Government Can Keep Costs Down?

Chidem Kurdas over at ThinkMarkets disputes the claim that government can keep medical costs down if it was given enough market power:

Consider the Pentagon, a huge monopoly that in theory must have more market power than just about any buyer in any market. You think the Pentagon keeps down the costs of its procurements? Procurement officers pass through the revolving doors of the military-industrial complex and join defense contractors. Politicians, government bureaucrats and the industry are one loving family.

The medical-industrial complex works in a similar way. Behind the rhetoric of helping consumers one can discern a scheme to re-distribute resources from the rest of the economy to healthcare, with its powerful interests. Put that way, it does not sound so nice. You could see the expansion of medical entitlements as a payback to campaign donors.

“Medical-industrial complex.” Clever, accurate, and scary. Read his post here.

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