Monday, October 19, 2009

the fireman comparison

It seems to be a new common comparison: Everyone likes the oh-so-socialist concept of the fire department. And it's just like universal health care! How in the world could you be against firemen, with their washboard abs and pinup calendars and fancy trucks and cute spotted dogs. They're the same damn thing as socialized medicine, so just get off your greedy bastard capitalist ass and pay up.

And to this I say: Non-sequitor much? They are exactly alike except that they're totally and absolutely different. In fact, they're different in so many ways that I'd have to attack them from multiple angles.

Mitigation v. Asset reimbursement

Let's be frank here. Health care insurance is -- well, insurance. Insurance is nothing more than a business contract where you (theoretically) enter on your own free will. You spread risk among a pool of similar risks. You insure some asset -- and if you lose or damage that asset, the contract agrees to replace or repair it. In the case of health insurance, your asset is your absolutely most valuable one: your own self.

Fire fighting is disaster mitigation. An asset (such as a home) has encountered a serious disaster (a fire, obviously) and firemen (with washboard abs) show up to intervene and keep loss at a minimum. This may mean they save a house. Or it may mean they contain the fire to one house to keep it from spreading to the house next door.

A more accurate analogy

Okay, come on. Let's think of another analogy that is more apropos that is similar to health insurance... Come on. It should be right there on the tip of your tongue. I'm practically giving it away. Still don't get it? Fire insurance, Einstein. Health insurance is to protecting your body as fire insurance is to protecting your house. Fire insurance is generally not considered a right (at least not yet). And fire insurance is not usually provided by the government with universal coverage. Why not? Because it's based on risk pools. Do you really want to pay your taxes in to a single universal pool where your house gets the same coverage (at the same premium) as the gasoline production plant across town? Your house -- worth maybe $200,000 -- versus a billion dollar petrochemical plant. Your house, where the chance of catching on fire are slim versus the plant that makes about 16 highly flammable materials. Why in the world would you not want to nationalize fire insurance and spread the risk for those poor petrochemical production folks?

If you really, really must draw an analogy to a fire department, the true analogy is a health department... You know, those folks that talk about washing your hands and give out restaurant scores -- not fricking nationalized health insurance. If you want an analogy to a fireman (with washboard abs) you'd be better off comparing him to a doctor or a nurse.

The problem of scale

And the analogy suffers from a severe problem of scale -- as if you finally agree your child can have a hamster and come home to find she's made a pet of a goddamn elephant. A fire department is a small, localized unit with a very defined task. Nationalized health care is an enormous undertaking on the federal level. It's a health program brought to you by the same health geniuses that brought you the food pyramid and the lipiphobic high carbohydrate diet that's turned us all into walking heart attacks while avoiding any semblance of science it can possibly avoid.

And on the topic of scale, I might also simply remind you: the US Constitution really does not apply so much to the ins and outs of local municipalities. It applies to the federal government.... you know, the one that wants to birth a behemoth.

One error means two is better

And why, oh why, do we think that because fire departments are operated in a socialist manner (assuming that really was true) that this would mean everything else in our lives should operate this way? Why not suggest the opposite? "The current mass of government regulation and intervention has totally trashed the business of health care. We should restructure fire departments in a way to totally avoid making this mistake. They should be paid for in a 100% voluntary manner." Add in our scale problems and the "it works for a fire department, so it must work for an enormous nationwide health care system" is sort of the same argument as "this fire in the fireplace looks pretty, why don't we set the whole house on fire?"

...if we did that, maybe those firemen would show up and we'd get to see their washboard abs.


Og Make Blog said...

Wow, that one did get stuck in your craw. Glad to see you are back. Dare I ask who was making such a stupid comparison?

Spork In the Eye said...

It actually seems pretty darn common in online rants and rambles. There are lots of sarcastic "lets get rid of fire, police and libraries since public health care is so awful."

Kari said...

I'm all about public money for firemen. They're hot! ;)

Tatarize said...

Real Universal Health Care IS like the fire department.

Insurance shouldn't enter into the picture and is only there because of a lack of actual fortitude and actual political will to make the system into what the system should be, a real universal health care system. Where the government pays hospitals and doctors for services rendered and there's no payment without services.

Insurance is a business model whereby we mitigate risks (in theory) and pay for services as such. There are actual insurance plans which cover you in the case of illness to get you back to where you were. If you become ill they pay you for lost wages and make sure you don't get hurt. Much like fire insurance will pay for your lost stuff when your house burns down. -- The fire department in this situation really is like real universal health care.

The difference is largely like the fire department before socialization. It was previously the case that fire brigades would put out fires and charge the person helped or loot their property and such. Insurance companies would pay the brigade that put out the fire for those properties with insurance. The system was haphazard and lead to large losses in property rather than a centralized system where fire departments put out fires and it didn't really matter whose stuff was saved.

Further you argue disanalogy due to the idea that the fire departments are localized. This is certainly the case for hospitals and doctors as well. Further it holds true for medicare as such as much of the reimbursement rates and businesses are conducted regionally. Additionally fire departments have very regional operations as well where fire departments are used to fight fires across state boundaries on federal land and as part of a much larger and national effort and presidential and gubernatorial declarations of disaster.

Ultimately any real universal health care plan would require, local, regional, as well as national support.

You aren't reimbursed for your lost health. You aren't paid for getting sick, your doctors are paid for mitigating the situation. And the constitution is established to "promote the general welfare".

There are certain requirements that everybody has and that need to be conducted at above the individual level. We have need for water, housing, health, security, electricity, roads, and a number of other projects and needs that cannot be elsehow conducted on an individual basis. If we do not own these utilities as a people they will end up owning us.

Much of your analysis seems dependent on staying on the obviously failed system we currently endure. Rather than making a clean break towards Medicare for all. Insurance is a terrible way to cover healthcare. Just as it was a terrible way to conduct fire departments prior to the Civil War. Your objection seems to be largely that we shouldn't half-ass this socialism and nationally pay for insurance but rather nationally pay for health-care; I couldn't agree more.

Spork In the Eye said...

I could go at this point by point, but I can already predict the outcome. It goes on for 18 iterations back and forth. We get off on 5 different obtuse tangents. And in the end we both think we got the better of the other and neither one of us has changed their opinion one iota. That just doesn't really feel entertaining to me or my enormous readership -- which numbers in the teens now.

The real niggling bit here is a primary starting point. Mine (and that of the framers of the Constitution) is one of individual rights. It is that the individual is supreme and the limited government is intended to serve the individual to protect him from the initiation of force. Dealings amongst individuals are entered voluntarily.

Pro-socialism camps (and that word sticks in the craw of many, which is not my intention--it just fits) have the starting point that the group as a whole is supreme and that individuals are there to serve the betterment of the group as a whole. And that's just fine and dandy as long as you happen to be the majority. Heaven help you if you are not, as your rights or property can be easily voted away. Government in this case does not protect one from initiation of force, but is actually a common initiator of force.

The irony here is that, more often than not, the socialist camps are non-religious, yet they follow the same basic broken theology of the religious they dislike. Their god is some mythical "group good" that is unseeable and unprovable. It hungers for self sacrifice, is jealous of those that come before it and is never satisfied. And like the uber-religious, they are more than happy to push their beliefs on you -- though the socialist is a little more intrusive as their beliefs are pushed with the force of law.

As to "general welfare" -- that, like "necessary and proper" is wildly taken out of context IMO. No one can convince me that a group of individualist men that were fearful of an oppressive regime they just left would write a document that painstakingly enumerates the limited powers of government -- and then toss in a wildcard.

Tatarize said...


You claimed the government couldn't do healthcare better because insurance companies only make about 3% profit. This somehow reminds me of a large graphic put out by the oil industry that showed that 100% of the dollar spent on gas went to various different places and oddly none of it was profit.

The problem here is that it's simply false. Medicare, the US's current socialized medicine engine, has about a 5% overhead and private insurance has a 17% overhead (though the numbers are really closer to 3% and 30% let's just run with these numbers), that means that certainly if you weren't paying massive salaries to the top industry brass (that's an expense and doesn't count as profit) they could cut the prices rather dramatically. There's a lot more overhead due to inefficiency in the system and lack of good organization, massive departments dealing with the departments of the various other companies in order to get through different forms to get the money, because of non-single payer situations. There's none of these billing issues or any such things with the fire department. They just go where they are needed and put out the fire. Just as healthcare should fix the health problems that arise with various individuals.

The rest of the answer is on my blog post. Apparently you can't post more than 4k worth of text to a comment.

Spork In the Eye said...

Can't post more than 4k? I can. I'm not sure I see the point, though. I just don't believe argument intended to skewer the arguer does any good. As my original post said: this will end up with us arguing many points and each thinking we are right and the other is wrong.

Great example though. Medicare is not what I would call a successful system. If you can spend more than you take in, it's damn easy to keep a low overhead and finance it all on debt. The system was set up with many promises... the original tax was never to be more than about 3%. The money was to be kept in a trust...

Now the tax (employer + employee) is about 15%. The trust fund is empty and we're financing it via debt. 5% overhead my ass. We'll know the overhead when the debt is paid off. (And it never will be paid off.)

Tatarize said...

Medicare is financed by the take-in from Medicare. It's actually a bit above the mark and that money is taken by the government to pay off debts and filled the drawer full of IOUs. The trust fund is empty because other sections of the government raided it for various things.

But, the take-in vs. distribution is 5% which is better than all the overhead for the private insurers which is significantly higher.

Just because the rest of the government is screwy, doesn't mean medicare is broken. Every dollar it takes it 95% goes to pay for services. That's better than the less than 80% the private insurers do.

Spork In the Eye said...

Well... sort of. But those numbers are misleading.

a) payout is below market cost. There are laws that actually force medical providers to take below market prices for goods/services... or take nothing. This drives up medical costs for the rest of the population to cover the point spread. (No, I am not saying this is the one and only thing that is driving up medical costs.)
b) the average per-month/member premiums for medicare are 2-3 times what they cost for typical large HMOs, again skewing those ratios.
c) and the most important factor award goes to... unfunded liabilities. We absolutely have known about future unfunded liabilities for 20 years or more (probably more like 50 years.) Part A alone has an estimated unfunded future liability of $38T. The entire program has an unfunded liability nearer to $90T. Knowing that this liability exists and not stating it in the overhead is nothing more than Enron Accounting.

So, it would be false to say medicare is fully financed by it's take-in. It is funded by future debt. It will most likely require both additional revenue and reduced services to cover. That's just math and has nothing to do with liking or hating the program.

Tatarize said...

Payout is not below market cost. It's collectively bargained, this is how much will be paid. Take it or leave it. If it were truly below cost then they would be forced to leave it. This certainly doesn't drive up the costs for other people. Just because one group gets better rates doesn't mean that other groups are forced to pay more. If there were more profit to be had by raising prices people would raise prices. The market sets the price it's not some zero sum calculation. And the Public Option would have ended up costing significantly less had it properly been tied to medicare rates.

Medicare covers the most expensive segment of the population, and no they aren't. The average premiums for medicare are quite low. Again, this can all be calculated by just looking at overhead. 95% of the money taken into medicare is paid out by medicare. And considering the collective bargaining and other advantages it's very effective. Everybody would be better off if Medicare covered everybody.

Unfunded liabilities aren't much of an issue. Basically we're sort of promising everybody paying into medicare today that it's not going to go anywhere and they'll have it when they retire. But, in reality we just spend that money on services for those currently on medicare and don't fund those promises. Medicare for all would solve that problem rather instantly in that the system would be funding the current medicare recipients (namely those paying the payroll tax) and simply an undue share of the money would go towards the health problems of the elderly.

Why would you state it in overhead? My claim is completely efficiency. For every dollar they spend 95% go to services and actual care. That's better than the 70-80% of the private insurers. So clearly the government can and does do better and there's obvious room for improvement.

The promise that medicare will be there when I retire is not paid for by debt, it's not paid for at all. It's unfunded and the expectation is we'll just tax the working youth in 40 years to pay for it.

It's currently solvent and will be for several decades to come. And sure we might need to raise taxes or remove the cap at some point in the somewhat distant future.

The system does a better job of spending dollars on care than the private system. When lives are on the line, that's what matters: lives. Real public healthcare would very much be like the fire department and would be a significant improvement for all Americans.