Does US have free-market healthcare? Hardly.

Free-market healthcare doesn't exist in the US. Half of every health dollar spent comes from government.

Matt Slocum/AP/File
An ambulance departed the executive terminal at the Philadelphia International Airport in January. Despite claims to the contrary, the US does not have a free market in healthcare.

Healthcare featured prominently in the debate at ISOS event yesterday. Mark Littlewood of the IEA and Rushab Ranavat of Debate Mate had to defend the claim that the free market can provide efficient medical care, in order to propose the motion ‘that humans would flourish if the state withered away’. As was to be expected, the opposition, consisting of Tim Horton of the Fabian Society and Peter Barton of Debate Mate, praised the NHS and attacked the American system as the result of free market madness.

This misrepresentation of the American system is an error made all too frequently, even by those who otherwise defend free markets. The American healthcare system does not represent a free market any more than the British one does, or the Cuban one for that matter.

Firstly, out of every dollar spent on healthcare in the USA, 50 cents is spent by the government – The US government spends more on Medicare, Medicaid and SCHIP than is spent on defence by The Pentagon. Secondly, despite the government using the ‘commerce clause’ of the U.S Constitution to legitimise just about every reprehensible thing it does, it still hasn’t managed to use it for its proper purpose of breaking down barriers to trade - like those that forbid the selling of health insurance across state lines. Thirdly, enterprising people who have tried to set up small, cheap clinics aimed particularly at the uninsured have found themselves the targets of massive bureaucratic red tape, and been forced to close.

The claim that this ‘free market’ in the USA does not cover the poorest members of society was also debunked with a concise and neat speech from the floor during the debate yesterday. The point was made that of the 40 million uninsured; the vast majority can either afford insurance, or are eligible for government-provided cover. This point has also been made very eloquently on the Free Market Cure website, which is definitely worth a look.

One thing is for sure. Whilst critics of the free market continue to misrepresent American healthcare, the debate will not progress. Tomorrow I will show what the debate should focus on – the real problems and the real solutions.

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