Sunday, March 6, 2011

If People Were Cows - We Would Not Argue About Health Care

I recently tried to make a point about health care and education; afterwards I came up with the following analogy:

Let us say the US Government was a dairy farm. Let us say that each cow requires 1 bale of hay per week to live. If the farm can trade one gallon of milk for a bale of hay then as long as each cow can provide any benefit over one gallon of milk - it adds to the health of the farm.

Some cows will provide 10 gallons - some less. If the farmer gets a sick cow and it only produces half a gallon - it is a burden. Unless of course one doctors visit would then bring the cow back to producing enough milk to add to the overall health of the farm.

The smart farmer who now realizes healthy cows produce more milk in general says I can have a vet come out each week and check on all my cows and this will cost 1 gallon of milk per cow

At this point each cow must produce more than 2 gallons each, but because of the visits the chances are that all the cows are now producing more milk - thus the "economy" of the farm has expanded. 

As time passes one cow begins to only produce 1 gallon - it no longer pays for itself so the farmer must decide what to do with the cow. the first reaction is sell the cow and get rid of the burden, or stop providing health care so the cow is back to covering its own costs. This farmer is smart though and he knows that if he stops providing health care for the under producing cow  - that cow will then get sicker and possibly spread disease to the other cows, thus increasing costs and decreasing profits. So the farmer must decide to kill or sell the cow.

The farmer then says "wait a minute - if this cow has two calves (I won't have to buy more cows), I can then increase the amount of milk I send out, and since I am now buying a lot of vet visits and hay - maybe I can cut a deal with the doctor and the hay person and maybe I can get my hay cheaper and my visits cheaper thus making the farm more money". The farmer realized that he needs to look at all the ways an individual resource can contribute to the overall health of the farm - and not just whether one cow can make at least 2 gallons of milk.

So the framer keeps all his cows healthy and fed, he decreases his costs, and increases revenue (which means greater profit) and he is expanding his farm and creating a self-sufficient economy. 

Moving forward the farmer realizes that if he takes all the cow dung and spreads it on the field - he can then get his own hay - and now he has just dramatically cut his costs and increases his profits.

Health Care in our society is not about giving people free stuff; it is about the big picture economic drivers that create an economic force that dominates a global landscape. And education is not about teaching someone how to draw a picture or read a poem, it is about creating a more intelligent populous that will reduce health care expenditures and increase output so that the economy can make more with less. Education and health care may not be a right - but it is the smartest economic decision we can make as a country.

And just in case someone wants to argue about how we provide elementary education, if the rest of the world provides more - then we must to - as in a business if you are not doing as much - or more than your competitor you will find yourself out of business - and I would prefer the USA stays in business for a long time.