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Posts Tagged ‘Health Care’

Yesterday, I shared part of an interview that focused on Mayor Pete Buttigieg’s scheme to give more subsidies to colleges, thus transferring money from poorer taxpayers to richer taxpayers.

Here’s the other part of the interview, which revolved around a very bad idea to copy nations that impose price controls on prescription drugs.

In some sense, this is a debate on price controls, which have a long history (going all the way back to Ancient Rome) of failure.

But my comments focused primarily on the adverse consequences of Pelosi’s approach.

And if you want more details, Doug Badger explained how Pelosi’s approach would backfire in a report for the Heritage Foundation. He starts with an explanation of the legislation.

The Lower Drug Costs Now Act of 2019 (H.R. 3), introduced last week with the backing of House Speaker Nancy Pelosi, D-Calif., would double down on the failures of existing government policies that have distorted prescription drug prices and contributed to higher health care costs. …H.R. 3 would establish a system in which the U.S. government bases prices for cutting-edge drug treatments on those set by foreign governments. The measure would set an upper price limit at 1.2 times a drug’s average price in six other countries (Australia, Canada, France, Germany, Japan, and the United Kingdom). The secretary of health and human services then would seek to “negotiate” prices below that upper limit for at least 25—and as many as 250—drugs each year. …A manufacturer that declined to negotiate the price of any of its products would incur an excise tax of up to 95% of the revenues it derived from that product in the preceding year.

Doug then warns against an expansion of government power.

The bill represents an unprecedented exercise of raw government power. The federal government already imposes price curbs across a range of programs, requiring manufacturers to pay the government rebates… These provisions all are confined to federal programs, but nonetheless have distorted drug prices throughout the health sector. It’s one thing for the government to dictate the prices it pays in programs it finances. It is quite another for the government to impose a price for a product’s private sale and to extract money from a company on a long-ago settled transaction.

He then concludes by showing some of the negative consequences.

…aggressive government price-setting has damaged innovation and limited access to new treatments in all six of the countries whose price controls the bill would import. If the U.S. adopts price controls, it risks the same results here. Access to new drugs is much greater in the U.S. than in countries with price controls, in part because of having shunned price controls. …This lack of access can have damaging effects. A study by IHS Markit…concluded that Americans gained 201,700 life years as a result of faster access to new medicines. …Countries with price controls also suffer a decline in pharmaceutical research and development. In 1986, European firms led the U.S. in spending on pharmaceutical research and development by 24%. After the imposition of price control regimes, they fell behind. By 2015, they lagged the U.S. by 40%. …the president’s Council of Economic Advisers…concluded that while price controls might save money in the short term, they would cost more money in the long run. Government price-setting, it wrote, “makes better health care costlier in the future by curtailing innovation.”

As you can see, price controls have a deadly effect in the short run (the 201,700 life years).

But as I stated in the interview, the far greater cost – in terms of needless deaths – would become apparent in the long run as new drugs no longer come to market.

By the way, it’s not just me, or folks on the right, who recognize that there will be adverse consequences from price controls.

Writing for left-leaning Vox, Sarah Kliff acknowledges that there are trade-offs.

The United States is exceptional in that it does not regulate or negotiate the prices of new prescription drugs when they come onto market. …And the problems that causes are easy to see, from the high copays at the drugstore to the people who can’t afford lifesaving medications. What’s harder to see is that if we did lower drug prices, we would be making a trade-off. Lowering drug profits would make pharmaceuticals a less desirable industry for investors. And less investment in drugs would mean less research toward new and innovative cures. …In other words: Right now, the United States is subsidizing the rest of the world’s drug research by paying out really high prices. If we stopped doing that, it would likely mean fewer dollars spent on pharmaceutical research — and less progress developing new drugs for Americans and everybody else.

Here’s a chart from her article, which I’ve modified (in red) to underscore how other nations are free-riding because American consumers are picking up the tab for research and development.

By the way, I have no idea where the red lines actually belong. I’m just trying to emphasize that consumers who pay the market price (or closer to the market price) are the ones why underwrite the cost of discovering new drugs and treatments.

And Ms. Kliff definitely agrees this trade-off exists.

Every policy decision comes with trade-offs… If the United States began to price regulate drugs, medications would become cheaper. That would mean Americans have more access to drugs but could also expect a decline in research and development of new drugs. We might have fewer biotech firms starting up, or companies deciding it’s worth bringing a new drug to market. …Are we, as a country, comfortable paying higher prices for drugs to get more innovation? Or would we trade some of that innovation to make our drugs more accessible to those of all income levels?

For what it’s worth, I don’t actually think there’s much of a trade-off. I choose markets, both for the moral reason and because I want to maximize long-run health benefits for the American people.

P.S. Because pharmaceutical companies got in bed with the Obama White House to support Obamacare, some people may be tempted to say Pelosi’s legislation is what they deserve. While I fully agree that it’s despicable for big companies to get in bed with big government, please remember that the main victims of Pelosi’s legislation will be sick people who need new treatments.

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I’ve always considered Senator Bernie Sanders to be the most clueless and misguided of all presidential candidates.

But I also think “Crazy Bernie” is actually sincere. He really believes in socialism.

Elizabeth Warren, by contrast, seems more calculating. Her positions (on issues such as Social Securitycorporate governancefederal spendingtaxationWall Street, etc).) are radical, but it’s an open question whether she’s a true believer in statism. It’s possible that she simply sees a left-wing agenda as the best route to winning the Democratic nomination.

Regardless of motive, though, her proposals are economic lunacy. So maybe it’s time to give her “Looney Liz” as a nickname.

Consider, for instance, her new Medicare-for-All scheme. She got hammered for promising trillions of dollars of new goodies without specifying how it would be financed, so she’s put forward a plan that ostensibly fits the square peg in a round hole.

But as Chuck Blahous of the Mercatus Center explains, her plan is a farce.

…presidential candidate Sen. Elizabeth Warren released her proposal to ostensibly pay for the costs of Medicare for All (M4A) without raising taxes on the middle class. As published, the plan would not actually finance the costs of M4A. …the Warren proposal understates M4A’s costs, as quantified by multiple credible studies, by about 34.2%. Another 11.2% of the cost would be met by cutting payments to health providers such as physicians and hospitals. Approximately 20% of the financing is sought by tapping sources that are unavailable for various reasons, for example because she has already committed that funding to other priorities, or because the savings from them was already assumed in the top-line cost estimate. The remaining 34.6% would be met by an array of new and previous tax proposals, most of it consisting of new taxes affecting everyone now carrying employer-provided health insurance, including the middle class.

Here’s a pie chart showing that Warren is relying on smoke and mirrors for more than 50 percent of the financing.

By the way, the supposedly real parts of her plan, such as the new taxes, are a very bad idea.

Brian Riedl of the Manhattan Institute unleashed a flurry of tweets exposing flaws in her proposal.

Since I’m a tax wonk, here’s the one that grabbed my attention.

Wow. Higher taxes on domestic business income, higher taxes on foreign-source business income, higher taxes on business investment, more double taxation of capital gains, a tax on financial transactions, and a very punitive wealth tax (which would be a huge indirect tax on all saving and investment).

If ever enacted, the United States presumably would drop to last place in the Tax Foundation’s competitiveness ranking.

And let’s not forget that Medicare-for-All would dramatically increase the burden of government spending. In one fell swoop, we’d become Greece.

Actually, that probably overstates the damage. Based on my Lassez-Faire Index, I’m guessing we’d be more akin to Spain or Belgium (in other words, falling from #6 in the rankings to the #35-#40 range according to Economic Freedom of the World).

P.S. Don’t forget that Medicare has a massive shortfall already.

P.P.S. Looney Liz’s plan is terrible fiscal policy, but keep in mind it’s also terrible health policy since it would exacerbate the third-party payer problem.

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In addition to speaking on tax competition at the European Resource Bank in Moldova, I also appeared on a panel about healthcare.

I used the opportunity to explain how government-created “third-party payer” has crippled market forces in the United States and produced inefficiency and needlessly high costs.

There are two visuals from my presentation I want to highlight.

First, I took Milton Friedman’s explanation of the how people care about cost and quality depending on whether they’re spendingf their own money and whether they’re buying for themselves, and I then showed how it applies to America’s healthcare system.

Ideally, purchases are made in quadrant 1. Thanks to government distortions, however, most health spending in America occurs in quadrants 2, 3, and 4.

When purchases occur in quadrant 1, buyers and sellers directly interact and there are incentives on both sides to get the most value.

That’s not the case, though, with purchases in the other quadrants.

I illustrated the problem with a slide that looks at the layers that exist between health consumers and health providers.

I also shared data on how third-party payer causes higher prices in every sector where it exists and also pointed out that we see falling prices in the few parts of the healthcare sector where people actually buy with their own money.

But that’s old news.

Let look at some new information.

Doctor Scott Atlas, in a column for today’s Wall Street Journal, concisely explains the problem of government-created third-party payer.

In an effort to bring down the costs of medical care, the Trump administration wants to make prices visible to patients, and it’s moving aggressively to make that happen. …A new executive order will require providers paid by Medicare to post prices for a range of procedures. Meanwhile, the Centers for Medicare and Medicaid Services recently finalized its mandate requiring pharmaceutical manufacturers to disclose the list price of prescription drugs in direct-to-consumer television advertisements. …Yet these moves won’t be enough to bring down prices. Transparency, though essential, is not sufficient. Nor does it always need to be legislated. Laws aren’t required to force sellers of food, computers or clothing to post prices. That information is driven by consumers who actively seek value for their money. …But patients typically don’t even ask about prices, because they figure “it’s all covered by insurance.” The harmful U.S. model is unfortunately that insurance should minimize any out-of-pocket payment. Health care may be the only good or service in America that is bought and used without knowing its cost. Unfortunately, the Affordable Care Act instilled even broader coverage requirements and added counterproductive subsidies that encouraged more-widespread adoption of bloated insurance, reinforcing a model of coverage that prevents patients from caring about prices.

How do we fix the problem?

Dr. Atlas says people need to have control over their healthcare dollars.

To bring prices down, …patients must have stronger incentives to consider price. …But as long as insurance minimizes the patient’s share of cost, the patient won’t bother price shopping. For price-transparency to have the most impact, it must increase visibility of the only price relevant to patients—out-of-pocket costs at the time of purchase. Cheaper insurance policies with higher deductibles, coupled with large, liberalized-use, permanently owned health savings accounts, are also important to motivate consideration of price. …We can make medical care more affordable without moving to a single-payer system. Centralized models uniformly regulate costs by restricting health-care use, generating lengthy delays for needed care, limiting access to important drugs and technology, and ultimately resulting in worse disease outcomes. The better path will involve reducing the cost of medical care itself by creating the conditions that bring down prices in every other area of the economy: incentivizing empowered consumers and increasing the supply of medical care to stimulate competition among providers.

Amen.

That means reforming Medicare and Medicaid, where the government directly creates third-party payer.

And it means reforming the tax code, where the government indirectly creates third-party payer with a big preference for over-insurance.

At the risk of upsetting some people, it even means defending the “Cadillac tax,” a provision of Obamacare.

And even agreeing with the Washington Post, which opined today in favor of that provision.

Consider the House supermajority, made up of Democrats and Republicans favoring repeal of the excise tax on high-cost health insurance plans, which would otherwise take effect in 2022. …the bill is backed by a potent lobbying coalition including insurance companies, labor unions — and even ExxonMobil. …Known as the “Cadillac tax” because it applies to especially generous “Cadillac” health plans, the tax equals 40 percent of the value of private-sector health benefits exceeding $11,200 for single coverage and $30,150 for family coverage in 2022. Albeit indirectly, the tax chips away at one of the largest subsidies in the health-insurance system, the tax exclusion for employer-paid health insurance… A wide consensus of economists identifies the tax exclusion as a major source of distortion in the U.S. system, building a higher floor under costs… The Cadillac tax would curb these tendencies… killing the Cadillac tax… The United States’ already out-of-whack health-care system will become more so, and bipartisan profligacy and pandering will have triumphed again.

Let’s close with a bit of dark humor.

One of my many frustrations is that people blame the free market for the various government-caused problems in healthcare. Here’s a way of visualizing it.

Government intervenes, which causes problems, and those problems are then used as an excuse for additional intervention. Sort of a turbo-charged version of Mitchell’s Law.

Ultimately, this process may lead politicians to adopt something really crazy, such as “Medicare for All.”

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The so-called Green New Deal is only tangentially related to climate issues.

It’s best to think of it as the left’s wish list, and it includes a paid leave entitlement, government jobs, infrastructure boondoggles, and an expansion of the already bankrupt Social Security system.

But the most expensive item on the list is “Medicare for All,” which is a scheme concocted by Bernie Sanders to have the government pay for everything.

Would this be a good idea? In a column for Forbes, Sally Pipes of the Pacific Research Institute explains that government-run healthcare in the United Kingdom has some very unfriendly features.

Nearly a quarter of a million British patients have been waiting more than six months to receive planned medical treatment from the National Health Service, according to a recent report from the Royal College of Surgeons. More than 36,000 have been in treatment queues for nine months or more. …Consider how long it takes to get care at the emergency room in Britain. Government data show that hospitals in England only saw 84.2% of patients within four hours in February. …Wait times for cancer treatment — where timeliness can be a matter of life and death — are also far too lengthy. According to January NHS England data, almost 25% of cancer patients didn’t start treatment on time despite an urgent referral by their primary care doctor. …And keep in mind that “on time” for the NHS is already 62 days after referral.

If this sounds like the VA health care system, you’re right.

Both are government run. Both make people wait.

And both produce bad outcomes. Here’s some of the data from the British system.

Unsurprisingly, British cancer patients fare worse than those in the United States. Only 81% of breast cancer patients in the United Kingdom live at least five years after diagnosis, compared to 89% in the United States. Just 83% of patients in the United Kingdom live five years after a prostate cancer diagnosis, versus 97% here in America.

Just like I told Simon Hobbs on CNBC many years ago.

The best part of Sally’s column is that she explains how the flaws in the U.K. system are being copied by Bernie Sanders and other supporters.

Great Britain’s health crisis is the inevitable outcome of a system where government edicts, not supply and demand, determine where scarce resources are allocated. Yet some lawmakers are gunning to implement precisely such a system in the United States. The bulk of the Democratic Party’s field of presidential candidates — including Senators Kirsten Gillibrand, Kamala Harris, and Elizabeth Warren — co-sponsored Senator Bernie Sanders’s 2017 “Medicare for All” bill. That plan would abolish private insurance and put all Americans on a single government-run plan… Britons face long waits for poor care under their country’s single-payer system. That’s not the sort of healthcare model the American people are looking for.

The bottom line is that Medicare for All would further exacerbate the third-party payer problem that already plagues the health care system.

And that means ever-escalating demand, rising costs, and inefficiencies.

There are only two ways of dealing with the cost spiral. One option is huge tax increases, which would result in a massive, European-style tax burden on the lower-income and middle-class taxpayers.

Taxpayers in the U.K. endure higher burdens than their counterparts in America, But they also suffer from the second option for dealing with the cost spiral, which is rationing.

Some of the data was in Ms. Pipes’ column.

If you want more examples (and some horrifying examples), you can click stories from 2017, 2016, 2015, 2014, 2013, and 2012.

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When I think about social welfare spending, I mostly worry about recipients getting trapped in dependency.

But I also feel sorry for taxpayers, who are bearing ever-higher costs to finance redistribution programs.

Today’s column won’t focus on those issues. Instead, we’re going to utilize new OECD data to compare the size of the welfare states in developed nations.

We’ll start with the big picture. Here it total redistribution spending, measured as a share of economic output, for selected countries that are members of the Organization for Economic Cooperation and Development.

Nobody will be surprised, I assume, to see that France, Finland, Belgium, Denmark, and Italy have the biggest welfare states.

The United States is in the middle of the pack. American taxpayers might be surprised to learn, though, that they finance a bigger welfare state than the ones that exist in Canada, Iceland, and the Netherlands.

The overall numbers are important, but it’s also educational to consider the various components.

And the largest chunk of social spending in most nations is for their old-age programs. The biggest burdens are found in Greece, Italy, France, Portugal, and Austria. The United States, once again, is in the middle of the pack.

By the way, keep in mind that there are many factors that determine why some nations spend more than others.

  • How generous are benefits? – This is often measured as the “replacement rate,” which compares retirement benefits to income during working years.
  • When can people retire? – Some countries allow people, or some classes of people, to get benefits while relatively young. Others are more stringent.
  • Does a country have an aging population? – Demographic changes already are beginning to have a large effect on the finances of some systems.
  • Is there a private savings system? – Nations such as Switzerland, Australia, Chile, and the Netherlands have significant private retirement savings.

Now let’s look at government spending on health.

Here’s the area where the United States is more extravagant than almost every other nation. Only France spends more money.

Actually, since per-capita GDP is significantly larger in the United States than in France, American taxpayers spend more on a per-person basis.

Some people will observe, with great justification, that the data for the United States may be a measure of the inefficiency of the American system rather than taxpayer generosity. This is a topic for another day.

Last but not least, let’s look at traditional welfare. In other words, cash assistance to the working-age population.

The fiscal burden of this spending is highest in Belgium, Finland, the Netherlands, Norway, and Luxembourg. The United States, meanwhile, is comparatively frugal.

P.S. Here are a couple of caveats for number crunchers and policy wonks.

First, there are methodological challenges when comparing OECD nations. Eastern European nations tend to be significantly less prosperous than Western European nations, thanks to decades of communist enslavement. So looking at this data does not really allow for apples-to-apples comparisons. Moreover, there are a handful of developing nations that belong to the OECD, such as Mexico and Turkey, so comparison are effectively meaningless. And Chile is on the cusp of becoming a fully developed nation so it’s in its own category.

Second, as I briefly mentioned above, nations have different levels of per-capita GDP. If we look at the last chart, Austria and Spain spend a similar share of GDP on welfare, but since Austria is a richer nation, its taxpayers actually finance a lot more per-capita welfare spending. The same is true if you compare Canada and Estonia, Sweden and Slovenia, and Germany and Greece.

P.P.S. There was virtually no welfare state in OECD nations prior to the 1930s and very small welfare states until the 1960s. For what it’s worth, the huge reduction in poverty in those nations occurred before the welfare state.

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There’s a long and sordid history of people in Western nations acting as dupes and apologists for communism.

This is especially the case with the wretchedly impoverished totalitarian outpost 90 miles south of Florida.

Based on what he wrote for the opinion pages of the New York Times, Nicholas Kristof belongs on that list of “useful idiots.”

Cuba…in health care…does an impressive job that the United States could learn from. …an American infant is, by official statistics, almost 50 percent more likely to die than a Cuban infant. By my calculations, that means that 7,500 American kids die each year because we don’t have as good an infant mortality rate as Cuba reports. …a major strength of the Cuban system is that it assures universal access. Cuba has the Medicare for All that many Americans dream about. …It’s also notable that Cuba achieves excellent health outcomes even though the American trade and financial embargo… Cuba overflows with doctors — it has three times as many per capita as the United States… Outsiders mostly say they admire the Cuban health system. The World Health Organization has praised it, and Ban Ki-moon, the former United Nations secretary general, described it as “a model for many countries.”

Kristof admits in his piece that there are critics who don’t believe the regime’s data, but it’s clear he doesn’t take their concerns seriously.

And he definitely doesn’t share their data. So lets take a close look at the facts that didn’t appear in Kristof’s column.

My first recommendation is to watch Johan Norberg’s video on the real truth about Cuba’s infant mortality.

But there’s so much more.

Jay Nordlinger authored the most comprehensive takedown of Cuba’s decrepit system back in 2007. Here are some of the highlights.

The Left has always had a deep psychological need to believe in the myth of Cuban health care. On that island, as everywhere else, Communism has turned out to be a disaster: economic, physical, and moral. Not only have persecution, torture, and murder been routine, there is nothing material to show for it. The Leninist rationalization was, “You have to break some eggs to make an omelet.” Orwell memorably replied, “Where’s the omelet?” There is never an omelet. …there is excellent health care on Cuba — just not for ordinary Cubans. …there is not just one system, or even two: There are three. The first is for foreigners who come to Cuba specifically for medical care. This is known as “medical tourism.” The tourists pay in hard currency… The second health-care system is for Cuban elites — the Party, the military, official artists and writers, and so on. In the Soviet Union, these people were called the “nomenklatura.” And their system, like the one for medical tourists, is top-notch. Then there is the real Cuban system, the one that ordinary people must use — and it is wretched. Testimony and documentation on the subject are vast. Hospitals and clinics are crumbling. Conditions are so unsanitary, patients may be better off at home, whatever home is. If they do have to go to the hospital, they must bring their own bedsheets, soap, towels, food, light bulbs — even toilet paper. And basic medications are scarce. …The equipment that doctors have to work with is either antiquated or nonexistent. Doctors have been known to reuse latex gloves — there is no choice. …So deplorable is the state of health care in Cuba that old-fashioned diseases are back with a vengeance. These include tuberculosis, leprosy, and typhoid fever. And dengue, another fever, is a particular menace.

Wow, I guess shortages extend well beyond toilet paper.

Next we have some very sobering data from a 2004 article in Canada’s National Post.

…a small bottle of tetracycline costs US$5 and a tube of cortisone cream will set you back as much as US$25. But neither are available at the local pharmacy, which is neat and spotless, but stocks almost nothing. Even the most common pharmaceutical items, such as Aspirin and rubbing alcohol, are conspicuously absent. …Antibiotics, one of the most valuable commodities on the cash-strapped Communist island, are in extremely short supply and available only on the black market. Aspirin can be purchased only at government-run dollar stores, which carry common medications at a huge markup in U.S. dollars. This puts them out of reach of most Cubans, who are paid little and in pesos. Their average wage is 300 pesos per month, about $12. …tourist hospitals in Cuba are well-stocked with the latest equipment and imported medicines, said a Cuban pediatrician, who did not want to be identified. …”Tourists have everything they need,… But for Cubans, it’s different. Unless you work with tourists or have a relative in Miami sending you money, you will not be able to get what you need if you are sick in Cuba. As a doctor, I find it disgusting.”

And here’s some scholarly research from Katherine Hirschfeld at the University of Oklahoma (h/t: Scott Johnson).

…the Cuban government continues to respond to international criticism of its human rights record by citing…praise for its achievements in health and medicine…the unequivocally positive descriptions of the Cuban health care system in the social science literature are somewhat misleading. In the late 1990s, I conducted over nine months of qualitative ethnographic and archival research in Cuba. During that time I shadowed physicians in family health clinics, conducted formal and informal interviews with a number of health professionals, lived in local communities, and sought to participate in everyday life as much as possible. Throughout the course of this research, I found a number of discrepancies between the way the Cuban health care system has been described in the scholarly literature, and the way it appears to be described and experienced by Cubans themselves. …After just a few months of research, …it became increasingly obvious that many Cubans did not appear to have a very positive view of the health care system themselves. A number of people complained to me informally that their doctors were unhelpful, that the best clinics and hospitals only served political elites and that scarce medical supplies were often stolen from hospitals and sold on the black market. Further criticisms were leveled at the politicization of medical care… Public criticism of the government is a crime in Cuba, and penalties are severe. Formally eliciting critical narratives about health care would be viewed as a criminal act both for me as a researcher, and for people who spoke openly with me. …One of the most readily apparent problems with the health care system in Cuba is the severe shortage of medicines, equipment, and other supplies. …Many Cubans (including a number of health professionals) also had serious complaints about the intrusion of politics into medical treatment and health care decision-making.

Three academics at Texas Tech University also found very troubling data when they investigated the nation’s health system (h/t: David Henderson).

With 11.1% of GDP dedicated to health care and 0.8% of the population working as physicians, a substantial amount of resources is directed towards reducing infant mortality and increasing longevity. An economy with centralized economic planning by government like that of Cuba can force more resources into an industry than its population might desire in order to achieve improved outcomes in that industry at the expense of other goods and services the population might more highly desire. …Physicians are given health outcome targets to meet or face penalties. This provides incentives to manipulate data. Take Cuba’s much praised infant mortality rate for example. In most countries, the ratio of the numbers of neonatal deaths and late fetal deaths stay within a certain range of each other as they have many common causes and determinants. …Cuba, with a ratio of 6, was a clear outlier. This skewed ratio is evidence that physicians likely reclassified early neonatal deaths as late fetal deaths, thus deflating the infant mortality statistics and propping up life expectancy. Cuban doctors were re-categorizing neonatal deaths as late fetal deaths in order for doctors to meet government targets for infant mortality. …Physicians often perform abortions without clear consent of the mother, raising serious issues of medical ethics, when ultrasound reveals fetal abnormalities because ‘otherwise it might raise the infant mortality rate’. …The role of Cuban economic and political oppression in coercing ‘good’ health outcomes merits further study.

The bottom line is that Cuba is a hellhole and statistics from a repressive regime can’t be trusted.

Though the real message of today’s column is that we should be revolted by people who are willing to be dupes for totalitarianism.

And I can understand why people willing to debase themselves in that way are so sensitive to criticism.

P.S. The New York Times has a pathetic history of covering up for the crimes of communism, most notably Walter Duranty, who was given a Pulitzer Prize in 1932 even though he despicably lied in his reports to promote Stalin’s horrid regime. He even covered up Stalin’s holocaust of the Ukrainian people. Even though Duranty’s evil actions are now public knowledge, the Pulitzer Prize Board has not revoked the award. The New York Times, to its credit, at least has acknowledged that Duranty lied to promote Stalin’s brutal dictatorship. One wonders if the newspaper eventually will apologize for Kristof.

P.P.S. I’m also not impressed that a former Secretary General of the U.N. endorsed Cuba’s health care system. After all, it was an official from the U.N. who praised the lack of obesity among the starving people of North Korea.

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I periodically mock the New York Times when editors, reporters, and columnists engage in sloppy and biased analysis.

But all these instances of intentional and unintentional bias are trivial compared to our next example.

The New York Times has gone above and beyond conventional media bias with a video entitled, “How Capitalism Ruined China’s Health Care System.”

Here’s the part that caused my jaw to drop.

After the sad opening story about the guy with the sick mother, there’s a section from 1:33-2:27 that makes two observations that basically show the premise of the video is totally wrong.

  • First, it points out (from 1:33-1:42) that there is a universal, government-run health system that ostensibly covers the guy’s mother, so her unfortunate status is yet another example that coverage in a government-run healthcare system is not the same as treatment.
  • Second, it points out (from 2:05-2:27) that life expectancy soared once the communist party relaxed its grip on the economy and allowed some liberalization, which would seem to be powerful evidence that capitalism leads to better health outcomes.

These are astounding mistakes.

But it gets worse. Sarah Lilly, who lives in China, debunked the rest of the video in a column for FEE.

The New York Times…attempts to blame capitalism for the many problems in China’s health care system. …As a resident of China and a recipient of outstanding private health care here, I was confused as to why the Times would show us the horrors of a capitalist system without actually visiting a private health care facility. …All of the horrors depicted in the high-quality video—the long lines, the scalping, and the hospital fights—occurred at government-run health care facilities. …At the very least, failing to feature a single private medical facility while blaming capitalism for the dysfunction of China’s public health system is intellectually dishonest.

She points out that the big-picture analysis in the video is wrong.

In the video, the Times praises Chairman Mao’s introduction of “free” health care and claims that when capitalism was introduced into the country, the state retreated and care was no longer free. Neither statement is true. First, health care was never free; it was paid for by tax revenues. Second, the state never retreated; rather, its regulatory apparatus became vaster and even more invasive. Out of sheer necessity, China allowed for the creation of private hospitals to ease the burden of the country’s heavily bureaucratic and deteriorating health care system.

And she also explains that the details of the video are wrong.

The Times video depicts the ungodly long line most Chinese face to see a physician. …It’s an appalling scene. …There’s just one problem. The Shanghai Cancer Center is a public hospital, not a private one. The long lines, scalpers, bribes, and physical fights with hospital staff—all of these exclusively happen in the public, communist, government-run hospitals. …In an egregious bit of sleight-of-hand, the Grey Lady asserts that capitalism is ruining Chinese health care while presenting us with a hospital where capitalism is not practiced.

To be fair, we get the same type of mistake when journalists look at the flaws in the American health system. They blame capitalism when the problems of ever-higher prices and uneven coverage are the consequences of government intervention.

P.S. My columns about sloppy bias at the New York Times don’t include Paul Krugman’s writings. Debunking those mistakes requires several different collections.

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