Socialism vs. Insurance Industry

[XNASA]

What the difference?

Is the Insurance Industry just Privatized Socialism? Is 'Privatized Socialism' an oxymoron?

Why is it that every free market righty I've ever met would never consider going without auto or health insurance?

Please help me to answer these burning questions.

Thank you.

[redqueen]

1. hehehehehe

:loveya:

[Burma Jones]

2. It's socialiam "with a purpose"

The purpose being to make a few people REALLY REALLY rich and provide drone jobs for millions.

[GreenPartyVoter]

4. That sounds about right

[ProfessorGAC]

3. Easy Answer

Because the free market righies you know are dumbasses. Of course, they wouldn't go without insurance. But, they wouldn't know socialism v. capitalism, in pure and technical terms, if both were snakes that bit them. Too stupid, and too wrapped up in their own little simpleminded visions.
The Professor

[XNASA]

9. Ahhh. I see.

Of course, I should've put it together from the start. The free market righties I know.....are ALL dumbasses.

Makes sense now.

It's just something I've wondered about. One time I stopped a verbose freeper at a getogether by insisting that he cancel all of his insurance policies in the 'spirit of being a true free market Murkin'.

He just kinda looked at me with the head-tilting gesture of a confused dog.

[ProfessorGAC]

13. That's Pretty Funny!

Good one to disarm the freeper! Let me say this about the ALL dumbasses thing!

I have been in the economics community since the mid-1980's. I have NEVER heard one person with expertise in some area of economics or econometrics use "free market" as a weapon. NEVER!

To me, the use of the term is a sign that they are clueless dweebs who understand nothing about economics, including what is required for a market to be a free market.

So, if they use that term, they are dumbasses. The use of the term proves it.
The Professor

[denverbill]

5. Effectually, many govt programs are like insurance.

And some, like flood insurance, crop insurance, etc, are even called insurance.

Look at unemployment (I think it's even called insurance as well). Everyone pays in, knowing that they could be the next victims of unemployment, just like their house could be the next one to burn down. Same thing with food stamps, AFDC, Social Security, Medicaid, and any other govt social program.

What Republicans are saying is that they want to go without the Social Insurance, because they figure they'll never be the 'victim'. Of course, they will immediately become the first ones to cry if they ever lose their job or their life savings are eaten up by some major event.

[sui generis]

6. not quite

the insurance industry is a profit industry. In a perfect insurance world, they would only insure people who statistically have no chance of ever filing a claim, and simply collect their premiums forever.

Socialized medicine (excuse, "Universal Healthcare") is quite different in concept -- although everyone would pay something into it, it would also be much more difficult to deny someone coverage as a "high risk" (ever smoked a cigarette or lived with a smoker? You are a high risk) or drop someone from coverage for filing a claim as private insurance does all the time.

I personally don't think that we need socialism in it's pure form at all, but we do need to determine what the priorities of government are when it comes to the basic health and welfare of the people whose tax dollars pay for it. You can have the best of both worlds.

[XNASA]

12. Agreed, but..........

Why would any free market righty want to contribute to a fund? Isn't that the complaint they have with....Taxes???

It's 'their' money. 'They' earned it. They seem to be saying that they can manage their money better than anyone else...so that would include insurance companies as well....Right?

If they hit someone with their car, they should pay the whole price. It was 'their' fault. They claim to be able to fend for themselves, yet....their participation in an insurance policy would seem to me, to be at odds with their basic philosophies.

:shrug:

[Kanary]

7. "Privatized Socialism" is what I've been thinking......

You came up with a good title...... it's time to make this a widespread chant.

Let the truth ring out. :)

Kanary

[whistle]

10. Maybe more like "Privatized Non-Accountable Socialism"....

...afterall, insurance companies can withdraw from their obligations anytime they wish or raise the anti when they see their risk going out of control, thus forcing millions to go without insurance (many Florida homeowners after Hurricane Andrew could not get insurance). I think the insurance industry operates much like Las Vegas gambling, the odds are with the house all of the time. Look at insurance company stock prices and profits. They are doing pretty well.

[XNASA]

14. OK, so the lesson with Hurricane Andrew would be.....

Don't live someplace where a hurricane might possibly occur, or....

If you're gonna live someplace where there might be a hurricane...be prepared to suffer the consequences. Right?

If I have a homeowners policy with 'Acme Insurance' and live in the Midwest, yet hundreds of 'Acme' policy holders in Florida make claims because of hurricane damage....won't my premiums go up eventually? Why?

If that's not socialism, I don't know what is.

[Skarbrowe]

45. John Stossel and ocean front property

John Stossel, the guy who loves to point out all the "ridiculous" center to leftist ideas, once did a segment on how taxpayers get stuck paying for houses built on the ocean that are constantly being blown down. He was very sarcastic in the fact that HE owned a home on the ocean and his house had been damaged AND he used the government funded insurance to rebuild. At least he was honest in saying he wanted a house on the ocean and if the taxpayers had to pay to rebuild his house, so be it. Strange.

I've lived a few miles from the ocean for seven years now and the first time a hurricane knocks down the house I'm living in I'm moving to New Mexico. At least there, all that can get me is drought, tornados, giant tumbleweeds from the many sandstorms, and possibly that pesky little rumor about Yellowstone's super volcano.

Wait, do I want to go by water or by a few feet of ash? Let me rethink this.

Skarbrowe

[trackfan]

8. I've been saying this for years - absolutely correct.

[Commie Pinko Dirtbag]

11. False dichotomy

I'll have "sensible regulation for the general welfare" for $50, please.

[leftyandproud]

15. involuntary participation vs volutary

lets be honest

[XNASA]

16. Exactly the point!!!

Even though 'insurance' is supposedly voluntary.......how many free market righties would dare to go without it? How many would dare to be without health insurance, or homeowners or auto????

BTW-There's nothing voluntary about auto insurance in Illinois. You either have it.....or you are penalized if caught without it.

[shimmergal]

32. Yes, and you can't go without homeowner's insurance either

unless you own your home free and clear. The mortgage holder makes you carry insurance. Not to mention the additional, private mortgage insurance you have to carry if your equity doesn't amount to 20% or more of the house's value.

In a _real_ free market, shouldn't the mortgage company assume that risk (that you'll default) for themselves? Esp. considering all the questioning they put you through when you apply for a loan?

[sandnsea]

26. It's mandatory

You have to have auto insurance in almost every state, if not every state. You can't get a loan on a house without homeowners. Or a car. Health insurance isn't mandatory and the funny thing about it is it's the only insurance that protects the person holding the insurance more than an outside corporate industry. Maybe the health care industry needs to become more powerful in order to make health insurance a mandatory law so that everybody has to have insurance and can then fight for regulations so it's affordable.

[Cleita]

17. Another thing that was brought up on the Randi Rhodes show

yesterday was that countries like Denmark and other Scandinavian countries put their tax revenues into social programs for the benefit of their citizens, not on wars like we do. In order to change the privatized health care we have into this country into national health care, we have to pass laws that would make it unprofitable for the insurance companies. For instance making them insure everyone for the same premium regardless of their health history would accelerate their getting out of the market.

As far as other kinds of insurance, like car insurance, I think privatization is all right. Here, you buy into insurance in case you have an accident. You aren't planning on one, so in this venue insurance works fine as a safety net.

[leftofthedial]

18. on the flip side

Soviet "Communism" was actually state capitalism.

Go figure.

[Loonman]

19. You don't have to beg and plead and fill out forms with socialism

They just hand stuff to you.

[Kanary]

20. Lots of good input here..... take it further.....

How 'bout combining all this into some coherent form, brief as possible and to the point, printing it out on our trustly computer printers, and leaving in places, like........ oh, how 'bout drs offices.......where people will read it, while looking for magazines, and maybe, just maybe, Do Some Thinking.

Since we don't have a press anymore, how 'bout taking this up on our own?

Anyone ready to start?

Kanary

[PROGRESSIVE1]

21. .................

.

[Kanary]

22. What's with the empty posts today?

cat got your tongue?

:)

Kanary

[muriel_volestrangler]

23. Everyone seems to be confusing government social programs

with socialism. Socialism involves the ownership of enterprises by society, rather than individuals or corporations who already have the capital.

So there's all the difference in the world between the insurance industry and socialism.

[Kanary]

24. not in how it plays out

same/same

[XNASA]

25. That may well be.....

But in reality, there's not much difference to the end user.

You take your money, you place it in a large pool or fund for the mutual benefit of everyone participating.

:shrug:

[Kanary]

27. And the rich put their fist in that large pool

and take out a huge share of it.

It's pretty obvious.

Kanary

[muriel_volestrangler]

28. So if the government owns the local car manufacturer

that's the same result as the private insurance industry, is it? Can you explain this to me please. I can't see it.

[Kanary]

30. Bwahahahaha!

Nice red herring.

But, no dice.

Maybe you could see it, if you were to actually *read* what is being said.

Kanary

[muriel_volestrangler]

42. definitions of socialism

1 : any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods
2 a : a system of society or group living in which there is no private property b : a system or condition of society in which the means of production are owned and controlled by the state
3 : a stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done

Can you see any mention of sharing risk between people there? I can't. That's why socialism and the insurance industry are different. Socialism would include collective ownership of the insurance industry, but it also means much, much more.

It's not whether I've read what's been said in most posts - it's a matter of replying to the actual question asked.

[XNASA]

31. Manufacturing and insurance are quite separate industries.

It's like comparing apple and oranges.

So in that case, I don't see it either.

But, if part of your tax money went into a state run manufacturing venture (cars for instance) and the government was able to either guarantee you a free, or at least very affordable car every now and then....then there isn't much of a difference.

As long as your pooling resources with others, it's a form of Socialism, no?

[muriel_volestrangler]

43. No, pooling resources isn't a form of socialism

if it were, then companies quoted on the stock exchange would also be a form of socialism. Especially if you're going to capitalise it, you have to use an accepted definition of Socialism, not just a fuzzy 'people working together' definition.

Insurance is about managing risk by pooling resources - risk of accident, bad health, dying early, or (in the case of pensions) dying late.

[XNASA]

44. Good point. Pooling resources is not necessarily Socialism.

How about mandatory pooling of resources as mandated by the government, either local or national?

[muriel_volestrangler]

58. Yes, that seems closer

a right winger may say it's the mandatory aspect that annoys them. I'd say that where there is a case for compulsory insurance, like cars, then the insurers need to be tightly regulated, if not government-run. This is like natural monopolies, such as utilities.

Of course, if you take your definition of socialism as one where peronsal wealth is allowed, you could still allow people to opt out of government-run insurance programs, if they wanted. They would just be risking that the money they earned would be enough to see them through any bad times and their retirement. But they wouldn't be able to invest their money for retirement - maybe lend it to the government, I suppose.

[Jim Warren]

29. Socialist bookmakers

Insurance companies are some of the world's best oddmakers.

When they win, they privitize their profit.
When they lose, they socialize their loss.

[Just Me]

33. This is a really interesting thread.

I'm printing the whole thing out so that I can reflect some more; and then, reach my own conclusion.

However, I am already leaning towards a view that insurance is merely a modified form of socialism, putting huge profits in the pockets of corporatists who essentially control our government.

[Kanary]

34. Your conclusion, that you're leaning towards, is on target.

People are so conditioned to freak at the very term "socialism" that it clouds visions.

Kanary

[XNASA]

35. Wow. 3 Years, over 6000 posts...........

And I think that this is the first time that a poster has referred to a thread that I started as being "Interesting".

This calls for a Bookmark Party!!!!!!

[Kanary]

37. Not just "interesting"..... ON TARGET.

Stuff that in your bookmark!

:toast:

BTW, has anyone said "Welcome to DU"? ~~chortle~~

Attacks come fast at DU, and compliments few.......

Something to learn there.....

Kanary

[XNASA]

39. I'm known to spend most of my time as a DU Lounge Lizard these days.

I don't venture into GD that much anymore. And if I do, it's usually something abstract.

[Kanary]

46. Probably wise, and safer.....

But, then, I wasn't one of those who found the "lounge" to be warm and cuddly.

To each their own, eh?

At any rate, this post was great!

Kanary

[mvd]

47. It's a very interesting topic

Another kudos from me. :hi:

BTW, you are right that socialism doesn't rule out profit. As I said, a lot depends on your perception of socialism.

[mvd]

36. Yep, it's too much about profit

I see insurance companies as they currently are as a part of capitalism, with the courts used as a check on power - just with other things. The decisions are usually ultimately made by the executives.

[XNASA]

38. Does Socialism necessarily rule out making a profit?

I think we can all agree that Insurance Execs are raking in billions of $$$$$$$$, but the point I'm trying to make is, from the POV of the End User, of the person paying the premiums, or the insurance carrier themselves.....

What's so different between insurance, and socialism?

So far, no one has been able to explain the difference.

[mvd]

40. When I think of socialism..

I think the person getting the insurance would be the most important. I really don't think insurance as presently given really has the recipient as most important.

[Kanary]

41. Of course not. Plenty of countries have proven otherwise.

But, we brave Murkins just shake in our boots at the thought.

And continue to merrily let people suffer the consequences.

Kanary

[wadestock]

48. The government doesn't "own" the insurance companies....

which means by definition that they are not a socialist institution.

But your point is that in the screwy world we live in today....we see insurance rates often controlled or affected in some way by the government...for whatever reasons.....which often involves capitalistic motivations....but could be in reaction to public pressure.....therefore there is a possible analogy between such services and government control.....or loosely.... socialism.

But please don't get into the trap of names....leave that to the neocons....who would tell you that ANY social programs or engineering leads us down an irreversible slippery slide to pure socialism...which is then just one short hair removed from all out communism.

We spend a LOT of money on social programs...more so than any nation in the world.....but we are not a socialistic state...we just don't know how to spend our money wisely. Money simply goes to people who don't really need it...that's the bottom line.

Insurance is an example of a service to the public run in a capitalistic environment which has not benefited or solved its problems from competition and profit making. One could argue that certain controls might improve the situation.

You could think of it this way. We are VERY bad capitalists when it comes to social programs. The businesses and the people are both crying....it just isn't anywhere near where it should be in terms of design. Perhaps the problem stems from applying classic "profit making" models rather than considering "sound business opportunities" for social oriented businesses.

I fundamentally believe that the inherent "technologies" of insurance companies has to be changed. We know the core technologies are statistics....but these have been manipulated to produce profits....not to see how efficiently and effectively services can be provided. Any insurance company which might advertise a "new way" which yields such a better overall result for its customers....with statistical proof of it...would surely get more people to sign up.
When you think about it....the entire design of insurance right now really doesn't produce legitimate competition in terms of the real services that are provided. If anything...such technologies might be used to con you for a while...get you into a certain pool of people...and then pull the rug out from underneath you.

We are truly a modern society in terms of medicine and other technologies....but back in the dark ages when it comes to social engineer. It's so bad it begs for some incremental step forward. For instance, social security stinks in terms of getting money to where it is really needed....and should be abandoned as a means for people to supplement their retirement....and actually be converted to a true "social insurance" for housing if one meets strict means testing and actually is out of a dwelling in their retirement years.

The list goes on and on and is not fixed by calling one thing or another....it is fixed by doing some SMART social engineering and backed by respectable companies that can participate in a program without raping it.

I believe that we have to truly evolve the "technology" of social engineering to make it capitalistically sound and to carefully monitor the dynamics of what is happening and be prepared to (dare we admit it) change it for the better. I'd like as a start to see some smart people look at the problem and recommend some real "technology improvements". This could conceivably start in think tanks and could become part of an organization analogous to DARPA for weapons development. We can fully endorse the notion of spending all sorts of money on weapons research or sending someone to Mars for billions of dollars...yet we can't seem to find a way to efficiently apply human endeavor to cut the total cost of social programs....yet yield much better services.

The ultimate irony of this is....
Truly sound social programs could be designed effectively using a capitalistic environment if only we had the brains to do it.

[XNASA]

49. True, the "Government" doesn't own the Insurance Companies.

I guess I was trying to approach this from the other side.

To a person who pays for his/her insurance....isn't it Socialist in nature?

So by definition....no, the insurance industry is not socialist. But in practice, it is....is it not?

Therefore, why do Repugs (pardon my French) go apeshit over having to pay taxes.......but don't seem to mind paying insurance?

FWIW, I don't mind paying for insurance. It makes a lot of sense to me.

[wadestock]

52. OK....I'm a bit more in tune with your question now.....

Yes....a repuke/neocon would actually adore having all sorts of insurance....this is true and an interesting observation....

And yes....the essential mandate to HAVE insurance (let's not argue the details why) means that insurance does takes on a socialistic characteristic.

In other words...if we had "true capitalism" (providing us really good choices of products/services) as well as "pure capitalistic choice" (to buy what we want for whatever needs we deed appropriate)...then you would find a much different animal out there and see the insurance industry tending to shed its "socialistic" qualities.

But your point to your neocon friends is very well taken. I'm sure the way they resolve the issue to convince themselves they are spending their money wisely goes something like this....

a. They want the insurance in the first place...because they like the protection....they are basically fearful of people taking their stuff in the first place.

b. Insurance companies make money...generally have a lock on markets till the cows come home....so they can truly respect them in terms of their "business savvy".

c. Neocons generally believe in Adam Smith's "silent hand" which guides our capitalistic system and all its dynamics....and they truly believe that as long as you have a capitalistic "free for all"...then things will eventually work their way out. The fact that 1% in this country are clearly pulling away from the middle class and taking with them an astonishing amount of profits that could be much better spread into the middle and infrastructure is of no concern to them....because of this fundamental belief. In essence....they stare right into the face of the devil and see all this outsourcing or "selling of America" as part of really smart business deals.

I have a number of neocon friends and they really do follow this overall pattern. They can get stiffed in a business deal....or lose a lot of money because they took some ridiculous risk and generally brush it off as if its just one bad hand in a long term poker game. You could admire them for their work ethic in many cases....but their ultimate downfall is their inability to see a better way of doing business....which actually does support capitalism and the people within the system.

In short....they are the wheelers and dealers....and not the innovators in our society. The worse part of it is they have evolved to be today's managers and corporate leaders and they're literally running our capitalistic system into the ground.

[Wapsie B]

59. "The government doesn't "own" the insurance companies"

But insurance companies by virtue of their campaign contributions and lobbyists own the government. Or at least a large chunk of it.

[rman]

50. corporations are not elected, have limited accountability

"What business is it of the corporations to decide what is socially responsible?
That isn't their expertise, that isn't what their stockholders ask them to do. So i think they are going out of their range. And it certainly isn't democratic."

Quote from "the corporation".

I'd say it is for society to decide what is socially responsible, that's what the democratic process is for.

Corporations, or more accurate, the individuals who run corporations and the stockholders, are a unelected minority. There are no formal agreements between them and the people regarding their influence on society. There is no such thing as a corporate constitution that protects the rights of the people, rights to which people had previously agreed.

It seems that society isn't happy with the fact these individuals in effect run the place, and they certainly do want to own just about everything.
Todays reality is that things like rain water, genes and indeas - things that were once thought of by society as "commons" - are being claimed as (intellectual) property by large corporations. And the push for more privitisation and globalization is continuing.

In my opinion any government supporting global privatisation of everything on request of corporations and in disregard of the people, is making a mockery of democracy.

[leodem]

51. How do you all feel about..

states making auto insurance mandatory by law? This is always a frequent topic with friends (most who are poor and can't afford it even with clean driving records). I'm in Maine and our neighbor NH doesn't require auto insurance by law, and I haven't heard of any other state that doesn't require it also.

[porphyrian]

53. Insurance Is Mandatory State-Supported Organized Crime - n/t

[StopThief]

54. The simple answer to your question is. . . .

that "free market righty(s)" analyze insurance on a risk vs. reward basis. Although they are aware that in the long run insurance is a losing proposition, they make the judgment that the risk involved with being uninsured is too great to take. They are willing to pay an affordable cost every month to ensure that there will not be a sudden unaffordable cost that will wipe them out financially.

The paradox is that insurance is really the proper choice for all parties involved. It is worth it to the purchaser for the reasons described above. It is worth it to the insurer because the number of policies written allow for the statistics to bear out and for a profit to be made.

[XNASA]

55. Risk vs. Reward Basis..

The same can be said for taxes, or what a free market righty (FMR)might call 'Socialism'. In the long run it's a losing proposition. But....

The same goes for insurance.

I understand the angles. I just don't understand why a FMR thinks that taxes are bad...and insurance is good.

Guess what I'm really trying to do, is point out the hypocrisy.

[StopThief]

56. If you could point out to a . . . .

FMR the risks of lower taxes, they might change their POV. My guess, though, is that they would assume that lower taxes would not affect the government programs that "keep them safe" and would therefore not change their attitude.

[StopThief]

57. The other point they would probably make. . . .

is that they do not have the opportunity to make the choice on taxes that they have on at least some forms of insurance.