Epicycles and Obamacare

From FEE.org (Oct. 28):

Ever heard of Ptolemy? He’s the guy whose model of the universe lasted for more than 1,000 years. The earth, thought Ptolemy, is at the center of the known universe and the planets dance around the earth. But this is where things got unnecessarily complicated.

To explain the apparently strange planetary motions, Ptolemy and astronomers after him used epicycles. It took centuries before Copernicus figured out that the need for epicycles could be reduced by putting the sun at the center of the known universe. Improvements by Tycho Brahe, Galileo, Kepler and Newton eliminated epicycles altogether.

Regulators are much like Ptolemaic astronomers—only they can meddle directly in the economy to try to get it to fit their model. The regulators perceive some “market failure,” then apply their linear logic to justify an intervention. When the intervention fails or causes some perverse effect, the regulator’s epicyclical thinking kicks in. He decides to fix the bad consequences of the earlier fixes. Intervention begets intervention.

Take Obamacare. Regulatory interventions in healthcare since World War II have created an unnecessarily expensive healthcare sector. These interventions have created a cozy provider-insurance cartel, but they have also caused medical inflation, which has made healthcare and health insurance increasingly less affordable over time. Less affordability limits people’s access. [read more]

Copernicus was able to change the paradigm because he had mental flexibility and objectivity—the “earthcentric” view of the universe was not his theory so inverting the theory was no big deal to him. In other words, his ego wasn’t attached to the theory. Initially, it is easy to under why people back then believed the earthcentric view. It is what they observed with their eyes even after the invention of the telescope. 

To those whose ego and power is attached to Obamacare won’t look for other models of healthcare. Also, if you think you’re ideology or narrative is perfect then any system or theory you devise that is based on that ideology you won’t probably change since it will be perfect too. There is no mental flexibility if you believe your narrative or theory is right. Even if the facts say otherwise.