To Stimulate the Economy, Defeat Health Care Reform

Posted by Michael F. Cannon in the Cato@Liberty blog The Church of Universal Coverage is telling us that national health insurance will stimulate economic growth.

• Senate Finance Committee chairman Max Baucus (D-MT) says universal health insurance coverage is the key to a healthy economy.
• MIT economist Jonathan Gruber says “health care reform is good for our economy.”
• Business Week columnist Chris Farrell writes, “Universal coverage would stimulate the economy [and] boost the financial security of ordinary Americans.”

That seems to contradict their usual spiel — which happens to be correct — that America’s health care sector is wasteful and inefficient. Americans spend twice the amount that other advanced nations spend on medical care, yet we’re not noticeably healthier. Researchers estimate that one third of U.S. medical spending produces nothing at all — that’s about $700 billion wasted per year. How is pumping more money into such an inefficient economic sector supposed to stimulate growth?