October 11, 2007

There's just never enough money available when you really really REALLY need it. Exhibit numero uno is the Great State of California, where I am privileged to pay my taxes, and where Arnold the Governator has been pushing for "universal coverage," with a requirement that each individual purchase health insurance, with various taxes imposed on providers and employers and others, and with subsidies here, tax credits there, etc.: The usual stew of silliness designed to get that square peg into that darned round hole, and things would be jolly if we could just get rid of people and their narrowminded whining.

Well, Arnold's original scheme just didn't elicit enough salutes from the hordes around the flagpole, and so he now has revised it. The idea now is to finance part of the needed $14 billion per year (guaranteed to be an underestimate) by leasing the California lottery to a private firm. Except that the Governator's budget proposal for the next fiscal year already includes a sale of the lottery for the general fund; if that now is going to be earmarked for "universal coverage," then the deficit in the state general fund---already at $8.6 billion and counting---will deepen markedly.

Isn't it obvious by now that even apart from all of the predictable perversities and quality degradation inherent in "universal coverage," the basic down-to-earth problem of how to pay for it is a Gordian knot best left uncut? The taxes, subsidies, and other machinations required to get such proposals approved under democratic institutions are the source of endless economic mischief, rapidly growing costs, and permanent slowdown.

Posted by Benjamin Zycher at October 11, 2007 06:00 PM

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