Problems With Obamacare Don’t Prove Private Sector Superiority

Mortgage MaddnessThe main stream media has been very focused recently on every problem with the Affordable Care Act (affectionately known as Obamacare). There are plenty of things not to like about the ACA and in particular the website launch but many in the media have taken this as an opportunity to push as common conservative platitude – anything the public sector can do the private sector can do better.

While prevalent, there is example after example after example where this meme has been proven wrong.

Of course we need look no further than our most recent financial crisis to see an illustration of the kind of wide spread disaster the public sector can create.

One of the biggest complaints about the ACA is the failure of the website to function properly. Due to this failure few have been able to actually obtain the insurance they were promised. On the other hand the mortgage banks set up such a complicated system that they lost promissory note that gives them ownership of a mortgage. If you believe Republican talking points losing the document necessary to uphold the terms of an agreement is something only the government would do.

Another issue with the ACA is that some people are losing the insurance they had even after the President said they could keep it. On the other hand the mortgage banks errantly foreclosed on some 4 million Americans. By comparison the inconvenience of being falsely forcibly removed from your home seems a tad bit worse than having your policy canceled.

Also a concern about the ACA is the additional burden it puts on young Americans with higher premium rates. On the other hand mortgage rates jumped without any corresponding increase in the loan rate from the Federal Government. Over a 12 month period the profit margin for new mortgages nearly doubled. This rise in profits for the mortgage banks has resulted in higher costs for new home buyers while negatively affecting the home sales market. At least the extra cost of health care gets you better coverage and saves you money on the back end.

Partially based on these problems and the distain for the ACA, House Republicans met to discuss possible impeachment hearings for the President. On the other hand a company called Blackstone Group recently used the same credit default swaps some consider the reason for the mortgage crisis to bilk another company out of over $15 million. Lesser acts of cheating would get you arrested in Vegas. The response to this possibly illegal and definitely immoral activity? Nothing. No hearings. No new regulations. No arrests. No one held accountable.

For all the good the free market can do the bottom line in the private sector is profits and this goal is typically at odds with doing what is good for the public. The public sector is far from a perfect entity but however flawed it may be it pales in to the comparison to those who believe that simply converting public sector programs on to private sector payrolls will suddenly solve the problems.

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