We’re told that:

Reeves: Budget tax raid not enough to fix NHS

Chancellor says billions more for health service will not undo ‘14 years of damage’ under Tories

OK, in the sense that that is what we’re being told. But that damage then:

As we can see, at no time at all has the NHS ever even had a flat real terms budget, let alone a cut in it. Over a 70 year-ish period it has only, ever, swallowed yet more money.

This is not a stirring tale of increased productivity now, is it? Which is that very argument that it requires reform. Because productivity should increase over time. Technology does march on and things do, thereby, become cheaper to do. If, of course, those new technologies are actually used efficiently to do those old things better and more cheaply. Which the NHS might well not be doing.

We also know how to increase productivity - markets. The Stalinist system of the Soviet Union managed not to increase total factor productivity by one iota in its whole 7 decades and a bit existence. The market economies over the same time period gained 80% of their growth from increasing that tfp.

We need markets in the NHS. QED.

Yes, yes, we know, that insistence that the NHS has its own inflation rate, that it requires a 4% real budget increase each year just to be able to stand still. But that’s just proof of the contention that we require market reform. It’s because the NHS has its own inflation rate that it requires reform.

Tim Worstall