COMMUNIST NEWS
To rebuild socialism:
a colossal but needed challenge
By Daniel Paquet and Archives
MONTRÉAL – Firstly, here is the bourgeois viewpoint on
capitalism :
Capitalism
Will Save Us -- If Only We Let It
Forbes Staff
This
story appears in the May 31, 2019 issue of Forbes. Subscribe
HARDLY A DAY goes by without some eminence from business or finance proclaiming
with furrowed brow and seeming sorrow that capitalism is in crisis and must be
overhauled if it is to survive and not be replaced with some variant of
socialism. Inequality, climate change, obscene levels of corporate profits,
stagnant wages, soaring healthcare costs, crushing levels of student debt, rampant
Wall Street greed, high-tech monsters and much more are all laid at the feet of
an allegedly heartless, unresponsive capitalistic system.
It ain't so. Contrary to all this highbrow hand-wringing, the problem is
bad government policies and, worse, a fundamental misunderstanding of free
markets. It's time for a reality check regarding this much-maligned system.
Capitalism is the
target of more and more protests.
SPENCER PLATT/GETTY IMAGES
Capitalism, free enterprise, free markets--whatever you label our
system--is moral because one succeeds by meeting the needs and wants of other
people. An entrepreneur tries to discern needs people don't know they have
until a product or service is introduced to the market. Think Steve Jobs and
the iPhone and iPad. Businesspeople try to persuade you to buy what they offer.
Unless the government gets involved, there is no coercion. Countless people are
trying to come up with ways to make everyone's lives better. If they succeed,
they might (gasp!) get rich, but we are all better off.
Ever more sophisticated supply chains rise up, which work precisely
because no tsar or central planner is in charge.
Government mistakes--not inherent flaws in free markets--are at the root
of every economic crisis in modern times. The Great Depression was
triggered by the draconian Smoot-Hawley Tariff Act, which imposed higher taxes
on thousands of import items, triggering a global trade war that devastated
economies. This felony was compounded when countries--Germany, Britain and the
U.S. were the worst offenders--substantially raised taxes in the teeth of a
sharp downturn.
The terrible inflation of the 1970s was the result of the Federal
Reserve and other central banks repeatedly printing too much money. The crisis
of 2008–09 sprang from the U.S. deliberately weakening the dollar, which set
off a flight to hard assets such as housing.
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High taxes are growth-killers. Taxes are a burden. Countries
that keep the burden light do better than those that don't. After it recovered
from WWII, Europe had growth rates comparable to or even better than those of
the U.S. But in the 1970s the weight of taxation became heavier and heavier
with the imposition of VATs and higher effective income tax rates. Result:
microscopic paces of expansion.
Every time the U.S. has enacted big tax cuts, its economy has blossomed.
The economy's post-Obama pickup came from the 2017 tax reduction and
deregulation.
Excessive regulations hurt. Regulatory expert Philip Howard cites a
typical example: An upstate New York apple orchard is subject to 5,000 rules
from 17 different programs. Regulations cost the U.S. some $2 trillion a year.
On average, a manufacturer pays $2,000 to $4,000 in annual taxes per worker;
its regulatory burden is $20,000 to $35,000. Is it any wonder that
manufacturing has suffered until recently?
Don't blame student debt on free enterprise. Government is the villain. With the best
intentions Washington created programs to help people pay for college,
primarily Pell Grants and student loans. Studies from the New York Fed and
others confirm that the more money colleges collected via these schemes, the
more students were charged.
High-priced healthcare is not a failure of capitalism. Free markets
are the solution here, not more government control. Ours is a third-party
healthcare system: government (primarily Medicare and Medicaid), insurance
companies and large employers, not consumers. Hospitals' revenues depend on how
well they negotiate with third parties, not on how well they please their
patients. What a drug company charges for a medicine is far smaller than what
you see reflected on a hospital bill. A big chunk of the price charged goes to
pay pharmaceutical benefit managers. Discovering in advance what a procedure
might cost is a Herculean effort.
In normal markets, if you make an advance in productivity, competitors
will likely follow suit quickly. Not so in healthcare or higher ed.
The Surgery Center of Oklahoma posts all of its prices online. It has
topflight surgeons; its overhead is low, by industry standards; and the cost of
an operation is a fraction of that charged at traditional hospitals and clinics
because patients pay the entire amount in advance. (Prices are higher if a
patient wants the center to file their insurance claim.) Yet it has few
imitators. Why? Because there is no consumer market. Since third parties foot
most of the bill, most patients have no incentive to compare quality and
prices, and would be hard put to do so even if they wanted to.
Take electronic records. Every dry cleaner and gas station has had them
for 20 years. But not healthcare providers: There was no competitive advantage.
Then Washington decided to mandate them but did so destructively, in a manner
worthy of the defunct Soviet Union.
Purdue University president Mitch Daniels has frozen tuitions since he
took office in 2013. He has enacted numerous efficiencies, so that to attend
this prestigious institution a student today pays less than a student did six
years ago. By the way, Daniels has boosted the number of
Purdue's tenured professors.
But just as with the case of the Surgery Center of Oklahoma and other
hospitals, there's no stampede of colleges and universities urgently following
Purdue's example.
Free markets reduce poverty. Real incomes per person have
risen over 50-fold since we achieved independence. Before the Industrial
Revolution, which capitalism made possible, individual incomes in the world
grew imperceptibly. Today, despite all the economic policy mistakes, poverty is
plummeting. Over the past 20 years, 1 billion people have escaped abject
poverty.
Free markets always turn scarcity into abundance, today's luxuries into
tomorrow's common products. Among countless examples is the handheld
phone. The first cellphone of the early 1980s--which could only make calls--was
as large as a shoe box, weighed as much as a brick, had barely an hour of
battery life and cost $3,995. Today there are billions of cellphones, and most
have the capability that a supercomputer had a couple of decades ago.
The same happy phenomenon of getting more for less would happen in
healthcare if certain free-market reforms were enacted, such as nationwide
shopping for medical insurance and removing restrictions on medical savings
accounts.
Inequality? Wages, until recently, had stagnated since the financial crisis of
2008, and they hadn't been improving much in the decade before then. Once
again, the problem was faulty government actions.
Investment is the sine qua non for progress, and more
investment takes place when money has a stable value. Until the 1970s the
dollar had been fixed to gold, and the U.S. economy had grown as no other
nation's ever had before. But since then our average growth has declined 25% or
more. And guess what: Income growth hasn't been as robust as when we were on
the gold standard, either.
Another factor: relentlessly rising medical costs. Employer-provided
insurance counts as part of an employee's compensation. Even though
compensation has risen, the cash part has lagged. Not helping, either, has been
the surge in federal payroll taxes, labeled "FICA" on your paycheck
stub. With a regime of low taxes, a trustworthy dollar and a patient-oriented
healthcare system, cash wages would rise very nicely.
Profits are essential. They are moral. Without them,
the economy stagnates and regresses. The economist Joseph Schumpeter famously
coined the phrase "creative destruction." Vibrant economies need
enormous amounts of new capital to move forward. Change constantly destroys old
capital--look at what the internet did to the value of legacy newspaper and
magazine publishers--which must be replaced. Capital is needed to finance
startups (most fail) and expansions as well as the productivity improvements of
existing businesses. Capital comes from profits and savings. In that sense
profit is a cost of doing business.
More and more young people want to work for outfits that are not
"just" business. This is one of the great virtues of
capitalism: The system seamlessly adjusts to people's wants and expectations.
Wise companies quickly pick up and respond to these changes. Forbes has
written frequently about these companies and the individuals pioneering their
efforts.
Some people in business do bad, amoral or unethical things. Yes, they do,
but that's not something unique to capitalism. People were guilty of bad
behavior long before Adam Smith penned his capitalist classic, An
Inquiry into the Nature and Causes of the Wealth of Nations, in 1776.
Moreover, in an open, free-market and democratic system, the bad ones are usually
flushed out, unlike in authoritarian or socialist regimes.
Socialism never works. It always leads to blood,
tyranny and tears, as can be seen today in Venezuela, Cuba and North Korea and
in the recent past in the Soviet Union, Maoist China and communist Cambodia
(where, in less than four years, the regime slaughtered more than one fourth of
the population).
What about the "socialism" of Scandinavia and Europe? They are not
socialist in the sense that the government owns and runs the economy. Many of
these countries have elaborate welfare programs, restrictive labor laws and
overtaxation. But all this is beginning to change.
What self-styled American socialists overlook is that countries like
Sweden have been scaling back government. Sweden has been cutting taxes. It has
no inheritance tax, and it allows school choice, which is anathema to Bernie
Sanders and his ilk. As for the rest of the EU, the average rate of economic
growth since the crisis of 2008 has been minuscule, less than half that of the U.S.
More to the point, capitalism creates the wealth that makes welfare
states possible. That's why more and more Europeans are looking at
pro-capitalist reforms, such as low taxes, to gin up their economies.
Forbes Staff
Steve Forbes is Chairman and Editor-in-Chief of Forbes Media.
And now the point of view of a Canadian trade-unionist
about health-care :
Defence of public health care has begun in a B.C. courtroom
By Pauline Worsfold Opinion
Tues., May 21,
2019
There
is a trial going on against public health care in Canada, the outcome of which
could very well affect access to health care for every single one of us. We
don’t hear about it every day because the trial process has been long and
tedious. It began in 2016.
But
for participants and observers alike, the monotonous court proceedings in
Cambie Surgeries Corporation v. British Columbia (Medical Services Commission)
are now getting interesting. As the defence of public health care gets
underway, we are getting to the heart of the matter.
The
question before B.C. Supreme Court Justice John Steeves is fundamental: Are we
going to have a health care system that treats everyone the same and in which
access to care is based on need? Or, are we going to move to an American style,
two-tier health care system where there is one system for the wealthy and
another one for everyone else?
This
case against public health care was brought by a group led by Brian Day, CEO of
Cambie Surgeries Corporation. Day wants the ability to charge higher fees than
the public system allows and to charge the public system and private insurance
at the same time. If he is successful, for-profit health care delivery could be
introduced into our public system.
Day
is claiming he wants to improve wait times for surgical treatment. His Charter
challenge is advancing an individual right to overcome unreasonable wait times
by seeking for-profit care. However, Day’s team has not provided any proof that
for-profit health care will alleviate wait times. Only anecdotal evidence has
been offered. Most importantly, Day’s case has not demonstrated that the
prohibitions on private insurance and extra billing are the source of any wait
time problems.
On
the other hand, those defending public health care can prove that the
introduction of for-profit care creates lots of problems. Last week Prof.
Marie-Claude Premont, a health care policy expert from the École nationale
d'administration publique, brought instructive evidence from Quebec, where a
Supreme Court decision from 2005 required the province to lift its ban on
private insurance under Quebec’s Charter of Human Rights and
Freedoms.
According
to Premont, the subsequent changes have created chaos where patients are
jumping the queue by hopping between public and private care. Private clinics
are being subsidized by the public system while at the same time charging
patients extra fees. As these changes take hold, the number of doctors leaving
the public system for private clinics is rising dramatically, draining resources
from the public system.
This
all creates a health care system skewed by market forces. Flying in the face of
the Canada Health Act’s guarantees of universality and accessibility, people
with resources have an advantage and because of financial incentives, services
are provided more readily where the profit is best.
It
seems clear to many courtroom observers that Day’s legal team is trying to stay
away from arguing over the Canada Health Act. And for good reason. It’s pretty
hard to object to principles that ensure the sick get taken care of regardless
of income.
Rather,
it looks as though Day is attempting to demonstrate that the public health care
system will not be negatively affected with the introduction of for-profit
care. In fact, he has tried to demonstrate that it is a natural evolution.
Day’s arguments were dealt a serious blow last week.
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There
are many ways to improve health care in Canada without compromising its
fundamental principles. Innovations in case management, which are now being
implemented in B.C., are a direct response to long wait times. And of course,
appropriate funding is key to protecting and enhancing our public health care
system.
A
universal, public pharmacare plan would also go a long way to improving the
system by reducing costs and increasing accessibility. These are the real
issues that need to be debated.
In
the meantime, we cherish a health care system that is blind to wealth and
status. A system where resources are distributed by need and not by the
marketplace. Should all of that be tossed aside because of unsubstantiated
claims made by people who stand to make the most money?
Before
we prescribe the treatment, let’s make sure we get the diagnosis right.
Pauline Worsfold,
RN, is the chair of the Canadian Health Coalition.
Grover Furr’s latest
talks on Youtube.
From: Grover Furr <furrg_nj@fastmail.fm>
Subject: Podcast (audio only) interview of me
concerning my book _Stalin: Waiting for ... the Truth_
Date: May 18, 2019 at 6:22:23 PM CDT
To: Grover Furr
<furrg@mail.montclair.edu>
Dear friends:
The folks who run this pro-communist podcast
invited me to be interviewed on the subject on my research on the Stalin era in
the USSR.
Here is the link to that audio-only interview:
I hope you find it interesting. Criticisms
welcome!
Sincerely,
Grover Furr
e-mail:
dpaquet1871@gmail.com
Communist News: www.dpaquet1871.blogspot.com
L’Humanité in English: www.humaniteinenglish.com
On-line Marxist encyclopedia
CocoWikipédia: www.cocowikipedia.org
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