As we progress through the summer and the presidential campaigns near their traditional starting point, we're starting to hear more and more in the press about some type of nationalized health care, because it is arguably the Democrats' signature (and some would argue last remaining) issue. We LibCaps are against it.

And why? Wouldn't it be lovely if all Americans could go through life without any worries about how to pay for the medical services we will all eventually need?

Well the reason is simple; we need look no further than our old friends the laws of supply and demand to understand why government health care will make us worse off.

Now it's true that the demand for a lot of medical products is inelastic. For example, it's not very likely that the demand for kidney dialysis would go up very much if were suddenly paid for by the taxpayers instead of consumers. But unfortunately this isn't true for a lot of other  (if not most) health care products and services. Therefore if all of a sudden these goods and services don't cost anything at the point of purchase to consumers, demand is going to skyrocket because let's face it, we are all going to sicken and die one day and virtually all of us want to delay that eventuality as long as possible. So the laws of supply and demand predict that when that demand goes up, supply will fall, i.e., shortages will result. This is why every nation that practices some form of universal health care winds up implementing some form of rationing, the most common practice being waiting lines for service.

Now some may say "what's the practical difference if the government establishes waiting lines versus the rationing of the free market?" Well with the government controlling things, we get arbitrary queues, while in the market we usually get self-rationing, where consumers themselves decide whether or not a particular health care product is worth the price charged. Now who has more knowledge about what is "worth it" or not to consumers: the individual consumer herself or the government? Thus market rationing is more rational than government rationing, and moreover in the marketplace the good or service is generally immediately available for those consumers who deem them "worth it."

Now health care is an immensely complex topic and the arguments for and against socialized medicine are likewise complex. But this fundamental reality—that the laws of supply and demand are immune to government decision-making and cannot be overruled with the stroke of a pen—lays at the core of liberal capitalist opposition to government-run health care.

yours/
peter.