Can Government Really Run it Better?

As the "debate" on comprehensive health care continues, two questions surface: (1) is this really a government takeover of our health system; and (2) can government really do it better than the private sector? I'm going to key only on the second question here.

From the Washington DC podium, President Obama and various administration and elected officials echo how government has the capability to run such a health care program and run it cheaper than private insurance companies (which have to make a profit and which also seem to pay high salaries to their CEOs). Yet, history tells a different story.

For example, compare the U.S Postal Service (which can't seem to deliver the goods) with private sector Federal Express. Unable to meet its expenses, the USPS has raised its rates and now warns of having to cut services (e.g., no Saturday delivery). Federal Express has raised rates to, but seems to make ends meet (even with cuts to its CEO's salary in 2009).

During the past year (through two administrations), the Federal government instituted several programs to save and/or jumpstart the economy. First was a series of "bailouts" of insurance, mortgage and bank companies. Chief among these were government-supported Freddie Mac and Fannie Mae. According to Sen. Charles Schumer (D-NY), "Fannie Mae and Freddie Mac are too important to go under," and that "markets should be assured that the federal government will stand by" them. Then Treasury Secretary Hank Paulson noted that some of the companies under duress during the 2008 meltdown were simply "too big to fail." The government's solution was to allow some large companies to take over the failing companies, creating even bigger companies. That trend is continuing in 2009, as bank failures escalate in number. If big were bad, then how can bigger be better? And a large part of the associated stimulus program has yet to be spent, now almost a year after it was needed "immediately."

Most recently, the Feds instituted a "cash for clunkers" program. By every measure, the program was a success in terms of selling cars; but it was also an administrative nightmare as many dealerships had to rely on their parent (private sector) companies to advance them the payments. This was needed because the Federal government couldn't manage to process it's own complicated paperwork in an efficient manner.

Can we add Hurricane Katrina response, the processing of claims by the Veteran's Administration, the H1N1 flu shot program, AMTRAK operations and the overall "effectiveness" of Medicare/Medicaid to the list of programs that government can't seem to run well or within cost containment bounds?

How about the IRS? If you've ever needed to contact someone, you get the main switchboard. Then, when you manage to get someone to help you, it takes weeks, sometimes months, to obtain the needed paperwork. In fact, we had two issues to address this past year and both times we received letters advising us that the IRS needed about 45 days to respond to our request. Another inquiry yielded the response that, "that's another office and we don't know what information they have..."

And, of course, let's not leave out the Social Security Administration...

No, the Federal government has a long and inglorious history of NOT being able to handle itself well. As a result, I am most concerned that when it comes to the newly proposed health care program they will also not be able to deal with it effectively in both administrative and fiscal terms.

So, please, Uncle Sam, keep us safe from war and other mandated national security programs. But, keep your hands and your scalpels off my body and out of wallet.