Economic Myths on High Prices

[james03]

There are three myths in economics that need to be corrected:

1.  High Mortgage Rates
2.  High Health Insurance prices
3.  High College Tuition costs.

Mortgage rates are somewhat normal, maybe they could drop 0.5%, but they aren't outrageous.  The real truth is High Home Costs.  Think about it, the invention of the nail gun should have DROPPED prices.

On health insurance, first off it is illegal in the US.  You can only buy health PLANS which are full of government stipulations.  Single men have to pay for pregnancy, for example.  Getting straight insurance, like going to the hospital, is impossible.  So having a health plan vs. insurance does result in some of the high price.  The real problem is high MEDICAL costs.  50 years ago a doctor came to your house in what was termed a house call.  He drove a Buick and lived in a better part of town.  You paid him cash.  Today he drives a Porsche, lives in a mansion, and has a vacation condo in Aspen.

College tuition is reasonable when you consider you have to fund massive admin bloat and sky high professor salaries.  Mostly this was due to government loan programs (currently around $1.5 TRILLION, with the majority being women) and various woke policies.

To fix these problems:

1.  Stop foreign buying of housing and deregulate the industry.  Shut down all immigration.  As the boomers die, home prices will come back down.  Normalized mortgage rates would normally get the prices down, but importing 10 MM foreigners just with illegal immigration counters that.

2.  Deregulate the medical industry.  Allow people to buy health insurance.  Create a new profession called "medic", which can be filled by military medics who have retired.  Allow them to write prescriptions.  Cap immaterial damages in lawsuits and eliminate criminal "punitive" damages and "triple" damages, which are criminal fines without a criminal defense, and have no right to be in a civil trial to settle a dispute.

3.  Get rid of government loans for tuition.  Eliminate bull crap requirements for colleges especially ones forced on colleges for accreditation. 

[Michael Wilson]

I would agree with the above except for the "shut down all immigration"; the U.S. Population is not reproducing at a high enough rate to sustain economic growth; unless someone can convert our country to Catholicism (real Catholicism; not the Conciliar type); we need immigration. What has to be stopped is illegal immigration, which allows countries such as Cuba in the 80's and Venezuela currently, to get rid of all of its prison population and dump them on us.

[LausTibiChriste]

College tuition and health care costs are not reasonable at all if you compare it with the majority of the rest of the world

[ChairmanJoeAintMyPrez]

The real problem is high MEDICAL costs.  50 years ago a doctor came to your house in what was termed a house call.  He drove a Buick and lived in a better part of town.  You paid him cash.  Today he drives a Porsche, lives in a mansion, and has a vacation condo in Aspen.

This blames the wrong people.  MD wages are not the driving factor in medical cost increases.  It's almost entirely administrative staff increase.  The same goes for universities.  Everyone can point to some professor or sportsball director who gets paid $400k per year, but this is not representative.  It may be a useful rhetorical strategy, but if you want to find the truth, look at the median instead.

Your internist won't be driving a Porsche unless he owns a practice that employs other doctors.  Go look specifically at internal medicine and family medicine salaries.  Seriously.  Adjusted for inflation, your family doctor makes less than the doctor of yesteryear by a wide margin.  He makes less than a large number of professions that require only a 4-year degree.  He even makes less than a lot of tradesmen.  Heck, he probably takes home less than a lot of nurse practitioners.  It is not a lifestyle profession anymore.  Neither is law, but for different reasons.

[ChairmanJoeAintMyPrez]

. double post

[james03]

I would agree with the above except for the "shut down all immigration";

This is mainly due to socialist "pension" programs.  Basically the government points a gun at you and steals your money to pay "pensions", but promises you that in the future they'll point a gun at your kids and grandkids and steal their money to pay your "pension" (with 10% to the big guy).

In a free market pension like Chile, workers accumulate productive capital over time.  When they retire, they are paid from the return on the capital such that real production is paid to the pensioner.  Arguably a slowly shrinking population in such a country would INCREASE the wealth of the pensioners as they would own a greater share of productive capital.

In a free market, population rates are meaningless.  The best performing asset over the past 10 years are pipeline stocks (technically MLPs).  They deliver diesel and gasoline at about the same rate, and payout their profits to holders of the company.  They are essentially zero growth companies.

[Michael Wilson]

This is mainly due to socialist "pension" programs.  Basically the government points a gun at you and steals your money to pay "pensions", but promises you that in the future they'll point a gun at your kids and grandkids and steal their money to pay your "pension" (with 10% to the big guy).

In a free market pension like Chile, workers accumulate productive capital over time.  When they retire, they are paid from the return on the capital such that real production is paid to the pensioner.  Arguably a slowly shrinking population in such a country would INCREASE the wealth of the pensioners as they would own a greater share of productive capital.

In a free market, population rates are meaningless.  The best performing asset over the past 10 years are pipeline stocks (technically MLPs).  They deliver diesel and gasoline at about the same rate, and payout their profits to holders of the company.  They are essentially zero growth companies.

It appears to me that population rates may be meaningless in the short term, but not in the long term; the lack of young people i.e. Those under 20, means that the largest sector of consumers per capita will no longer be powering consumer growth; the next set is from 20 to 40; as people get older they consume less of everything; a retiree with a large pension, hardly spends any of it; their homes are paid off; they don't drive to work any more, so their automobiles are not replaced; they don't wear out their clothes; eat as much; go to movies etc. etc. How do you replace such growth? 
Japan is one example very stagnant growth since the 1990's; China, who's population is actually on the verge of collapse will be the real life example, as they will not have enough young people entering the workforce, to replace those that are retiring. 

[james03]

How do you replace such growth?

Why do you need "growth"?  Assume a country with a stable population with gold money and a Chilean style pension system that year-in and year-out has the same GDP.  That wouldn't be a problem.

In actuality, in a country with a stable population, you would see slow growth due to technology improvements and productivity gains.  Which would be good.  Capital accumulation would also lead to growth, again a good thing. 

But in a fascist/socialist economy the main need for "growth" is due to paying ever increasing usury charges (non-productive loans, like government debt) and to stay ahead of inflation from socialist money printing for as long as you can.