The God-Shaped Hole!

Wednesday, August 12, 2009

Parallels - Auto Health Insurance

Imagine if the government told all auto insurance companies that the only way they could stay in business was by selling only the tip-top policy possible in each state. (Here in New Mexico, that would be a $250K/$500K/$500K liability and uninsured full coverage policy with $100 deductible.)

And then on top of that, they would also have to bundle an "extended warranty" with each policy, covering all auto maintenance, even oil changes, with a $10 deductible.
Of course this type of policy costs a lot, especially with a teen driver in the house, or an older car in the driveway. So of course the government would have to have a taxpayer-funded "public option" offering an identically ludicrous policy to anyone on the street who can't afford a private plan of such magnitude.

Auto mechanics, faced with voucher-clenching hoardes, would become swamped with requests to fix jammed door handles and squeaks in the A/C. This sounds like a good thing, but it ends up costing more than planned (as has Cash for Clunkers), and taxes must be raised on lower and lower tax brackets. Eventually, rationing is implemented.

And when all the private auto insurance companies collapse when people stop buying their ridiculously expensive policies, the government would be more than willing to take up the slack - for the public good, of course.

And since maintenance of older cars simply increases the overall cost of the plan, we have to junk them sooner. Why not a mandatory fifteen years in, since that's about when vehicles start falling apart.

The sheer scale of such a scheme would be staggering. Yet it pales compared to the "health care" plan which is now before the Senata.

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