During the hearing of Obamacare, the news was full of analysis. One of those pieces, in the “USA Today”, made a point that food is more of a basic need to people than healthcare:
A brief submitted by 215 economists argues that food is even more basic to survival than health care…
I was struck by this last night as I was cleaning out some of my “stack” in my office last night.
See, the food delivery market, while not perfectly so, is a free market example of how goods can be distributed efficiently. Based on demand and the profit motive, food stuffs are delivered to a literal market where individual shoppers are allowed to “ration” themselves based, in part, by how much money they have and what types of services they want.
For example, in my market I can by generic chicken soup, Ramen noodles and rice. Or, I can walk 50 feet away and purchase hand rolled sushi, fillet mignon, $60 wine and lobster.
As a real example of the power of markets I picked up this flier:
For $5, this profit driven market is offering a meal that feeds 4 people, perhaps more if the kids are younger.
If medical care were subject to the same market forces you would see the same thing happen with the cost of medical care. In the same way, if you allowed health insurance to be impacted by the same market forces, you would see prices of health insurance react in the same manner.
It’s only when government intercedes, by mandating acupuncture coverage, or by restricting the sale of insurance polices across state lines, that you see the price of a good or service go up.