Sometimes unintended consequences are so obvious that it is a wonder how so many people can convince themselves that such consequences are a surprise. Nassim Taleb became famous for positing that "black swan" events could destabilize complex systems, yet so many "black swans" are actually white swans. For example, the idea that we could offer mortgages to people who would never be able to afford them and then hide the risk via derivatives, should have never made sense to the people who were involved in setting up the scheme, yet because small portions of the structure seemed workable (and made many people a lot of money) the overall in-viability of the system was ignored.
While the future is never predictable, certain unintended consequences are so likely as to be assured. There are a number of areas of concern where we are assured that novel approaches designed to solve very complex and difficult problems will bring us prosperity, more security, and greater fairness.
In The New York Times, an ongoing problem that will be markedly exacerbated by attempts to provide Universal Health Care (Insurance*) has been noted:
Shortage of Doctors Proves Obstacle to Obama Goals
Obama administration officials, alarmed at doctor shortages, are looking for ways to increase the supply of physicians to meet the needs of an aging population and millions of uninsured people who would gain coverage under legislation championed by the president.
The officials said they were particularly concerned about shortages of primary care providers who are the main source of health care for most Americans.
One proposal — to increase Medicare payments to general practitioners, at the expense of high-paid specialists — has touched off a lobbying fight. [Specilaists, as well as Primary Care Providers, are already dropping out of Medicare because the compensaiont does not allow for a Doctor to run his or her practice at a profit; shifting around the payments and expecting Generalists to provide specialized care will cause all sorts of problems and will not solve the basic problem, which is too little compensation for the job.-SW]
Family doctors and internists are pressing Congress for an increase in their Medicare payments. But medical specialists are lobbying against any change that would cut their reimbursements. Congress, the specialists say, should find additional money to pay for primary care and should not redistribute dollars among doctors — a difficult argument at a time of huge budget deficits.
Some of the proposed solutions, while advancing one of President Obama’s goals, could frustrate others. Increasing the supply of doctors, for example, would increase access to care but could make it more difficult to rein in costs.
The need for more doctors comes up at almost every Congressional hearing and White House forum on health care. “We’re not producing enough primary care physicians,” Mr. Obama said at one forum. “The costs of medical education are so high that people feel that they’ve got to specialize.” New doctors typically owe more than $140,000 in loans when they graduate.
Lawmakers from both parties say the shortage of health care professionals is already having serious consequences. “We don’t have enough doctors in primary care or in any specialty,” said Representative Shelley Berkley, Democrat of Nevada.
If we decrease the cost of a service, in this case Medical care, the utilization will increase. If we don't pay Doctors enough to make it worth the time, money, and effort involved in becoming a Doctor, we will have less Doctors. This is not rocket science, but simple supply and demand. For what its worth, we already have Universal Health Care; we do not yet have Universal Health Care Insurance. If we decide that we can not accept rationing health care partially by cost and partially by patient responsibility, then we will have to limit the health care to everyone in order to keep the costs manageable. Everyone, except members of Congress and those lucky enough to share their insurance policies, will notice the rationing in short order; even the Congress will find their health care rationed, but since it will primarily consist of opportunity costs, it will be easily hidden and deniable. Medical rationing as a consequence of Universal Health Care (Insurance) is an inevitability; when people begin to die for lack of MRI scanners (cf N. Richardson) it will be depicted as an unexpected surprise; in fact it will be the whitest of white swans.
Consider an even more egregious example of good intentions leading to pain and suffering:
Could Food Shortages Bring Down Civilization?
The biggest threat to global stability is the potential for food crises in poor countries to cause government collapse
The surge in world grain prices in 2007 and 2008—and the threat they pose to food security—has a different, more troubling quality than the increases of the past. During the second half of the 20th century, grain prices rose dramatically several times. In 1972, for instance, the Soviets, recognizing their poor harvest early, quietly cornered the world wheat market. As a result, wheat prices elsewhere more than doubled, pulling rice and corn prices up with them. But this and other price shocks were event-driven—drought in the Soviet Union, a monsoon failure in India, crop-shrinking heat in the U.S. Corn Belt. And the rises were short-lived: prices typically returned to normal with the next harvest.
In contrast, the recent surge in world grain prices is trend-driven, making it unlikely to reverse without a reversal in the trends themselves. On the demand side, those trends include the ongoing addition of more than 70 million people a year; a growing number of people wanting to move up the food chain to consume highly grain-intensive livestock products [see “The Greenhouse Hamburger,” by Nathan Fiala; Scientific American, February 2009]; and the massive diversion of U.S. grain to ethanol-fuel distilleries.
The extra demand for grain associated with rising affluence varies widely among countries. People in low-income countries where grain supplies 60 percent of calories, such as India, directly consume a bit more than a pound of grain a day. In affluent countries such as the U.S. and Canada, grain consumption per person is nearly four times that much, though perhaps 90 percent of it is consumed indirectly as meat, milk and eggs from grain-fed animals.
The potential for further grain consumption as incomes rise among low-income consumers is huge. But that potential pales beside the insatiable demand for crop-based automotive fuels. A fourth of this year’s U.S. grain harvest—enough to feed 125 million Americans or half a billion Indians at current consumption levels—will go to fuel cars. Yet even if the entire U.S. grain harvest were diverted into making ethanol, it would meet at most 18 percent of U.S. automotive fuel needs. The grain required to fill a 25-gallon SUV tank with ethanol could feed one person for a year.
The recent merging of the food and energy economies implies that if the food value of grain is less than its fuel value, the market will move the grain into the energy economy. That double demand is leading to an epic competition between cars and people for the grain supply and to a political and moral issue of unprecedented dimensions. The U.S., in a misguided effort to reduce its dependence on foreign oil by substituting grain-based fuels, is generating global food insecurity on a scale not seen before.
If I recall, and I may be wrong, corn based ethanol was sold to us as a way to become less dependent on foreign oil. As a bonus, the MSM led us to believe that by using a renewable resource, food crops, to make oil, we were decreasing CO2 and saving the planet. Now it appears we have managed to raise the price of food around the world, made no particular impact on CO2 (since it turns out the energy cost of producing a gallon of gasoline form corn is greater than the energy produced) and since we decided, in our puritanical environmental purity, not to drill for oil, have increased our dependence on foreign oil, all at the same time. Could there be a bigger waste of money, time, and energy than the corn based ethanol boondoggle brought to us by our Congress? Again, if you were going to increase the demand on a product (grain for ethanol and food) while decreasing the supply (by refusing to drill for oil) the price has to go up. A barrel of oil is now one third of its peak, thanks to the global recession, but if and when economic activity picks up, the price will resume its upward trend. Further, some percentage of the decrease in oil prices has been offset by the rise in food prices. By artificially, politically, connecting oil and food, we are designing a system in which the prices almost have to escalate, short of consigning millions to starvation or halting the growth of the world's Middle Class.
(There are myriad other reasons for Lester R. Brown's pessimism about food shortages and the article is worth reading. There are also potential technological fixes being worked on to deal with some of these challenges. Brown's thesis is essentially a neo-Malthusian construct, that the earth's carrying capacity is being exceeded and civilizations will fail. We might think of the future as a race between Moore's Law and the Singularity on one side and Thomas Malthus on the other; thus far Malthus has been wrong every time.)
There are many other areas in which unintended consequences are so likely as to raise questions about the goals of those who propose their schemes. Yet it remains true that when it comes to human affairs, it is never wise to attribute to venality what can just as easily be explained by ignorance.
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