Perhaps the scariest potential effect of the proposed health care bills is the negative effect they likely will have on innovation. And if we adopt the bill, we will never know what we have lost. Unlike budgets, which with near certainty will become overdrawn quickly, we will never be able to point to the health care innovation we didn't have.
I want to quote liberally from a Ronald Bailey post, but I encourage you to read the whole thing:
Yet, the elements of market competition that still manage to survive have had the salubrious effect of driving medical innovation and improving patient health outcomes. A new study by the free market Cato Institute, "Bending the Productivity Curve: Why America Leads the World in Medical Innovation" reports:
...In three of the four general categories of innovation examined in this paper "” basic science, diagnostics, and therapeutics "” the United States has contributed more than any other country, and in some cases, more than all other countries combined. In the last category, business models, we lack the data to say whether the United States has been more or less innovative than other nations; innovation in this area appears weak across nations....
...Harvard University economist Kenneth Rogoff observed:
"[I]f all countries squeezed profits in the health sector the way Europe and Canada do, there would be much less global innovation in medical technology. Today, the whole world benefits freely from advances in health technology that are driven largely by the allure of the profitable U.S. market. If the United States joins other nations in having more socialized medicine, the current pace of technology improvements might well grind to a halt."
In my column, "2005 Medical Care Forever," I suggested this thought experiment:
...what if the United States had nationalized its health care system in 1960? That would be the moral equivalent of freezing (or at least drastically slowing) medical innovation at 1960 levels. The private sector and governments would not now be spending so much more money on health care. There might well have been no organ transplants, no MRIs, no laparoscopic surgery, no cholesterol lowering drugs, hepatitis C vaccine, no in vitro fertilization, no HIV treatments and so forth. Even Canadians and Britons would not be satisfied with receiving the same quality of medical care that they got 45 years ago....
As Rogoff suggests, the nationalized health care systems extolled by progressives have been living off the innovations developed by the "only country without a universal health care system." I wonder how Americans would vote if they were asked if they would be happy freezing medical care at 2005 levels forever?