UPDATE (7/24): If you're visiting this from Ed Morrissey's AIP column, thanks a million! Please have a look around.

My little Eddie's all grown up:

...we have insurance companies rationing care, or to be more exact, rationing compensation, which isn�t quite the same thing in theory but does in practice. But why should that be a surprise? All markets are rationing systems for products of varying scarcity. That is why markets exist � to set prices that allow for rationing of finite amounts of goods and services based on supply and demand, with prices rationing goods and services to those who pay the most while allowing the greatest distribution. We have rationing systems for anything requiring a purchase. About the only thing we don�t ration is air.

What Kristol meant to say was that Kennedy made an argument for government rationing of medical care. We have that, too, in Medicare, Medicaid, the VA, and Indian Health Services, all of which are terribly dysfunctional, and none of which should build confidence in expanding the government rationing to the rest of America. Kristol responded to Kennedy�s call for just that by reminding people that they don�t need politicians in charge of their medical decisions.

It's not only markets that ration. All scarce goods are rationed somehow. And every rationing system creates a distribution of those goods. What I think the Democrats do is look at the distribution ex post and decides it doesn't like it, so it wants to change it. It's the common schism in politics between equality of opportunity and equality of outcome, or ex ante vs ex post equity. But the decision to change rationing systems doesn't just influence distribution. It can also change the production of health care.

Labels: economics