The Jaker

Mostly rational politics, with occasional rants about how a few crazy Republicans are ruining the country.

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Wednesday, November 09, 2005
How to fix France, and what's the right economic model?
I agree with the emerging sentiment that the problem in France is not one of racism, though clearly that exists, but of economics. My friend Bryce (B - you need a blog) is right that France's strict employment policies screw up companies' ability to adapt and innovate, creating a stagnant economy that grows minimally and dramatically underemploys its (well-educated) resources.

But let's not throw the baby out with the bath water and say that every step towards entitlement or protectionism is misguided (not saying you said that B). France, in my opinion goes too far... we've all learned by now that capitalism drives innovation which drives progress, and that all of this can be stifled by policies that are too restrictive. But I also strongly believe that U.S. conservatives who regale us with the wonders of the free market take that too far as well. The free market is what caused generations of elderly to live in poverty before Social Security. There will always be smarter people who are able, if allowed, to take complete advantage of their intellectual inferiors. At some point we have to stop the gap from widening.

The sweet spot, I believe, between free market capitalism and socialist idealism, is the guarantee of basic human rights (the simple version): a certain level of livable subsistence, and basic healthcare. On the first point France probably goes too far and we definitely don't go far enough. But on the second point, the U.S. is lagging what I consider acceptable. Which is why I hope universal healthcare is a big part of the Democratic platform when it's rolled out early next year.
posted by CB @ 4:36 PM  
  • At 5:10 PM, Anonymous Bryce said…

    Hopefully a blog will be forthcoming!

    I agree with you that we must strike a balance between free market capitalism and idealism. For example, I fully support initiatives to retrain former employees of obsolete (or out-globalized) businesses, such as the steel industry. And I support some degree of unemployment compensation and welfare.

    However, we must recognize that there are people out there who, no matter how large the safety net, will fail to take advantage or abuse the system. Medicare, welfare, and unemployment fraud are rampant in this country. And there are homeless and poor even in socialist Europe.

    As for our healthcare woes, which are certainly real and a huge problems for businesses, I don't necessarily believe that socialized healthcare is the best answer.

    How come healthcare costs weren't as much of a problem 20 years ago? I think there are several reasons. First, there's been an increase in the number and costs of malpractice lawsuits -- doctors now routinely run otherwise unnecessary tests to cover their asses. Even Dr. Sara, the biggest liberal I know (and love) agrees on this point. Second, in the Stark Laws (Google it), Mrs. Clinton served up to the HMO's near monopolies on healthcare. The laws effectively bar physicians from opening up competing their own competing healthcare centers. Less competition = higher prices. Finally, demographics. We're on average an older society and old people have more health problems.

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