Final thoughts: As our nation’s healthcare systems evolved over time, in no way do I propose altering proven federal agencies, like the Communicable Disease Center (CDC), National Institute of Health (NIH) and other fine programs, the VA specialty centers, and Medicare centers for transplants. We would all be best served by the continuation of these specialized programs. But get the government out of trying to solve what millions upon millions need that is frequently wrong and at the unconscionable expense. No one expects the government to specify what car we can buy or what smartphone we need; healthcare should be no different.
And Congress, keep whatever new bill you write short; Obamacare, at 2,572 pages, was voted on before being read. Make insurance premiums either fully deductible for individuals and/or employees, or not at all for individuals, and for those at work, but treat both groups the same tax-wise. Don’t rob one group of healthcare recipients to pay for another group. Skip middle-class entitlements with more deductions by reducing insurance costs with market reforms.
Relevant Other Issues When Addressing Healthcare: the medical liability problem of doctors having to sometimes pay exorbitant premiums for their malpractice insurance, prescription drug prices have escalated in recent years to unconscionable levels, and there is a developing shortage of physicians.
Medical Errors (malpractice): It is rare that a doctor maliciously and thoughtlessly injures a patient in treating them. Rather, errors occur for various reasons, which often can be described as engineering screw-ups that things like color-coding and bar-coding could solve, and instead of investigating in secret and shaming a perpetrator, they should be presented to a team to re-engineer, so mistakes do not recur. Take a lesson from the Navy, who, in operating flight decks of aircraft carriers, ostensibly the most dangerous working environment in America, have no accidents. Malpractice litigation takes place under state statutes and regulations, but national consortiums can produce model legislation for states to pick and choose from. One suggestion; how about capping awards? By capping, I mean, for example, no award shall exceed $1 million, or whatever.
Prescription drug cost inflation: President Obama gave the pharmaceutical industry a blank check to raise prices as they deemed fit in return for their endorsement of Obamacare. The result; AARP’s RxPrice Watch Report found the average retail price among 622 prescription medicines widely used by seniors more than doubled from $5,571 in 2006 to $11,341 in 2013. Note that the average Social Security benefit was $15,526 and the average income for Medicare beneficiaries was $23,500. Specialty drugs for cancer, hepatitis C, and rare diseases averaged $53,384 in 2013, 18 times the annual average cost for brand-name drugs ($2,960) and 189 times higher than the average price for a generic drugs ($283).
Doctor shortage: The Association of American Medical Colleges is projecting a shortage of physicians over the next decade by 61,700 to 94,700. Driving the shortage is Obamacare’s attempt to expand access to healthcare. Increasing access is certainly admirable, but increased access does “consume” more doctors. Obamacare dilutes incentives to practice medicine, reimbursing at 50 cents on the dollar. High-income tax rates inhibit the supply of top earners across all industries, but hurts those who spent many years in training at low wages, and incurring huge debts, to then work long hours for a shorter number of years, with malpractice threats always looming.
Let me end, as I started, with this question to you, dear reader: I know you wouldn’t want the government telling what smartphone you can have or what car you should drive, so why would you want the government to tell you what kind of healthcare you can have?
APPENDIX: 2015 Federal Budget Numbers—From Center on Budget and Policy Priorities
In 2015, the Federal government spent $3.7 trillion, amounting to 21% of the nation’s gross domestic product (GDP). Of that $3.7 trillion, over $3.2 trillion was financed by Federal Revenues. The remaining amount ($438 billion) was financed by borrowing.
Social Security $888 billion or 24%
Medicare, Medicaid, CHIP, and marketplace subsidies $938 billion or 25%
Medicare $546 billion or 2/3rd of $938
Defense $602 or 16%
Safety net programs $362 billion or 10%
Interest on the national debt $223 billion or 6%
17 - EDUCATION
Through my writings, I’ve attempted to explain some economic principles and dispel some economic myths. While socialism places government at the center of economic order, capitalism places the individual at the center. Capitalism is about free enterprise, the development of capital resources and creating wealth, and, most importantly, development of personal happiness, freedom to learn and grow, and the protection of everyone with their own safety and benefit. I’ve tried to show that the development and growth of credit are about people working and creating actual resources:tractors, cars, computers, buildings and labor. This creation takes place in the real and private economy. And of these resources, the most important element of all is us, people. We, the individuals, that learn, experiment, and find better ways of doing things that benefit everyone; all at a lower price than was ever imagined. With an economy looked at this way, that places the individual at the top of the pecking order of things needed to develop real resources that we need and want, it becomes obvious that to grow, education is just about the one huge element that will allow us to proceed in growing our wealth and happiness. In Chapter 7, I inserted a lecture from someone who’s given a lot of thought to our plight of decreased economic mobility in the U.S., which, in other words, is about whether children do better than their parents. Thus, I proclaim as fact that the most important ingredient in growing our economy, and with it, growing everyone’s wealth and happiness, depends more on our education than on anything else.
My writings and the insertion of essays and op-ed to follow centers on education. I break it down into: The Young (K-12 Schools and Choice), Why do we need the Federal Department of Education? Why re-thinking the curriculum is necessary. Not everyone goes to college. How to better train those choosing to go into the trades, and addressing educational needs of the unemployed and those displaced in the workforce. Special attention should be given to schools in the black neighborhoods. The theme weaving all this together is about knowledge in our culture; the body of knowledge as we as a people, progress forward on this exciting and stimulating path of advancement. On this path forward we learn, and profit, and gain more freedom to learn, and profit, all while we grow older, knowing that it is mandatory that we pass this on to our children, so that we all may spiral on forward in this process of life. We as a nation, and as a society, have come a long way. This chapter is about ideas on ways to improve this educational process. This is not for the elite, but for everybody.
The Young and K-12 Schools and School Choice: Options for school choice besides private and parochial schools are mainly charter schools. These first started in Minnesota after the state passed the charter school law in 1991. Nearly 7,000 of these independently operated public schools of choice exist in 43 states and the District of Columbia, enrolling nearly 3 million students. While these students comprise only 6% of K-12 public school enrollment, 17 school districts have more than 30% of public school pupils attending charters, and 190 have at least 10% charter enrollment, per Chester Finn, Jr., and Bruno Manno, writing in Investor’s Business Daily, 1-9-17. The charters are in a tug-of-war over power and control over American public education, which spends $600 billion yearly and employs some 6 million adults. When state legislators enact a charter law, they break the local district’s monopoly on creating and operating public schools by withdrawing its singular franchise to create and run schools.
The educational establishment and its supporters are agitated by the charters. This is a governing revolution, in that states have more options than entrusting delivery of schooling to local districts; that communities have more options than elected school boards, and the families have more options than being told by political bureaucracies where to send thei
r children to school.
Most Americans love our universal free public education for the young. It has been a major factor in developing our country, and is contributory to the maintenance of democracy and freedom. But when institutionalization gets too ingrained, bureaucracy takes hold, and political groups find a way to game the system for the benefit of a few, the disinfectant of light on the situation and the letting of competition allow us to find new and better ways. School choice is what the competition has offered us to improve our free and public schools.
I indict the teachers’ union as a force that has worked to degrade the country’s education value. Over the years, they’ve built up a bureaucracy that favors the long-term and maybe not-so-great teachers over the new, more capable teachers, and with the goal of doing little to improve things in the classroom, again in favor of old management, and at the same time are deaf to the cry of failing inner-city schools. They continually talk of never degrading the public schools, and they never stop fighting the competition that voucher supported and private schools bring to education. They can do this because they’ve sponsored laws that let them take dues from their membership, which is mandated by their unions to include all teachers in each district. So, the young, entering and maybe more capable teacher is forced to pay dues to an “organization” supposedly bargaining on their behalf. Protecting public schools in this way has thus become a ruse for further entrenching management to protect the “failing” schools. Nowhere is this more evident than in the black innercities. While black inner-city mothers beg for better schools for their kids,many are prevented from getting into charter schools because of a shortage. Some of the lucky may get a slot through a lottery system, and others may be in districts that award tuition to private schools, and other districts might allow students to collect public money covering tuition and be free to take it to a school of their choice, but the local teachers’ union crowd is always there to shut down these efforts as much as possible.
School choice has appeared as the antidote that will allow more and more parents to escape bad schools and eventually will force universal public and free schools to improve for all of our kids, for the benefit of everyone.
The Department of Education: President Carter advocated for a cabinet-level education department, which was created in 1979. My dad told me we should always have schools controlled locally; that we should never let Washington get into education, because that would open the door to tyranny by letting future wannabe dictators in Washington, through propaganda, bend the minds of kids, to further entrench their position of power at the expense of our freedom and liberty. That hasn’t happened, but this department has been responsible for liberally handing out student loans, which, in turn, led to the massive inflation in college tuition, which then translated into massive student debt. The other downside, as I see it, is creating a bureaucracy that promoted a socialist agenda. That is, working on an agenda to grow the size and power of government at the expense of private enterprise. So, today, we have a lot of unemployed people with degrees they can’t use, all saddled with debt they probably will never be able to pay off. To me, it’s a no-brainer to shut down the Federal Education Department. We all started with the capable public as well as private schools funded locally, operated by capable teachers and their managements serving all citizens well, to everyone’s benefit.
The indebted students: Student debt now stands at $1.3 trillion, spread out over 44.2 million borrowers, and with a delinquency rate of 11.6%. While investing in one’s higher education has been a good investment in the past, it certainly isn’t now for those with crushing debt. While student loans are an important component in helping students obtain an affordable education, maybe the government should get out of the business of originating and profiting from issuing student loans. Over the past 25 years, the cost of a college education has increased four-fold. Inflation is always caused by too much money chasing too few goods, and this has to be the case when examining the explosive rise in college tuition. The antidote to high prices has always been competition by entrepreneurs finding new ways. Some innovators have computerized access to their elite lecture courses, making them available to the masses, easily obtainable and cheap. Undoubtedly, other innovators will invent better ways to bring more educational opportunities for future students.
Vigilance of the curriculum must always be examined for relevancy: I present an anecdotal case about new math. This one case poignantly makes my case.
“No Need to Reinvent the Math Wheel Over and Over”
“Regarding Wendy Kopp’s Copying Singapore’s Math Homework (op-ed, Dec. 8): When my children were in elementary school, a ‘connected math’ curriculum was introduced. This warm and fuzzy program was so obtuse and nonlinear in its methods, that I was faced with my otherwise bright children feeling inferior in math. So, 13 years ago, I researched math programs, purchased a set of Singapore Math Workbooks, and ultimately retired from my career so that I could home-school them in math. The workbooks were so logical and lucid that my two children quickly achieved a proficiency in math two years ahead of their peers. I had meetings at the highest levels I could access in our school district to recommend dropping “connected math” but was told that because millions were spent, the curriculum would have to run the usual seven-year course.
Incidentally, both my children took calculus as high-school juniors and are currently attending one of the best liberal arts colleges in the country. I wonder why, as a nation, we continue to insist on reinventing the wheel when it comes to math when there are examples of successful programs around the world. All I can gather is that publishing companies’ profits supersede what is best for our children.”
C.C. Wetzel, M.D., Salem, Ore., The Wall Street Journal, 12-15-16
Educating our future workers going into The Trades:While traveling in Germany a few years back, I heard a local speak on the German way of differentiating between how to educate those heading to colleges and those heading to the trades. The U.S. system allows high school students to pick a college preparatory curriculum or other alternatives; one including shop and exposure to the trades. Those favoring carpentry or such might go on to community colleges for more advance preparation, or enter a system of employment geared to apprenticeship and obtaining a license for a given trade, or they might seek employment in a factory offering some training on the job. The German way, though more rigid, offers a more sophisticated way of training skilled factory workers to handle the most complex machinery imaginable. Read on for more detail:
“Germany Offers a Promising Jobs Model”, Edward P. Lazear, and Simon Janssen. The Wall Street Journal, 9-9-16. Mr. Lazear, former chairman of the President’s Council of Economic Advisors (2006-09), is a professor at Stanford University’s Graduate School of Business and a Hoover Institution fellow. Mr. Janssen is a research fellow at the Institute of Employment Research in Nuremberg, Germany.
“Donald Trump and Hillary Clinton both maintain that foreign competition and unfair trade practices hurt the U.S. Yet the problem of many American workers comes not from the global market, but from poor training. The success of Germany, which faces competition from developing countries, shows that well-trained workers can thrive amid pressure from abroad.
Only about one-third of American adults 25 and older have completed a bachelor’s degree, per our analysis of the Current Population Survey. Most workers entering the labor force rely on skills that they acquired in high school. Meanwhile, about 75% of German’s private-economy workforce has taken part in the country’s system of vocational training with apprenticeships.
This system prepares millions of Germans for careers as machine operators, medical assistants, bank clerks, and countless other occupations. The U.S. has associate-arts degrees awarded by community colleges, but only about 5% of American workers’ schooling ends there.
Higher education hasa large payoff in the U.S. In 2015, the average annual earnings of a high-school grad working at least 40 weeks a year
was $38,400. Those with a bachelor’s degree took in $78,600.
Contrast this with Germany’s vocational-training system for those who do not attend university. Although Germans are about half as likely to go to college, more than 85% of private-economy workers without college degrees have a vocational training and apprenticeship. In 2014, Germans with apprenticeships earned about two-thirds of what those with at least a bachelor’s degree did.
Germans with vocational apprenticeships earn about 92% of the average German wage; American high-school grads earn only 70% of the average American wage. Germans with vocational apprenticeships are considerably better off than their American counterparts. Data show this to be true for nearly 15 years.
Lost manufacturing jobs tend to draw the most attention from free-trade critics. Foreign competition affects those jobs directly, because countries tend to trade manufactured goods and not services. Yet the wage figures in manufacturing are virtually identical to those for the economy: American high-school grads in manufacturing earn 45% of their college-educated counterparts. The relatively high wages of Germans, implies high productivity among those with vocational training.
Germany’s model has its shortcomings. It places students onto separate educational tracks as early as age 10 and sometimes creates rigidity in a technologically changing world. But misclassified students can, and often do, switch academic tracks. Employer associations and trade unions steadily update the training curricula to keep pace with shifting demand for skills. A recent University of Zurich study found that training changes fluidly with technology to accommodate the market.
While Germans with vocational training do well relative to university graduates, neither group has experienced much wage growth in the 2000s. But this has little to do with trade: Earnings outside manufacturing have fared ever worse than those in manufacturing, even though the trade affects the latter more.
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