“The welfare of the masses is always the alibi of tyrants.”   Albert Camus

Reading an article in our local paper this morning by Jay Marks, I was struck by the similarities of the arguments of those proponents of Medicaid expansion and those who are pushing more ethanol use.  Marks explains:

“Federal requirements are forcing refiners to produce growing amounts of fuel blended with ethanol, endangering the supply of pure gasoline in the central part of the United States, including Oklahoma.”

Later in Marks’ article, he quotes an academician (Dermot Hayes) from Iowa State University, an ethanol proponent (big surprise he is from the corn state of Iowa!):

“It is as if the U.S. oil refining industry had found a way to extract 10 percent more gasoline from a barrel of oil.  This additional fuel supply has alleviated periodic gasoline shortages that had been caused by limited refinery capacity.”

Let’s translate what we know so far:

Rather than produce an amount of a gasoline product that matched consumer demand, the government is forcing refineries to produce more of a gasoline product for which there is less demand and less of another for which there is a greater demand. 

Furthermore, there is no mention that cars operate less efficiently on ethanol fuels than they do on pure gasoline.  There is also no mention that it takes more than one gallon of gasoline equivalent to produce one (less efficient) gallon of ethanol.   The actual numbers are this:  3 gallons of gasoline are needed to produce 4 gallons of ethanol, which is 1/3 less efficient. Hmmm.

Why not leave the market alone?   Murray Rothbard helps us by backing into this insanity with the question, “Cui bono,” or “Who benefits?”  Who benefits from this government intervention, other than the politicians who were bribed to make this happen?  And shouldn’t we give some attention to what is “not seen,” those individuals who are harmed by this intervention, those who must replace non-ethanol burning automobiles before their time and how about those who have starved because the corn they would have eaten was diverted to this less utilitarian purpose? Or those who find food more expensive because the grain is being used to produce ethanol rather than feed livestock?

I believe the same sort of dynamics play out with Medicaid and its expansion.  There are lots of folks who benefit from Medicaid, just not the poor.  Big hospitals, big pharma, big insurance, you know… the usual suspects.   And just as no one is pointing out that more efficient gasoline must be wasted in order to produce ethanol, few point out that in order to receive the Medicaid expansion money proponents are so anxious to get their hands on, a prior robbery of hard-earned dollars must occur.  Always remember that the government has no money of its own.  It must rob wage earners of their money in order to have any thing to pass out to the cronies. 

Isn’t this Bastiat’s “What is Not Seen?”  all over again?  The damage that must be done to produce the “benefit” the Medicaid expansion crowd claims, needs to be spotlighted a bit more, I think.  It is easy to point to the beneficiaries of any government intervention.  It is a bit more difficult to showcase the widespread victims of these same programs, even though more damage is done to them than any possible benefit can be claimed for the “winners.”  Just as with the push for ethanol production, those proposing an expansion of Medicaid tell us that it is for our own good.

 

G. Keith Smith, M.D.

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