Transcript Health Care Reform

Our Argument
 Economics
 Theory
 Data
 Politics
 Theory
 Data
 Critique
Akerlof - “Market for Lemons”
 Health → category of credence goods
 Assymetric information is a eo ipso problem in the health segment
 Supply: No signaling assumption
 Demand: Judging quality by market statistics
 Formally: Q=D(p, µ), S=S(p), µ=µ(p)
 Equilibrium pre-condition → S(p)=D(p, µ(p))
 Good quality is crowded out sequently
Adverse selection
Rawls - Theory of Justice
Thought Experiment
 Hypothesis: Obama care does not ameliorate existing
violation of 2nd principle
 Approach too less egalitarian and flawed for both sides
of market participants
I. Prohibition to summon pre-existing medicial
conditions for dumbing
II. Public-private model → not universal health care might
not maximize Rawls´ social welfare function
Conclusion
 Reject Obama care due to efficiency shortcomings &
violation against the theory of justice
Economic Facts
 In 2011, health care premiums increased by 9%
 Estimated increase for 2012: 12%
 Workers have the largest burden
 Workers earnings only increased by 4%
Graph
14%
12%
10%
8%
Workers earnings
average healtch care premiums
6%
4%
2%
0%
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
More Facts
 Tax credits for businesses simply don‘t work
 90% of firms did not apply
 Only 7% applied successfully
 70% of the firms can‘t easily find affordable health care
Impact on AS/AD
 Higher work costs put downward pressure on
investments
 Aggregated demand is directly affected, decreases
 New equilibrium for the economy at lower price level
and lower GDP
Impact on AS/AD
Politics
 Democratic Capitalism
 Individuals should be free to pursue their
interest
 Private ownership of property
 Totally free market – no government
interventions
Conservatism
 Conservatism is characteristic of
 Resistance to change
 Ambivalence regarding governmental activity to
improve human conditions
 Individual freedom
 Anti egalitarianism – distrust in human nature
Obama Care
 Does not improve people’s condition
 Health insurance should be voluntary
 Obama Care will destroy both the free market and
individual freedom
 Federal government has no business regulating health
 Tax increases are unaffordable
Obama Care
 Tarnishes free market
 Public Plan
 Government Run Health
 Encroaches on State Sovereignty
 Tenth Amendment
 ”The powers not delegated to the United States by the
Constitution, nor prohibited by it to the States, are
reserved to the States respectively, or to the people.”
ObamaCare
 Lower Quality Care
 Government Intervention on Medical Decisions
 Longer Wait Times
 Harms traditional values of Freedom and Liberty
 Employer Mandates
Individual Mandates