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Lalucas's Links
AUGUST 15, 2009 1:50PM

My Letter to a Fiscal Conservative

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Dear __________:

I wanted to write a personal note to thank you for your consideration of my position on affordable health care in the message crafted for our district's House Representative. I know that it goes against most conservative tenets to refrain from protest on the issue of health care reform with regard to a public option.  I have struggled to understand the conservative position for some time now, but I think I understand your position much better now. I am reading a book called a "Conflict of Visions", by Thomas Sowell. His writing is helping me gain perspective on the nature of the fiscal conservative juxtaposed to a more socially liberal perspective with regard to economic policies.

In result, because I think we may be more in agreement than you would suppose, I want to explain my perception of what is happening with our economy:

I have come to see that most segments of big business have become "too big to fail". They must continue to exist and prosper due to a lack of other viable consumer options in the marketplace. Having a handful of giants in any segment of business works against the principles of competition in the market place that are needed to keep the free market functioning equitably.

As I have written, the creation of the public option for homeowner's insurance in Florida reopened the market for new smaller businesses to compete with the insurance giants. Short of anti-trust or other regulation, the only entity large enough to jump start competition with businesses in the "too big to fail" category is the government. As the President has said many times, he is not in the "car business" or the "banking business", but his administration knows that the current economic situation where greed has run wild can only be curbed by the economic force of competition in the market place.

We seem to find ourselves in a period of time where conservative principles left unchecked for too long have thrown the market out of balance. Although I am no fan of big government, or perhaps even this new version of government intervention, I have realized over the past several years that big business cannot be expected to police itself any better than certain branches of the government have done. We are in need of leadership and decisions that force a level of business practice that is not just profitable but follows fair trade in business as well. Market competition is the only remedy possible for capitalism gone feral.

With regard to health care, the CEO's of the insurance giants went on record saying that they had no problem cancelling policies of their customers when they became sick to a level that was deemed too costly to the corporation. Regardless of politics on any side, they sold the customer a product then did not  perform as advertised of their product.

In a normal marketplace, this would cause a lack of return business that would ultimately impact the bottom line. Failure to provide products that were paid for by insurance premiums is not only bad business practice but should result in at least the punitive damage of loss of business and profitablity to the corporate entity. With businesses "too big to fail", there is little negative impact to the bottom line, however, as they can raise premiums without limitations. There is no other choice for the consumer due to lack of viable competition. In result, big business gets away with selling a product that can become worthless without notice, without recourse for remedy or refund.

Some corporations will not do the right thing ethically, morally, socially or even in the sense of good business practice because the only thing ruling corporate interests is ever-increasing profitability. By definition, a corporation exists solely to create profit.  The only way to check the business practices of a corporation is to seriously cut into profitability through intensely viable market competition.

In result, as well as to circumvent the effect of corporate lobbyists , this administration is opting to provide market competition in the corporate world on behalf of its citizenry. I am eager to learn if in the end,  the plan may be to operate for profit (as in the takeover of GM) which certainly will be a new concept in the market place.

Is it possible that the plan to create government participation in the market place could be viewed properly as capitalism working through  the precepts of the free market? If so, this is a relatively new concept. I remain optimistic a public option will provide a much needed wake up call to big business, who have been able to operate unchecked for a very long time.

In the end, if this new force in the market place becomes viable, the United State of America will maintain its status as a capitalist country, with the government providing competition in the freemarket on behalf of its citizens. I have come to believe we are looking at the beginnings of a new hybrid capitalistic economy.

On the surface, it may appear that a liberal government is attempting to become much bigger than ever in recorded history in its efforts to save every corporate entity from failure while "giving away" market products to the masses.  We have to look beyond the talking points to understand what is truly happening in the marketplace. Again, I hold, a public health insurance option will serve much the same function as Citizen's homeowner's insurance (with all its flaws) serves for us in Florida. We have seen that high risk homeowners have been served by a state run homeowner's insurance company. The same thing is possible by allowing the government to create a public health care risk pool for the uninsured and uninsurable through a public option for health care insurance.

I do not propose that the transition will be easy or without initial cost, but short of competition, how will affordable health care and/or the possibility of getting what was paid for through years of premiums ever be restored? The structure of our economy dictates that the insurance giants must be forced to compete for their customers. It is really the only solution short of regulation, which now seems to be a thing of the past. Apparently, due to lobbying efforts, regulation would face an insurmountable uphill batte in Congress. We will see what works in the end, but I truly believe that reform is needed in the insurance industry. 

That is my take, do with it what you will...

Best Regards,

Lisa Lucas

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This is an excellent post. I'm happy to see logic and reason instead of mindless talking points, which so many conservatives put forth. Your poist explains things very well.

rated for sense and logic--
Thanks, Stephen. I have been arguing for days with local conservatives who are against health care reform. They can only see it as a move toward more big government. This was my synopsis of all the points we have been covering. Not getting any real estate sold, but I guess not every day is about making a dime...:)
Of course, the people who really need to read this don't have the attention span to absorb the truth of what you are saying. It's much easier to listen to Limbaugh platitudes and Hannity sound bites.
Thanks, Steve. I did send it out to some conservatives. I think their feeling is that this is not a normal role for government to take and is fraught with the potential for abuse. In some of that, I am in agreement. We have moved in a new direction when that body that is meant to police the corporate world chooses to become its competition rather than its regulator. It is worth a try, I guess, if things were not so out of balance that there is no other way! We will see!
Lisa, that was an excellent take and perfectly logical assessment of what is going on right now. The health care system has been hijacked and is killing our economy. One million bankruptcies per year tied to health care issues is unsustainable, not to mention the human toll. Who is next? It could be you or me!

PS. Hope you are doing well.
Thanks, Michael, I am doing better. For some reason, I seem not to be doing as well as I usually do with real estate, but have had some closings and a couple more on the books.

I am really stirred up about the shenanigans around health care reform. We are having our House Rep here on August 25th so I have been negotiating for reasoned remarks from the Realtors Association. After all these years, our national association has been unable to get a group plan for us.

At least 40% of our county's population are self-employed, many are Realtors, so we need to advocate health care reform. That goes very much against conservative views with regard to government...All I can do is try and they have listened. The committee has agreed to language that gets the point across without being partisan -- I was very pleased with the joint effort.
Well, NeilPaul, I read something similar from one of my fellow Realtors today about insuring homes on the coasts. Some of them are old and there are insurance abuses in the event of a major storm. Many more of the homes are newer built mansions on the ocean. These people would be happy to insure their homes at any cost, but at one point in time (2004 & 2005), some of these were not insurable either. Maybe not as many as with the older homes, but there were enough to put pressure on the state to create an insurance pool for the higher risk homes. No one that built an oceanfront mansion coudl foresee the possibility that their million dollar plus investment would stand uninsured in the United States of America. Save for the intervention of the State government, they would remain uninsured.

To give you a snapshot of insurance costs in Florida:

Recently, my husband and I found a modest 1800 sq ft foreclosure in Stuart, Florida. It was near to a canal (not waterfront) that poured into the intercoastal waterway. This home could have been purchased for about $180,000, but the insurance for the property would be upwards of $6,000 per year. The insurance costs would have been almost half of the mortgage, and combined with property taxes would have been MORE than the mortgage costs. Insurance here is a problem as are taxes, but that is another issue in itself.

The same ridiculous costs are associated with the cost of health care insurance for the self-employed. Currently, I pay 15% of my gross yearly sales for insurance. That is a LOT of expense for a policy with a high deductible.

Not all people needing affordable insurance are scumbags, NeilPaul. Surely you must know that! And in some cases, of which I am living proof, the insurance companies have gouged us to the point of either going uninsured or doing without something else (like a fuel efficient car). I am not poor or unemployed, but it is not a happy situation in which I find myself with regard to health insurance expenses...
One of the funny things about what passes for conservatism now is that it's really just down home, old fashioned Republican pro big biz/wealth politics. Real conservatism was that for about 15 minutes, then became a label to "intellectualize" wealth control, basically. It's now more like European conservatism, with a ruling class to protect. 99% of those who call themselves conservative have no idea what it is, was, and how it came into being.
And yes, it is proper to call a public option insurance plan capitalism, because that's exactly what it is. I've been telling people that for years, but most understand political reality based on labels. Thinking about it too deeply in real terms isn't for the faint-brained, and there's no shortage of that commodity in America.
Good post, you see the light.
Thanks, Paul. I am working on it night and day, reading and writing, writing and reading. I am surprised but suddenly there is a dialogue happening in my local email box. We are trying to find concensus on health care reform as all of us need it. Some times things can change when philosophy collides with reality.
PS to NeilPaul: I corrected the sentence regarding a worthless product to reflect my intended meaning.
Thanks for reading Thomas Sowell (I love him!); I'm a Republican who's read "Big Salon" for years; I thought I was the only one who ever bothered to read across the aisle. I think normal Americans, on whatever side of the aisle, are not that far apart on this issue. Of course our current system has a lot of evils and need to be reformed. However, the idea of government control makes my blood run cold. My local representative is a nice guy, but I didn't elect him to decide what medicines I may have or when and how I die.

Dialogue is good!

I find Sowell's writing to be very even-handed. At this point in A Conflict of Visions, I cannot find any bias on his part toward what he calls the "constrained" view, which is the conservative position. It may come later, but since he is a professor, I believe he often writes "textbook" style to allow a varied readership to be exposed to his observations. Since so much written today comes from one partisan viewpoint or the other, I am appreciative of his work.