Wednesday, 29 June 2011

Left-Wing Stupid Attack...

Often, you'll find yourself debating with a lefty, finding yourself faced with the same tired, idiotic arguments abour how evil markets are, and supporting their application to public services makes one a baby-eating bastard. It's total nonsense of course, and just demonstrates a complete lack of imagination on the part of the person saying it, but the arguments against left-wing stupid attacks are time-consuming to make, so I thought I'd write this post as a handy cut out and keep reference for linking to when some idiot pops up on twitter calling you a baby-eating bastard for making a perfectly sensible proposal.

#1 "But a market means the rich get better treatment than the poor"
or variations thereof, will be one of the first things you will hear when debating with lefties about the introduction of proper functioning markets in public services.

Markets do not mean the total retreat of the state from provision, nor do they mean the poor will lose out. A market, and this does actually need explaining to even a well-informed lefty, is merely the measurement of people's choices. There's no market in the NHS, because if you get ill, you take the service you're offered. You don't choose your GP, you accept the one nearest you. This is also true of schools.

If you have competing providers on the other hand, the customer, you, me and the poor too, will want to get the best service possible. Providers will want as many patients as they can get (if you structure the market right...). It is perfectly feasable for the Government to intervene in a market to ensure equal access to the services for rich and poor, for example by providing vouchers to, or subsidising insurance of the poor, and services can indeed be free at the point of delivery.

The important thing is that providers - an this can include state provision - competes. If it's up to snuff, the people will flock to it and the service will flourish. Provide sub-standard care, or a poor education, and you will fail. Thus the poor service providers fail, or get taken over by new management, and the good expand. This doesn't require any more money, just a different way of moving the money through the system. Instead of a bureaucracy planning services, the orgnisation of the system happens organically through the actions of the invisible hand.

#2 "But that's duplication of service, that's inefficient. People want good local services, not be forced to shop around" That's what they Say, yes. But when offered choice, do people ever want choice taken away again? No. As for inefficiency, well where has state planning offered a better service than a private sector operating in a competitive market? This is nothing but economic flat-earthism.

#3 "But this is ridiculous" scream the lefties "the state must ensure access, not leave it to random chance". Just like the state ensures everyone has access to food or clothing? the only things in which there are shortages, housing, healthcare, decent education are markets in which the state has a significant or dominant role. Marketisation has failed occasionally, but only when the barriers to entry are too high, as in the railways, when the structure of the market was wrong, as in the railways, or when the "market" is directed by bureaucrats, not customers, as in some NHS reforms of the past two decades. & the railways. The fact is everywhere. Markets when properly regulated to ensure competition & prevent monopolies, provide services such as food distribution better than state planning, ever has, because the service is directed by the underlying consumer directing the flow of money. This is so true, most people don't notice it when it works. But it is markets which ensure that you have access to African fruit in December & New Zealand lamb in June. If the state directed it, you'd be eating seasonally. And that is neither as healthy nor as fun as Hugh Fearnly-Wittingstall pretends.

So, in education, vouchers ensure everyone has equal access to the market. Legislation can ensure that schools do not charge more than the voucher & compete only on service if equality needs to be maintained. In health, governments can, and do all over Europe, step in to provide insurance to the poor, to ensure all have equal access yet services have a mixture of public and private finance and crucially private provision is semlessly integrated into state provision. Obviously such radicalism won't be acceptable to our brainwashed population. But the source of the finance isn't the important thing - marketising health doen't even mean an insurance model. It means breaking up the NHS into competing providers. People will be free to choose their GP, who will then act as the guide to specialist care with the patient. There will be less need for a central NHS bureaucracy, and competing providers will ensure standards are higher than they are now. A Market can still be free at the point of deliviery, and if it's still free at the point of delivery, who cares whether it's a bureaucrat directing services, or a market.

I'll repeat that. Markets in Health & Education can still be free at the point of delivery.

And once more, so that even the most blinkered, tribal lefty can understand. MARKETS IN HEALTH & EDUCATION CAN STILL BE FREE AT THE POINT OF DELIVERY.

#4 "But the profit motive is wasteful. I want money going on services, not shareholder returns" The profit motive isn't the only means of running an organisation, though, and in a properly functioning market in health or education, perhaps people may trust non-profit organisations (like BUPA), or charities (like Eton) more than a profit-motivated business. Let's see them compete on a level playing field shall we rather than let prejudice decide? Even if profit remains a motive, Shareholder returns are not the only way of deriving value. The John Lewis Partnership, which includes Waitrose, is mutually owned, a structure I'd like to see much more of, and healthcare may lend itself to this model, as the practice of law does. The market is neutral when it comes to organisational or capital structure. In a market in which patients decide where they go, we could see from results, rather than having to guess, which is best.

The "left-wing stupid" attacks on markets often aren't attacks on markets, but on something else - the profit motive or shareholder capitalism, usually. Or they're representations of an idiot belief that complex services can be planned by Government, which they can't. Or they're a belief that a market always involves the rich muscling out the poor, which is just a lack of immagination on how Government works in the countries with the highest living standards. Public services are best when government works with the private sector to deliver services each doing what it does best.


Single acts of tyranny said...

My personal favourite response to point #4 is to ask why profit making Mercedes produced far better cars than state-owned Trabant given that they were both made by Germans?

Because if the complaint holds, then the money "siphoned off" to give to shareholders should have degraded Mercedes and meant Trabants were the envy of the world.

Nice post.

Jon said...

Excellent post.

Re #4 - the profit motive exists in every human being. In state directed services or companies, profit gets siphoned off to the bureaucrats directing it.

It's also why various Socialist Worker Union leaders are currently earning c. £250,000 a year.

lost_nurse said...

competing providers

Fine, although I'd be happier if we also saw French-style levels of investment and proper (i.e. non-refusal) insurance regulation.

'Competition' is a pleasing mantra, no doubt. But in the context of, say, acute services provided by a major teaching hospital, how do you 'compete' in critical care (which relies heavily on multi-specialty support)? There's a lot of big talk by self-styled John Lewis providers at the mo' (especially the likes of Circle), but they really aren't interested in competition, so much as bloc contract cherry-picking of the easy stuff (I've seen how the capacity gets used, believe me).

So, for starters, I'd like to see a properly level playing field.

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