Special Announcement: Today at 3:30 pm ET, Rick Rule will interview me on my magnum opus book “The Structure of Production,” and how to apply my “stages of production” approach to investing and analyzing the economy. “Structure” introduces gross output (GO), as the best, most comprehensive measure of the economy. Rick Rule, who is the world’s top expert on mining and energy, considers “Structure” his favorite academic book of mine and feels it is especially useful to investors. To watch the interview, go to Rick Rule Live with Dr. Mark Skousen
“If you are not healthy, you are not wealthy.” — R. E. McMaster (“Maxims of Wall Street,” p. 141)
“We squander health in search of wealth,
We scheme and toil and save,
Then squander wealth in search of heath,
And find at last a grave.” —Henry Winn (Maxims, p.21)
The assassination of the CEO of UnitedHealthcare last week was a wake-up call to the healthcare crisis in America and the critical role business plays in our lives.
The words “deny,” “defend” and “depose” were inscribed on the bullets that killed the CEO.
It turns out that UnitedHealthcare, the country’s largest medical insurance company and a member of the Dow Jones Industrial Average since 2012, has the highest incidence of avoiding paying claims (refusing an estimated one-third of claims submitted).
And yet, its profit margins are thin, less than 4%. (HCA, which owns hospitals, has a profit margin over 8%.)
The major media ran horror stories of individuals who had been denied claims by UnitedHealthcare and other insurance companies. As one person said, “I’m an ER nurse and the things I’ve seen dying patients get denied for by insurance makes me physically sick.”
On a broader level, consumers are facing additional challenges — dramatically rising medical and car insurance premiums. Billboard ads of personal injury attorneys are proliferating, resulting in even higher premiums.
Not surprisingly, the insurance industry and the new Republican controlled Congress are likely to pursue changes in the law to resolve the growing conflict between customers and insurers.
Here’s One Solution: Look to Singapore!
Our leaders can often learn a lot by seeing what other countries are doing to resolve their healthcare crisis.
Look no further than Singapore, which is now ranked the #1 country in the world in the Economic Freedom Index.
They have the best healthcare system in the world called Medisave, which includes market incentives to satisfy the needs of consumers, as well as for-profit businesses.
As a result, Singapore spends only 5% of gross domestic product (GDP) on healthcare versus 18% in the United States. It also has the highest life expectancy in the world (84.5 years).
The U.S. Medicare and Medicaid programs, as well as private insurance companies, could learn a lot from this city-state.
The Medisave program is universal, covering all citizens. Catastrophic insurance is automatically covered by the government, while the remaining expenses for doctor visits, prescription drugs and basic surgeries are covered by private Health Savings Accounts (HSA). HSAs are co-financed by employers and employees. HSAs and deductibles encourage consumers to shop around and minimize the costs of medical help. Disputes are rare, because you are paying out of your own pocket, rather than relying on an insurance company to pay for routine medical expenses.
Want more information?
I highly recommend Sean Flynn’s book about Singapore’s program: “The Cure That Works: How to Have the World’s Best Healthcare — at a Quarter of the Cost,” available on Amazon.
‘Best Brief in Economics I’ve Ever Read’
I highlight Singapore’s Medisave plan in my 15-page essay, “Economics of Life Made Simple.”
In this essay, I offer the most effective solutions to our economic problems — the medical crisis, inflation, inequality, global warming, wasteful government programs, education and the business cycle, among others.
Last year, Michael Shermer commissioned me to write a cover story, “Economics of Life Made Simple,” in honor of Adam Smith’s 300th birthday. It’s been a hit ever since, with hundreds of people buying multiple copies.
For example, David Berkovitz, who teaches business law and accounting, recently told me, “Mark, I always wanted to understand economics, so I read ‘Economics for Dummies,’ and still couldn’t understand it… until I read your essay, ‘Economics of Life Made Simple.’”
The next day, he wrote me the following burb: “Concise and clear, this essay is THE source for anyone seeking to understand this important topic. It should be required reading for everyone in the college.”
In this essay, I tried to answer fundamental questions about money and the economy, such as: What is the secret to our tremendous economic growth over the past 250 years?… Why are young people so attracted to socialism?… Why is inflation coming back?… Is capitalism inherently unstable?… What is the economists’ solution to global warming? It also includes a section on gross output (GO).
I’ve had so many requests for this article that I printed up 5,000 copies and sent them to friends and handed them out at various conferences. A professor at the University of the Bahamas bought 50 copies to hand out to his students. A coin dealer asked for 25 copies to hand out to his clients.
A highly successful lawyer from North Dakota attended FreedomFest and picked up a copy. He told a colleague, “This is the best brief in economics that I’ve ever read,” and made copies to send out to all his clients.
One Christian minister, Dallin H. Oaks, wrote, “I have just finished reading your ‘Economics of Life Made Simple.’ Marvelous! I have never read a better expression by a sophisticated professional who has written to the clear understanding of laymen. Congratulations! I hope this will be widely circulated. It is very important.”
A top official of the Bureau of Economic Analysis (BEA), which puts out the quarterly data on GDP and GO, was so impressed that he sent it to his youngest son, who is pursuing a degree in business analytics at the University of Tennessee.
A mother wrote me from Colorado, “I’m making copies for my boys to send to them in college.”
And, I just got word today that Union Editorial, the prestigious book publisher in Spain, is translating it into Spanish.
How to Order Your Own Copy
You can read my essay online here.
If you like it, why not buy a printed copy and pass it along to your friends and colleagues? They are more likely to read it as a printed copy. I sell it for $3 each at www.skousenbooks.com. The minimum order is three copies.
Best Gifts at Skousen Books: Order in Time for Christmas!
All three books are available at a holiday discount at www.skousenbooks.com. Autographed and mailed at no additional charge inside the United States.
P.S. I will be holding a special, subscribers-only teleconference on Dec. 18 at 2 p.m. EST on the fact that “Bitcoin Doubled This Year… Will it Double Next Year?” It is free to attend but you must register here to be able to attend. Don’t miss out!
We are only now finding out the background of the alleged killer of the UnitedHeathcare CEO.
What could possibly motivate a young man from a successful and influential family in Baltimore, who was valedictorian of his high school and a graduate with honors from the University of Pennsylvania and then suddenly be accused of committing pre-meditated murder?
Apparently, he suffered from a debilitating back injury and subsequent surgery that could have triggered a violent reaction. His family had lost track of him for six months.
The editorial board of Wall Street Journal, “Perhaps he saw himself as an avenging hero who would take on that system. This is a common trait of young men — and they are mostly young and men — who justify violence with the perverse logic of a cause. It doesn’t take much for a disturbed individual to pick up the populist theme of blaming seemingly distant and faceless corporations for social ills and flipping a mental switch into murder.”
This is another sad case of cultural decline: the story of a promising young man who could have made a positive difference in life and instead went down a path of destruction.
