Doctors or Drones?

Most everyone has heard the age old conundrum, should a country produce more guns or butter?  In normal economic terms, if you put your resources into producing butter, you will have less resources to produce guns.  The US appears to be looking at the choice of producing drones (read defense spending) or supporting doctors (read health care).  As both grow, efforts to reign in the deficit inevitably bring the arguments that health care cost growth must come at the expense of defense, and vice versa.

It is staggering to compare US health care spending against that of other countries. The data indicates the US spends about twice as much on health care (doctors in this post) than other modern countries.  Why?  And who cares?

The short answer is we had better all start caring.  Health care is bankrupting the country, it is over 50% of the deficit and growing.  It is approaching 20% of out GDP.  As health care continues to grow, it will crowd out the country’s ability to do other things, like buying drones (meaning defense spending).

Universal health care is one option.  One of the standby arguments, however, against  universal health care is that it is socialized medicine.  (That does not seem so bad to me if the health care is effective as in Germany, France, Japan, Canada, etc.)  But the critics continue, “and you know that universal health care robs money from other government priorities, like defense”.  Hmmm.

Unless a country borrows endlessly, as the US has done in recent years, there is a limit to what any country can afford.  In that sense, the positioning of drones or doctors is correct.  But trading off health care verse defense spending does not need to be the only alternative.

Look for answers to the question, why is America’s health care so expensive.  A Forbes article sheds a different light upon the costs.  While the answer to how to reduce the cost of specialist (like over prescription or higher salary) and poor utilization of hospitals is not straight forward, what is clear is that drones have nothing to do with it.  There are models around the world of health care that covers all residents, costs much less, and produces outcomes as good or better.

Looking at defense spending, again we find a disconnect.  US defense spending is the highest in the world and equals about as much as all other nations spend.  The reasons are many.  Defense employs many workers and over time defense contracts have found their way to almost all Congressional districts.  Defense is good business.  Campaign donations, jobs, and to some extent, hidden subsidy support for commercial aviation, transportation in general, and electronics are beneficiaries.  We know defense can be cut.  We don’t have agreement on where and how much.

So the issue is not doctors or drones.  We have already too much defense spending and far too much health care spending.  The country needs to think.  Why should we not want a health care delivery system that cost about half (the same as other modern countries) and produces equal or better outcomes?  If we do, then let’s work on how to get there, and not try to reduce the number of people who can get health care (as Congress is now contemplating)?

We also know we are spending far more on defense than other countries.  Why don’t we develop a foreign policy that protects basic American interests but funds the defense apparatus necessary at a lower level, or collects contributions from other nations who choose not to spend themselves?

The better notion is that we want doctors and drones, just not the expensive version we have now.



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