McArdle makes a good point about the two concerns which are often tangled up in all kinds of conversations about transfers, that is
In discussing the morality of a single-payer system, those efficiency considerations are irrelevant. In discussing the morality, one thing matters1: who is made better off, and who worse off, by the system?Basically, rather than caring about whether the problem is solved, the morality aspect looks at whether we should (normatively, morally) task the people subsidising the system to pay for those being subsidised. And in my personal capacity I think it's useful to consider, for all kinds of government-mandated transfers... including particular annuity payments.
I liked three particular points:
1. Anecdotes are pointless
A gigantic single-payer system is a pretty blunt instrument; it transfers money from one group, the young and healthy, to another group, the old and sick. It does not distinguish much more finely than that between the deserving and undeserving within that class. This is why discussions of particularly deserving or undeserving people within the larger class, such as your fine old Uncle Bob who served his country in two wars before becoming a minister, are irrelevant; as with the surfers and taxi drivers, almost any class we can specify will contain some very worthy members who deserve more from society than they have gotten. What we need to know is whether the class of old and sick people as a whole are much more deserving than the class of young and healthy people; whether our transfers do more good than harm.
Anecdotal arguments are just so... ew. Both sides will be able to point to their favourite anecdotes, ignore the other's point, and come out with a moral victory and no agreement.
2) Risk pooling is a morality argument (and not an efficiency one)
She quoted someone else:
If you're healthy, a world in which Giuliani's plan was law would be a world in which it was economically foolish of you to purchase high quality, comprehensive coverage. And that would be fine -- for the healthy individual. But insurance works based on risk pooling. If our hypothetical 23-year-old only uses $10 of health care a year, but is now paying $80 rather than $100 for his plan, that's less money that can subsidize someone with a chronic illness.So what's the problem with not pooling? It seems that the problem is that someone else is not being subsidised, not that risk pooling makes the system more efficient...
3) How do we determine if those being subsidised deserve to be subsidised by the paying group?
1. They are needy. The class we propose to benefit has greater need for the money than the class from whom we propose to take.
2. It's not fair. The class we propose to benefit has been unluckier than the class from whom we propose to take.
3. They are responsible. The class from whom we propose to take has in some way contributed to the problems we are trying to rectify.