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The Politics of Controlled Crisis
...For cryin' out loud, we have a single payer government health care system called Medicaid that has a 40% fraud and 'legal graft' rate from coast to coast! (Or at least on both of them.)

Not waste and inefficient procedures. Fraud and graft!

Why? Simple. No politician in New York or California ever gets a vote from denying medical benefits to anyone -- it only costs them votes. "Heartless politicians deny medical care to the poor..." The very same argument being used to beat up insurance companies in Congressional hearings today. Add to that all the money the politicians collect from the medical services providers -- hospitals, unions of health care workers, suppliers, etc.

That's an awful lot of political incentive against cost efficiency. Where is the incentive for it?...

...When Spitzer was AG of New York why did he totally ignore the notorious massive graft in NYS Medicaid, which he was explicitly charged under the law to police, to pursue Wall Street instead, which was the jurisdiction of the SEC and Feds? Because that's how political incentives apply to government medical care programs.

Reality is this: Politicians will hand out medical benefits with no more efficiency retraints than today until the day arrives when they feel the pain of having to raise taxes to pay for them. Then they will apply "cost saving measures" by hacking the govt's health care budget with a meat cleaver from the top down -- making the whole system even less efficient than ever.

Why? Because it follows from the only political incentives they feel: (1) Get votes by handing out more benefits; then (2) avoid losing votes by stopping tax increases with budget caps, enforced top-down.

Politicians have no incentive, zero, to deliver "cost efficiency" in medical care. That only cost them votes, so they effectively are against it. Look at Medicaid from New York to California. Orszag admitted it to Postrel!...