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Weekly Economic Update

Posted on 07-28-2010

“Obamacare” Comparisons

Supporters of America’s move toward a government-controlled health care system frequently make reference to similar “successful” programs in other nations.  A glimpse at three such national programs seems timely…

Canada

A recent Reuters headline noted, “Soaring Costs Force Canada to Reassess Health Model.”  The article notes that with pressure from an aging population and the need to rein in budget deficits, Canada’s provinces are taking tough measures to curb healthcare costs.

Healthcare in Canada is delivered through a publicly funded system, which covers all “medically necessary” hospital and physician care.  It now accounts for roughly 40% of provincial budgets.  Such spending was a mere 7% of provincial government expenditures in the 1970s (Investor’s Business Daily).

Rationing of health care, including reasonable access to specialists, is a major, and sometimes deadly, problem.  It has become an all too common practice that when wealthier people or high-level Canadian political leaders require immediate access to health care, they routinely come to the U.S.

Once banned by law, private-sector health care clinics are expanding across Canada.  Health care funding and the word “crisis” go hand-in-hand in Canada today.

Cuba

This largely failed Socialist nation 90 miles from Florida prides itself on high-quality health care.  However, the system is broken, and is slowly bankrupting the nation.

Cuba boasts of having the best doctor-patient ratio in the world, with one doctor for every 170 people, versus one doctor for every 390 Americans…

…but hang on

More than half of all Cuban physicians work overseas, many after defecting.  Doctors who remain in the country earn about $25 per month, with many instead taking jobs as taxi drivers or hotel workers, where they can make more money (The Wall Street Journal).

Cuba has a small number of higher quality clinics catering to paying medical tourists and high-level politicians.  However, the majority of Cubans take their chances in filthy, under-resourced hospitals.  Women regularly avoid gynecological exams “because they fear infection from unhygienic equipment and practices.”

Planning to visit a Cuban hospital as a regular citizen?  Plan on taking your own syringes, towels, bed sheets…and soap.

United Kingdom

The National Health Service (NHS) is the U.K. version of government-run health care.  It is the largest employer in Europe with more than 1.3 million employees, and has been around for 62 years.  It has an annual budget equivalent to more than $160 billion (The Wall Street Journal).

It is now planning to undergo a major overhaul that will (in theory) cut high swaths of bureaucracy by eliminating a layer of financial managers.  The plan is to put more power in the hands of doctors to decide how to spend the money…

…what a concept!

The plan calls for reducing management costs by more than 45% over the next four years.  Unfortunately, placing the words “reducing management costs” and “government” in the same sentence rarely, if ever, succeeds.

Various proposals to help control hospital costs have been suggested or—on occasion—enacted.  These have included removing every third light bulb in a corridor, asking patients to bring their own medicines from home, cutting the number of sterile packs used, and not changing the sheets between patients, but merely turning them over.

“Obamacare”…We can hardly wait


USA Today Quarterly economic survey

 

The USA TODAY economic survey of 47 top economists was conducted July 15-21. Median estimates through Q3 2011:

USA TODAY  •  Monday, July 26, 2010

Survey participants: Dean Baker, Center for Economic and Policy Research; Nariman Behravesh, IHS Global Insight; Richard Berner, Morgan Stanley; Jay Brinkmann, Mortgage Bankers Association ; Bill Cheney, John Hancock Financial; David Crowe, National Association of Home Builders; J. Dewey Daane, Vanderbilt University; Richard DeKaser, Woodley Park Research; Rajeev Dhawan, Georgia State University; William Dunkelberg, National Federation of Independent Business; Michael Englund, Action Economics; Jay Feldman, Credit Suisse; Lyle Gramley, Potomac Research Group; Ethan Harris, Bank of America-Merrill Lynch ; Maury Harris, UBS AG; Stuart Hoffman, PNC Financial Serrvices Group; David Huether, National Association of Manufacturers; William Hummer, Wayne Hummer Investments; Dana Johnson, Comerica Bank; Hugh Johnson, Hugh Johnson Advisors; Paul Kasriel, Northern Trust; Dean Maki, Barclays Capital; Ken Mayland, ClearView Economics; Dan Meckstroth, Manufacturers Alliance/MAPI; James Meil, Eaton; Robert Mellman, J.P. Morgan; Joel Naroff, Naroff Economic Advisors; Frank Nothaft, Freddie Mac; Donald Ratajczak, Morgan Keegan; Martin Regalia, US Chamber of Commerce; David Resler, Nomura Securities International; Chris Rupkey, Bank of Tokyo-Mitsubishi UFJ; John Ryding, RDQ Economics; Joshua Shapiro, MFR; Robert Shrouds, DuPont; Allen Sinai, Decision Economics; James Smith, Parsec Financial Management; Sean Snaith, University of Central Florida; Sung Won Sohn, California State University; Jeff Thredgold, Thredgold Economic Associates; Bart van Ark, The Conference Board; Chris Varvares, Macroeconomic Advisers; Mark Vitner, Wells Fargo; Brian Wesbury, First Trust Advisors; David Wyss, Standard & Poor’s; Lawrence Yun, National Association of Realtors; Mark Zandi, Moody’s Analytics

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