Cap the crap

Cap and Trade is a simple concept. You cap the amount of x that you want to limit. Then, in order to allow the economy some leeway to deal with the problem, you allow companies to exceed the limit by purchasing an exception from another company that is falling below the limit. Now, it's important to understand this this plan is itself a compromise. You could simply tax the x or ban it, and be done with it. Instead, cap and trade allows variation in order to help businesses survive.

Now, since it's already a compromise, any added conditions must be to help particular businesses. This is called lobbying or interest group influence. The more of it you have, the less well the original plan will work. Of course, you can tighten the exceptions later, or, as well, continue to loosen them. In any case, you've damaged the simplicity and effectiveness of the plan by fiddling with it.

I have two reactions to this. My Milton Friedman response is that, by allowing interest groups to alter the plan, you've irreparably harmed it. It will turn out to be hellish tightening the plan in the future. My Edmund Burke response is to pass it, and get set for a long drawn out battle to tighten the plan.

But there's another Edmund Burke response. You can stand firm on Cap and Trade, and compromise on other things. If the health of the planet is truly at stake, than either this Edmund Burke response or the Milton Friedman response should win out.

My health care plan

Let me ask everyone a question: Do you consider price and discount when buying Tylenol and Pepcid? I answer in the affirmative.

Here's another question: Do you consider price when considering brain surgery? I answer in the negative.

Therefore, I suggest splitting health care costs into two categories:
1) Medical goods that a consumer could price and shop accordingly on.
2) Medical goods that a consumer cannot price and shop accordingly on.

Once you do this, you can split up medical costs into:
1) Costs subject to a deductible.
2) Catastrophic Costs.

And, further, you can say the following:
For 1) You don't want third party payers, since you want the consumers to shop for the best price.
For 2) You can have a third party payer. In fact, you can have one: the Federal Government.

Now, here's Milton Friedman's plan:

"A more radical reform would, first, end both Medicare and Medicaid, at least for new entrants, and replace them by providing every family in the United States with catastrophic insurance (i.e., a major medical policy with a high deductible). Second, it would end tax exemption of employer-provided medical care. And, third, it would remove the restrictive regulations that are now imposed on medical insurance—hard to justify with universal catastrophic insurance.

This reform would solve the problem of the currently medically uninsured, eliminate most of the bureaucratic structure, free medical practitioners from an increasingly heavy burden of paperwork and regulation, and lead many employers and employees to convert employer-provided medical care into a higher cash wage. The taxpayer would save money because total government costs would plummet. The family would be relieved of one of its major concerns—the possibility of being impoverished by a major medical catastrophe—and most could readily finance the remaining medical costs. Families would once again have an incentive to monitor the providers of medical care and to establish the kind of personal relations with them that were once customary. The demonstrated efficiency of private enterprise would have a chance to improve the quality and lower the cost of medical care. The first question asked of a patient entering a hospital might once again become "What’s wrong?" not "What’s your insurance?"

I would add a Democratic Party addition to this plan: You could relate the deductible to income.

That's my plan. Everyone covered.

I would add the following: I've no idea what the correct amount of money that we should spend on health care should be. That's why I would like some portion of our medical bills to be subject to our own choice.