Of Health Care, Socialism, and Economic Recovery

I had a student once who critiqued an article's incorrect use of capitalism. She defined capitalism as the non-interference of the state in corporate interests. Since her definition did not mesh with mine, I realized that defining capitalism is tricky business, and I went to an economics professor. He pointed out, and I quite agree, that capitalism is like many terms in the English language, too dangerous to define specifically. It's best just to highlight general characteristics but try not to pin it down too neatly. That said, I want to sit briefly with a broad definition that must be widely held in public as it is on the public encyclopedia, wikipedia: "Capitalism typically refers to an economic and social system in which the means of production (also known as capital) are privately controlled; labor, goods and capital are traded in a market; profits are distributed to owners or invested in new technologies and industries; and wages are paid to labor." My student's definition of capitalism would certainly fit under this rubric, but so would a number of other definitions that might not sound like hers. Every term in that definition is debatable, but generally capitalism is opposed to "socialism," which supports some form of public or shared ownership of resources and means of production. Since preserving "capitalism" against "socialism" seems to be part of the healthcare debate, I think that the problem we have is this: can a system still be capitalist and involve government control? And if not, do we really want to live in such a capitalist system?

Based on the recent healthcare debates, obviously a significant and vocal portion (though, polls suggest, not a majority) of this country seems to think that the slightest slip toward socialism would damage our great capitalist tradition (while crying keep your government hands off my Medicare, the government-run program; and while I could talk about the use of race-baiting and fear of change in these town hall meetings, I will leave that to other commentators). First of all, Democratic Party Health Care proposals have so far left out the proposal I most support (to paraphrase Jimmy Smits from the final season of the West Wing), removing "over 65" from Medicare, thus making Medicare available to everyone. Why have they avoided this? Because somehow it might be socialism to have a government, single-payer health insurance option that competes with private insurance and that regulates health care costs. Socialism, by the way, would mean complete government control of the health care system, from nurse to hospital to insurance. No Democratic proposal supports a socialist health care system; the hospitals and doctors remain private, and private insurance options would remain (and if they think they can't compete with a public, single-payer option, then that should tell you something about what kind of crappy job your private health insurance does for you). In the 1100-page House bill, there is no mention of "death panels" or "communal standards." The bill and many health care reformers do advocate government regulation of health care. If you're a libertarian, that will piss you off, but for the rest of us, that should be fine. It is not socialism, it barely qualifies as a mixed economy, it's just government intervention in the capitalist market place for the sake of the consumer, something that we should support if we think that cars should be safety-tested before they are sold.

If we are to accept the libertarian definition of capitalism, and we think the U.S. should be a pure capitalist state, then there should be no tax-payer-paid police, no state-supported military, no public schools, no public libraries, no regulation on any industry whatsoever (including the FDA that tries to keep lead out of baby formula), and we, as individuals, should pave our own roads. If you are a libertarian, then you would find the U.S. government has disgustingly indulged in a "mixed economy" since its inception. If capitalism means a complete lack of state intervention in anything, I don't think most of us, when it comes down to it, want to live in such a country. If you like that a government agency won't let poison be packaged as medicine, then you like the FDA, and you like government regulation in the pharmaceutical industry (and I wish there was more of it, personally). So the debate should not be how to keep socialism out of our capitalism, rather how mixed should our economy be and in what places. This, of course requires that "socialism" not be treated as a demonic concept; it requires that we live in a world filled not with black (capitalism) and white (socialism), but shades of gray where we pick which blend works best for us as a nation and a society.

Just so you know, countries that have been sporting more mixed economies are faring better than us these days. The WHO rankings are well known; the U.S. healthcare system comes in at a staggeringly low 37 (if you consider how much richer the U.S. is than #36, Costa Rica). France is #1; the U.K. is #18. While conservatives in the U.S. have been making digs at the British NHS, the British blogosphere has fought back in defense of their system. It is imperfect they note, but a hell of a lot better than the U.S. system. Even Canada is ranked higher, at #30, than the U.S.

And those mixed economies of France and Germany have actually exited the recession. We are still in a recession for reasons similar to the BBC's explanation for the U.K. Finance was too big a chunk of our economy, but, and the BBC notes this as well, our economy was not the right mix of capitalism and socialism in a time like this. France and Germany's mixed economy had social safety nets that better protected their economies, and so their economies are growing again. Ours is still shrinking, and there are people for whom unemployment protections are running out. So the next time someone demands that we preserve pure capitalism at all costs, I hope that they can also think about their support for the troops in Iraq and Afghanistan (paid for by that socialist defense budget of ours) and how we got stuck in a recession longer than states with more mixed economies.