Tuesday, June 04, 2013

Probability and morality in healthcare reform

This morning Democracy in America has a great post on Obamacare, highlighting the folly (in European eyes) of approaching healthcare as an insurance problem.

An insurance premium is basically calculated by multiplying the payout in case an event takes place by the probability that the event takes place. Crucially, and obviously, the payout is conditional on having purchased  protection. If a flood takes away my house I will be reimbursed only if I have purchased flood insurance, otherwise I will sleep outdoor. If I damage my car I will be paid to repair it only if I have insurance, otherwise I'll walk.

Healthcare (in America, where it is treated insurance-like) is different: emergency care is not withheld subject of having insurance. Despite Europeans believing that uninsured Americans are left dying in the streets, emergency care has to be administered, everything on top is not, but the basics are offered. Afterwards a patient is billed and if uninsured he/she will pay the potentially large sum up to his/her abilities which could include personal bankruptcy. Awful but better than death.

This is the fundamental difference, I am saved even if I have not paid. In finance the difference between buying an option or the underlying is that in the first case the capital is protected, hence the upfront premium. This applies also to standard insurance as well (where instead of capital we have the thing we want to protect, i.e. a car, a house, etc.) but not to health insurance. When it comes to health in America, the capital (our life) is protected anyway irrespective of our having health insurance.

The article points out that as Obamacare stands, the incentive/penalty for young, healthy people is not enough to push them towards buying insurance (and thus contributing to the overall expense) and a bigger carrot/stick is needed. Of course the ultimate stick would be saying, if you do not have health insurance you will not be treated at all, you will be left dying. Morally impossible one has to admit.

Monday, April 22, 2013

Ah, the irony ...

The same people who were up in arms against the government trampling individual freedoms when it came to gun control, do not seem to mind in the case of the trial of the Boston bomber. 

Tuesday, January 29, 2013

It won't add anything ....

... to the unsolvable debate. But this is one of the most interesting and well put things I have read on the subject of gun control. An interesting excerpt:

Mr Garrison and his ilk among CSOPA seem gripped by two common fallacies. The first is the belief that county sheriffs can violate federal laws that they happen to disagree with, and can deny federal officers the right to enforce federal law in their counties. This is simply hogwash. It is true that as a local law officer Mr Garrison will not be required to enforce federal laws, but neither can he violate them just because he happens to believe they are unconstitutional. As for keeping federal officers out, well, the South has tried that a couple of times before. It did not end well.
The second is a misguided notion that the second amendment is the best and surest constitutional protection against tyranny. As Conor Friedersdorf sagely noted, the Bill of Rights offers much more effective and less costly checks on government power. There is the fourth amendment, which protects against unreasonable search and seizure; the fifth amendment, which guarantees due process; the sixth amendment, which establishes fair trials; and so on. When these rights were hollowed out during the war on terror—by acts of Congress, the courts and even through executive orders—where was the outrage from those who see tyranny in every gun law?
The second amendment has a lizard-brain appeal: it is sexier to imagine yourself a lone soldier for justice defending your loved ones against an oppressive, tyrannical government than it is to imagine yourself protesting warrantless wiretapping. Mr Garrison approvingly cites a letter written by another sheriff, which states: "We must not allow, nor shall we tolerate, the actions of criminals, no matter how heinous the crimes, to prompt politicians to enact laws that will infringe upon the liberties of responsible citizens who have broken no laws." Stirring words, and entirely unobjectionable. I wonder if he had the same response to the Patriot Act.

The only thing one can add are the immortal words of the Onion. 

Tuesday, September 25, 2012

Friday, January 13, 2012

Gingrich's comments does more for inequality than the whole of Wall Street

Mitt Romney, like Kerry before him, is paying the price for speaking another language next to English.

This attack on education not only shows desperation in Newt Gingrich (with a large dose of cheek for someone who does not stop referring to himself as a man of culture, a historian) but I believe contributes more to America's inequality than the whole of Wall Street. (Forgive my hyperbole but few things are more repellent than attacks on intellectual "elitism").

America has the best universities in the world, it produces the greatest scientists, it has some of the world's best publications; its intellectual elite is on par, if not above, that of any other country. As for the rest of the country, bar a certain isolation from the outside world, it is more or less comparable to the "rest" in any other country. What differentiates America is a certain, recent, liking (comparable perhaps to France's mythical attachment to the countryside) of anti-intellectualism, folksy wisdom and an education that is all but informal.

This is a slippery slope (can this great evil as well be attributed to Nixon and his dark manoeuvrings?) and the wedge between the two can only become larger; comments like Gingrich's make things only more difficult. America's intellectual elite will become even more unapproachable and possibly a little more secretly self loathing (universities on both sides of the Atlantic are full of Americans being more "European" than the Europeans not to be confused with the "rest"). The rest will become even more proud in their ignorance and intellectual isolationism. I usually don't like Michael Moore but I agree that Bush, by glorifying being a C-student, made being a C-student as if it were the best possible achievement.

Are we surprised that Americans actually believe in America's exceptionalism?

Monday, November 14, 2011

Piu' che la legge, pote' lo yield

To all those claiming that capital markets are wild places that serve no constructive purpose, I reply, look at Berlusconi. As I write this I am not sure if he will ever come back, but the markets managed with merciless strength to dislodge someone that had up to now played the legal system like a fiddle. As much as we we hope for the absolute fairness and objectivity of the law, there is nothing as objective as a two way price.

Thursday, September 15, 2011

Could this be a sensible future?

From the NY times

With only 960 residents and a handful of roads, this tiny hilltop village in the arid, sulfurous hills of southern Sicily does not appear to have major traffic problems. But that does not prevent it from having one full-time traffic officer — and eight auxiliaries.

The auxiliaries, who earn a respectable 800 euros a month, or $1,100, to work 20 hours a week, are among about 64 Comitini residents employed by the town, the product of an entrenched jobs-for-votes system pervasive in Italian politics at all levels

“Jobs like these have kept this city alive,” said Caterina Valenti, 41, an auxiliary in a neat blue uniform as she sat recently with two colleagues, all on duty, drinking coffee in the town’s bar on a hot afternoon. “You see, here we are at the bar, we support the economy this way.”

Maybe this is the future of declining developed nations. All this talk about austerity seems to forget that not everyone welcomes competition, not everyone has an inner entrepreneur that is waiting to be woken up; some people (and I am inclined to say that it is a sizable minority if not a small majority) simply want to work a little, without stress, and only with the goal of being paid enough to live.

If you are someone working for example in manufacturing in the West and see your fairly good job disappear somewhere else, you might reply, I don't want to be retrained to be a software engineer or something else, I don't want to move somewhere to struggle to find a job, I want things to be as easy as they were before. Of course the reply is, keep dreaming, but what can a government really do? Of course all western governments would love to have a population like Hong Kong; ready to put up with a hard life without complaining and without expecting much with the hope one day of setting up a winning business venture. Unfortunately the average seems to be closer to those who find a definite benefit pension a standard.

What can one do? Unless you can expel all the undesirable (which are most of the times the natives and not the immigrants), those who refute to compete, something must be done. These people must be taken care somehow either with unemployment benefits or public housing or even through prison should they turn to crime. They will not disappear.

So, isn't the model of Comitini suddenly attractive? Clearly the traffic wardens' salaries are not for the work done but to keep them employed and to keep the town employed. I am of course against government jobs being too nice, i.e. definite benefit pension, unsackable, etc., but if you have an amount of money to spend on taking care of that part of your population which could not cope with a fully competing society, would you rather spend it to create the bitter environment of public housing and prisons or to create the pleasant one of a small Sicilian town's coffee bar?