Wednesday, October 5, 2011

The High Price of Hidden Costs


Many policy experts and economists think it’d be far better if people knew the cost of health care, if they were aware what their full, employer-sponsored premiums cost, etc. I agree. Transparency is the right way to go.
But make no mistake, people will be annoyed. No, that’s not right. A $5/month debit card use fee is annoying. Suddenly learning that your income is lower than it would otherwise be by $10,000 because of your “employer-paid” premium is not annoying. It is enraging.
What will Americans do when they finally recognize the full cost of health care?....I think many people will be furious at how much of their paychecks are, effectively, being piped into the pockets of health insurers, health care providers, drug manufacturers, health IT gizmo creators, massive radiology machine developers, other device makers, and government programs. Some will think the return is worth the price. Many will not, particularly those who think insurers are wringing them dry.
Once you start thinking about it, you'll be surprised at just how addicted we all are to hidden costs. There are all the hidden bank fees, of course, which become enraging when they turn into transparent fees and we realize just how high they actually are. There's the hidden cost of healthcare that Austin points to — hidden because, in the American system, employers pay for most of it and most of us never really realize just how much we're really paying.
 Read more at : http://motherjones.com/kevin-drum/2011/10/high-price-hidden-costs

There are hidden taxes, too. If we want to reduce greenhouse gases, the single best way to do it is via a carbon tax. But that's transparent and produces a gigantic political battle. So instead we end up with direct EPA regulation, something that every economist in the world agrees is less efficient, less effective, 

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