Get the Olympic rulebook out of our private lives and legalize steroids
We’ve seen quite a few sporting upsets at the London 2012 games so far. But what remains predictable are disqualifications for drug use, with an Albanian weightlifter and Uzbekistani gymnast being banned and some Chinese swimmers facing allegations of doping.
The reasons for cheating are clear. Performance enhancing drugs (PEDs) offer improved performance and detection is far from certain. A constant arms race between drug developers and those who test for them has led to a situation where even the World Anti-Doping Agency Director-General himself has confessed that they are catching “the dopey dopers, but not the sophisticated ones.”
Only users who poorly time their intake get caught, while those on more intelligent cycles can avoid detection at the games themselves. Simultaneously, the rules on what is allowed constantly change to account for new substances. At different times caffeine and Vitamin D have been prohibited. Bizarrely, blood doping is now banned while training at high altitude to achieve the same effects is permitted.
Many have responded by asking for greater international cooperation in cracking down on the drugs trade. There are alternatives, however. The Chairman of the IOC takes the view that a more stringent out-of-competition testing system, with a greater use of the “whereabouts” policy, would improve detection.
Further restrictions on PED markets will not just affect performance athletes, though. The vast majority of users do so recreationally for aesthetic reasons. Growth in users has been dramatic in the past few years, particularly in poorer areas such as the Welsh valleys, where 60% of recycled hypodermic needles are from steroid use, not heroin use.
These users do not have the professional team that Olympians do, procuring drugs and ensuring their quality. As with mood-altering drugs, steroids are often cut with other substances, such as baby oil. The legal status of these drugs also means that users are often restricted to purchasing products developed for bulking up cows or the treatment of injured horses. Legalising supply would ensure that fitness enthusiasts could rely on brand strength for the quality of their drugs as they can do with legally available supplements now.
Many of the health complications that arise as a result of use can be put down to a poor circulation of information. Many learn how to use steroids by word of mouth or from internet forums. Moves to legalise the use of drugs would help to open the world of PEDs, so that those who do choose to use them can educate themselves to do so as safely as possible.
Steroid use is swelling, and whatever happens in the world of professional athletes, the rules of their games should not affect the lives of those outside them. We should ignore calls for tighter controls (especially when those who decide what is permissible change their definitions so often) as these clearly have not stopped the use of steroids skyrocketing in recent years. Rather, we should push for legalisation of all performance enhancing drugs so that those who are more vulnerable can be safer in pursuing their fitness goals.
Why a fat tax would be a terrible idea
When we scheduled the release of The Wages of Sin Taxes for 15th May, we did not guess that it would be sandwiched between the announcement of a 50p minimum price for alcohol in Scotland (Monday) and a new campaign for sin taxes on food and soft drinks (today). Writing in the British Medical Journal, two academics have just called for price hikes on sugar-sweetened beverages and ‘junk food’ as a way of dealing with Britain’s alleged obesity epidemic.
Obesity rates, like drinking rates, have not actually risen for ten years, but the same decade saw the medical profession gain an uncanny grip on the nation’s political process and they are in no mood to relinquish it. Taking a break from hassling smokers and drinkers, the mandarins of public health have taken the ‘next logical step’ and moved on to the general population.
“Economists generally agree,” they write, “that government intervention, including taxation, is justified when the market fails to provide the optimum amount of a good for society’s wellbeing.” Even if this dubious statement were true, there has never been a time when the market offered more choice in what we eat than drink than today. And, contrary to popular belief, it is much cheaper for a family to subsist on fresh fruit and vegetables than it is to eat out at McDonalds three times a day. For the spokespeople of public health, the problem is not that there is a lack of options, but that we plebs are not choosing the right ones.
Defining junk food is notoriously difficult. As Rob Lyons explains in his excellent book Panic on a Plate, a portion of McDonalds fries contains a quarter of an adult’s recommended intake of Vitamin C, while middle class favourites like olive oil, parmesan and pasta are rather fattening. A tax on “sugar sweetened beverages” will presumably leave apple juice and smoothies untouched, despite the fact that fruit juices are often sweeter and more calorific than Coca-Cola.
Whichever foods and drinks fall under the spotlight, it is unlikely that the new sin taxes will do anything except make the poor slightly poorer and George Osborne slightly chirpier. The record of fat taxes and soda taxes abroad is dismal. When academics assessed the effect of soda taxes in the USA, they found no evidence of a reduction in childhood obesity and concluded that "soft drink taxes are ineffective as an 'obesity' tax." Last year, a study claimed that a 10 per cent tax on sugar-sweetened beverages would lead to a 7.5 ml reduction in daily consumption, but this equates to just three calories a day. Since adult males require 2,500 calories per day to maintain a healthy weight, the impact on obesity rates would be somewhere below negligible.
Perhaps recognising this, the authors of the BMJ article insist that these taxes would have to be set at at least 20 per cent (in addition to the 20 per cent VAT). Such a rate would hit us all in the pocket, but it would still have an imperceptible effect on British waistlines. A 2007 study found that even a 100 per cent tax on “unhealthy foods” would reduce average body mass index (BMI) by less than one per cent (a reduction in BMI of just 0.2 points).
Although there is ample evidence that sin taxes of this kind do not work, we run the risk of accepting the medical establishment’s terms of debate by even discussing it. The real argument against this kind of state interference is that what we eat and drink is simply no one’s business but our own. As I show in The Wages of Sin Taxes, the claim that obesity is an economic time-bomb which forces the slim to pay for the sins of the fat is fallacious. Without that justification, the meddlers are exposed as the ugliest brand of paternalists. It is time to call these taxes what they are - fines for living in a way that displeases the British Medical Association. But since it is clear that these doctors won’t be happy until they can issue us with ration books, perhaps it time to remind these public servants who their masters are.
The Wages of Sin Taxes: The True Cost of Taxing Alcohol, Tobacco and Other "Vices"
- “Sin taxes” on cigarettes and alcohol are designed to boost revenue, not improve public health
- Minimum alcohol pricing will exacerbate poverty and entrench inequality without discouraging binge drinking
- Most of the costs of drinking and smoking fall on individual consumers, not the public. There is no economic justification for increasing taxes on smokers and drinkers.
In a report released today, The Wages of Sin Taxes (Download PDF) by Christopher Snowdon, the Adam Smith Institute condemns the government’s decision to increase taxes on cigarettes and alcohol this year and to introduce minimum alcohol pricing.
The report argues that ‘sin taxes’ (taxes on commodities seen as harmful to health) are ineffective in reducing consumption and are not necessary for recouping lost revenue. The taxes are highly regressive and force the poor to pay for the government’s mishandling of public finances.
The taxes don’t work
Cigarette taxes are now so high that increases drive smokers to the black market instead of discouraging consumption or raising more revenue. Sin taxes are more likely to deter moderate users than heavy users, whose demand for cigarettes and alcohol is relatively inelastic.
A heavy smoker or an alcoholic is unlikely to reduce consumption because of a price rise, making sin taxes an unreliable way of reducing consumption or improving public health.
The victims of cigarette and alcohol duty
Sin taxes hit moderate and heavy users alike. Research has shown that previous rises in cigarette tax have made only 2.3% of smokers quit, with the other 97.7% just paying more in tax.
Taxes on cigarettes and alcohol are regressive and hit the poor hardest. The average smoker spends £1660 a year on cigarettes – 20% of the bottom 10%’s income. Sin taxes are the most regressive indirect taxes, as they tend to target products that are disproportionately consumed by the poor.
Minimum alcohol pricing is also deeply regressive, only affecting the cheaper drinks consumed by the poor. Punishing poor people for enjoying a drink or a cigarette exacerbates poverty and treats the poor like children who need to be controlled by the state.
The public cost of smoking and drinking
Taxes on cigarettes and alcohol have often been justified by studies that claim to estimate the “social cost” of these vices. These studies include intangible costs borne by individual consumers, such as “emotional distress”, lost years of life, and individual expenditures on cigarettes and alcohol. These are personal costs, not social costs. They also fail to include the economic benefits the alcohol and cigarette industry gives to the UK in terms of employment and government revenue. Most of these studies should be relegated to the bin of junk statistics.
In fact, smokers and heavy drinkers do not cost the state more. Though smokers may cost more during their working lives, but non-smokers require greater expenditure in pensions, nursing care and welfare payments. Chronic diseases associated with old age are far more expensive than the lethal diseases associated with smoking and alcoholism. Smokers and drinkers are not a burden on the state, and the myth of saints subsidising sinners should not be used to justify tax rises.
The appeal of ‘sin taxes’
Despite the fact they hurt the poor and do not change consumer consumption, sin taxes have always been popular with governments as a source of revenue.
Sin taxes and minimum alcohol pricing should be recognised for what they really are - stealth taxes and paternalism designed to control the poor.
Chris Snowdon, author of the report and Adam Smith Institute fellow, says:
“Campaigners for sin taxes and minimum pricing often claim that “healthy citizens” are forced to bear the cost of other people’s lifestyles. In fact, the evidence shows that smokers take less from the communal pot than the average Briton and the money raised from alcohol duty comfortably pays for any burden drinking places on public services. If the aim of policy is to make individuals pay their way, the government should slash the beer tax and subsidise cigarettes. We are not seriously suggesting the government does this, but if politicians insist on increasing taxes on these products, they should admit that the purpose is to raise revenue. Essentially the government is forcing the people who are least likely to live to extreme old age to pay for the escalating costs of an ageing population.
“As we show in the report, amongst EU countries there is no relationship between alcohol prices and alcohol related harm, nor is there an association between cigarette prices and smoking rates. The only significant effects that sin taxes have are to make the poor poorer and black marketeers richer.”
Our comment on the cigarette plain packaging consultation
"Cigarette plain packaging laws are an illiberal, authoritarian attempt at social engineering. What’s more, they probably won’t work.
"Adults should be free to smoke and to advertise their cigarettes as they choose. The consultation makes no mention at all of civil liberties or individual responsibility. The government assumes, wrongly, that its job is to control the behaviour of adults.
"There is no evidence to suggest that plain packaging laws will reduce smoking rates. At the most, they will drive smoking underground. Already, one in nine cigarettes smoked around the world is counterfeit or smuggled, and the standardisation of cigarette packs would be a counterfeiter’s dream come true.
"Most worryingly, plain packaging laws for cigarettes will lead to similar proposals for things like alcohol and fatty foods. As soon as plain packaging laws were passed in Australia, the public health lobby began demanding that the cigarette industry be forced to make cigarettes “foul tasting”. The British Commons health select committee is already considering plain packaging laws for alcohol.
"Health fascism is alive and well. Plain packaging is a massive step for the nanny state, and smokers and non-smokers alike who value consumer choice and individual responsibility should oppose it."
— Sam Bowman, Head of Research. Read the ASI's report on plain packaging by Christopher Snowdon, published earlier this year: Plain Packaging: Commercial expression, anti-smoking extremism and the risks of hyper-regulation.
To contact the Adam Smith Institute for further comment, phone 0207-222-4995 or email info@old.adamsmith.org.
Yes, Virginia, there is a slippery slope
A lot of people don’t like slippery slope arguments. To people who see themselves as pragmatic, slippery slope arguments are a convenient way for ideologues to rule out small reforms. As such, people who don’t already believe in the intrinsic badness of government are usually unmoved by the idea that a little reform they like might lead to a big reform they don’t like somewhere down the line, and dismiss the case altogether.
The worst thing about FA Hayek’s “The Road to Serfdom” is the name: many people who haven’t read it (and a few who have) assume that Hayek’s argument is that a state-provided safety net will inevitably lead to totalitarianism.
But slippery slopes really do exist. One good example is tobacco control. The health lobby tends to use tobacco as a testing ground for new pieces of authoritarianism, then extends them over the other things it doesn’t like.
When we released our Plain Packaging report on the latest anti-smoking wheeze thought up by health lobbyists, we warned that, if implemented, plain packaging laws would eventually be extended to things like alcohol. This was nonsense, said the health lobby. Tobacco is unique.
Well, yesterday the government released details of its alcohol strategy inquiry. Among the areas it will look at like “raising the legal drinking age” (because that works so well in the USA?), and “reducing the strength of alcoholic beverages” (like Iceland, which prohibits the sale of beer with more than 2.25% alcohol by volume strength), was this:
• Plain packaging and marketing bans.
Ah. Looks like tobacco isn’t as unique as they assured us it was. (Dick Puddlecoat also mentioned this on his blog yesterday.)
This shouldn’t be a surprise. As soon as Australia passed its plain cigarette packaging law, the health lobby moved on to alcohol. Winning the first piece of ground allowed them to move on to the next piece of ground. We saw this in the creep of “sin taxes” from tobacco and alcohol on to fatty foods and online gambling, and it’s happening again on the packaging front.
When some people make policy proposals, they think of themselves as all-powerful autocrats, supporting precisely the policy they themselves want, and able to limit governmental power along exactly the lines they think are appropriate.
But that’s deluded. The reality is that a government big enough to tax and control the things you disapprove of is big enough to tax and control the things you approve of, too. Slippery slopes are real, and they’re dangerous.
200% Proof perfect that we're being ruled by (...)s
I'm afraid that I don't struggle at all, like Sam did, to find something to say about minimum alcohol pricing. This is the most monumentally insane, stupid and illiberal nonsense that we've had imposed upon us in years. There have been things more illiberal, yes, but not insane at the same time. I'll leave you to fill in the (...)s in the title there for I'm afraid that my carpet biting outrage at this silliness might lead me to become intemperate in my language. Idiots just isn't strong enough.
As Sam points out a lot of the detailed heavy lifting on this has been done by Chris Snowden, sometimes of this parish. Alcohol consumption is falling, definitions of "binge drinking" are ludicrous, the statistics on alcohol related hospital admissions are nonsense (they are assumed, not counted or calculated), boozers, smokers and lardbuckets save the NHS money, not cost it and anyway, what is this interference in our charting our own way from cradle to inevitable grave? Not to say that it's regressive in distribution.
There is worse though than just entirely shakey evidential support (much of it cooked up by people paid by the government to lobby the government) and gross illiberalism. There's actual stupidity as well in at least two points. The first is that minimum pricing is almost certainly illegal. We even have case law on the point.
The second is so glaringly, inanely, stupid that it even has the European Commission on the right side of the point. And yes, you know someone has to have been really barmcaked to have managed to get them on the right side of any question more complex than the cuteness of kittens:
The European Commission sounded a warning to Britain about the policy, saying it believed “minimum tax rates to be preferable to minimum pricing for alcohol”.
“Minimum tax rates put all products on an equal footing from a market perspective, whereas minimum prices can increase the profit margin of products with the lowest production cost,” a spokesman said.
Let us assume that all of the evidence is in fact sound: that there is an outbreak of binge drinking, that this is doing harm and that higher alcohol prices will reduce these evils and harms. How magnificently chocolate teapot do you have to be to insist that that extra money from the higher prices goes to brewers and supermarkets rather than into the Treasury? If you're going to sting the boozers because they've been naughty boys and girls then the least you can do is reduce the tax burden on others, no? Instead of pumping up the profits of some favoured sector?
I can reveal that I've once met Cameron, just after he came down from Oxford. I took an instant dislike to him and I'm able to say that the intervening years haven't produced any evidence that I should have changed my mind.
Minimum alcohol pricing is doing something that almost certainly shouldn't be done and then compounding the error by doing it in the most cackhanded way possible and illegally to boot. Just what is it that they teach in PPE these days?
The injustice of minimum alcohol pricing
I’ve struggled to write something about minimum alcohol pricing today. It’s a hugely important issue, and one I care deeply about. But I can’t help but be angry at the people who've proposed it, and the government made up of supposed “conservatives” and “liberals” who plan on implementing it. It's anti-individualism at its worst.
The “evidence-based” arguments made for minimum alcohol pricing are, in fact, based on distortion and bad science. The policy is paternalistic, indiscriminate, and only hits people who are frugal or on lower incomes. Slippery slope arguments are common, for good reason. But they’re especially appropriate here.
The idea behind minimum alcohol pricing is that all drinks must cost at least a certain amount per unit of alcohol in them. The figure being used right now is 40p per unit. On that 40p figure, the price of cans of (say) Becks would go up to at least £1, bottles of wine up to about £3.70, and so on.
If that sounds harmless, it’s because the temperance lobby have a clever strategy. Most people won’t oppose the principle of minimum alcohol pricing at such a low price level, because it won’t affect what they like to drink. But once the principle of minimum alcohol pricing is in place, the minimum price will climb inexorably upward.
The politics of this are straightforward but effective: target the most marginal, “problem” group – in this case, binge drinkers – with a low minimum price to pass an apparently-trivial law.
Once it’s in place, raising the minimum price is like boiling a frog. Bring the heat up slowly and steadily and, before people know it, they’ll be in boiling water. It’s what happened with cigarette duties: now taxes account for over 80% of the price of a packet of fags.
The justifications for this are completely, utterly bogus. Britain does not have a drinking problem: as ASI fellow Chris Snowdon has pointed out, we drink less today than ten years ago, less than a hundred years ago, and far less than we did before that.
Internationally, we are in the middle of the table in the European rankings, behind France, Germany and Spain, and far behind the Czech Republic and Luxemburg.
But what about binge drinking? In fact, the definition of “binge drinking” has been warped beyond all recognition. Three pints of strong lager in a day counts as a “binge” for an adult man, according to official definitions. A woman drinking two large glasses of wine is “binging” as well.
As Chris points out, the number of diseases defined as “alcohol related” has tripled in the last 25 years. When you change the meaning of words to suit your purposes, you can “prove” anything.
Minimum alcohol pricing is outrageously regressive, as are all “sin taxes”, only really affecting the behaviour of people who can’t afford expensive booze. In some ways this is Victorian-style paternalism, but the temperance movement of the 19th Century was about self-help and personal choice. Today’s anti-alcohol “health campaigners” are more akin to the American Prohibitionists. For them, the state is the ultimate weapon with which to impose morality on the masses.
And this, really, is why I hate minimum alcohol pricing so much. It’s puritanical fascism. That fear that someone, somewhere, may be having fun can finally be eliminated using the power and violence of the state.
All of the “evidence” in the world shouldn’t undermine the basic value we place on individual liberty. The case for minimum alcohol pricing is extraordinarily weak as it is, but nothing should undermine the right to choose our own poison.
The good intentions paving company
By now we should be well on our way to the "Big Society, Small Government" that David Cameron promised us. Now the Coalition is weakening on GDP growth, the idea is to promise us happiness, or at least well-being. Apparently, the government will nudge us towards more wholesome life styles rather than enforcing it through tax and regulation. In December 2010, the Nudge Team in the Cabinet Office published how their insights could be applied to health. The topics covered were: smoking, organ donation, teenage pregnancy, alcohol, diet and weight, diabetes, food hygiene, physical activity, and social care.
So far, so good. Who could argue with improved well-being for us all and it being achieved through our own preferences and behaviour rather than government fiat?
Unfortunately, the programme has both a flaw and a problem. The flaw is the idea that GDP and happiness (i.e. satisfaction with life) are not as independent as the government would have us believe but closely correlated. Look no further than Greece to see the impact of a sharp deterioration on incomes on life satisfaction. In January the IEA published an admirable analysis (“...and the Pursuit of Happiness: Wellbeing and the Role of Government”) showed clearly that GDP led life satisfaction.
It concluded “Happiness economics, which tries to extend a deficient hedonic morality to the arrangements of an open society, must be pronounced an unworkable project.” Well that’s a bit high-flown but it boils down to the need for government to stick to its knitting, and that includes improving GDP, and desist from trying to manipulate our behaviour to match its preferences.
The problem is measurement. A whole new science of indexing happiness is developing. The OECD has a big hand in this as it wishes to measure well-being across countries. Five years ago, an introductory paper on measuring subjective well-being noted four methods for starters: multi-item scales such as the Positive and Negative Affect Schedule and Satisfaction With Life. More recent important measurement approaches include the Experience Sampling Method, Ecological Momentary Assessment and the Day Reconstruction Method. There have been no shortage of proposals since then but the problem has less to do with confusion than dealing with time effects.
For example, an excessive imbiber of alcohol may report high satisfaction with life until his doctor diagnoses cirrhosis. The observer may know that no good will come of his drinking but if subjective well-being is what is measured, then drinking will increase his score on party nights even if the mornings after tell a different story. It is not just a matter of short-term fluctuations but of factoring in the bad consequences from many years later. To account for those, the government statisticians have to, in effect, present value the dire future and subtract it from today’s satisfaction.
In other words, we are no longer measuring subjective well-being as promised but what that subjective well-being would be if we were rational people with perfect knowledge of the government’s forecasts for us and if those forecasts were correct. That is a lot of “ifs” to correct our illusions of our own well-being.
It does not take much manipulation of the figures to provide justification for whatever it is that the Department of Health, for example, wishes to do. It opens the door to more government interference in our lives and choices. They know how to maximise our well-being even if, and especially when, we do not.
So what started out as a benign philosophy, Big Society, Small Government, perversely turns out, and not unusually, to have unintended consequences. The issue is not the means, i.e. whether changing our behaviour is achieved by nudging (behavioural economics) or traditional tax and regulation. The issue is freedom. No one will quarrel with the need for government to tell us what the consequences of our behaviour are likely to be – assuming the science is valid – but we should be allowed to make our own choices.
National happiness cannot be divorced from GDP; if our government wants us to be happy (and vote for them), they should concentrate on GDP.. Manipulating subjective well-being statistics to justify further government interference in our lives will not deceive the electorate.
Echoing Rick Santorum
Tom says he's no Rick Santorum. And thank god for that. In 2006, Santorum said he was against individualism, libertarianism, and much more:
One of the criticisms I make is [of] this whole idea of personal autonomy ... this idea that people should be left alone, be able to do whatever they want to do, government should keep our taxes down and keep our regulations low, that we shouldn’t get involved in the bedroom, we shouldn’t get involved in cultural issues.
I'm certainly glad that Tom's no Rick Santorum. You might think Rick Santorums are rare in the UK. If only:
I don't like choice. No, sorry that was a lie. I hate choice. I detest it. Simplicity is best. . . .
To me, a hospital and a doctor serve a function. Its not complicated. If I get sick I go to my doctor, he gives me a prescription. If I get really sick I phone 999 they take me to a big white building and put me in a bed. Since when did it all get so complicated? I don't want to book a surgeon. I don't want to choose my care, to rate my food, to score my surgeon. This is not X-factor this is my health. I am an historian not a medical genius. I would much prefer it if my doctor or hospital made my choice for me. What scares me the most is that if my entire life experience of consumer choice has been frustration at the rise in prices, why should it be any different in the NHS? Am I crazy? Am I the only person who does not want choice?
That's lefty blogger Eoin Clarke applying the philosophy of Santorumism to healthcare. After reading his whole post at "The Green Benches", including a story about the agony of choice at Starbucks, I wonder if "The Green Ink" might be a better title for his blog instead.
I can't stand the Santorumist view that some jumped-up prig in government should be able to interfere in my private life. Most people in Britain shudder at the thought of Rick Santorum. And so they should. But they should also shudder at his meddling, father-knows-best worldview being applied to the rest of their lives, including their healthcare.
Privacy isn't just a good thing when it comes to sex. Santorum's collectivist delusions about controlling your bedroom are bad, but Clarke's collectivist delusions about controlling your healthcare are hardly any better.
Update: Simon Cooke has more thoughts on choice in bread and cheese, and what that means for healthcare and education.
The third-party payment problem
It will probably have passed most British readers by, but US politicians have been talking a lot about contraception recently. The short version is this. First, the Obama administration decided to mandate that church-affiliated employers offer insurance that covers contraception, regardless of their religious objections. Predictably, a political firestorm kicked off. So the Obama administration came up with a ‘compromise’ – church-affiliated employers won’t be charged for contraception coverage, but insurers have to provide it anyway.
Now, I’m no Rick Santorum. I’m a fan of contraception. But there’s so much wrong with this story that it’s hard to know where to start. Should the government really compel you to buy a service from a private company? It’s probably better than the government nicking your money and providing that service themselves, but for a libertarian it still rankles. Then there’s the insensitivity to deeply-held religious conviction, which not only exposes the ‘liberal’ left’s inability to tolerate social mores that differ from their own, but also highlights the way big government inevitably tramples on diversity and choice with its one-size-fits-all monomania. And then there’s the idiot-economics which suggests that you can force a company to provide a service without anyone having to pay for it. In this case, assuming insurance companies can’t find a way of covertly passing on the cost of contraceptive cover to church-affiliated employers, then everyone else with insurance ends up footing the bills through higher premiums.
But perhaps the biggest problem is the one explained by Sheldon Richman in this Freeman article: contraception has nothing whatsoever to do with insurance.
Insurance arose as a way for individuals to pool their risk of some low-probability/high-cost misfortune befalling them. It shouldn’t be necessary to point this out, but coming of child-bearing age and choosing to use contraception is not an insurable event. It’s a volitional act. It may have good consequences for the person taking the action and society at large, but it is still a volitional act. It makes no sense to talk about insuring against the eventuality that a particular person will use contraception.
This gets right to the heart of the fundamental problem with modern-day healthcare: we rely too much on third-party payment, whether by governments or insurers. As Richman says, taking out insurance (or paying taxes) so that some third-party pays when a big-ticket, catastrophic health expense comes your way is perfectly rational. But paying someone else to take responsibility for your predictable, routine, run-of-the-mill health costs is crazy. It introduces huge dead-weight administrative costs and seriously distorted incentives, and is one of the key drivers of out-of-control healthcare inflation.
As I wrote a while back, “The key to successful healthcare reform is to get patients paying doctors directly for routine services, and returning insurance (of whatever sort) to its natural role.” This Adam Smith Institute report suggested a way of doing it, and we’ll be addressing the issue in greater depth in a forthcoming paper on Singapore’s healthcare system. Watch this space.