5.20 Socialized Medicine
Many people are unhappy with the cost of their medication. President Joe Biden decided to force drug companies to charge less. He did that as part of what he calls the Inflation Reduction Act. When inflation occurs prices go up. Biden's policies of borrowing from the U.S. treasury which prints enormous of money for him to borrow, causes money to be worth less and prices to go up. Instead of spending less Biden decided to force companies to charge less. The problem with doing this is explained in the previous lesson on price controls. One problem with price controls is that the cost of the material companies have to buy to make their products goes up with inflation and if the companies can't charge more to cover their costs they can't make their products any more.
If drug companies can't cover their costs because of price controls on medicines, they'll stop making those medicines. In addition they will stop spending money to develop new and improved medicines. In the video below a panel put together by the Wall Street Journal discusses what's wrong with Biden's policy. A panelist says that you won't see the cures that are left on the table tomorrow. He means that people won't realize what cures to diseases were never discovered because of price controls, they just see the lower price being charged today and think that's great. Another panelist calls Biden's claim that he will negotiate lower prices with the drug companies negotiations with the Godfather. The Godfather is the name of a famous movie about the ruthless head of a criminal gang who forced people to do what he wanted.
What happens when you have free health care for everyone? That is called universal health care. That question is answered in the video below. Canada has free health care. There are long waits for health care as a result. Stossel mentions in the video below that there are long waits in U.S. emergency rooms. The reason for that is that U.S. emergency rooms take everyone whether they can pay or not. Despite that waits in U.S. emergency rooms are shorter than the waits in Canadian emergency rooms.
ABC news doesn't allow their videos to be shown on separate pages. Clicking the ABC video image below will take you to a new page with the video. After watching it return to this page by closing the new page.
The Democrats in the beginning of the video below say that health care is a right and everyone should have it. One problem with the government paying for health care mentioned below is strikes. If the government doesn't pay enough money health care workers go on strike.
One thing to keep in mind is that when the government pays for health care for everyone that doesn't mean it's free. The reason for that is the government has to get the money from somewhere and that somewhere is the taxpayer. So either way you're paying for health care, whether you pay the doctor and the hospital or you pay the government who then pays the doctor and the hospital. The costs are however redistributed since people who earn more money pay more of the taxes. The poor may not have to pay taxes at all. There is a hidden cost to the poor though because the companies that might have hired them and paid them good salaries can't because so much of their money goes to taxes for "free" health care.
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