Nicholas Kristof, Obamacare, and the Broken Window Fallacy

Nicholas Kristof offers up an individualized argument for Obamacare:

John is a sawmill worker from Yamhill County, Ore., where I grew up. He was a foreman at a mill, he felt strong and healthy, and he had very basic insurance coverage through his job. On April 18, he was married, at age 23, and life was looking up.

Ten days after the wedding, he was walking in his backyard carrying a neighbor’s dog — and he suddenly blacked out. That led, after rounds of CAT scans, M.R.I.’s and other tests, to the discovery that the left parietal lobe of his brain has a cavernous hemangioma. That’s an abnormal growth of blood vessels, and in John’s case it is chronically leaking blood into his brain. ...

Perhaps the worst is the pain — blinding, incapacitating headaches that have left him able to sleep only in short intervals. He vomits daily when the pain surges. “The pain is constant,” John said. “It’s a 7 or 8 on a scale of 10, and then it hits the high peaks and makes me vomit.”

With John unable to work, he lost his job — and his insurance coverage. Esther had insurance for herself and for her two children (from a previous marriage) through her job building manufactured homes. But she couldn’t add John to her plan because of his pre-existing condition.

Without insurance, John has been unable to get surgery or even help managing the pain. When he collapses or suffers particularly excruciating headaches, Esther rushes him to the emergency room of one hospital or another, but an E.R. can’t do much for him. One hospital has told them not to come back unless he gets insurance, they say. ...

If a senator strolled indifferently by as John retched in pain, we would think that person pitiless. But isn’t it just as monstrous for politicians to avert their eyes, make excuses and deny coverage to innumerable Americans just like John?

As far as individual morality is concerned, the Parable of the Good Samaritan seems wholly apt here. We have an obligation to those we encounter in life who need our help.

As an argument in favor of a specific social policy--namely, Obamacare--Kristof's column is riddled with fallacies.

1. Appeal to pity: Substituting a story designed to elicit pity for evidence
2. Misleading vividness: Using a vivid example to imply that it is likely to occur
3. Spotlight: Creating the impression that those who receive the most media attention actually represent the groups they belong to.
4. Cherry picking: Finding cases that support your argument while ignoring those that don't

Probably the most egregious problem in Kristof's argument, however, is his invocation of the broken window fallacy. Frederic Bastiat explained that we all too often focus on consequences that are easy to see, while ignoring those that are hard to see:

In the department of economy, an act, a habit, an institution, a law, gives birth not only to an effect, but to a series of effects. Of these effects, the first only is immediate; it manifests itself simultaneously with its cause - it is seen. The others unfold in succession - they are not seen: it is well for us, if they are foreseen. Between a good and a bad economist this constitutes the whole difference - the one takes account of the visible effect; the other takes account both of the effects which are seen, and also of those which it is necessary to foresee. Now this difference is enormous, for it almost always happens that when the immediate consequence is favourable, the ultimate consequences are fatal, and the converse. Hence it follows that the bad economist pursues a small present good, which will be followed by a great evil to come, while the true economist pursues a great good to come, - at the risk of a small present evil.

In fact, it is the same in the science of health, arts, and in that of morals. It often happens, that the sweeter the first fruit of a habit is, the more bitter are the consequences. Take, for example, debauchery, idleness, prodigality. When, therefore, a man absorbed in the effect which is seen has not yet learned to discern those which are not seen, he gives way to fatal habits, not only by inclination, but by calculation.

Kristof here invokes a single but attractive and sympathetic example as an argument for a major shift in national policy. Presidents do this when they invite a symbolic figure to sit next to the first lady at the State of the Union address. Congressmen do this when they decide who to invite to legislative hearings. Trial lawyers do it when they select the most piteous victim to be the named plaintiff in mass tort class action.

It's effective because who amongst us wants to seem like the priests in the Parable of the Good Samaritan. It's analytically flawed, however, because it fails to take into account the interests of the mass of other individuals who may be adversely affected by the change of policy in question.

Sure, it would be great if John had health care insurance. But at what cost to everybody else? Should women under 50 be denied mammograms so as to hold down health costs so that John can have government-subsidized insurance? How about men over 70 with slow acting prostate cancer? Should we deny them treatment on the assumption that something else will kill them first, so that the government can afford to insure John?

The point is that Kristof and his ilk are basically running a con. They want you to focus on the most sympathetic cases, while ignoring the large and amorphous mass of individuals who will be adversely affected.

Resources are scarce. There ain't no such thing as a free lunch. Hard decisions have to be made.

Let's at least make sure that, as Bastiat urged, we count both the effects that are seen and those that are unseen.

Comments

[Aethelbald]

>>it almost always happens that when the immediate consequence is favourable, the ultimate consequences are fatal<<

This is the kind of twaddle that Dickens might have written for one of his more sanctimonious characters. It is hardly the basis for a moral argument. I think you're scraping the barrel for excuses not see what is right before your (IMO moral) eyes.

[newrouter]

A few questions:

John had insurance when this malady struck him. Isn't this what insurance is for, the unexpected condition striking?

John lost his job due to his medical condition. Would that not make him eligible for social security disability and medicaid? If so then the social safety net is working. If not then repair this element of the safety net.

[Adrianne]

Why not just separate insurance from employment? Seems a no-brainer... (signed, a happily self-insured person).

[pdq123]

Good response. But dude, Kristof has only one letter "f".

ProfB: Thanks dude.

[Daniel]

when John lost his job he could still obtain Cobra insurance for 18 months. was no treatment or operation possible in that time period? if not what could medicine do for him now? if pain suppression is the only way to go it is not that expensive.

[Bill Beyer]

It may be worth noting that Oregon HAS a 'government option' already, and so 'John' is either apocryphal or a deliberate invention.

[Donna]

I think the Kristoff story missed something important. John now has Oregon Medicaid. But he STILL can't find a doctor to help him. This is because the GOVERNMENT does not think brain surgeons are worth paying for.

Just because it's government doesn't make it better.

I will pray for John. Hopefully, because of this story some doctor will come forward and offer his services pro bono.

[Greg]

The case of John seems rather strange. He lost his job, with its health insurance, due to an ongoing medical condition, and he didn't opt to continue his coverage via COBRA? Esther has health insurance, but it doesn't have annual open enrollment? That's different from every form of group health insurance I've had.

[Karl K]

Nicholas Kristof is an intellectual charlatan, like so many of these NYT columnists -- Maureen Dowd, Bob Herbert, Charles Blow. They would all fail a rigorous logic course, get no better than a C in a good English composition course, and flunk any basic economics course. Pathetic.

[Jeff]

normally John could have signed up for COBRA upon losing his job then his current coverage would not have lapsed ...

To those that rightly point out that COBRA can be expensive I would point out that it is not for a single 23 year old (he didn't cover his wife) and COBRA is alot cheaper than paying out of pocket for a serious illnes that he knew he had ...

Looks more like John didn't plan very well and yes it is a tradgedy that he will need to look for charity to pay his medical bills, bills that he will incur getting the medical treatments he needs ... he will not be denied medical treatment, he may be bankrupted by them though.

Better than dying ...

we already pay for the John's of the world with higher premiums or out of pocket charges ...

[Ian Callum]

My expectation is that a year after passage of health care reform the number of uninsured will have increased. I base this on the simple economic premise that raising the price of a good or service will result in decreased demand.

The bills in Congress call for the coverage of preexisting conditions and include community rating provisions. As these features increase costs for insurance companies, it follows that health coverage will be more expensive. This means that some people will be priced out of the market and will let their coverage lapse.

Congress anticipates providing subsidies for purchase of insurance only after 2013, but institutes taxes and penalties immediately. The likely result is that health insurance and health care will cost more in 2011 and 2012, and that fewer people will be insured. Some people will not only lose their health insurance but also be fined for being unable to afford it. The inequity of this situation is so egregious that it may not pass judicial review.

[Patrick]

Wouldn't John be eligible for Medicaid? And Medicare and S.S.? Seems like a pretty clear case of disability.

And there's the Oregon health Plan, which was is a state-sponsored (and, of course, rationed) health insurance program.

[Bryan C]

Among the other fallacies Kristoff also manages to squeeze in False Dilemma: Senators pass this bill or people like John will suffer and die. Senators have not passed this bill. People like John will suffer and die.

Kristoff's whole Good Samaritan analogy is screwy. The Samaritan's choice was significant and noble because he personally took upon himself the expense and responsibility to help this injured stranger. The Samaritan did not use the man as a prop to shame other passing travelers into helping instead, or commandeer someone else's donkey to transport the man, or extort free lodging from the innkeeper. He sacrificed his own time, money, and resources knowing that he would gain no personal worldly benefit, and that the man he saved might very well still despise him just for being a Samaritan.

These actions and motivations have very little in common with passing a law, or with writing a column.

[twitter.com/briancrouch]

Were insurance truly insurance, that is, protection against catastrophic incidents and illness, John would easily have been able to afford the premium. Since it has devolved into a pre-paid system, premiums grow ever more expensive.

[www.google.com/accounts/o8/id?id=AItOawmXfzOjLzrx31iCwxeDQIbmaEzHhHxuoLM]

Kristoff also ignores the entirely foreseeable consequences for John. His new federal healthcare overlords will treat him, but not particularly well. Certainly less well than the current network of charities and state programs available to him.

He could have "[bought] insurance through the Oregon Medical Insurance Pool (OMIP), a state program that insures people who are rejected for private individual coverage because of medical conditions or who can’t get a private-sector portability plan or who are eligible for the federal Health Care Tax Credit (HCTC) program. Call 1-800-848-7280 or visit www.omip.state.or.us "

If he couldn't afford coverage through the pool, Oregon has programs for covering low income families. Kristoff gives the false impression John had NO options once he lost his employer-provided health insurance.

[Mrs. du Toit]

Your illustrations are good, but I think a much better one is that they want to explode the cost of health insurance for the young and the middle class (where young families and the middle class can get well-baby care for their children), so the government can create insurance plans that provide sex change operations for someone too lazy to work and buy insurance without a government subsidy.

Yes, my example might also be a fallacy (reductio ad absurdum), but when engaging in a street fight against an unscrupulous opponent, Marques of Queensbury rules will get you killed... and in this case, it is the majority who will die as a result of this nonsense.

A plan that is supposed to enable "47 million" Americans to get health insurance, but will actually make it unaffordable for another 100 million is the greatest fallacy of all.

Fallacies aside, tyranny of the minority is something the Founders warned against, and I can't think of a better example of it than Obamacare.

[Marty]

What about John's COBRA rights, either to keep his work insurance or to opt into his wife's insurance when he lost his, which would waive the limitations on pre-existing conditions?

[Marty]

Also, a fallacy you missed, a variation on the fallacy of the excluded middle. Most of what is proposed in the House and Senate bills is totally unnecessary in order to address John's problem. You can solve his problem with very limited reforms, if any are needed at all.

I'm not convinced a solution isn't already in place thru COBRA (see my previous comment), but if not, all it would take would be something along the lines of what I think COBRA entails---he can keep his insurance for a period by paying for it, and if/when he involuntarily loses coverage he can immediately be picked up on his spouse's coverage without limitations for pre-existing conditions that were known when he had the coverage he lost.

There certainly are a lot of problems with our current system, but this case either isn't a problem or could be solved very easily.

[Michael Kennedy]

I cannot imagine a neurosurgery residency program that would be unable to get that fellow signed up for Medicaid, and probably Social Security, as disabled. They would be setting him up for the senior resident, with a senior attending assisting, for that very challenging surgery. When I was a surgery resident, I interrupted several vacations to return early for an interesting case like that. Maybe his dignity would be affected by the status of being "an interesting case" but he would get far better care, I suspect, than he would in one of the filthy NHS hospitals repeatedly described in British newspapers.

[J. Galt]

The Army of Davids is fighting this fight on two fronts.

The healthcare ethics front.....we're winning....but we must keep up the pressure.

The economy front (where I concentrate).....deficits....we're winning huge.

......killing jobs and business....we NEED to do BETTER.

Make sure eveyone knows this bill is a JOB KILLER.

[Thomass]

Posted by: newrouter | 11/30/2009 at 05:06 AM

"John lost his job due to his medical condition. Would that not make him eligible for social security disability and medicaid?"

Not right away for social security and probably not if he has assets for medicaid. His best bet would be to keep up the cobra payments until he could get social security disablity and medicare (I believe you end up up medicare if disabled). But it takes a year and you may need a lawyer (social security fights hard to keep you off it). Basically the safty net is weak (disablity health insurance is hard to get and payments are low). I'd advise everyone to buy some private disablity insurance to help cover the holes. Use it to cover cobra payments... and house payments. Its not expensive and many plans will cover 60-70% of your existing income. As a side benifit, the insurance company will fight with social security to get them to admit your disabled. It's in their interest because they lower your benifits by the amout social security pays. But it is in your interest because it gets you social security provided health coverage / off expensive cobra.

[Terrye]

I don't support Obamacare. However, I think that some people have gone off the deep end when they say women will be denied mammograms or pap smears. No one is denying anyone, anything. The truth is that for most women these tests at an early age are not necessary. If someone wants one however and is willing to pay for it, then no one saying that she can not have one.

There are plenty of reasons to oppose Obamacare, without making hysterical claims about women being denied mammograms.