I hope this doesn't violate blog etiquette, but I'm going to repeat a conversation an anonymous Canadian and I have been having over at East of Eden, on the post I mentioned in Casting the Net, Vol. 6.  I'm hoping she'll continue the discussion here, because (1) the blog owner is taking a break for Lent and I don't want to overwhelm her post while she is gone, and (2) I think several of my readers would enjoy the conversation and have something to contribute to it.  If the best part of overseas travel is being with family and friends, the second best is the opportunity to meet other points of view.  I'd welcome a Canadian viewpoint around here.

The original post is here, and I've excerpted below our conversation so far.

CA:

As a Canadian who's been online for 11 years (talking to Americans, watching America, visiting America) I'd like to make a few comments about what I see as the causes and effects of the current economic situation.
1. A major cause of the economic troubles now is a corporate culture that rewards short term thinking - bonuses based on quarterly returns for example - an action with a large short term benefit may not be in the company's best long term interests. Rev'ing an engine makes a really cool noise and makes you go fast for a while, but it burns out the engine. The economic engine is burnt out.
2. I realise that watching America through the Internet selects for a certain level of affluence, but "your" idea of comfort is very different than most of the rest of the world's - even a Canadian's! - idea of comfort! When a blogger posts, "We're struggling financially" then posts a picture of her house and neighbourhood, or talks about the great decorating find at the Pottery Barn or wherever, well, it's hard to be sympathetic. It's hard not to think that you don't actually understand what struggling is, and this inability to understand just how "rich" you are has led you into this mess.
3. The affluence gap. A "rich" Canadian may not be as "rich" as an American, but our "poor" aren't as poor either. I have traveled in the States, as has my dh on business and the evidence is very easy to spot from the window of a plane or the side of the highway. The gap between rich and poor in the US is extremely disturbing. Again, I think a great many Americans just don't understand and appreciate just how "rich" you are.
4. And may I say? This rev'ing of the economic engine to get more and have more, taking out mortgages for more than the house is worth in the expectation that you can sell it for more later, credit ratios of 30:1, and so on? Yes, this is what America did, and yes, you're taking the rest of the world down with you. I think that should be as much, if not more, of a moral concern as the workers in your company (I applaud your concern for them BTW) and your pondering the "deep dark hole that America has binged herself into"
Obviously, I'm going to post this as Anonymous, but I look forward to the comments on my comment.

LW:

It's a little odd, leaving a comment that the writer of the original article won't read for over a month, but since the Anonymous Canadian invited comments, I can't resist:

1. You are 100% right. It's not the only cause of the problems, but certainly a major factor. Rewarding short-term thinking is...well, short-term thinking. Rather than the engine analogy, though, I'd compare it to over-fishing the oyster beds, and hope we haven't taken the last oyster.

2. I agree that we are all, even the poorest American, much richer than we think. And we have, indeed, become accustomed to a ridiculous level of luxury. But in defense of the examples you mention, it is not impossible to have a large, beautiful house and struggle financially, even if you didn't overextend yourself in buying it. Very few people can buy any house and not be dependent on a job to provide income to pay the taxes, let alone a mortgage. You might say they could sell the house, but probably not without a tremendous loss, and maybe not even then in this market. And you can buy "great decorating" items at places like the Pottery Barn for less than a meal at McDonalds.

3. True again -- about problems with the large gap, I mean; I don't know enough about Canada, unfortunately, to compare. But I think there are too many causal factors to make a country-to-country comparison particularly meaningful.

4. Yes, there was a lot of stupidity and crime to go around, and I'm glad to see someone blaming the folks who knowingly bought more house than they could afford as well as the banks that financed them. But I don't buy the idea that "we" are bringing the whole world down. A former Canadian Prime Minister (sorry I don't remember which one, but I think the quote is reasonably close to what he said) once said that bordering the United States was like sleeping with an elephant: when the elephant rolls over, the whole bed shakes. With the world as interconnected as it is, Canada isn't the only country affected, and the U.S. economy -- whether up or down -- makes waves that are felt worldwide. But we have no monopoly on greed and stupidity -- even the careful Swiss were taken in by Bernie Madoff, and the desire to improve one's lot is a universal trait.

What strikes me most about the whole situation -- and here I'll show my age -- is that once upon a time we knew the value of frugality, thrift, savings, and living within our means. Many people still do, but clearly not enough. How did we fail to pass this on? I think it all goes back to point #1 -- the rewards for short-term thinking, not just corporately, but all over.

CA:

Yes, perhaps a little odd, but the first blog that I've come across that had a topic that seemed appropriate for the comments that I've wanted to make somewhere for a very long time. And blog-visitors can always have a conversation while blog-host is away.
PM Pierre Trudeau said that sharing a continent with the US is like living with an elephant, when the US sneezes, we get a cold. Perhaps I am generalizing, or single-cause blaming just a bit too much, but I think the US's prominence in the world (deserved or not) confers more responsibility than privilege, and a large part of the responsibility for this mess is US spending habits: governmental, corporate and personal.
It's hard to 'see' an acceptance of that global responsibility in stimulus bills requiring US-only purchasing (for example).
As for your example of a purchase from Pottery Barn costing less than a meal at MacDonald's - what is the cost of a meal at MacDonald's? What are you doing eating there anyway? when a sandwich from home takes as much time and costs so much less for more nutritional value?! (Just as an aside)

DH and I are self-employed,and have not yet financially recovered from the dot.com crash of 2001. There was some light at the end of that tunnel though, until this fall...it's all a little hard to take.
I'll show my age too - I was raised in the era when saving, frugality and living within our means meant something. When a budget meant 'not now', instead of 'we'll get it on credit.'

LW:

Sorry, Canadian Anonymous, I didn't mean to give the impression that we eat at McDonald's. I did eat a chicken sandwich there about a year ago when I had a coupon for a free one, and I was surprised that it was a pretty decent sandwich. But, as you point out, I can (and do) make better, cheaper, sandwiches at home. Why, I'm so old that our kids and my husband always took homemade lunches to school/work! I used McDonald's to make my point because, as far as I can tell, no one in the U.S. considers himself too poor to eat there. But my point may have been wrong, anyway, since I confused the Pottery Barn, which I do not know, with Old Time Pottery, which I think of as a place to buy cheap, though sometimes useful, junk.

Thanks for identifying, and correcting, the Trudeau quote. I was sure it had something to do with the elephant rolling over...but having already admitted my age I can admit a sometimes faulty memory. :)

You say this is "the first blog that I've come across that had a topic that seemed appropriate for the comments that I've wanted to make somewhere for a very long time." If it's not rude to hijack you, I'd love for you to come over to my blog and continue the conversation. My readership is not large (okay, it's very small), but includes differing nationalities as well as a range of ages, life situations, and political opinions. One thing they nearly all have in common, however, is that they value saving, frugality and living within their means, and agree that a budget means "not now" instead of "we'll get it on credit."

The floor is open.  :)

Update:  Please note that the comment section has spilled over onto a second page (hooray!), so to see the most recent comment you'll need to click the "Next" button.

Posted by sursumcorda on Monday, March 2, 2009 at 2:25 pm | Edit
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I'd be delighted! Pondering..where to start?



Posted by katie baker on Monday, March 02, 2009 at 7:04 pm

Welcome, Katie! Begin wherever you'd like. Note that under Links on the sidebar you'll find an rss feed for comments, if you'd like to use it.



Posted by SursumCorda on Tuesday, March 03, 2009 at 7:07 am

I'd love to continue the conversation here - this is something (a very big something!) that has been bothering me for a very long time. (and I’ll ask one of my techno-sons what an RSS feed is and how to use it…)

And start off by saying that on the whole I have found individual Americans to be lovely people, but that as a nation – you’re all just a little bit hard to understand. That is one of my aims in this conversation; I’d like to understand y’all just a little bit better.

A bit of introduction – I have lived in Canada, Scotland and England. My husband and I have been married for 33 years, I am a convert to Catholicism from Presbyterianism, and we have raised 6 children to the age of majority on a single income. In Canada, this means something significantly different than it does in the States. There is no deduction for dependent children in our income tax returns (not since the early 80s) nor is there a deduction for mortgages. On the other hand, we have "free" health care, not dental or prescriptions though.

I am not at all sure how that works out on a family balance sheet, I am quite sure that it makes a difference in national attitude. I was confronted once at a conference in Texas by an earnest young woman who demanded to know about our universal health care. I explained how it works, and she interrupted, "Yes, but is it socialism? is it socialism?" with a facial expression that equated socialism with the boogyman. I tried to explain, that no, I didn't think it was socialism, rather a different social contract or understanding of the mutual obligation and responsibilities between citizens and government. She either didn't understand, or wasn't convinced. I couldn't tell. (This is not a unique conversation, BTW, only one of many about health care that all ended with calling it socialism.)

In any case, I think this difference between our countries, a difference in the level or degree of responsibility we feel for each other and towards our government is another factor in what we may as well call 'the economic meltdown.'

Yes, as you say, desire to improve one’s lot is a universal trait. But at what cost? At the cost of disregarding the lot of your neighbour as none of your concern? As not part of your equation?

I don't think it's an accident that Canada has universal health care and stable - so far! - banks. I think the sense of responsibility that inspired our health care system also – to a certain degree – governs our banks as well. Even though we complain about their profits too! We recently applied for a mortgage, just about the time that murmurings about sub-prime mortgages started, and asked if such a thing was happening in Canada? No, definitely not, we were told, “We don’t want our customers getting into situations that they really can’t afford. It’s not good for them and it’s not good for us.”

So now, the financial world is in turmoil, plants are closing, people are losing their jobs, houses are being foreclosed or simply abandoned and the man on the street (to whom all this is happening) feels bewildered, powerless and scared.

The American man on the street knows that all this has something to do with Wall Street, the spending related to Bush’s War on Terrorism, and the banks (big and small) taking advantage of him. And went out and voted for Obama hoping that a change in Commander-in-Chief might turn things around

The Canadian man on the street (with the same things happening to him) knows that all this has something to do with Wall Street, the spending related to Bush’s War on Terrorism, and the top-level US banks getting themselves into a heck of a mess. And all he can do is tighten his grip on the rollercoaster cart and hang on. Someone else is driving.

The elephant has sneezed and the whole world has a cold. We’re all going to have to work together to get healthy again, but I (and many other Canadians that I’ve talked to) think that the elephant has to change its ways as well. (Start using a tissue maybe… ;)) But we have no confidence that it can or will.

What do you think? What do you think needs to be done to repair and restore our economies? What do you think needs to change to keep it from happening again?



Posted by katie baker on Tuesday, March 03, 2009 at 11:41 am

From Webster’s New World dictionary.

socialism – The theory of the ownership and operation of the means of production and distribution by society rather than by private individuals, with all members of society sharing in the work and the products.

socialized medicine – complete medical care, made available through public funds, for all the people in a community, nation, etc.

So, under these definitions the Canadian system seems to be, at the least, socialized medicine. (Even if the care isn’t “complete” because dental and prescriptions are not covered.)

As to the socialism question – if the means of production (hospitals, clinics) and distribution (doctors, nurses, other health care providers) are owned or operated by government (where people are employed by the state institutions to deliver the care), then yes – the system is socialism. If the hospitals, clinics and doctor’s offices are owned by private individuals or corporations, and the workers are paid out of the proceeds of such operations, then it is a mixed system – since the government is paying these private individuals with public funds. I would call such a system semi-socialism.

To help with further defining the question – could you expound on which parts of the Canadian health system might be considered private and which public?



Posted by Dad-0 on Tuesday, March 03, 2009 at 1:12 pm

Responsibility for One’s Neighbor

As to the type of responsibility we feel for one another and towards our government, I would say that books could be written about this. President Jefferson said, “If we can prevent the government from wasting the labors of the people under the pretense of caring for them, they must become happy.”

This is/was the American philosophy in a nutshell. We want/wanted small government that left us to our own devices and existed to ensure the national defense, carry on diplomatic relations, provide for smooth interstate commerce (by not allowing tariffs between the various states) and deliver the mail (the first socialized service in the USA.) I have used the is/was and want/wanted constructs as it may be that we are now sailing away from that view towards one of entitlements.

Private charity has always been encouraged in this country – first by the near universal assent to Christianity – and even now, in the post-Christian, atheist age by the tax laws that allow deductions for charitable contributions. Again it is hard to say what needs to be said in only a few sentences – so please ask for more information as you see fit. What I am trying to say is that the original impulse is that the private person has a better idea of what charity is needed in his community than some external organization, whether the state or the church. In fact it has been shown that those more philosophically inclined towards government solutions (in the US, members of the Democratic party) give less money privately than those not so inclined (Libertarians and Republicans.) It might be said that “liberals” want to be responsible for the needy with other people’s money (taxes on the “rich”) and are happy to offload that responsibility to government, whereas “conservatives” feel the need personally and respond accordingly.



Posted by Dad-0 on Tuesday, March 03, 2009 at 1:45 pm

I love your quote, “We don't want our customers getting into situations that they really can't afford. It's not good for them and it's not good for us."

I think that there are many contributing factors to the creation of sub-prime loans in the US. One is the bundling of mortgages into packages of mortgages that were then sold as investment vehicles. The main reason this became a problem was that the mortgage-writing institutions no longer had an incentive to keep their customers from getting into situations that they couldn’t afford. This is because they never serviced the mortgage! As soon as it was written it was sold to some bundler. The bank only saw the commission on writing the mortgage. It had no risk on the table concerning the mortgage – that was the bundler’s problem.

A second factor was the slicing and dicing of the CDOs (collateralized debt obligations) and other bundled instruments into many tranches. This had the black-magical effect of resulting in all kinds of risky loans being rated AAA because, somehow, when you mix a whole bunch of sub-prime loans together their quality improves through “diversification.” This was sheer fantasy, or fraud. This is the area I foresee as having the greatest chance of class action suits – assuming that the lawyers perceive there will be any value left to loot from the rating agencies and others who perpetrated the folly.

A third factor was the Community Reinvestment Act and the resulting change in bank attitude through the generations after it was first passed in 1977. This act was passed to prevent red-lining – the practice of drawing lines around geographic areas and saying that no loans are to be made inside these areas because the risk is too great. This was attacked as unfair and often, racist, as many times the redlined areas had a majority black population. When first passed there was much wringing of hands by bankers as they felt they were being pushed to make loans more risky than they wanted to. However, eventually these bankers retired and they were replaced by people who had grown up with the reality of making loans without being able to really hold people’s creditworthiness to close scrutiny. Now, most of the loans in the red-lined areas were not that big. Real estate is usually pretty cheap there – but the whole psychology of making loans without close scrutiny had taken hold. It was easy to follow the slippery slope to making larger and larger more questionable loans, especially if you didn’t have to service them.

A fourth factor was the change in regulations that allowed banks to have investment arms once again (reform of the Glass-Steagall laws.) This meant that the lending part of the bank would make risky loans that it would sell to a bundler – the bundler would perform his black-magic, and then the investment arm of the bank would buy some of the AAA rated stuff for its portfolio. It seems that the left hand didn’t know what the right hand was doing! In the end the banks WERE servicing their own baloney – they just didn’t know it!

This baloney was pedaled all over the world and when the truth came out, the credit markets froze. Nobody felt he could trust what somebody else had to say about the quality of a loan. This basically has caused the first significant drop in the velocity of money in a long time. Once people couldn’t get financing for the time it took the ship to cross the ocean from China to Long Beach – the contagion spread to non-banks. Everyone had to pull back – which has a ripple effect. The attempt to stimulate by more government spending will only have a marginal effect – until the butcher, the baker and the candlestick maker can get their businesses rolling again – either using new methods of finance, or with less finance. It will take a few years for this to occur.



Posted by Dad-0 on Tuesday, March 03, 2009 at 2:46 pm

I'm excited! This is the kind of exchange of ideas I had hoped for when I began blogging. Hopefully we'll get many points of view—unfortunately several of those I can usually count on for insightful comments are travelling at the moment, including those with the Swiss and Japanese perspectives. I hope they aren't completely overwhelmed when they return. :)

Katie, I am honored to make your acquaintance. When I'm not busy being SursumCorda I'm better known as Linda. We, too, raised our children (though only two) on one income, and I can't say that the tax deduction made a significant difference in the affordability of that decision, though we were happy to take it.

I may be a citizen of the United States, but I feel just as much as you that "someone else is driving" and all we can do is hang on by our fingertips. I am not at all happy with the efforts of our government in these matters (beginning at least as far back as Clinton, including Bush, and certainly not excluding Obama) and greatly fear they will do more harm than good. In the Jefferson quote mentioned by Dad-O, the previous sentence is just as important: I place economy among the first and important virtues, and public debt as the greatest of dangers. To preserve our independence, we must not let our rulers load us with perpetual debt. We must make our choice between economy and liberty, or profusion and servitude. It is sadly amusing that Jefferson himself died deeply in debt.



Posted by SursumCorda on Tuesday, March 03, 2009 at 2:56 pm

Repairing and Restoring

Repairing and restoring the economies is a very tough question. My first perception was that the credit markets were frozen – and that TARP was going to be created to unfreeze them by buying up the black-magic mixtures of sub-prime debt that had value in the aggregate – but which were so opaque that each individual security was too risky to touch. That is not how things turned out. Instead the money was used to partially nationalize various businesses. (What else can government equity stakes in businesses be called but nationalization?)

Now there are various and voluminous plans to spend more money doing more things to get things going. Notice how many pronouns there are in that last sentence. That is the problem – solutions being proposed are vague and not inspiring of confidence. No confidence, no business expansion. Everyone hunkers down and waits for the other guy to make the next move.

Luckily all humans die. How’s that for a shocker? The good thing about it is that the younger generation grows up and has no patience for the incompetence of his fathers. He wants a life – so he starts to do business. He finds a way. With time a new system evolves – sometimes within the larger framework of the fathers, but sometimes in ways beyond the imagination of the prior generation. In the long (ten years or so) run, this is the way out. In the short run we have to hope that the Democrats’ use of the old, worn ideas of Keynes, used in the 1930s to no avail, work better this time. (It is great irony to me that Harry Reid is accusing Republicans of clinging to “old, worn ideas” when he and his party are going back to ideas so old and so worn that you need academic training to even know they are old and worn.)



Posted by Dad-0 on Tuesday, March 03, 2009 at 3:21 pm

How to keep it from happening again.

It is interesting to me how many times we hear the phrase, “So this can never happen again.” It is used as an argument for making a new law, or restricting a freedom; for putting someone in prison, or to death. It is a pipe dream. The Maginot line did not prevent another German invasion of France. This doesn’t mean some actions should not be taken – it is just to say that nothing can ever stop anything from ever happening again.
I would propose one simple solution to changing the incentives around sub-prime loans – make the issuers service the loans for a certain period of time – say three or five years – before they can sell them off to someone else. There also might be something done to make any kind of bundling more easy to disassemble. Transparency is needed in the makeup of securities. Information is the grease of verification – and Reagan was right to “trust but verify.”

Most important of all is to put any new proposals through the “eighth grade boy” test. This is a phrase I concocted when I was designing rules for games. Play testing by eighth grade boys is a very effective way of finding holes in the rules. They are old enough to read the rules, and their whole outlook on life is trying to find out how to get to the next level. Rules and regulations should be subject to the test in an attempt to avoid the worst of unintended consequences.



Posted by Dad-0 on Tuesday, March 03, 2009 at 3:37 pm

Dad-O asked:
“To help with further defining the question – could you expound on which parts of the Canadian health system might be considered private and which public?”

Well, my friend Teri and my friend Cindy are both family doctors in a nearby small town. Cindy is also Chief of Staff at the hospital and her husband Rob, also a GP, is the town’s only anesthetist.

Teri, and Cindy and Rob rent their offices, pay their receptionists, pay their nurses, and buy their supplies from their operating budget. They see patients and bill the Ontario Ministry of Health for these patients’ visits and whatever else they do for their patients. These fees are set by the Ministry; an simple office visit is so much, a full physical is so much, ordering a test, referring to a specialist is so much and so on. In addition, Cindy is paid as Chief of Staff, and Rob is paid for his services as an anesthetist.

While that may seem to be a system designed to encourage a patient-treadmill fast-in-fast-out kind of system, it doesn’t work out like that. Doctors are hard-working but well-paid, doctors are generally some of the better-off people in town. In addition, every time I’ve been to the doctor, the doc has enough time for me, I’ve never had the sense that I’m being hurried out the door.

I don’t pay for doctor’s visits, whether it be to a GP or to a specialist. My son is suffering from some mysterious illness (constant nausea and recurring vomiting, he’s 6’4” and 145lbs…) and has had innumerable doctor’s visits and tests over the last 18 months. All “free.” Some people abuse this system and go to the doctor or the Emergency department for trivial things, but many –most? - don’t.

There are private, user-pay clinics. These are typically for non-medically necessary services such as plastic surgery, laser eye surgery (ewwww!), and some diagnostic services, (I could have taken my wealthy sister up on her offer to visit such a clinic and they might have been able to do all the tests J’s undergone in the last 18 months in a day or so, and might have been able to figure out what’s wrong with him, but we never really got that desperate. It would have been $2k at least.)

As I understand it, it is not legal to run a private clinic offering medically necessary services. … Abortion neatly falls into the grey area there…some provinces allow private abortion clinics, other provinces don’t. (Dr. Morgentaler is suing his way through the provinces that don’t.)

Contrary to what the participants of some e-mail lists I’ve belonged to have claimed, the “STATE” does not tell me what doctor I must visit, nor does it tell the doctors what patients they must see. The “STATE” does not hire and fire or certify the doctors and nurses in the system. There is an independent College of Physicians and Surgeons for that (I can’t remember the name of the body that certifies nurses.)

I guess by your definitions this is “semi-socialism.”

And leads me to the question (I will answer your other points over the next few days) what’s wrong with socialized medicine? To me, it seems more responsible, more Christian-concern-for-my-fellow-man, and more efficient than a business-model health care delivery system. I have corresponded with so many women who worry about paying for health care for their children, only work –leaving their children in care – for the health coverage, only limit the number of children they have because of lack of coverage. I just can’t make it fit with what I understand of Catholic values. “I was sick and you cared for me.”

I just can’t imagine worrying about my children, my parents and my spouse like that – that something may go wrong with them and I wouldn’t be able to get them the care they needed.

On a lighter note, I can’t imagine how I would have coped with my four accident-prone boys! Some months we were at Emerg once a week!

I will answer your other points; it will take some time though. You've offered a lot to think about.



Posted by katie baker on Tuesday, March 03, 2009 at 8:31 pm

What's wrong with socialized medicine?

Good question. Here are some answers you might get from the average conservative American (presented from a somewhat more neutral viewpoint).

1. There's a fear that we won't have the freedom to get the care we need when we need it. For example, some government official could decide that a treatment that may save my life is not covered (too expensive). Of course, we already have that problem with insurance companies, but at least there's a possibility of raising the money some other way if insurance denies coverage.

2. There's a fear that anything run by the government will have poor quality or be inefficient because the system lacks proper incentives. For example, people would use resource they don't need if it's "free". Also, there could be a shortage of doctors if they are not paid well. On the other hand, a single system could avoid certain inefficiencies via paperwork reduction, bargaining leverage, and avoiding adverse selection.

3. There's a general fear of more government control over our lives.

4. There's an ethic of self-sufficiency, which says each one should pay his/her own way (rather than redistributing income).

5. There's a fear of higher taxes. The extreme of this considers taxation to be stealing. Higher taxes also mean more government control and less individual control (bad), and makes the economy weaker (less flexible, less efficient).

6. Pro-life advocates do not want to support abortion. If the state pays for it with our taxes, we have no choice. Currently, we can choose not to buy insurance that supports abhorrent practices (although excluding those does not leave many options).

7. In addition to the above reasons, the whole idea of socialism is vaguely associated with totalitarianism and the loss of freedom, which can get people to react with a lot a fear and anger without really thinking through the specific issue.

Did I miss any?



Posted by Peter V on Wednesday, March 04, 2009 at 10:15 am

This is not a complaint! - but the people here are too thoughtful. :) There's so much to think about I hardly know where to begin. I guess with health care, since it's such a big issue.

First, I am glad to hear from someone who likes the Canadian system, and who knows it from the doctor's perspective as well as the patient's. Here we hear mostly from the disgruntled refugees, such as the hospital nurse who said she fled the Canadian system because she felt she could no longer do her best for her patients. Or a friend, also a nurse, who observed medical care getting worse and worse; even with her specialized knowledge, both of medicine and of the system, she could not prevent neglect and delays from causing, in her (educated) opinion, her father's premature death.

Our family's only personal experience with Canadian medicine was wholly positive: This was many years ago—sometime in the 1960s—and we were on one of our Canadian camping trips. (Aside: I don't know what it's like now, but back then Ontario's Arrowhead Provincial Park was one of my favorite places on earth: clean, wild, and I've never seen so many stars!) My dad sustained an injury—I spilled a bucket of boiling water on his legs and the resulting burn was nasty enough to cause him to seek medical attention. He was well pleased with the care he received, and astonished that he was charged not one cent, even though he was a non-citizen tourist. On the other hand, his experience 30 years later with private medical care in Costa Rica was equally pleasant. He broke his ankle, and the whole process, from x-rays to cast, cost him $40; in this country the cost would have been 10 to 100 times that, and in his opinion could not have been any better. (You may be seeing a pattern here; my father experienced emergency medical care from Canada to Costa Rica, from Norway to China.)

It does seem odd to me that it be illegal in Canada to offer private medically-necessary services when unnecessary ones are allowed; one can endure a long waiting period for LASIK surgery, but for someone who needs heart surgery, paying for quicker, private care could save his life. We get plenty of Canadian "medical tourists" here.

Medical care in the United States worries me a lot. In my lifetime I have seen it improve...and then decline. We'd like to think that things will keep getting better and better, but that's not necessarily the case. I've seen childbirth, for example, go from barbaric to enlightened and back to barbaric again, to put it polemically. When I was born, penicillin was still in its heyday, effecting almost magical cures; we now have more antibiotics, but also MRSA. Polio was still killing and crippling people in this country back then, and smallpox a grave concern; certainly we've made progress on those fronts, but I'm not at all sure that the cocktail of vaccines our babies receive today is doing more good than harm. When I was little our doctor may not have had all the medical knowledge physicians do today, but when we were sick he treated us in our own homes; he knew us, our history, and our family situation, knowledge that often made up for lack of today's medical expertise.

The very best medical care I ever experienced came in the late 1970s and early 1980s, at a small family medical clinic in an inner city neighborhood in Rochester, New York. It served as a residency training program for a university medical center; medical care was given by a combination of nurses, nurse practitioners, residents, and senior physicians. This provided care from several viewpoints, which as a young mother I found very helpful. Even more helpful was the respect they accorded us: never before nor since have I had a doctor say, in response to my question, "You know, I was reading a paper recently that touched on that issue; let me make you a copy." They also occasionally provided information on what is now called "alternative medicine." Most times patients were seen in the office, but the staff knew their patients' families, occasionally made house calls, and were happy to consult by telephone. They listened at least as much as they talked, and I never felt rushed. Costs were not an issue: prices were reasonable, the clinic gave a certain percentage of medical care for free, and had very lenient payment plans for those with financial difficulties.

How I miss those days! I have not had much faith in medical care since. The changeover of the concept of insurance from one that covered extraordinary expenses only to one that covers nearly everything has sent prices through the roof, as has our litigation-happy society. Doctors cannot afford to trust patients who might turn around and sue them, and they no longer have enough time to listen well enough to develop trust, anyway. One friend of ours, a prominent and well-respected physician, quit his job because he no longer felt he could do it right, as the organization he worked for pushed him to see more patients in less time. Nurses have been telling me for several years of their frustrations: they became nurses in order to help people, but they, too, can no longer do their jobs well, being overworked, rushed, and understaffed.

So you see I am not setting up our system as a paragon, but I'm afraid that most of our society has lost the knowledge of how good medical care can be under a system that is not ruled by insurance companies and lawyers. In those days one budgeted for medical care just as one budgeted for food and clothing, with insurance to cover the unexpected, high-cost situations that would break anyone's budget. And just as with food and clothing, public and private charity was available for those whose budget could not stretch far enough.

It may be that we cannot put that genie back into the bottle, and a government-controlled medical system is our best recourse. Certainly our family had its fears during our period of unemployment, because doctors now charge cash-paying customers more than they charge insurance companies. We were healthy enough to get low-cost insurance during that time, but could we again? Yet I fear a government-run system, for many of the reasons Peter V mentions. The British system of socialized medicine is already showing us examples of care being denied people who are old or handicapped, for the very good, though inhuman(e), reason that the system can't afford it. Although I know that government theoretically can introduce efficiencies into a system, and sometimes does, I find it unlikely that adding more layers of bureaucracy, more offices of this and that, and more government employees will actually result in less paperwork. Ask anyone who has moved from his private employer-based insurance to Medicare. But I would be happy to be wrong about this.

As most of my readers know, I'm greatly in favor of freedom of choice. (Not license: I'm also greatly in favor of discipline, responsibility, commitment, self-control, and charity—limitations imposed by an individual on himself in the interests of community, family, or and his own health and sanity.) Democracy, though the best form of government I know, can become the tyranny of the majority when there is little or no freedom of choice in the important issues of life. Hence my strong feelings about home and private education, home birth and midwives, alternative medicine, small and organic farmers, the (un)availability of natural (unpasteurized) milk and juice, and the restrictions rampant litigation has imposed on our lives. I fear that socialized medicine here would bring still more harmful restrictions. Our dentist is not a "preferred dentist" by our insurance company, so they pay much less than if we went to a dentist with their imprimatur. Right now we still have the option of paying more to stay with her; would we retain that right under a socialized system? The wonderful Christian medical-sharing system that one of us belonged to (not insurance; members prayed for, encouraged, and covered the medical expenses of each other) would no longer be legal, if the examples of Massachusetts and Switzerland are predictive.

According to a friend who works for a Swiss pharmaceutical company, U.S. private health care is subsidizing research and production that benefits Europe, and no doubt the rest of the world as well. Because of this, Europeans do not see the true costs of their medical care, and may be in for quite a shock if the U.S. nationalizes its system.

Part of me would be more than happy not to have to fear unemployment more for loss of medical coverage than for loss of income. The rest of me cannot say, "If it ain't broke, don't fix it," because in many ways the system is "broke." But I would cry, "If it ain't completely broke, please don't make it worse by your efforts to fix it."



Posted by SursumCorda on Thursday, March 05, 2009 at 10:10 am

My only experience with the Canadian system is via my aunt, who is a professor of nursing at a university in Ontario. One point that she made is that there isn't any such thing as the "Canadian" system - the provinces are completely separate, though they may do things similarly in different instances.

She says that the system works quite well for her and her family, but only because of the connections she has through teaching. So, she can get fast care and seen by various specialists that would otherwise take forever, or be impossible for the average Canadian.



Posted by Jon Daley on Thursday, March 05, 2009 at 11:37 pm

Thank you Peter V for the list of reasons why one might object to socialized medicine. All but point 6 (about abortion) basically boil down to a fear of the unknown (and a mistrust of government to do right by you?) This is understandable, I suppose my questions about business-model health care are based on the same thing. I’m accustomed to simply showing my card at the doc’s office, I don’t know how any other system would work for me.

Your point about a fear of socialism becoming totalitarianism (point 7) nicely leads me into Dad-O’s discussion about mortgages, that I’ve been pondering the last few days.

First, of all, I’m shocked by the injustice of the practice of red-lining. I had never heard of such a thing!

Then when I thought about it a bit more, I was even more shocked to realize that this is what “P” from an e-mail group I belonged to had been talking about. (I eventually quit this email group because of my growing exasperation with their unwillingness to have the discussion we are having here; they just wanted to dismiss Canada as evil (socialist) and move on to rave about Sarah Palin some more…)

“P” said (I’m condensing) that the Democrats had pushed through a bill that forced banks to give mortgages to poor people, regardless of whether they were qualified or not. Banks had a quota of mortgages they had to hand out to poor people and if they didn’t, they’d be fined by the government, and have their licenses taken away. She went on to say that this was obviously a Democratic conspiracy to wreck the US economy so that the government could then step in and nationalize everything. (I can just imagine what she’s saying now!)

I was sure there was some other more rational explanation, I am glad to have some light shed on this. Thank you.

But the rest of what you say in that post, should, I think, be read in the light of the previous post about responsibility for one’s neighbour.(and yes, I’m going to keep using Canadian spelling…)

Mortgage bundling, re-configuring of CDO’s, de-regulation of banks are all pretty good examples of people (corporations are made up of, headed by and run by people) not showing a sense of responsibility for their neighbour!, don’t you think?
As are company managers making decisions that earn them a bonus this quarter rather than what’s best for the company in the long-term.
And companies and countries persisting with environmentally harmful industrial practices at the expense of neighbouring countries and the globe, and on and on,

Private charity is to be commended, but even the Church recognizes that it’s not enough, that’s why She encourages tithing and other things. “ As Sursum Corda said, “the desire to improve one's lot is a universal trait.” Human nature will tend us all towards taking care of our own interests first, often to the exclusion of the interests of others, or outright discrimination towards others.
Expressed as an equation, it’s something like Should / Human Nature = Usually Doesn’t.

To be truly just, and fair and charitable and loving towards the poor, our neighbour, we need something that, in effect, compels us to behave better than we might on our own accord. That, to me, is part of a government’s mandate, to ensure support, charity, and justice for the poor. (And yes this can be abused or get out of hand just as easily as anything else.)

Especially as we move farther and farther away from the Christian values that created our laws, governed our behaviour and inspired our nations in the first place…



Posted by katie baker on Friday, March 06, 2009 at 7:15 pm

Another problem, and possible solution.

Katie - thanks for another thoughtful contribution. Now I would like to point you to a web site where another thoughtful analyst posts compelling content. John Mauldin is an author and an analyst of the economy and money managers. I post a link to this week's note by him as he addresses a contributing factor in the continuing banking crisis (mark to market rules) and gives a possible solution. Also, at the end, he manifests an example of the American impulse to help thy neighbor without assigning that responsibility to a government bureaucracy. I hope it provides some insight. Link



Posted by Dad-0 on Saturday, March 07, 2009 at 8:15 am

Webmaster's note: If you don't see the content (or if it's garbled) after clicking on Dad-O's link, refresh the page in your browser. That's what I had to do.



Posted by SursumCorda on Saturday, March 07, 2009 at 8:27 am

Two points:

SursumCorda said:
'Our dentist is not a "preferred dentist" by our insurance company, so they pay much less than if we went to a dentist with their imprimatur. Right now we still have the option of paying more to stay with her; would we retain that right under a socialized system?'

Under a socialized system such as Canada's you can see whomever you please. I very recently decided to switch to a new family doctor. I'm very pleased with my new doctor and except for a $25 fee to transfer files, was able to accomplish the switch with no hassle or permission or paper work whatsoever.

Second point:
Relying on community charity to decide what is necessary and to help your neighbour when needed and to allow him to be self-sufficient when possible works in ideal situations only. This charity assumes that everyone lives in a community that has access to at least some wealthy people, mostly middle earners, and very few poor people. In a situation like this, emergencies can be very easily taken care of by the community. But what happens when you live in a community with zero wealthy people, very few middle earners, and mostly poor people. This model of relying on charity to care for those in dire situations, or even normal but costly situations, assumes that we all have access to charity. The reality, however, that there are many people who don't have access to that kind of charity. They don't live in communities that have a balance of wage earners. They don't live in the 'small town' of 100 years ago. Today's reality is that we live in highly stratified communities. For most of us, our neighbours are very similar in economic profile to ourselves. And while this model of charity would work very well for wealthy and middle earning communities, it would not work well at all for poor communities. In fact this model, and to a large extend, the current model in the US, exacerbates and deepens a community's poverty virtually ensuring that that community by and large will stay poor.

That is one cause of the gap between the rich and poor in the US that Katie has previously mentioned. In Canada, the poorest of the poor are much LESS poor that the poorest of the poor in the US. And the richest of the rich are much LESS rich that the richest of the rich in the US. Yes, we have high taxes and we redistribute wealth through taxation and social programs. But we also don't have such drastic differences between the rich and poor. And that is not to say that rich aren't very rich. One can still become very successful by hard work and ingenuity in Canada.

The Canadian system of taxation and socialized medicine accomplishes that 'community charity' model on a national level. It evens out those stratified communities differing access to charitable resources. Especially in times such as these, where it is possible that some areas of the country are struggling more than others, it ensures that everyone has access at all times to at least the basics of a healthy life. And for those who can afford more or better, they can usually purchase those extras with very little trouble.



Posted by tina darnel on Saturday, March 07, 2009 at 10:18 am

Thanks, Tina, for becoming part of the discussion.

I wish I knew more about Canada. A few glorious vacations, and living across the lake (in Rochester, NY) are not sufficient to give me any knowledge of the relative gaps between rich and poor, much less the causes. Do you know a website with statistics and/or analysis that you would recommend?

I'm not convinced (yet, anyway) that the gap between rich and poor is that easy to fix. I know a lot of poverty is that natural to recent immigrants, which is as it has been since the beginning of our country, and not that much of a concern unless their children fail to do better. I'm of the generation that saw a large immigrant population from Southeast Asia become absorbed into this country. Some did very well, becoming successful entrepreneurs; their children did even better, putting to shame children who started with many more advantages. Yet others, despite aid and support by government, private charities, and individuals, saw their families break up, their young girls become pregnant, and their boys get into trouble...situations all but guaranteed to perpetuate poverty. Whatever the answer—if any—is to the difference between these groups, it isn't a simple one.

I agree that community charity isn't sufficient if your community is small. Of course one neighbor helping another is the best situation, but private charity in this country is hardly limited to neighborhoods; it reaches across the country and internationally. I get quite annoyed when I read statistics that show the percentage of GNP (or some other measure) that various countries give to provide assistance to impoverished peoples, almost always accompanied by "look how badly the U.S. does in comparison to other countries." I am sadly prepared to believe that we do not do nearly as much as we should to help others, but any comparison that does not take into account the aid given by non-profit organization, corporations, and private individuals, (in all countries) is meaningless. Our five-year-old grandson sponsors (with his own money) and corresponds with a child in the Compassion organization. His contribution deserves to be counted at least as much as whatever percentage of my tax dollars the government passes on—and he has the advantage of knowing (or will, when he is old enough to handle such things) that his money is not funding abortions.

I am not kidding when I say I'm glad to hear from people who like the Canadian healthcare system, even if it means I can no longer use the "Canadian's don't like it" argument. :) Since it looks inevitable that we will be saddled with a similar system, it's good to know that it can work.

I'm still not sure about the dentist, though. You say you can see whatever doctor you want and switch with no paperwork. (As someone who hates insurance paperwork, I find that good news indeed.) However, if it's true what Katie says about it being illegal to provide private care for medically necessary services, I think my dentist would be illegal. (I'm only using my dentist as an example; think doctor if dentistry is not considered medically necessary.) She has chosen not to participate in our insurance company's "preferred" program—which supposedly holds down costs, but in my observation only drives dentists to doing in two visits what they would otherwise do in one, because the per-visit charge is too low, and to do unnecessary procedures. It seems that in Canada she (and we) could not opt out of the system and get what we consider to be better care.

My Swiss correspondents are back home now and I hope they will be contributing another viewpoint when they get out from under the mountain of work they returned to. Switzerland has yet a different form of national health care; I believe universal insurance is required, and government-regulated, but not government-run.



Posted by SursumCorda on Sunday, March 08, 2009 at 5:55 pm

I have another question for you patient Canadians: What is childbirth like in Canada? I may not like the UK's socialized medicine, but I love it that midwives and home births are supported and encouraged there. In the U.S. most births are over-medicalized (my spell checker tells me that's not a word, but you know what I mean), many of our midwives are being persecuted, and home births difficult or impossible to arrange.



Posted by SursumCorda on Sunday, March 08, 2009 at 6:58 pm

Dropping in via the link at conversion diary.

Childbirth in Canada is free. :)

You get a "provincial" medical card - this number is all you have to show for any medical services. All billing is done by the hospital/clinic and you never see it, or pay a cent.

If you don't have coverage through an employer, you pay medical premiums. This is about $250 for a family of 4-5, every three months.

I had only hospital births - all 3 were c-sections. All medicines, anaesthetics, etc covered. Recently my province (Alberta) approved provincial funding for midwives. I'm not familiar with the situation in all of Canada, but in Western Canada at least, home births/midwifery are covered. Since I was unable to deliver naturally, I never looked into contacting a midwife - but I know they're out there.

Coincidentally, many of the physicians in all my experience with Canadian doctors (I am 33) have been foreign-educated immigrants.

Nearly ALL the drs in my current city of residence are from South Africa.

We suffer from not having enough doctors to go around, and waiting in a "walk-in" clinic for 4-5 hours is not unusual.

Having said that, I don't complain. I try not to take our advantages for granted. I have a friend who has nursed in the Sudan. The stories she tells are horrifying and heartbreaking.



Posted by Cara Hoeppner on Monday, March 09, 2009 at 2:31 am
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