Healthcare

The NHS is safe in their hands – unfortunately


In the row over Daniel Hannan’s comments on the NHS, David Cameron said: “Millions of people are grateful for the care they have received from the NHS – including my own family.” I suppose that I am too, in the sense that the NHS was the only available provider of healthcare when I had a life threatening emergency condition. If I went out into a desert unprepared, I am sure I would be grateful if I came across a water hole when I was dying of thirst. That does not mean that going out into the desert unprepared is a good idea – there are better ways of doing things.

Cameron, as with most of our politicians who wish to make us grateful for what we are given, forgets the notion of “opportunity cost”. Every NHS bureaucrat has an opportunity cost. Every time I am offered a treatment or course of action that is supplier driven it uses resources that could be used to meet my real demands. Most families I speak to have personal experience of something that their children really need not being provided by the NHS. At the same time there is chronic waste – not necessarily of the sort caused by bureaucrats pushing pieces of paper round but of the sort caused by nobody having the foggiest idea what should be provided and how because, in the absence of price and cost signals, nobody can possibly know.

Cameron further said: “One of the wonderful things about living in this country is that the moment you’re injured or fall ill – no matter who you are, where you are from, or how much money you’ve got – you know that the NHS will look after you.” Well, it depends what you mean by “look after”, I suppose. Again, much personal experience and many discussions with others suggest that in a model that ignores price signals it is “voice” that counts. The articulate and the knowledgeable get what they need. My wife, for example, would not have received her periodic mammograms – which she needed as a breast cancer patient – unless she had telephoned to petition for them to be reinstated. They were quietly dropped because the three radiographers at the hospital had left, gone on maternity leave and gone on sick leave. I could cite many other depressing examples. Perhaps that is why the articulate and the knowledgeable like the NHS – they can get what they want, and get it quite cheaply.

Lib Dem health spokesman Norman Lamb said that Hannan was not a maverick and that his views were shared by many people in the Conservative party. The good news is that they are shared by many people in the Lib Dems too; and by some in the Labour Party. Many in the Lib Dems admire models where the state, one way or another, puts purchasing power – or at least the power of decision – into the hands of the people and takes it out of the hands of the politicians.

Why is nobody in the Conservative Party in parliament willing to spell out the objectives of government intervention in health care and have an honest debate about how those should be achieved?

Academic and Research Director, IEA

Philip Booth is Senior Academic Fellow at the Institute of Economic Affairs. He is also Director of the Vinson Centre and Professor of Economics at the University of Buckingham and Professor of Finance, Public Policy and Ethics at St. Mary’s University, Twickenham. He also holds the position of (interim) Director of Catholic Mission at St. Mary’s having previously been Director of Research and Public Engagement and Dean of the Faculty of Education, Humanities and Social Sciences. From 2002-2016, Philip was Academic and Research Director (previously, Editorial and Programme Director) at the IEA. From 2002-2015 he was Professor of Insurance and Risk Management at Cass Business School. He is a Senior Research Fellow in the Centre for Federal Studies at the University of Kent and Adjunct Professor in the School of Law, University of Notre Dame, Australia. Previously, Philip Booth worked for the Bank of England as an adviser on financial stability issues and he was also Associate Dean of Cass Business School and held various other academic positions at City University. He has written widely, including a number of books, on investment, finance, social insurance and pensions as well as on the relationship between Catholic social teaching and economics. He is Deputy Editor of Economic Affairs. Philip is a Fellow of the Royal Statistical Society, a Fellow of the Institute of Actuaries and an honorary member of the Society of Actuaries of Poland. He has previously worked in the investment department of Axa Equity and Law and was been involved in a number of projects to help develop actuarial professions and actuarial, finance and investment professional teaching programmes in Central and Eastern Europe. Philip has a BA in Economics from the University of Durham and a PhD from City University.


20 thoughts on “The NHS is safe in their hands – unfortunately”

  1. Posted 14/08/2009 at 11:39 | Permalink

    Whenever I ‘use’ the National Health Service, I get the impression that I’m under orders. People are telling me what they are going to do, not asking me what I would like.

    When my GP says something, I often reply that I’ll consider carefully whether to take her advice. But we both know she’s not ‘advising’ me at all: she’s thinks she’s issuing instructions.

    When the NHS was formed, it ‘took over’ many private and charitable hospitals, in what has been called ‘the biggest [state] expropriation of property since the dissolution of the monasteries’.

    Surely this is another important area where a good deal more privatisation is overdue.

  2. Posted 14/08/2009 at 11:39 | Permalink

    Whenever I ‘use’ the National Health Service, I get the impression that I’m under orders. People are telling me what they are going to do, not asking me what I would like.

    When my GP says something, I often reply that I’ll consider carefully whether to take her advice. But we both know she’s not ‘advising’ me at all: she’s thinks she’s issuing instructions.

    When the NHS was formed, it ‘took over’ many private and charitable hospitals, in what has been called ‘the biggest [state] expropriation of property since the dissolution of the monasteries’.

    Surely this is another important area where a good deal more privatisation is overdue.

  3. Posted 14/08/2009 at 15:44 | Permalink

    I find the way in which this issue is developing is really worrying. Daniel Hannan is now being called ‘unpatriotic’ for criticising the NHS. There seems to be a determination to close down any debate on health and how it is organised. It seems the Americans can discuss it but not us!

    Are the Tories afraid of what Brown and Mandelson will say, or worse, do they actually believe that the NHS is wonderful? Let’s hope its just timidity and they will forced to act after the election.

  4. Posted 14/08/2009 at 15:44 | Permalink

    I find the way in which this issue is developing is really worrying. Daniel Hannan is now being called ‘unpatriotic’ for criticising the NHS. There seems to be a determination to close down any debate on health and how it is organised. It seems the Americans can discuss it but not us!

    Are the Tories afraid of what Brown and Mandelson will say, or worse, do they actually believe that the NHS is wonderful? Let’s hope its just timidity and they will forced to act after the election.

  5. Posted 14/08/2009 at 16:16 | Permalink

    Since, basically, the IEA has fallen into irrelvance the debate is elsewhere. See for example Charlotte Gore

  6. Posted 14/08/2009 at 16:16 | Permalink

    Since, basically, the IEA has fallen into irrelvance the debate is elsewhere. See for example Charlotte Gore

  7. Posted 14/08/2009 at 19:45 | Permalink

    I agree with Peter about the way the issue has developed in the media. And Cameron’s stance on the NHS is cause for deep concern. In particular, his promise to expand the NHS suggests he has failed to grasp both the severity of the fiscal crisis and the extent to which the health service fails ordinary patients.

  8. Posted 14/08/2009 at 19:45 | Permalink

    I agree with Peter about the way the issue has developed in the media. And Cameron’s stance on the NHS is cause for deep concern. In particular, his promise to expand the NHS suggests he has failed to grasp both the severity of the fiscal crisis and the extent to which the health service fails ordinary patients.

  9. Posted 14/08/2009 at 23:36 | Permalink

    DavidNcl: if the IEA is irrelevant, why are you reading and commenting on their blog? Me thinks the gentlemen doth protest too much.

  10. Posted 14/08/2009 at 23:36 | Permalink

    DavidNcl: if the IEA is irrelevant, why are you reading and commenting on their blog? Me thinks the gentlemen doth protest too much.

  11. Posted 15/08/2009 at 01:54 | Permalink

    There is a difference between think-tanks and politicians in the considerations they should take into account in their pronouncements. Think-tanks may be excused for not taking account of political consequences – thinking the unthinkable and saying the unsayable is to some extent their raison d’etre. But a politician should consider the political consequences of his actions. And in that regard, if Dan is sincere in his opposition to nationalized healthcare, which I don’t doubt that he is, he has made a big mistake. He has made it less likely than ever that his party will do anything radical on health. In fact, he has made radicalism on any subject more difficult for the Tories. An own goal.

  12. Posted 15/08/2009 at 01:54 | Permalink

    There is a difference between think-tanks and politicians in the considerations they should take into account in their pronouncements. Think-tanks may be excused for not taking account of political consequences – thinking the unthinkable and saying the unsayable is to some extent their raison d’etre. But a politician should consider the political consequences of his actions. And in that regard, if Dan is sincere in his opposition to nationalized healthcare, which I don’t doubt that he is, he has made a big mistake. He has made it less likely than ever that his party will do anything radical on health. In fact, he has made radicalism on any subject more difficult for the Tories. An own goal.

  13. Posted 15/08/2009 at 02:10 | Permalink

    Healthcare is the most toxic topic for classical-liberals. It must be handled with care. Direct attack on socialized medicine will convince few who are not already convinced, and alienate many, leading them to dismiss the views of the attacker on other subjects. A less confrontational attitude – coming to bury Caesar, not praise him – will get better results. The desirability of universal coverage should be acknowledged, and the failings of the current system should not be exaggerated. But attention should gently be drawn to the inevitability of rationing, and the cruelty and arbitrariness of many state-rationing decisions. Likewise the utility of markets for information and incentives.

  14. Posted 15/08/2009 at 02:10 | Permalink

    Healthcare is the most toxic topic for classical-liberals. It must be handled with care. Direct attack on socialized medicine will convince few who are not already convinced, and alienate many, leading them to dismiss the views of the attacker on other subjects. A less confrontational attitude – coming to bury Caesar, not praise him – will get better results. The desirability of universal coverage should be acknowledged, and the failings of the current system should not be exaggerated. But attention should gently be drawn to the inevitability of rationing, and the cruelty and arbitrariness of many state-rationing decisions. Likewise the utility of markets for information and incentives.

  15. Posted 15/08/2009 at 10:49 | Permalink

    Bruno – Hannan probably realised that there is zero chance of the Tories abolishing the NHS and moving to a market-based system. He could, however, make a difference to the debate in the US, which is more finely balanced. If the US further embraces socialised healthcare it will be disastrous, and in that context Hannan should be applauded for his courage in speaking out.

  16. Posted 15/08/2009 at 10:49 | Permalink

    Bruno – Hannan probably realised that there is zero chance of the Tories abolishing the NHS and moving to a market-based system. He could, however, make a difference to the debate in the US, which is more finely balanced. If the US further embraces socialised healthcare it will be disastrous, and in that context Hannan should be applauded for his courage in speaking out.

  17. Posted 15/08/2009 at 14:03 | Permalink

    Bruno is, I fear, quite right about the effect of Daniel Hannan’s statement, although this says more about the state of our politics in this country than Hannan’s tactics.

    What may well have more impact is when Cameron and co have to face reality and dramatically reduce public spending. There is simply no possibility of the NHS being exempted from this and sooner or later the Tories will have to face this.

  18. Posted 15/08/2009 at 14:03 | Permalink

    Bruno is, I fear, quite right about the effect of Daniel Hannan’s statement, although this says more about the state of our politics in this country than Hannan’s tactics.

    What may well have more impact is when Cameron and co have to face reality and dramatically reduce public spending. There is simply no possibility of the NHS being exempted from this and sooner or later the Tories will have to face this.

  19. Posted 18/08/2009 at 09:25 | Permalink

    Political catchphrases like ‘universal access to healthcare’ are clouding the debate. ‘Access’ is not a binary variable; it not something that you either ‘have’ or ‘don’t have’. What they actually mean is that everybody gets SOME healthcare. This says nothing about whether people get the kind of healthcare they need or want, of the right quality and quantity.
    Denied care on the NHS does not occur in the form of a money price that scares anyone off. But in the form of a disgruntled doctor, himself on a tight budget and without the facilities he would wish to use, who tells his patient to go home and take two Paracetamols even though he knows better.

  20. Posted 18/08/2009 at 09:25 | Permalink

    Political catchphrases like ‘universal access to healthcare’ are clouding the debate. ‘Access’ is not a binary variable; it not something that you either ‘have’ or ‘don’t have’. What they actually mean is that everybody gets SOME healthcare. This says nothing about whether people get the kind of healthcare they need or want, of the right quality and quantity.
    Denied care on the NHS does not occur in the form of a money price that scares anyone off. But in the form of a disgruntled doctor, himself on a tight budget and without the facilities he would wish to use, who tells his patient to go home and take two Paracetamols even though he knows better.

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