Jesus Hates Taxes With thanks to a Facebook Friend
Showing posts with label capitalism. Show all posts
Showing posts with label capitalism. Show all posts
21 March 2011
24 November 2009
Co-Operative Health Insurance?
In my post Capitalism as a Belief System, I mentioned the idea of using capitalism as a way of running an economy without buying in to capitalism as a belief system.
I think I've already explained what I mean by not buying into capitalism as a belief system: a rejection of the idea that any and every enterprise "should" or "must" be run according to the principle of maximum return per unit of risk. In my previous post, I suggested that the health-care area was one area where I'd personally want to use the Golden Rule as the governing value. I accept that there is much debate about the values surrounding healthcare, but I just want to suggest here a mechanism by which the operating systems of capitalism can be used for more altruistic ends. That mechanism is the co-operative enterprise.
Before anyone feels that they need to enlighten me about the facts, co-operative enterprises are not new nor do I claim to have invented the idea. As businesses, they tend to work very much in the same way as ordinary businesses: investors, a managing board, operations management, employees and customers/clients. The difference between a co-op and a profit-seeking organization is their reason for existing. Almost all for-profits business exist with the ultimate sole goal of maximizing profits. Co-ops exist for the benefit of stakeholders.
Probably one of the most well-known forms of co-operative in the United States are old-fashioned credit unions. You become a member of a credit union, deposit some money in a savings account, and get a return on your money from monies that the credit union lends to other credit union members. In the old days, you couldn't borrow money from a co-op until you had deposited a sum of money for a specified period of time.
What is the point of a credit union? To hopefully provide a service to members whereby: 1) they have access to loans which they would not have otherwise had access to; 2) they have access to a good rate of return on their savings and; 3) they have access to a good borrowing rate on their loans. The primary goal here is not for the credit union to make a profit to reinvest in order to grow and provide shareholders or owners with an ever-increasing earnings stream. The primary goal is to provide a decent, basic savings and loan service to members.
It seems obvious to me that health insurance could be run on similar principles. I know that in California, homeowners who cannot otherwise find home insurance due to a high risk of fire in their area can insure their homes through a type of State insurance which seeks only to cover the costs of claims. On a much more simple level, the Amish operate a system whereby every family puts a sum of money into a "pot" and medical care is paid out of this pot. There are also a couple of medical cost-sharing schemes run by Christians for Christians (which typically require you to sign up to a doctrinal statement!) which aim at members covering the cost of other members.
Will co-operative health insurance solve the current crisis of health-care costs? No, I don't think so. The causes are many and complex but a lot of them can easily be filed under the two basic categories that drive all capital markets: fear and greed. Fear of not having the absolute cutting edge drug or treatment; fear of not having the best possible consumer choice if one has the money to purchase it.
The underlying problem is spiritual, it is a problem of values, as I suggested in my last post. We simply cannot countenance a health-care system that is run for the general good which might limit the ability of the very rich to buy cutting-edge medical care. In money we trust. We are happy to tell the working person that he has no right to a vaccination if he cannot afford it, because what we are absolutely certain of is that the rich person has the right to expensive experimental drugs if she can afford it.
I think I've already explained what I mean by not buying into capitalism as a belief system: a rejection of the idea that any and every enterprise "should" or "must" be run according to the principle of maximum return per unit of risk. In my previous post, I suggested that the health-care area was one area where I'd personally want to use the Golden Rule as the governing value. I accept that there is much debate about the values surrounding healthcare, but I just want to suggest here a mechanism by which the operating systems of capitalism can be used for more altruistic ends. That mechanism is the co-operative enterprise.
Before anyone feels that they need to enlighten me about the facts, co-operative enterprises are not new nor do I claim to have invented the idea. As businesses, they tend to work very much in the same way as ordinary businesses: investors, a managing board, operations management, employees and customers/clients. The difference between a co-op and a profit-seeking organization is their reason for existing. Almost all for-profits business exist with the ultimate sole goal of maximizing profits. Co-ops exist for the benefit of stakeholders.
Probably one of the most well-known forms of co-operative in the United States are old-fashioned credit unions. You become a member of a credit union, deposit some money in a savings account, and get a return on your money from monies that the credit union lends to other credit union members. In the old days, you couldn't borrow money from a co-op until you had deposited a sum of money for a specified period of time.
What is the point of a credit union? To hopefully provide a service to members whereby: 1) they have access to loans which they would not have otherwise had access to; 2) they have access to a good rate of return on their savings and; 3) they have access to a good borrowing rate on their loans. The primary goal here is not for the credit union to make a profit to reinvest in order to grow and provide shareholders or owners with an ever-increasing earnings stream. The primary goal is to provide a decent, basic savings and loan service to members.
It seems obvious to me that health insurance could be run on similar principles. I know that in California, homeowners who cannot otherwise find home insurance due to a high risk of fire in their area can insure their homes through a type of State insurance which seeks only to cover the costs of claims. On a much more simple level, the Amish operate a system whereby every family puts a sum of money into a "pot" and medical care is paid out of this pot. There are also a couple of medical cost-sharing schemes run by Christians for Christians (which typically require you to sign up to a doctrinal statement!) which aim at members covering the cost of other members.
Will co-operative health insurance solve the current crisis of health-care costs? No, I don't think so. The causes are many and complex but a lot of them can easily be filed under the two basic categories that drive all capital markets: fear and greed. Fear of not having the absolute cutting edge drug or treatment; fear of not having the best possible consumer choice if one has the money to purchase it.
The underlying problem is spiritual, it is a problem of values, as I suggested in my last post. We simply cannot countenance a health-care system that is run for the general good which might limit the ability of the very rich to buy cutting-edge medical care. In money we trust. We are happy to tell the working person that he has no right to a vaccination if he cannot afford it, because what we are absolutely certain of is that the rich person has the right to expensive experimental drugs if she can afford it.
Capitalism as a Belief System
There have been a number of debates going on in the blogosphere about US health-care reform which I have been participating in over the last few weeks and quite a few of these have branched off into discussions about business, economics and social beliefs and values. In conjunction with yesterday's post on the subject of compassion and The Golden Rule, I've had a some thoughts on the subjects of "The Golden Rule, Capitalism and Health Care" which I'm going to attempt to write about in a series of posts.
In many ways, I'm still a "foreigner" here in the US and one of the things that has struck me is how much capitalism appears to be for many people in the US a belief system as well as a way of running an economy. After twenty years working in the equity markets, my own opinion is that capitalism is, historically, the least worst way of running an economy that human history has devised.
It's also my opinion however, that as a belief system, capitalism stinks. And I believe that capitalism is the number one belief system held by US society. Christians may say that they believe in the Lordship of Christ, but in actual fact we believe in the Lordship of Profits. We prove this every day by the way we live our lives.
I think that there are historic reasons for many of our economic beliefs. The rule of King George III in raising taxes in America for his own selfish empire building had much to do with establishing the idea that taxation is stealing. The right to "life, liberty and the pursuit of happiness" which is enshrined in the Declaration of Independence was almost "life, liberty and the pursuit of profit"; so this value has a 200+ year history in US society.
And, of course, the Cold War which was actually a clash of super-powers was characterized in the US as "The good and moral values of capitalism versus the bad and immoral values of socialism/communism". In US culture, "democracy" and "capitalism" are seen as synonymous by many even though they are not. In US culture, "totalitarianism" and "socialism" are seen as synonymous even though they are not. And the worst conflation of all is the idea that Christianity and the pursuit of profits (capitalism's value system as opposed to its operating system) are synonymous.
Let's be really simplistic here. Jesus said that the greatest of all commandments is "love God and love your neighbor as yourself" (basically, The Golden Rule). Capitalism says that all businesses must be run for the highest risk/reward ratio - for the highest profit. Therefore Capitalism's value system cannot be the focus of Christian behavior or of Christian ethical reasoning.
Rather than testing every social venture by the test of "Will this venture make the highest profit for the capital that has been invested?", Jesus' teachings require Christians to use the test of "Will this venture benefit the citizens of this country/State/city/county in aggregate?" I appreciate that determining aggregate social benefit is another complex ethical problem but I don't think that we can abdicate the responsibility of making that moral determination by simply defaulting to the standard of profit. "Oh, it's too difficult to decide what it means for society to 'benefit' from health-care, so let's just run our health-care system on the basis that all providers should make as much as they can from their investment."
We do already recognize that some services to society are too important to leave to individuals to either perform or to raise money for. And, historically, many of these things were once left to individuals: policing, fire-fighting and education. It's a mystery to me how we can argue that education is of benefit to society and should be paid for by taxes but that health-care is not a benefit to society and that those who cannot pay for it do not deserve it. One blogger actually compared health-care to purchasing an iPhone or a car: a luxury consumer good that one shouldn't have if one can't pay for it. That makes sense using the "lens" of capitalistic values to make my ethical judgments. If I use the "lens" of doing unto others as I would have them do to me, I come up with a whole different opinion about the value of health-care to society.
In many ways, I'm still a "foreigner" here in the US and one of the things that has struck me is how much capitalism appears to be for many people in the US a belief system as well as a way of running an economy. After twenty years working in the equity markets, my own opinion is that capitalism is, historically, the least worst way of running an economy that human history has devised.
It's also my opinion however, that as a belief system, capitalism stinks. And I believe that capitalism is the number one belief system held by US society. Christians may say that they believe in the Lordship of Christ, but in actual fact we believe in the Lordship of Profits. We prove this every day by the way we live our lives.
I think that there are historic reasons for many of our economic beliefs. The rule of King George III in raising taxes in America for his own selfish empire building had much to do with establishing the idea that taxation is stealing. The right to "life, liberty and the pursuit of happiness" which is enshrined in the Declaration of Independence was almost "life, liberty and the pursuit of profit"; so this value has a 200+ year history in US society.
And, of course, the Cold War which was actually a clash of super-powers was characterized in the US as "The good and moral values of capitalism versus the bad and immoral values of socialism/communism". In US culture, "democracy" and "capitalism" are seen as synonymous by many even though they are not. In US culture, "totalitarianism" and "socialism" are seen as synonymous even though they are not. And the worst conflation of all is the idea that Christianity and the pursuit of profits (capitalism's value system as opposed to its operating system) are synonymous.
Let's be really simplistic here. Jesus said that the greatest of all commandments is "love God and love your neighbor as yourself" (basically, The Golden Rule). Capitalism says that all businesses must be run for the highest risk/reward ratio - for the highest profit. Therefore Capitalism's value system cannot be the focus of Christian behavior or of Christian ethical reasoning.
Rather than testing every social venture by the test of "Will this venture make the highest profit for the capital that has been invested?", Jesus' teachings require Christians to use the test of "Will this venture benefit the citizens of this country/State/city/county in aggregate?" I appreciate that determining aggregate social benefit is another complex ethical problem but I don't think that we can abdicate the responsibility of making that moral determination by simply defaulting to the standard of profit. "Oh, it's too difficult to decide what it means for society to 'benefit' from health-care, so let's just run our health-care system on the basis that all providers should make as much as they can from their investment."
We do already recognize that some services to society are too important to leave to individuals to either perform or to raise money for. And, historically, many of these things were once left to individuals: policing, fire-fighting and education. It's a mystery to me how we can argue that education is of benefit to society and should be paid for by taxes but that health-care is not a benefit to society and that those who cannot pay for it do not deserve it. One blogger actually compared health-care to purchasing an iPhone or a car: a luxury consumer good that one shouldn't have if one can't pay for it. That makes sense using the "lens" of capitalistic values to make my ethical judgments. If I use the "lens" of doing unto others as I would have them do to me, I come up with a whole different opinion about the value of health-care to society.
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