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Ezra Klein writes in the Washington Post that health care costs and college costs are very similar. They’re really high, and no one has been able to keep costs down. As he writes:
Like the health-care sector, the higher education sector is heavily subsidized by the government. Some take that commonality as a causality: Health-care and college costs are out of control because the government subsidizes them. I think the truth is closer to the reverse: The government subsidizes them because their costs are out of control.
Health-care and higher education are similar in another way, too: People don’t think they can responsibly say no to either expense. Families take out hundreds of thousands of dollars of debt to pay medical bills and tuition costs. The only other cost that’s anything like that is housing — and it’s a much more optional expense. You can buy a house on your schedule. Health-care costs and your child’s 18th birthday tend to be somewhat less cooperative.
The two sectors are fundamentally unlike normal things one buys because one can’t really say no. One can’t responsibly refuse to buy health care or education and leverage that refusal to reduce costs.
Technology could, in theory, reduce the cost of both things, but it’s not likely to happen in any dramatic fashion any time soon.
Technology is also not the also not the cost control mechanism favored by any nations that actually have high quality, inexpensive education and health care.
As Klein writes: “In other countries, they deal with this pressure by mainly having one buyer: the government. That’s how single-payer health care holds down costs, for instance. The government says no on behalf of all the people.”
Let’s see how far that technology solution takes us.
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BULGAR on May 10, 2012 12:10 PM:
Health care and education should be free? What planet are you living on there commie boy?
CB on May 15, 2012 1:38 PM:
Why stop at college and health care? I know! Let's make all the banks give mortgages to people who cannot afford their own house!
Cause that really worked out well. Oh, wait- NO IT DIDN"T!
Let's just skip the whole four to six years of college and GIVE AWAY diplomas with a box of cracker jacks- because that's what a college education is worth, when every single person has one.
Why does health care cost so much? Because doctors and hospitals need to protect themselves from frivolous lawsuits, and the unions of health care workers have bloated themselves.
Anything the government 'needs' to subsidize is something that isn't working right.
minstrelmarty on May 21, 2012 3:19 PM:
There's a difference between the price of something and its cost. The price of medical care is far too high; so is the price of higher education.
What we don't know is where all that money is going. I suspect that it will turn out that the margin (price minus cost) is extremely large. We need to turn teams of forensic accountants loose on both industries. They should be required to work totally in the open, making both their inquiries and their findings visible while they work.
My guess is that we would find much of it vanishing into the offshore bank accounts of a relatively small group of people.