Saturday, 28 April 2012

Buyer or Producer?

I can commend to all thinking people a book by Arthur Seldon entitled "Capitalism." Or, if you can't face the full and long version, there is available a "condensed" version from the Institute of Economic Affairs. If considered with an open mind this book is a real eye-opener, especially to those of us raised since 1945 on the idea that "the State" is the best provider of all manner of social improvement programmes.

I had long understood that pre-1939 there was no general pension or welfare provision unless you were fortunate enough to have a generous employer. Nothing could be further from the truth, there existed a large number of "Friendly Societies" sponsored by those evil money grabbing capitalists and into which their employees paid literally a few pence a week or month. The "society" provided unemployment relief, health care and pensions. All of Britain's hospitals were privately funded and built, usually funded out of trusts set up again by those evil and uncaring "capitalists" with public subscription producing funds for specialist units and even sponsoring doctors to provide care for the "poor and indigent" who were neither permanently employed or could not make even the smallest contribution to a "friendly society."

All of this began to unravel in 1911, when a Liberal Government decided there were votes to be had by interfering directly and taking over responsibility for some, but not it must be noted, all of these provisions. Enter the greatest tax hoax ever, the "National Insurance Scheme." Not only was the money collected not invested, it wasn't "insurance" either. It killed the Friendly Societies by imposing a contribution on everyone in employment, a double whammy for those who already had the provisions the National Insurance was supposed to give, but which, in a majority of cases, actually gave less than they had enjoyed previously, and cost more.

This began the slide from a "market led" provision of the services the people wanted and could afford and opened up the way for the massive expansion of the bureaucratic take over of the entire voluntary sector. It also paved the way for the cherished socialist ideal of a "producer led" economy in which jobs are created by constantly generated goods and services without any reference to demand, cost or requirement. In a large part this is what has led to the mindset that burning down a building completely is good for the building trade - so don't provide fire protection, just make sure you don't kill anyone when the fire happens. It has fueling the idea that "equality" can be created by reducing everyone to a net consumer, dependent for everything on a "producer." Perhaps the starkest example of this is the NHS, in which the patient is forced to sit on waiting lists, or to accept drugs which aren't necessarily effective or the best available simply because the NHS Mandarins have decreed that is what you will have. This was brought home to me rather starkly this week when I put my back out badly. I went to our local GP (Germany doesn't have an NHS) and told him what I was normally treated with. His response was astonishment, then outright disbelief. The treatment he prescribed is more expensive, but it was 200 times more effective and one heck of a lot faster. The difference? Like all doctors here, they offer the patient a service which is not set by them, but by the patient's actual need.

The startling fact is, once one begins to dig into these things, that governments are probably the worst possible providers of the vast majority of services, from health care to 'welfare.' One of the main reasons is simply the costs they incur (and ignore or simply pass on the taxpayers) and the other is that central planners, remote from the end user are without question the worst possible arbiters of what is needed. Worse, whenever a government attempts to intervene in pursuit of some ideological objective in any aspect of service motives become confused. Firstly, if everyone is dependent on the "benevolence" of the "State" all power over the lives of the "beneficiaries" is subsumed to the faceless bureaucrats and politicians. There is no such thing as a "benevolent" bureaucracy, they are all fueled by power, hierarchy and the desire to control "the masses."

It has taken me a while to read Seldon's book. It has taken even longer to dig around and verify what he says and the examples the IEA has identified. It has been an eye-opener. It is time more people started to challenge the media-political agenda of the "welfare state" and the "socialist dream" of the literati - most of whom where wealthy academics drawn, surprise, surprise, from the same political classes currently feeding us this entire load of codswallop about "equality" through the "State."

Read the book, I think you'll end up weeping in anger and frustration at how we've all been taken for a ride ...

1 comment:

  1. I don't think I have to read the book to weep... I'm ashamed of what our government has become.