Freddie Hayek just got it so wrong, didn’t he?
That idea that a centrally planned, centrally controlled, centrally paid for, National Health Service would end up as being part of the Road to Serfdom.
My how we all laughed, eh?
The prediction running along the lines that such centralisation would mean that the population is managed for the benefit of the healthcare system. But that runs into the obvious point that we’ve had this system for 8 decades now. And they don’t tell us what we can smoke, eat or drink in order to save money on healthcare, do they? Nope, absolutely not, they continue to minister to our ailments without any hectoring - and obviously no banning or punitive taxation - as to what we do or how we ail. None of us are ever confronted by pecksniffs insisting that we must change our ways in order to save the NHS money. Good Grief no.
Britain is becoming a “national health state” under Rachel Reeves, with treatment poised to account for half of all public services spending by the end of the decade.
Analysis by the Resolution Foundation said the Chancellor was presiding over a “major reshaping of the state” that will pave the way for more tax rises after she boosted NHS budgets in the spending review.
The Left-leaning think tank said the health service was on course to account for almost £1 in every £2 of all day-to-day Whitehall spending by the next election. This is up from a third in 2010 and a quarter in 1999.
This is, sadly, inevitable. As we all know, it is markets and competition which impell productivity increases. Central planning doesn’t. So, a centrally planned healthcare system does not become more productive - that’s why the NHS is said to have its own inflation rate. It requires a 4% increase in real resources each year just to be able to stand still. Real GDP growth hasn’t been 4% in a year - other than lockdown rebound - since the NHS was founded. No, that’s not a causal relationship. Thus the NHS takes an ever larger bite of everything done by everyone each year.
As the Resolution Foundation notes we are now at the point that we’re a healthcare service with a state attached to it. Soon enough Britain will be a healthcare service with a population attached. Unless, you know, we actually reform it so that productivity increases?
Maybe we could try that?
Tim Worstall