Obama Launches Price Controls

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The Thursday edition of The Wall Street Journal headline read: "Obama Relaunches Health Bid." However, the real story was not that at all; the real story was the stealth imposition of price controls... in a vacuum.

"But if prices don't fall by a certain percentage and coverage doesn't expand beyond 95% in a given state after a time, the plan would call for adding a government insurance option to that state's choices, according to the aides familiar with the White House conversations."

Let's look at that a bit more closely.

1. The government mandates that prices for insurance fall by an unstated percentage... for the same coverage... for reduced coverage... for expanded coverage... no clear definition there... or the government steps in.
2. The government mandates that coverage must expand beyond 95% of all people in the state... legal U.S. residents... legal U.S. residents and legal foreign persons... legal U.S. residents, legal foreign persons, and all illegal foreign persons... no clear definition there... or the government steps in.

Let's presume that:

1. The government mandates that all people regardless of legal or illegal status must be covered beyond 95% of the total population and it is the responsibility of the insurance companies to be sure they are covered even though the insurance companies have no authority to force anyone to be covered and, furthermore, even though the federal government would make it illegal to not have insurance, the federal government would not accept responsibility for achieving the 95% coverage in any particular state. That's certainly clear enough.
2. The coverage mandated at reduced prices would still require the insurance companies to cover new procedures regardless of the expense of those procedures if the government deemed those procedure to be worthwhile and even if covering those procedure meant providing insurance coverage at a loss. That's certainly clear enough.
3. Insurance coverage for high-risk individuals would be mandated as part of the reduced prices-expanded coverage requirements thereby insuring coverage will be provided at a loss. That's certainly clear enough.
4. If one insurance company fails to meet its obligations under the mandate causing the state mandate requirements to be missed, all insurance companies in the state will be held responsible for the failure and subject to government controlled, taxpayer funded competition. That's certainly clear enough.

From the government's point of view, this is a no-brainer. After all, the government has operated at a loss forever and has been able to expand its operations and coverage of society's actions, so why shouldn't insurance companies be expected to do the same?

Next on the list:

• Public option car and truck insurance with mandatory coverage requirements for those who ignore present mandatory requirements.
• Public option homeowners and renters insurance with mandatory coverage requirements for those who chose to not have insurance.
• Public option dental insurance with mandatory coverage requirements for those who choose to pay for their own dental care.

In each case, insurance companies will be responsible for making sure the mandates are met... at reduced prices.

Next for price controls... reductions:

• Rent
• Fuel
• Food
• Clothing
• Transportation

Of course, you'll note that federal and state governments are exempt from any of the above regulations and mandates and cost reductions.

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