Is Tom DiLorenzo right that Obama’s proposed “public health insurance option” will drive private providers out of business? Why would it?
could private business hope to provide a superioir service that the state service would fade away? no the state can be relied upon to turn things in its favour, use uneconomic (political) means to do this. that means that it will be squeezing out private providers. in fact, you could only imagine that private provision would not be crowded out, if there are no( and there could be no) private providers in the market you are considering.
Well, first of all, the government would have to bid loans away from the lonable funds market, thus crowding out the private sector (not necessarily for healthcare, but for investments in general). The real problem is that the government has the taxpayers and the printing press on its side, and is not bound by the profit motive. The government healthcare abomination could (would) operate at losses for quite some time pushing out their so-called “private” competitors. But after a while, as is always the case, the government will over-extend itself and create something which cannot be paid for (social security, Medicaid), and is extremely inefficient (DMV, post office). Government projects always seem good at first because people don’t grasp the unseen, the ramifications of its intrusion. Medicaid was praised in its early years, but now everyone sees it for what it is (even Obama).
He is, but I would revise “drive out of business” to “render almost useless”, simply because private health insurance still exists in countries who self-identify as democratic socialist regimes. However, the private insurers are so under priced and out-competed by the state and its monopoly powers that they offer a distressingly bad ratio of care/payouts to premium rates. Private insurance exists but its effectively driven out of business.
I consider this worthy of mentioning because statists will take no time in informing you that your ideas are invalid as private health insurance exists in France.