Farmer numbers to plummet...

In China.  It would appear that even if your don't build it, they will come.

If Han Jun is right, over the next three decades a population the combined size of Germany, France, Britain, Italy, South Korea, South Africa, Spain, Poland and Canada will up sticks and move to China’s swelling cities. Mr Han, a rural expert at Beijing’s Development Research Centre, reckons that by 2040, the number of people in China’s countryside will have shrunk by 500m to just 400m. On that assumption, China’s city-dwellers would rise to well over 1bn, catapulting the urban population from 45 per cent of the total to around 70 per cent.
The startling numbers conjure up images of mass migrations and the trebling or quadrupling in size of big cities such as Beijing, Shanghai and Guangzhou. In practice, it is unlikely to be quite like that. China, after all, is a planned economy. Even so, McKinsey Global Institute, which has researched China’s urbanisation trends, paints one scenario under which, by 2025, the country will have 15 super-cities with an average population of 25m people each. Meanwhile, many cities will “move” to the countryside as the state frantically constructs new urban centres in the interior and as changing land use blurs the distinction between village and town.
This is not futurism. By some counts, China already has some 170 cities with a population above 1m. That compares with nine in the US and two in the UK. In population terms, Tianjin is China’s New York and Qingdao its Los Angeles.
The emergence of second and third-tier Chinese cities with big populations has businesses salivating at the prospects of a consumer bonanza. A steady stream of urbanites could indeed become tomorrow’s purchasers of kitchen appliances, insurance and cars. City authorities will need mass-transit systems, power grids and telecoms equipment. Chinese urbanisation could, as McKinsey says, be the biggest business opportunity of the next several decades.
There is a hitch. Not only will planners need to build the physical infrastructure to accommodate this urban groundswell. Harder still, China will have to erect a legal framework. As things stand, of the estimated 200m migrants who have already swapped their hoe for factory aprons or a hard hat, the bulk have no right to permanent residence in the cities. The so-called hukou registration system, instituted by Mao Zedong in the 1950s as a way of limiting internal migration, divides China’s urban population into two castes – privileged official residents and marginalised migrants. [More]

Examples like this are the reasons why I am not wringing my hands about the rapid expansion of the Chinese economy.  Too many worriers simply fail to acknowledge the burden 1.3B people represent even for a rapidly expanding powerhouse.

Now add in the increasingly likely appreciation of the yuan, and instead of a threatening debt-holder, China begins to look like the Mother of All Consumer Markets.  To be sure it's early, but China seems to have the ability to accelerate trends.

A juvenile moment...

A GMO "tipping point"?

First.

It looks like a sucker's bet to me...

Mike Walsten points to an account of the "African land grab" in the Observer. I have read similar stories and posted about this, but apparently the speed of this land rush is increasing.

An Observer investigation estimates that up to 50m hectares of land – an area more than double the size of the UK – has been acquired in the last few years or is in the process of being negotiated by governments and wealthy investors working with state subsidies. The data used was collected by Grain, the International Institute for Environment and Development, the International Land Coalition, ActionAid and other non-governmental groups.
The land rush, which is still accelerating, has been triggered by the worldwide food shortages which followed the sharp oil price rises in 2008, growing water shortages and the European Union's insistence that 10% of all transport fuel must come from plant-based biofuels by 2015.
In many areas the deals have led to evictions, civil unrest and complaints of "land grabbing". [More]

Much of the consternation is misguided I think.  I can certainly appreciate the appearance of hungry people exporting food, but this has not been uncommon in world history. At least this kind of commercial colonialism is more productive and less dangerous than say, military adventurism.  Think how much cheaper in lives and dollars if we had simply started buying land in Iraq, sending over young farmers, and employing locals to grow stuff for Mideastern markets.

Look a little longer term.  Let's say these mega-farms prosper, and many locals make decent wages (relatively) and the local economy begins to grow based on selling to these farms.  After all, they can't import everything they need from the home country.  This is not a bad thing for an area that needs development.  Also the presence of such an economic force would tend to mitigate against the sad cycle of tribal warfare and stabilize young democracies by growing the middle class.

Is value being bled from Africa? Absolutely.  But value is being added to Africa many times over.

But here's the clincher. Since few seem to have read the collective history of colonies everywhere, let me predict what will happen. Just like Saudi Arabia, or Brazil, or the US - or any colonial effort anywhere - eventually the locals decide they've had enough and simply nationalize/confiscate the industry.  After all, the land isn't going anywhere.  I give them a generation, and African countries will be food suppliers to the now agro-colonial powers. 

Ask the "colonizers" at Standard Oil, for example.

Saudi Aramco dates back to May 29, 1933, when the Saudi Arabian government signed a concessionary agreement with Standard Oil of California (Socal), allowing the company to explore Saudi Arabia for oil. Standard Oil of California assigned this concession to a wholly-owned subsidiaryCalifornia-Arabian Standard Oil Co. (Casoc). In 1936 with the company having no success at locating oil, the Texas Oil Company purchased a 50% stake of the concession. called

After a long search for oil that lasted around four years without success, the first success came with the seventh drill site in Dammam, an area located a few miles north of Dhahran in 1938, a well referred to as Dammam number 7. The development of this well, which immediately produced over 1,500 barrels per day (240 m³/d), gave the company confidence to continue and flourish. The company name was changed in 1944 from California-Arabian Standard Oil Company to Arabian American Oil Company (or Aramco). In 1948, Standard Oil of California and the Texas Oil Company were joined as investors by Standard Oil of New Jersey who purchased 30% of the company, and Socony Vacuum who purchased 10% of the company, leaving Standard Oil of California and the Texas Oil Company with equal 30% shares.

In 1950, King Abdul Aziz Ibn Saud threatened to nationalize his country's oil facilities, thus pressuring Aramco to agree to share profits 50/50. A similar process had taken place with American oil companies in Venezuela a few years earlier. The American government granted US Aramco member companies a tax break known as the golden gimmick equivalent to the profits given to Ibn Saud.

In 1973, following US support for Israel during the Yom Kippur War the Saudi Arabian government acquired a 25% share of Aramco, increased the share to 60% by 1974, and finally acquired full control of Aramco by 1980. In November 1988, the company changed its name from Arabian American Oil Company to Saudi Arabian Oil Company (or Saudi Aramco). [More]

Even workers imported from say China will be more "local" than not after enough time.  It's called immigration and examples of its success in abound in your backyard. In fact, there may be some forward thinking African leaders already leaps ahead of the colonizers just making sure the hook gets set firmly.

The bottom line for us may not be the anguish of small farmers being shifted involuntarily to other work, but the idea that lifting them, albeit involuntarily, out of subsistence living starts them on the path to long hoped-for stability and progress.  It may not be perfect during the "colonial" phase, but given time, it will work out pretty well for a large majority, I'll bet.

Finally, this is one reason why I don't bother with the falsely alarmist, and frankly self-promoting cries of "Who will feed the billions and billions in the world tomorrow?" The answer is obvious: emerging waves of farmers of the world.

Maybe it will take longer than I think, but successful "colonizing" efforts, whether political or economic, seem to have one eventual result: independence.

Headline of the Week...

Researchers: Men want sex until almost dead

I don't write this stuff, folks.

[More]

 

We need a better answer...

Than "It's cheap". (Worth the whole 20 minutes, IMHO)



Our defense of the status quo in farming has been about economics, and it is a good defense.  But like all defensive strategies, the opposition soon develops counter-strategies.

The worst case scenario for American agriculture is a resurgence of world-wide prosperity that enables food consumers to choose arbitrarily. [Update: In the hard light of morning, this statement doesn't make as much sense as I apparently thought yesterday. Increased prosperity would bring millions of new protein consumers to the market, for one thing. I have no idea what losing high-end consumers would mean, but likely the ratio is small comparing to new middle-class consumers.]

For extra credit: how would you answer chef Dan Barber?

Just in case...

Something (God forbid!) should happen to...oh, shoot - you know...

True honest fact: I have never bought my own underwear.

Get Googled...

The book, that is.

[More]

Just finished reading - well, listening - to this and highly recommend it.  If you want to understand why advertising will be the next industry to be wrenched like music and retail from the pressure of ideas whose time has come, this account will be riveting. Excellent writing, strong journalism, astonishing implications.

Other reviews seemed bored with the pace, but it could be in listening over several sessions, that was not as noticeable.  BTW - the reader, Jim Bond was one of the best American readers I have heard. (I wonder if he introduces himself as "Bond.  Jim Bond.")

[Another review][And another]


Need I say it - the Kindle version is $9.99!

This Week's Junk Box...

[Note: I've been searching for a name for a weekly post that most popular blogs are using, and I have started copying: a link-dump of stuff I've found, but don't have time to think a deep thought about.  I've decided on the junk box theme, as it is a common concept on most farms]

So FWIW, here is what's in my information junk box this week:

• Superb explanation of the National Debt (since that is the topic of current outrage)
• Not coincidentally, how the Ryan Roadmap - for all its courageous ideas - doesn't really do much for the above
• The gin is just for show - it's all about malaria and scurvy.
• I won't miss the jet jocks myself.
• I feel better about USFR's half-million viewers at 5:00 AM now.
• Are we becoming Japaralyzed?
• Being American means never having to say sorry.  Not.
• Are Chinese pork subsidies actually American soybean subsidies?

Another step in the right direction...

Many of you have argued cogently for market forces in medicine.  And as one of the two big issues (the other being universal coverage), cost control mechanisms have been hard to devise and garner support for.

One good step would be more price transparency.  For those of you who despair of anything so actually helpful coming to pass, behold, proof that we can at least begin to tackle this gargantuan problem.

Two days ago I wrote a post about why I think price tags could save American health care. One of the great forces of the U.S. economy is the price-conscious consumer. Collectively we manage to drive down the cost of everything from bar soap to tax preparation. Such is the nature of a competitive marketplace with transparent prices. So why not unleash that dynamic on the health care industry?
As it turns out, I'm not the first person to have this idea. In fact, there is currently a bill sitting in Congress that would do exactly what I'm proposing. On Feb. 25, Representative Steve Kagen—who happens to also be a doctor—introduced the "Transparency in All Health Care Pricing Act of 2010." The bill is 429 words (that's right—429 words, not pages) and already has 45 co-sponsors. I know a whole lot more about economics than I do about politics. Could someone out there please tell me how we can get this thing passed?
Here, read how brilliant it is:

SEC. 2. TRANSPARENCY IN ALL HEALTH CARE PRICING.
(a) In General- Any and all individuals or business entities, including hospitals, physicians, nurses, pharmacies, pharmaceutical manufacturers, dentists, and the insurance entities described in subsection (d), and any other health care related providers or issuers that offer or furnish health care related items, products, services, or procedures (as defined by the Secretary of Health and Human Services) for sale to the public shall publicly disclose, on a continuous basis, all prices for such items, products, services, or procedures in accordance with this section.
(b) Manner of Disclosure- The disclosure required under subsection (a) shall--
(1) be made in an open and conspicuous manner;
(2) be made available at the point of purchase, in print, and on the Internet; and
(3) include all wholesale, retail, subsidized, discounted, or other such prices the individuals or business entities described in such subsection accept as payment in full for items, products, services, or procedures such individuals or business entities furnish to individual consumers.

Combine that level of price transparency with insurance that incentivizes consumers to pay attention to cost—e.g., co-insurance, high-deductible plans—and I think we'd start making a real dent in health-care cost inflation in a very short period of time. [More]

This week at various meetings several mentioned the idea of just eliminating insurance altogether, but that's hardly feasible, let alone wise. Insurance for all kinds of unpredictable things in life has been around for a really long time. (Probably starting with marine shipping).  As long as it is a transaction between policy holders and insurers, there will be those whose math skills who will allow consumers to offset inherently fickle fate while making a buck in the process.

The problem arises when another payer - government, employer, parents, etc. - interrupts this transaction. Whatever steps we can make to push toward more straightforward health insurance should reap considerable low-hanging economic fruit. Of course, efforts must be made to provide assistance for those who cannot even afford catastrophic coverage, or these efforts will fail for too much of the population.

At the very least, some kind of pilot program would be worthwhile.  As someone who has asked doctors what things cost, I've had strange reactions - and some surprising discounts.

Suppose a clinic with a new fMRI decided to have a 2-week sale to introduce themselves and their service?  Just as private medical labs are springing up to pretest for drugs (just to make sure before the interview) and pregnancy/paternity, I could see specialization really taking hold with concomitant economies of scale for more of medicine that we think right now.

It seems like we've been wrangling about health care forever.  It seems even longer if you are currently a have-not in our system. I remain hopeful we are simply handling this the way we seem to do all enormous issue - the hard way.

The pork industry thrives...

Some good news about a pork company:

AgFeed Industries ( FEED - news - people ) issued guidance for 2010 and 2011 this morning. The company expects to market 2 million hogs in both years, with sales improving by $90 million year-over-year. Shares of AgFeed soared on the news, gaining 13.3% to $5.11. [More]

Of course, there is this to keep in mind.

Go, Canada...

Not being a hockey fan, but having a professional interest in plumbing, this struck me as deeply important stuff.

The water utility in Edmonton, EPCOR, published the most incredible graph of water consumption last week. By now you’ve probably heard that up to 80% of Canadians were watching last Sunday’s gold medal Olympic hockey game. So I guess it stands to reason that they’d all go pee between periods.
But still—the degree to which the water consumption matches with the key breaks in the hockey game is stunning. [More]

I guess this explains the phrase "flushed with victory".


[via iglesias]

Wish I'd said that...

One very pithy metaphor-parsing that caught my eye in a post about unemployment.

Long-term unemployment is more a social than an economic problem. A rising tide may lift all boats, but you do have to have a boat. Otherwise, you will be in over your head before long. [Source]

 Just as the end of winter is when the worst of the starvation kill occurs for many wild animals, the exhaustion of both resources and compassion are, I believe, setting the scene for similar human misery.

Choose conflict last...

I have been talking at meetings this winter about my doubts concerning the feeling in much of agriculture to confront those who take issue with our methods and goals. For example, the rising anger at the HSUS (for which I have no respect, BTW) seems to have fed the conviction that some well-choreographed public relations campaign is just what we need to...umm...accomplish something and make us feel better.

Many climatologists are harboring the same urge to lash out at skeptics. Some cogent advice might apply to both.

When scientists and advocates, motivated by these biased perceptions, respond with tit- for-tat attacks on climate skeptics, it takes energy and effort away from offering a positive message and well-planned engagement campaign that builds public support for climate action and instead feeds a downward spiral of "war" and conflict rhetoric that appears as just more ideological rancor to the wider public.
Alternative positive messages and strategies include re-defining climate change away from just being an environmental problem, to being a national security, public health, and economic problem, with policies that would lead to societal benefits in these areas rather than just perceived economic sacrifice, hardship, and costs. This does not mean replacing a focus on environmental science and impacts with other frames of reference, but rather it means partnering scientists and science educators with opinion leaders from across sectors of society who can speak to complementary dimensions of the issue and who can communicate about the benefits that would occur from specific policies, both at the national and local level.
Moreover, when scientists inaccurately presume that climate skeptics have single-handedly swung polls in the direction of public disbelief--and then adopt a warfare posture and "fighting back" strategy against skeptics--they call further media attention to the original "ClimateGate" event and feed the preferred narrative of skeptics.
If the tit-for-tat attacks from the tail ends of the spectrum on climate change continue unabated, what was once presumed influence on the part of these scientists will likely become real influence on public opinion, and scientists risk being partly responsible.

In other words, while some scientists may think that "fighting back" is the solution, they may actually risk further contributing to the problem of public disengagement and policy inaction. [More]

I will be writing more about in Top Producer about this mistaken strategy, but for now, I second the opinion above.

Why 2009...

Will loom large in farmer memory and life: it finished so badly. [Note: this assumes you have been able to "scrape the gum of 2009" off your shoes]

Daniel Kahneman, one of the preeminent happiness researchers, explains how we experience happiness, and how we remember happiness.  (Stay with it to the end - it's worth it.)




It is also curious to me, how, at the end of the lecture, Kahneman cites a Gallup poll the has an inflection point of about $60,000, which is eerily close to the the median mean household income for the US.

On Wisconsin!...

Places where bars outnumber grocery stores.

FloatingSheep, a fun geography blog, looks at the beer belly of America. One maps shows total number of bars, but the interesting map is the one above. Red dots represent locations where there are more bars than grocery stores, based on results from the Google Maps API. The Midwest takes their drinking seriously.
Of course there are plenty of possible explanations for the distribution. Maybe people get all their food from superstores like Walmart in the red dot areas, so there are fewer gigantic stores than there are small local bars.

Then again, the FlowingSheep guys did their homework and found, according to Census, that the number of drinking places in those red dots are really skewed compare to the average. So it's also possible that area of the country just likes to drink a lot. [More]

Update:  The comment below reminded me of this map that bounced around the blogosphere as few weeks ago: Europe's Alcohol Belts

This map shows Europe dominated by three so-called ‘alcohol belts’, the northernmost one for distilled spirits, a middle one for beer and the southernmost one for wine. Each one’s existence and extension is determined by a mix of culture and agriculture.

The Wine Belt covers the southern parts of Europe, where wine has historically been an important industry and an everyday commodity: the whole of Portugal, Spain, Italy, Montenegro, Greece, Macedonia, Bulgaria, Hungary, Moldova and Georgia; all but the northwestern zone of France; and significant parts of Switzerland, the Czech Republic, Slovakia, Croatia, Serbia, and Romania. [More]

[via sullivan]

Don't forget...


To shop for cards and presents.


Look - it beats "Sweetest Day".

[Blog note: lots of travel; lots of head cold; not many posts]

Posts that just didn't make it...

Nope - couldn't think of a snappy opinion, but found these interesting, nonetheless..

• No wonder this winter has been hard on my ethics.
• Asia makes an economic comeback, from way back.
• Handmade bicycles
• The organ referees - do we really need them?
• Updating your fact file is never-ending.
• 1 of 4358 spring planting weather forecasts

The Earth moved...

No. Seriously. 

Scientists say the Chilean earthquake was strong enough shift the Earth on its axis and make each day a fraction shorter.

Early analysis by NASA shows the axis of the Earth should have moved by about eight centimetres after the Chile earthquake. [More]

Weird - I thought that meant something else entirely.

I think I worry too much...

And I worry about that.  Such anxiety loops are common.  My favorite is Steven Wright's famous: "I worry about getting performance anxiety."

It also can keep us awake at night.

This human frailty has profound consequences. Dan Wegner, a psychologist at Harvard, refers to the failure as an “ironic” mental process. Whenever we establish a mental goal — such as trying not to think about white bears, or sex, or a stressful event — the goal is accompanied by an inevitable follow-up thought, as the brain checks to see if we’re making progress. The end result, of course, is that we obsess over the one thing we’re trying to avoid. As Wegner notes, “The mind appears to search, unconsciously and automatically, for whatever thought, action, or emotion the person is trying to control. … This ironic monitoring process can actually create the mental contents for which it is searching.”
These ironic thoughts reveal an essential feature of the human mind, which is that it doesn’t just think: it constantly thinks about how it thinks. We’re insufferably self-aware, like some post-modern novel, so that the brain can’t go for more than a few seconds before it starts calling attention to itself. This even applies to thoughts we’re trying to avoid, which is why those white bears are so inescapable.

What does this have to do with sleep? For me, insomnia is my white bear. My conscious goal is to fall asleep, which then causes my unconscious to continually check up on whether or not I’m achieving my goal. And so, after passing out for 30 seconds, I’m woken up by my perverse brain. (Most animals lack such self-aware thoughts, which is why our pets never have trouble taking a nap.) [More]

I think this could be one reason many of us are starting to control what suggestions or stresses get introduced into our brains during the day.  Once they have taken up residence...

Ignorance may not be bliss, but it may help you sleep better.

Free markets can fail....

The progression of events in the individual insurance market points out one flaw in the free-market defense of our status quo in health insurance.  Like many other market activities, it is particularly brutal during economic retractions.

Braly explained that her company's premium increases on individual policies were based on several circumstances: One, people are getting older. Two, people are becoming unemployed, and if they're healthy they're dropping out of the insurance pool. Three, the cost of diagnostic testing is soaring.
Implicitly, she begged for the government to help -- put people back to work so they're eligible for cheaper group plans, and clamp down on costs. (Not even the government can stop people for growing older.) Without that help, she intimated, premiums are going to keep rising sharply and WellPoint's already meager profits are going to be hammered worse.
In delivering this appeal, Braly was forced to make an implicit admission that her industry almost never makes explicitly: The nation's health coverage system is so hopelessly broken that even the health insurance industry can't handle it anymore.
Her testimony, and other statements she and other WellPoint executives have made, suggests that insurers can't profitably manage through periods of high unemployment. They can't price policies in a way that keeps healthy young people in the same pool as older people, producing a mockery of the very point of indemnity insurance. Despite a decade of unobstructed consolidation, which was sold to regulators as a way to control healthcare costs by creating mega-insurers like hers, her industry can't control healthcare costs.
Braly's words are a reminder of the most important unasked question in the entire healthcare debate: What do we need insurance companies for, anyway?
The only way insurers can remain profitable at all is by selling healthy people on policies that don't offer much coverage at all, while squeezing older, less healthy people remorselessly so they either pay for most of their care out of pocket or get priced out of the insurance market completely (thus becoming a burden for taxpayers). [More]

This death spiral could be just beginning as COBRA coverage and subsidies for many are ending in the next few months. But what is more troubling to me is the false comfort many feel because they have group coverage.

One suggestion that many on both sides seem open to is deregulating the health insurance industry, especially freeing them from wildly different state rules.  Thus companies could offer low-priced catastrophic only coverage, enabling more to be covered while still using market forces to temper demand for goods and services.  If you have to pay for the first $5000 of medical expenses, you wait out some colds and ear infections, for example.

I agree - heck, I practice this idea. But I'm still seeing whopping increases in premiums.  By my figures I'm one of those fortunate folks who support the medical care of others who didn't win the health lottery.

But how far interstate sales could this go to addressing the growing problem of binary health care delivery?  Proponents argue it could solve most of the problem.

One thing that would not survive 50 state regulatory regime competition is guaranteed-issue and community rating in the individual market. In the six states that impose such requirements the vast majority of people who are relatively healthy are overcharged so that the small percent who are sick can be undercharged. This form of private sector socialism would quickly dissolve, as the healthy sought cheaper insurance under other regulatory regimes.
This would be a good outcome for healthy people because lower premiums would encourage the uninsured to buy insurance. But would people with pre-existing conditions (who remain in shrinking pools with rising per capita costs) be unfairly burdened? The solution that would face the least political resistance would be to exempt these six states from the proposal, unless they opt in. But a better solution would be for states to find more rational ways of subsidizing the care of high-cost patients.

Overall, University of Minnesota economists Steve Parente and Roger Feldman estimate that cross-state purchasing of health insurance would induce 12 million more people to obtain health insurance. That number would double if tax subsidies for health insurance were equalized — thus insuring 80% of the number of uninsured people the Senate (ObamaCare) health bill aims to insure — without any net cost to the federal government. [More]

There is persuasive logic behind this idea, although the idea of a completely unregulated insurance market seems far-fetched. It is not hard to imagine inexpensive, but complex products that seem to offer coverage but take advantage of the asymmetrical health cost information between consumers and insurers to cleverly limit uneconomical payouts.

Plus I don't any reason why recission would not continue to be a problem.  While it affects a tiny number of insureds, it is exactly those types of long-shots medical calamities that catastrophic insurance is designed for. So unless recission is prohibited - and it is an idea both sides seem to agree on - trying to introduce market reforms to make consumers self-ration won't work. If buyers don't believe "cat" policies will protect them, they won't buy them, at least not at the numbers suggested in the study.

But the minute recission is prohibited, the door to regulation is now open and the numbers change for all. Throwaway comments about "subsidizing high risk pools" should really have some hard costs attached to them.  I don't think they are trivial, and their existence would only encourage continued adverse selection and denial of coverage for the rapidly expanding list of pre-existing conditions.

There seems to be no good market solution for this problem. There are some people who will consume much more health care than they could ever pay for. The pure market response is to allow wealth to be the rationing mechanism. Requiring emergency rooms to treat such patients is not on any p/q chart, and while it has served as our de facto solution, I don't think it will suffice much longer.

Unless the entire population is covered in some way, the most expensive health care consumers will rapidly be shunted by such mechanisms into the uninsurable category by market forces. At some point, that remnant from the system will be unsustainably costly - which is close to where we are now.

It is legitimate and I think intellectually honest to support using this system to control costs. Capping government care costs for the sickest/poorest would accomplish that. However, this idea is almost never spoken about clearly, just left as the answer-which-cannot-be-named.

It is also certainly less attractive when your child is born with asthma, or your company folds and your COBRA runs out.  The future uncertainty even for those with gold-plated coverage is growing.  My take is we are not factoring the real costs of this lottery system of health insurance.

Nonetheless, some form of rationing will be, and has always been in place. The status quo is certainly not pure market action, and I think introducing more deregulation will only increase the anxiety surrounding this fact of modern life.

Capitalism works great on the way up. But even in the US we have discovered that allowing a huge and complex economy to collapse by cascading bank failures for example, should be avoided. Likewise, allowing more citizens to be ejected from an imperfect market system in health care may seem economically rational, but may simply be overlooking the greater dangers this could bring.

At the very least, I think such an outcome would utterly undermine confidence in both our government and medical system. The longer term consequences of that would be both socially and economically crippling.  

Unfortunately, there is little choice midway between free markets in medical care/insurance and significant government involvement. Any solution that is not universal simply degrades reverts back to where we are headed now.  You can't make universal acceptance work without universal coverage.  You can't prevent recission without regulation. And so on.

It seems to many of us that health care economics is less amenable to classic market solutions because we will not tolerate the solutions it produces.