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There is a cottage industry in the making: “Obama the socialist” paraphernalia.  One of the striking features of this industry is the confusion that stands behind it.   As revealed in pictures above, some people don’t know the difference between National Socialism (fascism, Nazis; image one above: Nazi Brown Shirt/Obama) and Communism (sometimes called socialism; image two: Lenin/Obama).  The two groups hated each other and fought bloody wars.   Yet, for some, hey, a socialist is a socialist.  And they want to make you believe that Obama is one, which will help to kill health care reform, for the fifth or sixth time in U.S. history.

Fool me once, shame on you.  Fool me twice, shame on me.  Fool me three, four and five times, hand me the clown suit.

If one were to believe Fox News, the fear of socialism is running rampant in the Land.   Folks who regularly depend on government sponsored hearth care, for example, the Medicare program and the Department of Veterans Affairs, or who will someday depend on them, appear to feel no compunction about attacking the public option in Obama’s health care plan.  For some reason, it is socialism, but Medicare and Social Security are not.   Of course, these are not the only individuals attacking Obama.  There are radical free marketers who in principle just hate the idea of the government getting involved in anything.   They would even kill Social Security.   (I wonder how many of them don’t have health care or are in danger of losing theirs.)  After all, if the government gets involved, it will undermine the private insurance companies, and with this undermining the fall of capitalism and America can’t be far behind.

What is the main argument against a government sponsored alternative:  the government, which can’t seem to do anything right, will undermine well-run insurance companies, because a government sponsored option will be non-profit.  The counterargument: if we don’t have good non-profit competition, the price of insurance will continue to skyrocket and help bankrupt the country.

There is a lot of fear in insurance land.   We seem to have here companies that are afraid to compete with a government run program.  I wonder why.  Fear that their bloated profits might shrink?  Fear that they will be put out of business?

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But the magic of the market should be able to find a place for private companies, even with a government sponsored alternative.  Does every vet choose the services of the Veterans Administration over private health care?   Surely not.  If the private insurance companies have good products to market, they will find patients, even with a public option available.  The public option that Obama is recommending is not going to be so attractive that it will drive out of the market well-run and reasonably priced private insurance.  But if the insurance companies don’t provide good service at reasonably prices, it should be their problem, not ours.

To return to socialism.  The funny thing about this debate is that few young people have any idea about the dangers of socialism.  That’s because they have grown up in a world in which there aren’t any dangers from socialism, at least not in the way in which the over 50 set remember.   And those who seem to be most concerned (look at the crowds at some of the town halls),  appear to be those currently benefiting from Social Security and Medicare or those who will be benefiting within a decade or two.  This form of “socialism” is quite fine and dandy.  (Just try to find a Republican member of the Senate who wants to do away with these programs.)

The danger for the young is not socialism; it is a capitalism that is malfunctioning and cannot compete.  One way to hamstring the American system is by perpetuating the endlessly wasteful health care system that we now have.  Many in big industry recognize this.   The question is rather simple for them: how do we compete against countries whose overhead for manufactured goods is markedly less than ours because their health care expenses eat less of the pie?

If we let fears from another era get the best of us now, we will have no one to blame but ourselves and (some special interests) for a declining standard of living in the years to come.

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