmykia, and Ingushetia, the infant mortality rate is close to 100 per 1,000 births, putting these regions in the same category as Angola, Chad, and Bangladesh. Tens of thousands of infants fall victim to influenza every year, and the proportion of children dying from pneumonia and tuberculosis is on the increase. Rickets, caused by a lack of vitamin D, and unknown in the rest of the modern world, is killing many young people.

Uterine damage is widespread, thanks to the 7.3 abortions the average Russian woman undergoes during childbearing years. Keeping in mind that many women avoid abortions altogether, the 7.3 average means that many women have a dozen or more abortions in their lifetime.

Even today, according to the State Statistics Committee, the average life expectancy for Russian men is less than 59 years — 58 years and 11 months — while that for Russian women is 72 years. The combined figure is 65 years and three months.[1] By comparison, the average life span for men in the United States is 73 years and for women 79 years. In the United States, life expectancy at birth for the total population has reached an all-time American high of 77.5 years, up from 49.2 years just a century ago. The Russian life expectancy at birth is 12 years lower.[2]

After seventy years of socialism, 57 percent of all Russian hospitals did not have running hot water, and 36 percent of hospitals located in rural areas of Russia did not have water or sewage at all. Isn’t it amazing that socialist government, while developing space exploration and sophisticated weapons, would completely ignore the basic human needs of its citizens?

“The filth, odors, cats roaming the halls, drunken medical personnel, and absence of soap and cleaning supplies added to an overall impression of hopelessness and frustration that paralyzed the system.”

The appalling quality of service is not simply characteristic of “barbarous” Russia and other Eastern European nations: it is a direct result of the government monopoly on healthcare and it can happen in any country. In “civilized” England, for example, the waiting list for surgeries is nearly 800,000 out of a population of 55 million. State-of-the-art equipment is nonexistent in most British hospitals. In England, only 10 percent of the healthcare spending is derived from private sources.

Britain pioneered in developing kidney-dialysis technology, and yet the country has one of the lowest dialysis rates in the world. The Brookings Institution (hardly a supporter of free markets) found that every year 7,000 Britons in need of hip replacements, between 4,000 and 20,000 in need of coronary bypass surgery, and some 10,000 to 15,000 in need of cancer chemotherapy are denied medical attention in Britain.

Age discrimination is particularly apparent in all government-run or heavily regulated systems of healthcare. In Russia, patients over 60 are considered worthless parasites and those over 70 are often denied even elementary forms of healthcare.

In the United Kingdom, in the treatment of chronic kidney failure, those who are 55 years old are refused treatment at 35 percent of dialysis centers. Forty-five percent of 65-year-old patients at the centers are denied treatment, while patients 75 or older rarely receive any medical attention at these centers.

In Canada, the population is divided into three age groups in terms of their access to healthcare: those below 45, those 45–65, and those over 65. Needless to say, the first group, who could be called the “active taxpayers,” enjoys priority treatment.

Advocates of socialized medicine in the United States use Soviet propaganda tactics to achieve their goals. Michael Moore is one of the most prominent and effective socialist propagandists in America. In his movie, Sicko, he unfairly and unfavorably compares health care for older patients in the United States with complex and incurable diseases to healthcare in France and Canada for young women having routine babies. Had he done the reverse — i.e., compared healthcare for young women in the United States having babies to older patients with complex and incurable diseases in socialized healthcare systems — the movie would have been the same, except that the US healthcare system would look ideal, and the UK, Canada, and France would look barbaric.

Now we in the United States are being prepared for discrimination in treatment of the elderly when it comes to healthcare. Ezekiel Emanuel is director of the Clinical Bioethics Department at the US National Institutes of Health and an architect of Obama’s healthcare-reform plan. He is also the brother of Rahm Emanuel, Obama’s White House chief of staff. Foster Friess reports that Ezekiel Emanuel has written that health services should not be guaranteed to

“individuals who are irreversibly prevented from being or becoming participating citizens. An obvious example is not guaranteeing health services to patients with dementia.”[3]

An equally troubling article, coauthored by Emanuel, appeared in the medical journal The Lancet in January 2009. The authors write that

“unlike allocation [of healthcare] by sex or race, allocation by age is not invidious discrimination; every person lives through different life stages rather than being a single age. Even if 25-year-olds receive priority over 65-year-olds, everyone who is 65 years now was previously 25 years. Treating 65-year-olds differently because of stereotypes or falsehoods would be ageist; treating them differently because they have already had more life-years is not.“[4]

Socialized medicine will create massive government bureaucracies — similar to our unified school districts — impose costly job-destroying mandates on employers to provide the coverage, and impose price controls that will inevitably lead to shortages and poor quality of service. It will also lead to nonprice rationing (i.e., rationing based on political considerations, corruption, and nepotism) of healthcare by government bureaucrats.

Real “savings” in a socialized healthcare system could be achieved only by squeezing providers and denying care — there is no other way to save. The same arguments were used to defend the cotton farming in the South prior to the Civil War. Slavery certainly “reduced costs” of labor, “eliminated the waste” of bargaining for wages, and avoided “unnecessary duplication and parallelism.”

In supporting the call for socialized medicine, American healthcare professionals are like sheep demanding the wolf: they do not understand that the high cost of medical care in the United States is partially based on the fact that American healthcare professionals have the highest level of remuneration in the world. Another source of the high cost of our healthcare is existing government regulations on the industry, regulations that prevent competition from lowering the cost. Existing rules such as “certificates of need,” licensing, and other restrictions on the availability of healthcare services prevent competition and, therefore, result in higher prices and fewer services.

Socialized medical systems have not served to raise general health or living standards anywhere. In fact, both analytical reasoning and empirical evidence point to the opposite conclusion. But the dismal failure of socialized medicine to raise people’s health and longevity has not affected its appeal for politicians, administrators, and their intellectual servants in search of absolute power and total control.

Most countries enslaved by the Soviet empire moved out of a fully socialized system through privatization and insuring competition in the healthcare system. Others, including many European social democracies, intend to privatize the healthcare system in the long run and decentralize medical control. The private ownership of hospitals and other units is seen as a critical determining factor of the new, more efficient, and humane system.

Yuri N. Maltsev, senior fellow of the Mises Institute, worked as an economist on Mikhail Gorbachev’s economic reform team before defecting to the United States. He is the editor of Requiem for Marx. He teaches economics at Carthage College.

Senator McCaskill’s recent tweets are in bold italic print and are in date order. My response follows each tweet.

Clairecmc = I said we must pay for it. Current multimillion $ (even a billion for the biggst) health ins execs say all private not working. Saturday July 18, 20:09

Let’s see… you voted Yes for the 700 Billion TARP and I am pleased to report you were able to save Goldman Sachs and they have a whopping $3.4 billion quarterly profits, and average bonuses on track to hit a record $700,000. Plus you were not able to save two of their biggest competitors!! TARP really worked for them.

You also voted Yes for $787 Billion Stimulus that has stimulated only friends of Congress. You said approximately 90 days ago, things were better. Obama said unemployment would never exceed 8% if we passed the stimulus in nanoseconds. Oops!!

Now you want to spend 1-3 Trillion on Health Care.

Plus, who are these people; “health ins execs say all private not working” I find that hard to believe and would like to see some proof of that. We know that MAYO DOES NOT agree with the plan.

Clairecmc = No one benefits from delay in health care reform. We need to get it done, and get it done right. Sunday, July 19 8:01

Yes anything that we slam dunk has much better results. Just like TARP and Stimulus. Of course, you thought those should be done asap too.

Clairecmc = Big mistake, tweetng when dead tired,one more time spelled right….I support public option,as long as private can compete. Now sleep. Monday, July 20, 23:11

“As long as private can compete.” Economics 101, private industry CANNOT compete with Government. But to make it easier for you to understand lets walk through a little analogy. Follow along now.

1. Sen. McCaskill’s husband makes millions in the Nursing home business.

2. Assume, he charges an average of $4,000 per month per person.

3. Charging $4,000 gives Sen McCaskill and her husband a tidy profit.

4. NOW Government is opening Nursing homes and government will charge an average of $2,500 per month per person.  (Remember, Government is not concerned with profit, only with fairness. If they run low on funds they will print money and raise taxes.)

5. People now have a choice between the public nursing home costing $2,500 per month and your husbands private nursing home costing $4,000 per month.

5. Government has also made a rule that once you leave your private nursing home, for any reason, you may not go back to a private home, you must go to a government home.

6. So over time there won’t be anyone in the private nursing home. But that will not happen immediately.

7. So now there are options.  How will you and your husband compete with government? Can private compete?

Clairecmc = Public OPTION.Think about what option means,that folks have choice btwn a public plan and option of privte plan.Lower costs, choices good. Tuesday, July 21 11:19

NOT AN OPTION. Sen McCaskill making statements like the above shows that you have not read the bill; don’t understand the bill; or are you intentionally deceiving the public.

IBD has studied and confirmed with the US House Ways and Means Committee: “On Page 16, the language indicated to us that once the bill became law, insurers would no longer be permitted to sell new private individual coverage”.

Please review this link:

http://ibdeditorials.com/IBDArticles.aspx?id=333066661999894

Clairecmc = I’m gonna faint. Commerce Com mark up, Ds and Rs working together. FAA reauthorization.Wish we could do this on everything.What does public. Tuesday, July 21, 14:02

Sending these condescending tweets is very unprofessional. Sen McCaskill, you are a bought and paid for Democrat. Stop with the snarky comments regarding Republicans.

Going back through your votes will show you vote ‘against’ the Democrats only when you are covered. The American people saw your recent No vote on a bill that would have passed with or without your vote. Then we had to watch you on TV breaking your arm congratulating yourself.

Big question that no one will answer:  Why is Congress excluded from this bill?  Good for us but not for you?

Please point me to the section of the United States Constitution that makes health care a right and a responsibility of Congress.

That says it all.

Yes We Can!!

What A Great Country!

The Old

I am serious

Faces of America II

I mean business

The retired...

I will not grab my ankles!!

Faces of America

A young patriot

America

The Young

The Ticked

The following  is a press release received from Claire McCaskill’s office today, May 12, 2009.  Love her warning.

WARNING: It appears the Republicans have thought of a new way to say no and are planning to sabotage this bill in order to protect the credit card industry by forcing a vote on a guns in the national parks provision.  (If you can think of a connection between credit cards and guns, let me know!)

This tactic was tried on another bill this year, and it worked.  Claire believes these important credit card reforms are necessary and doesn’t plan to let their trick work this time around.  Therefore, she plans to vote against a procedural maneuver masked as a gun issue in order to pass credit card protections American consumers desperately need.

News from

Senator Claire McCaskill

For Immediate Release

May 12, 2009                         

McCaskill Applauds Bill to Reform Credit Card Practices

Senator co-sponsored bill to stop companies from unfairly raising interest rates

WASHINGTON, D.C. – Amid this economic crisis, more and more Americans are relying on credit cards to get through tough times, and finding themselves victim to unexplained increases in interest rates and fees. Today, U.S. Senator Claire McCaskill urged her colleagues to pass a bill she co-sponsored in the Senate to prevent credit card companies from taking advantage of cash-strapped consumers with abusive and predatory lending practices. The bill is expected to pass the Senate on Thursday and similar legislation passed the House of Representatives recently.

“When times are tough, getting squeezed by credit card companies makes things even worse for Missouri families,” McCaskill said. “For too long, I’ve heard story after story about these companies jacking up interest rates on cardholders in good standing or targeting seniors and college students with deals they can’t afford. I’m pleased to see Congress finally doing something to protect the public from the worst abuses in this industry.”

Recently, McCaskill praised President Obama for speaking out on the importance of passing these credit card industry reforms following a meeting he held with top executives from 14 credit card companies. She has been an advocate for better practices in the credit card industry since she arrived in the Senate, introducing credit card reform legislation with Senator Carl Levin (D-MI) in May of 2007. She also co-sponsored a provision to protect college students from credit card marketing ploys with Senator Herb Kohl (D-WI).

Specifically, the Credit Card Accountability, Responsibility and Disclosure Act of 2009 would:

· Protect consumers from arbitrary interest rate, fee and finance charge increases and prohibit universal default on existing balances

• Require fairness in application and timing of card payments, such as applying payments to the balance with the highest interest rate first

• Protect the rights of financially responsible credit card users by prohibiting interest charges on debt paid on time

• Provide enhanced disclosure of card terms and conditions and strengthen oversight of credit card industry practices

• Ensure adequate safeguards for young people targeted by credit card companies

• Require tougher penalties for companies that violate the Truth in Lending Act

• Protect recipients of gift cards by requiring all gift cards have at least a five-year life span, and eliminate the practice of declining values and hidden fees for cards not used within a reasonable period of time

• Encourage transparency in credit card pricing by requiring a Government Accountability Office (GAO) study on the impact of interchange fees on consumers and merchants

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