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Archive for September, 2009

In Search of a Better Health Care System

Posted by kostub on September 15, 2009

The assumption that spending more of the taxpayer’s money will make things better
has survived all kinds of evidence that it has made things worse.
– Thomas Sowell

Rapid increases in the costs of health care in the US has placed an undue burden on small businesses, the self-employed and the uninsured, and the system is need of an extensive overhaul. The White House health care page has an excellent description on the goals of such a comprehensive reform. While the goals themselves are noble, and no person should be denied health care or have to go broke just because they became sick or had an accident, the lawmakers seem to have forgotten the true goal of the reform viz. make health care affordable for all.

The administration’s proposal for cost reduction involves setting up a massive public insurance plan which will be able to negotiate lower payments to doctors and hospitals. But, past experience has shown us that government involvement and socialization does not result in lower costs. Medicare, one of the government’s largest social programs is already running into budgetary difficulties despite the fact that it negotiates far lower rates with medical providers than private insurance. Moreover, similar reform has already been enacted in Massachusetts, and yet we still see rising medical costs there.

Why are these costs rising? In a previous post, I had argued that the reason costs in India were under control was due the presence of free market competition amongst medical providers. By contrast, in the US, neither the provider nor the patient has any incentive to decrease the cost, as all of it is borne by someone else i.e. health insurance. In fact, both have an incentive to increase the cost by ordering unnecessary or more expensive tests – the provider gets paid more while the patient believes that they are getting better treatment. Obama’s plan does little to change this fact. All it does is transfer the cost from employers who pay the premiums (which is indirectly transferred to the employees in terms of lower salaries) to the tax payers. Read the rest of this entry »

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Excuse me, I have a reservation

Posted by kostub on September 8, 2009

Whether born from experience or inherent physiological or cultural differences,
our gender and national origins may and will make a difference in our judging.
– Sonya Sotomayor

Recently, the Indian cabinet approved a 50% reservation for women in Panchayats, while the bill for 33% reservation for women in the parliament still languishes on the back burner due to opposition from the left. Reservations for minorities or women have been a contentious topic in India: there have been numerous protests in the past when reservations have been proposed and this one is no different. In spite of this, no political party ever seems to have considered any alternatives to reservation to solve the problems for the underrepresented classes in society.

The number of women parliamentarians in India is abysmally low with only 10% of the MLAs being women. The women’s liberation movement wants this bill to address that issue have come out strongly in its favor.  There is something to be said about having more women in powerful positions and the hope is having these reservations will address many of the social injustices faced by women. Other countries like Pakistan and Bangladesh already have reservations for women in the parliament, while the US & the UK have a much lower percentage of women legislators than Pakistan and yet have a much better social standing for women. India has had 33% reservation for women in Panchayats for over a decade and that has definitely led to an increase in women participation in politics at the grassroots level. But has that really made any difference to the social status for women, such providing access to education, improving health of women, reducing domestic violence, or has it just been touted as a panacea for all evils just because it provides the political parties with a reliable bank of votes?

Clearly, diversity is a good thing and we definitely want to encourage participation from all classes of society. Diversity provides many socio-economic benefits by bringing together people from various backgrounds, cultures and opinions. This fosters a deeper understanding of issues which may result in more appropriate solutions to address the present social and cultural problems. It also provides a platform for underprivileged classes to raise their standing in the society. In order to increase diversity, India has adopted the reservation system which allocates some percentage of the seats to minorities and women in education and public services. Other countries, such as the US, have policies of affirmative action that provide women and minorities the access to better education and have had reasonable success in improving the social standing of women and minorities alike. Does the Indian system do the same? Read the rest of this entry »

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