That’s the First Law of Thermodynamics—There Ain’t No Such Thing As A Free Lunch!
Of late, I’m seeing more references to the Obama Administration as “lawless,” and it certainly has a record of disobeying its own signature law as it tries to implement Obamacare. But no matter how hard they try to bend or break the fundamental Laws of Nature, there ain’t no such thing as free healthcare either.
Someone has to pay: hence, the various redistributive schemes to try to finance the program. Jonathan Cohn has a piece over at TNR titled Yes, Obamacare is Redistribution—But Republicans Are Wrong About Who Pays. He tries to show how the money to fund the scheme (more than $2 trillion over the next decade) will be raised. Most of the sources make little real-world economic sense. For example, Medicare providers will summarily be short-changed $415 billion on their compensation for the goods and service they provide. The logic behind this is that it gives providers with an incentive to become more efficient by being paid less rather than deciding to get a better paying job or start a more profitable business. Yeah, that’ll work.
The truly stupid ideas in the Obamacare financing scheme are the fees to be imposed on the healthcare industry such as the medical device tax. This adds a violation of Second Law of Thermodynamics which says that every system operates with some increase in entropy. The $165 billion dollars of increased cost to the system will never be recovered when the real world results of the program are viewed as a whole. Even an economy as large as ours won’t be able to hide the loss.
If your think healthcare is expensive now, just wait till it’s “free.”
Let it burn.