Out on the health-care stump in Pennsylvania today, President Obama talked up the importance of competitive markets:
He continued, “An insurance broker told Wall Street investors that insurance companies know they will lose customers if they keep raising premiums. But since there’s so little competition in the insurance industry, they’re okay with people being priced out of health insurance because they’ll still make more by raising premiums on the customers they have. And they will keep doing this for as long as they can get away with it.”
Or until someone with common sense allows people to cross state lines to purchase insurance. But that would break the self-replicating chain of big government, so it’s not going to happen.
Here’s what always does happen: Democrats use disasters brought on by regulation to justify further regulation. Restraining insurance companies won’t be the last step in that chain, of course. When government-imposed price caps suck the incentive out for insurance providers, lawmakers will go on TV wielding a report about how underserved the insured have become. This will justify new guidelines for what providers will then have to offer. It never ends.
We saw this with the housing boom and bust. Government-imposed equality of ownership distorted the market. The follow-up disaster demanded — what else? — government-imposed regulation. Wealth redistribution is the gift that keeps on taking.