Thursday, July 23, 2009

Atlas Shrugged, Health Care, and Collectivism

This weeks quote is from Atlas Shrugged and since one of the main topics being discussed in Washington right now is Socialized health care I thought I would share a story to illustrate the devastating effects of collectivism. The story is about a tramp Jeff Allen, former shop foreman at Twentieth Century Motor Company who had snuck onto the The Comet(train) and Dagny offers him to be her guess for diner. He explains to Dagny how the owner of the Twentieth Century Motor Company had passed away and that the heir had come in and brought a new plan of how to run the factory.

The following is an excerpts from Atlas Shrugged, © Copyright, 1957, by Ayn Rand.

"They let us vote on it, too, and everybody—almost everybody—voted for it, We didn't know. We thought it was good. No that's not true, either. We thought that we were supposed to think it was good. The plan was that everybody in the factory would work according to his ability, but would be paid according to his need.

The Starnes heirs made long speeches about it, and it wasn't too clear, but no body asked any questions. None of knew how the plan would work, but every one of us thought the next fellow knew it. And if anybody had doubts, he felt guilty and kept his mouth shut—because they made it sound like anyone who'd oppose the plan was a child-killer at heart and less of a human being. They told us that this plan would achieve a noble idea.
He goes on to explain how it worked
"Try pouring water into a tank where there’s a pipe at the bottom draining it out faster than you pour it, and each bucket you bring breaks that pipe an inch wider, and the harder you work the more is demanded of you, and you stand slinging buckets forty hours a week, then forthy-eight, then fifty-six - for your neighbor’s supper - for his wife’s operation - for his child’s measles - for his mother’s wheel chair - for his uncle’s shirt - for his nephew’s schooling - for the baby next door - for the baby to be born - for anyone anywhere around you - it’s theirs to receive, from diapers to dentures - and yours to work, from sunup to sundown, month after month, year after year, with nothing to show for it but your sweat, with nothing in sight for you but their pleasure, for the whole of your life, without rest, without hope, without end … From each according to his ability, to each according to his need…"

"We’re all one big family, they told us, we’re all in this together."

"It took us just one meeting to discover that we had become beggars - rotten, whining, sniveling beggars, all of us, because no man could claim his pay as his rightful earning, he had no rights and no earnings, his work didn’t belong to him, it belonged to ‘the family’, and they owed him nothing in return, and the only claim he had on them was his ‘need’ - so he had to beg in public for relief from his needs, like any lousy moocher, listing all his troubles and miseries, down to his patched drawers and his wife’s head colds, hoping that ‘the family’ would throw him the alms."
He goes on to explain how good men were forced to become bad
What was it they’d always told us about the vicious competition of the profit system, where men had to compete for who’d do a better job than his fellows? Vicious, wasn’t it? Well, they should have seen what it was like when we all had to compete with one another for who’d do the worst job possible. There’s no surer way to destroy a man than to force him into a spot where he has to aim at not doing his best, where he has to struggle to do a bad job, day after day. That will finish him quicker than drink or idleness or pulling stick-ups for a living.

“God help us, ma’am! Do you see what we saw? We saw that we’d been given a law to live by, a moral law, they called it, which punished those who observed it - for observing it. The more you tried to live up to it, the more you suffered; the more you cheated it, the bigger reward you got. Your honesty was like a tool left at the mercy of the next man’s dishonesty. The honest ones paid, the dishonest collected. The honest lost, the dishonest won. How long could men stay good under this sort of a law of goodness?

Rand demonstrates the hypocrisy in the behavior of the villains.
Was there any reason why this sort of horror would ever be preached by anybody? Was there anybody who got any profit from it? There was. The Starnes heirs. I hope you’re not going to remind me that they’d sacrificed a fortune and turned the factory over to us as a gift. We were fooled by that one, too. Yes, they gave up the factory. But profit, ma’am, depends on what it is that you’re after. And what the Starnes heirs were after, no money on earth could buy. Money is too clean and innocent for that.
And the downfall..
Well, we got what we asked for. By the time we saw what it was that we’d asked for, it was too late. We were trapped, with no place to go. The best men among us left the factory in the first week of the plan. We lost our best engineers, superintendents, foremen and highest-skilled workers. A man of self-respect doesn’t turn into a milch cow for anybody. Some able fellows tried to stick it out, but they couldn’t take it for long. We kept losing our men, they kept escaping from the factory like from a pesthole - till we had nothing left except the men of need, but none of the men of ability.

To work - on a blank check held by every creature born, by men whom you’ll never see, whose needs you’ll never know, whose ability or laziness or sloppiness or fraud you have no way to learn and no right to question - just to work and work and work - and leave it up to the Ivys and the Geralds of the world to decide whose stomach will consume the effort, the dreams and the days of your life. And this is the moral law to accept? This - a moral ideal?

Well, we tried it - and we learned. Our agony took four years, from our first meeting to our last, and it ended the only way it could end: in bankruptcy.
Pretty powerful writing and would take the time to not only read the book but read this part of the book. I know some might say it is extreme, but Health Care is not right it is a service. And to tax the wealthy to run/make deficit neutral is not right, I'm sorry it just isn't. Why are we forcibly taking someone’s income to the benefit of someone else?I have a problem with the concept of taking the fruits of someone’s hard earned labor simply so that I or someone else may benefit at their expense.

In order to truly reform health care we must unleash the potential of the free market. The reality is that there are over 133,000 pages of health care regulation in the U.S. Code currently. This obviously goes beyond simple consumer protections and begins to invade in business’ and people’s affairs.


I know this is a hot topic, leave me a comment and let me know how you feel? Am I a child-killer? Is the government given us a moral program?


  1. Those passages certainly make a good point about some of the failings of socialism. But as far as health care, I have questions. If our health care system would work better in a free market environment, then why isn't it currently sufficient? It is a free market system now, right?

    The anti-reform people say the system will fail if it becomes socialized, but the way I see it, its already a failure. When the leading cause of bankruptcy in the country is from medical costs, then the system we have does not work, IMHO. Or if it does work, it doesn't work for poor people.

  2. David - I don't buy the argument that it is already a failure, we are not in a completely free market. Like I mentioned above that there are over 133,000 pages of health care regulation in the U.S. Code currently...that is not a free market. Take an example of how the free market has worked with today's health care:

    A procedure such as Lasik Eye Surgery, the costs were originally quite high for that procedure. Without any coverage of this procedure from insurance companies or the government, prices for the procedure have come down over time because of a free market.

    Laser eye surgery has the highest patient satisfaction ratings of any surgery, it has been performed more than 3 million times in the past decade, it is new, it is high-tech, it has gotten better over time and... laser eye surgery has fallen in price. In 1998 the average price of laser eye surgery was about $2200 per eye. Today the average price is $1350, that's a decline of 38 percent in nominal terms and slightly more than that after taking into account inflation.

    Laser eye surgery is one of the few health procedures sold in a free market with price advertising, competition and consumer driven purchases.

    Hope that helps.

  3. I need Lasik, so that is great news! :D

  4. Healthcare in America is not even close to being a free market. In fact, it is government intervention (requiring Managed Healthcare in many circumstances) that has contributed to the mess that we have today.

    I sold medical equipment to dentists for many years . . . the cosmetic side of dentistry is another great model of free market principals at work. It benefits the consumer because there are choices and varying prices and THE CONSUMER (not the government or insurance companies) decides who he wants to go to based on the factors that are most important to him.

    I'll bet you in 10 years politicians like Pelosi and Obama will be saying that Dental Health "is a right" . . . only to be given to everyone and paid by that 60% of us that actually pay taxes.

  5. I am on the side of promoting free markets in the healthcare space, so don't take the following comments that wrong way.

    But, to be fair, you cannot compare an elective surgical proceedure like Lasik (breast implants, face lifts and penis pumps...etc) to a heart cath, brain surgery... and other life saving proceedures.

    I am on the industry side of the medical device / biotech field. Believe me there is cost and ineffiecnies that can be rung out of the system. Fix the system first and force the worst of the looters out of the system.

    You only have to watch 60 minutes last night to get a small sense of it. I have been and sold to So. FL, it is a freaking joke the corruption down there.

    However, the recent discussions on a double tax on the medical device companies will truly stiffel medical innovation and continued investment.

    This truly is the worst of all the ideas that are out there today. Why doesn't the government fix their own house before the bite the hand that feeds them and stiffle the innovative engine.

    Hell, medical innovation is one of the last industry advantages the US has. Washington should really try not to ruin it, like they did the manufacturing industry.

  6. Anon -

    "But, to be fair, you cannot compare an elective surgical proceedure like Lasik (breast implants, face lifts and penis pumps...etc) to a heart cath, brain surgery... and other life saving procedures."

    You make great points and I agree with everything you are saying, but can you explain why you cannot compare those procedures? With new and approved technology and innovation and If you allow competition with the innovative engine your talking about why should the price still go up?

    Thanks for the discussion!