August 8, 2007
There Are Free Lunches
I don't wish to besmirch Robert Heinlein's Centenary. Yet I fear that his words are being used in a way of which he might have disapproved.
TNSSAAFL is a great tool for those who oppose expanding the scope, cost, and coercive power of government. It is a good principle to keep in mind, but I suggest that it is not universally true. The free market delivers millions of free lunches everyday.
I signed up for the Eat & Enjoy Rewards card at Chili's (yes, I am quite the epicurean!) For registering it online, I get a free appetizer. Have you seen their portions? I can make a lunch out of that and probably bring some home. "But you gave them your email address, they can spam you and track your purchases!" Still pretty close to free for me. I get 142 spams a day instead of 141 -- I bet there's will be better than discu0nt c!@l|s.
I'm not shilling for the card, I'm shilling for the free market. Blog friend Josh Hendrickson invokes TNSTAALF on a great post today about The Myth of Preventative Health Care. I don't disagree with the thesis of the article. But the linked article makes a leap:
“Fundamentally, if you’re going to control health care costs, it involves denying people care they want — or things they’ve been trained to think they want,” Mr. Gruber says. “There is no easy answer.”
I disagree. The market frequently provides people what they want -- or things they have been trained to want. I just got a free Motorola Razr for upping my service contract for two years. I want the phone, and I am happy on T-Mobile. I can get calls at Chili's for free on weekends.
In health care, I always cite maternity care and Lasik surgery. Two areas where the free market has influenced price and service have seen drastic improvements while the rest of the health care system has seen price gains and service stagnation. Insurance typically does not cover Lasik surgery, so market forces prevail. The costs have gone from thousands per eye to hundreds for both. Our bass player got a guarantee: anytime his vision drops below 20/20, they'll provide the procedure for free.
They built a beautiful new hospital in Boulder that I've heard called "the Maternity Marriott." It has WiFi and nice chairs and stylish hallways. The specialty is maternity. Services are still funded through insurance, so there is no price competition. Yet this hospital is one of many updating comfort, design and service to compete for a hospital stay where the choice is the patient's and not the ambulance driver.
Dig Heinlein, fight government intrusion, but do not use TNSTAAFL to accept the status quo ante.
Economics and Markets Posted by jk at August 8, 2007 11:04 AM
That Chili's card wasn't free. You are overlooking the time cost associated with registering online.
The point Gruber is making is not that the free market is ill-equipped to provide individuals what they want, but rather that any attempt to control costs by insurers and government must be done by reducing care.
Posted by: Josh Hendrickson at August 8, 2007 2:12 PMThat's exactly the part I reject. As I mentioned, I liked the rest of the article. The Lasik providers are not controlling costs by reducing care. Nor are nurse-staffed RediCare clinics in Wal*Marts and CVS stores or Wal*Mart's $4 generic prescriptions.
That does not directly contradict your point about insurers or government. I think, however, that too many health care debates start on the premise of a scarcity that is more manageable than many on both sides will admit.
The free market will provide a lot of very low cost lunches if allowed so to do.
Posted by: jk at August 8, 2007 5:33 PM | What do you think? [2]