The ever glorious Mr. Murphy

Err, no:

A simple example provides clear illustration (and I quote the numbers from memory, but they’re near enough right). The UK spends a little over 40% of GDP on government services. About 8% of GDP – or about one fifth of government spending – is on health services, and the private contribution in addition to that is small. The US on the other hand spend about 29% or so of GDP on government services but the government spending on health is low whereas overall 16% of US GDP is spent on healthcare, for outcomes that are rarely better (which means occasionally they are) than the UK (which means for many they are worse). So add US government spending and healthcare spending together and they come to more than UK government spending including healthcare provision.

You see, of that 16% of US GDP which is spent on health care a goodly chunk….in fact, more than half of it…is spent by ….the government! Medicaid is alone around 3% of GDP. VA health care spending is mebbe another 1% and there\’s Medicare to add onto that: another 4% or so maybe? And yes, there is more govt health care spending than that over there.

So, sorry, no, total US spending is not higher than total UK spending.

Now this might seem to be trivial…but it really isn\’t I\’m afraid. To say that US governmental spending upon health care is low when it\’s actually a higher portion of a larger GDP than UK spending on health care is, umm, just flat out wrong.

Oh, and, adding US govt spending on to non-govt health care spending in the US does not lead to a higher total spend than what is spent in the UK either.

This is also amusing:

Thirdly, it is very obvious that we cannot afford to duplicate many services. There is only room for one water system, one gas supply network, one national grid, one health service, one education service, one rail system, one road network and so on, and on, in the UK.

While I agree with the point that there are natural monopolies the idea that health care, education, to give just two examples, are such is absurd.

But then that\’s Ritchie for you.

8 thoughts on “The ever glorious Mr. Murphy”

  1. I don’t think Ritchie has the capability to properly understand the concept of a natural monopoly. His mindset appears to be the reverse of normal reasoning – if it has been shown that a service can be operated as a state monopoly, then it means that the service can only ever be operated effectively as a state monopoly.

  2. Tim: while RM is a sloppy idiot, there is actually a real point here, in that government spending + private healthcare in the US = 38%ish GDP, which is a hell of a lot closer to European levels of spending than the raw figures would imply (given that government spending + private healthcare in most European countries is barely any larger than government spending alone).

    Ian: there were four regional monopolies. Competition was confined to a few flagship routes (eg London-Edinburgh) and mostly featured lossmaking services run for ego/prestige reasons.

  3. I wonder whether acting is a natural monopoly?

    I suggested to him some time ago that Equity was nothing but a bunch of rent seekers wanting a fee from anyone wanting to act (and doing little else – certainly not doing anything for the consumer) keeping lots of wannabes out of it.

    He sniffed and snorted that the role of Equity is to maintain standards! If only accountants and lawyers were as vigilant!

    Well, if the state is (according to him) best placed to do this for doctors and lawyers (as he suggests in that piece), why not actors?

    That’ll be fun…

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