WhoWee said:
The Democratic Party leaders in Ohio explained the losses today (on the radio) - low turnout is to blame - nothing else.
This news outlet should be happy to hear they were right...
http://www.newsnet5.com/dpp/news/political/elections_local/cuyahoga-county-board-of-elections-director-disappointed-with-low-voter-turnout
The notion that voter turnout explains the results is a fiction.
http://www.tnr.com/blog/william-gal...gn=f7bdd257b4-Edit_and_Blogs&utm_medium=email
The important bits:
In 2006, 38% of voters were Democrats. In 2010, the figure was 36%. Amazingly, Democratic voter turn out
outperformed, given the scope of the shift in ideology, which is typical for off year elections (the most motivated voters - left and right - make up a disproportionate share of the electorate).
This bodes poorly for the Democrats in 2010, assuming no change in ideological trends. In 2006, 32% of voters said they were conservative, compared with 41% in 2010 - depsite no change in the proportion of voting Republicans.
Some insurers from experience want to collect premiums but don't want to pay claims - family experience.
Anecdotal evidence form a disgruntled relative whose insurer refused to pay a claim that was, in almost certain probability, invalid proves nothing. The rate of claims denial varies widely amongst private insurers, between 2.7% (UHC) and 6.8% (Aetna). Medicare has the highest decline rate, at 6.85%. Not surprisingly, many claims are denied due to technical errors (filing the wrong forms, not filling the forms out properly, etc). The more bureacratic, public health systems would logically be expected to have higher rates of technical rejections.
These were 2008 rates, and there may be newer data available. I can say with absolute confidence, however, that Medicare will continue to exceed average private sector rejection rates,
even without seeing the data. Why is this? Certainly not the profit motive - even if we take it as a given that private insurers are generally more efficient claims processors than their public sector counterparts (a function of the profit motive - bureaucracies inflate their budgets by expanding payrolls regardless of efficiency, while competitive companies can be said to start with fixed potential revenues and work to minimize costs, the difference being profit), insurance companies make more money when they deny more claims. Market competition is a more likely factor. Medicare has a coverage monopoly, and doctors are more likely to accept it to gain access to its large insured population. On the other hand, insurance companies must compete both for covered consumers and participating providers. High claims denial rates make physicians less willing to accept the insurance, which drives individuals to seek coverage elsewhere.
Why should the market operate any differently than the government.
Individual participants in a competitive market are price takers - this means their marginal revenue for a given product is simply equal to the market price for it. They cannot, at the abstract, force that price higher or lower by increasing or decreasing the firms supply, because other suppliers (either existing or newly entering) will meet the difference.
The profit maximization problem, then, is purely a function of marginal cost. At the optimal, marginal costs equal marginal revenues (the last dollar spent on production generates one dollar in revenue). A competitive firm cannot affect marginal revenue, so its place on the industry supply curve is purely a function of its cost competitiveness. This determines how much it supplies, and how much revenue (and in turn profit) it generates.
Because a firm in a competitive market can only maximize profit by minimizing costs, it has an incentive to be more efficient - it has no other means of raising revenues or generating profits. A firm in a monopolized market is a price determinant; it can raise revenues by charging higher prices instead of reducing costs. This reduces the monopolists incentive to increase efficiency (defined as output/dollar). In the case of goods whose price elasticity of demand is relatively low, like healthcare, the monopolists power is increased. A consumer is unlikely to respond to rising prices or declining quality by consuming less.
This is a simple explanation for the abstract concept, "competitive firms are more efficient than monopolistic firms". Since government tends to be a monopoloizing market participant, we can expand this to say, "the market is more efficient than the government".