Mortgage Bailouts and Health Reform

What does the mortgage crisis have to do with the future of health care reform? Plenty.
Stan J. Liebowitz, economics professor at the University of Texas at Dallas, tracked the intervention of the federal government into mortgage lending during the past 20 years. Boiling it down: In the name of home ownership, economic laws were suspended so that people without assets could buy houses. Should we be surprised when they cannot pay for them, and when they are foreclosed upon?

Now economists insist that free markets cannot adequately serve the lending industry, and that is why the federal government must step in to rescue it.

The commonality with health care reform is twofold:

1. The federal government, since at least 1965, has continuously ratcheted up its involvement in the payment and delivery of health care. States have either stayed a step ahead of the feds, or followed closely behind. Government has nearly destroyed the health care market economy.

2. The same logic used to justify a federal bailout of mortgage lenders and the banking industry will be used to reform health care. We have been told for decades that health care cannot operate in a free market environment. When it fails to meet governments’ goals for it, our vaunted U.S. health system, so the politicos will claim, need to be rescued by the government.

The big difference is that we have time to do something about health reform. An army of health insurance agents can dispatch itself to work overtime to convert the insurance market to consumer-directed health plans.

Only by bringing consumer (aka voter) pressure on Washington, D.C. and state capitals will the United States be able to avoid a national health plan. I am convinced that without such a movement, the march to socialized medicine will reach the tipping point by 2012-2014.

Please, don’t let this happen.