Understanding Brazil’s Socialized Medicine Debate
As a matter of fact, our own national medical association (CFM) is the first to attack and criticize such position, textually condemning for-profit medicine in our medical ethics manual: "Medicine should not, under any circumstances whatsoever, be practiced as a commercial activity."
If Medicine cannot be practiced as a for-profit, commercial activity (meaning doctors in Brazil should receive a "fair" payment for their work), we are tempted to think that healthcare should be a right nor a privilege or a commodity.
At this point it is essential for us to try to find a proper definition of health. It is indeed a very complex concept that is very hard to pin down since it has a number of legal, social and economic implications. Should we use the World Health Organization (WHO) definition that health would be "a state of complete physical, mental and social well-being and not merely the absence of disease or infirmity"? Well, either this definition is wrong or every inhabitant of this vast planet is unhealthy. It is natural for the human being to pursue this marvelous state of perfection, but we have to keep it in mind that this can rarely be achieved, and even so, only for a few moments.
Then what can we say about transforming health into a right, a fundamental right, to be granted by the state? And just how would that be done -- using money that is brutally withdraw from the taxpayer? Now you can understand the seriousness of what is going on here in Brazil. Our constitution dates from 1988. It adopted the health definition we just went through, and states that it should be a right to be granted by the state and our public healthcare system, named SUS (in Portuguese the letters stand for Unique Health System). In fact, this definition has been criticized worldwide because it promotes the medicalization of existence and it opens the possibility of government abuse under the pretext of promoting health. So it is not that hard to understand why most governments adopt this utopia definition.
Let's examine other attempts to define health.
Health was once described as "absence of disease", as "well functioning of the organism as a whole" or even as "an activity of the living organism accordingly to its specific excellences". A good definition would be a mix between "a physical and mental state where all vital goals are reached, given the circumstances" and "a subjective and individual perception of well being" that vastly varies among people. I believe that any global attempt to define health should be avoided because it disregards the individual, and health is something that concerns the individual solely.
In Portuguese we use the term "mercadoria" as a synonym to "good" or "commodity" or even "merchandise". This term is derived from Latin and has its origins in the word mercatóre (merchant) -- the same root of the word "market". In classic economics a good can be produced by human work and put in the market to be commercialized. The market, far from being a place, is actually the process that guides the economic system based in the division of labor and the private property of the means of production. Economic calculation is the intellectual north that guides the choices taken by their participants, that act through voluntary exchanges.
The system of prices is a fundamental indicator of what is going on at a precise moment, once it reflects the total of all interactions that are taking place and informs the producers what to produce, how to produce and how much to produce. The alternative to the system that we just described is socialism, where the property of the means of production is collective or belongs to the state. In this second system, the production is determined by state decrees and, in the absence of prices, by bureaucratic decisions. This renders economical calculation impossible. This is why socialism is not viable and has failed everywhere that it has been implemented. In other words, to say health is a commodity means that it could be possible to obtain it from the market, through voluntary exchange, without the use of force or coercion.
With this information, we can say that nobody is able to acquire the commodity "health" in the market, because it is actually an abstract concept, rather than a finished product. Health is an intangible and abstract good no matter what definition we agree to adopt. Nevertheless it is possible to obtain services and products that can grant the maintenance or restoration of lost health due to disease or externalities. In this sense, even though health should not be considered a merchandise, medical services and health care are a real commodity once they can -- and gladly are -- provided by the market, in a far superior way than any attempt any government could possibly make.
It only would make sense to talk about absence of commerce in the very undesirable situation where the government would provide all health care in its totality. In this sense Brazil is in a better position than Canada. Even though Canadian public health care system has more money and works better than our SUS, doctors are forbidden by law to be paid out of the pocket in Canada. For the moment we still have distorted regulation, limited free market, out-of-pocket medicine in Brazil. And we want to keep it that way. There is a lot of pressure in the opposite direction for full socialization.
So how do we stand up for what is right?
We try to show doctors and people in general that there is a situation where health can become an ended product, a real merchandise. This happens whenever the welfare state uses the abstract concept of "health" as a mean of exchange to impose its interventions and regulations and justify its rates and taxes. One of Ludwig von Mises' most keen observations was the cumulative tendency of statal interventions. The government, in its knowledge, perceives a problem and interferes with the intention to "solve it". Nevertheless, instead of it, the intervention creates two or three new problems that the state believes that it should again interfere to solve it once more. And this keeps going on and on, diving even deeper into socialism. As Murray Rothbard has said, no other area can offer a better illustration of this dramatic scenario as public health care.
The truth is that to dictate that health is a fundamental right and that the state should provide universal, free and quality health care unfortunately does not change any economic law. It does not make any miracle to fall from the skies. What happens is that you have in one hand scarce resources and in the other hand infinite demand. There is no magic: there will be scarcity and there will be rationing, translated into long waiting lines and restrictions and so on.
There is only one way to go: less government, fewer taxes and fewer regulations. A real market in medicine would be responsible to bring prices down and increase quality, as it happens in all other fields of economy. Another important issue: so long "government imposed charity" is called off this will open the way for voluntary private charity, not to mention doctors who will prefer to work in a for-profit market of people with less buying power, in the same way Walmart works, for instance.
We have to encourage everyone we know to look the socialist health care system for what it really is, not just for its undelivered promises. It is actually an immoral, sky-rocket, super-expensive and bad system. And there is more: this redistributivist system is also responsible, under the fake promise of free health care, for conducting everyone as sheep deep into the road of serfdom. So it is crucial that we understand that health should never be used in this way and stop asking for socialized medicine as soon as possible.
Health care is a very important issue. It is far too important to be left in the hands of government.