Wednesday, November 17, 2010

How traditional business and social irresponsibility have caused our current healthcare crisis


American healthcare is in a state of turmoil. News is flooded with debates about the GOP trying to repeal Obama’s healthcare bill and the Obama administration pushing for middle-class rights. The arguments are endless. As Barack Obama stepped into the presidential office, he faced a healthcare issue that is so complex and so misunderstood that the only thing the American public can agree on doing together is to point a blaming finger at the President.
Any unbiased, educated person will agree that Obama is not the root cause of this problem. We also know the problem didn’t spring out of the blue. So who, or what, is to blame? The answer is simple: the flawed paradigms of traditional business and American capitalism.
Traditional business is fixated on minimizing costs and maximizing profits. The mentality is that if something works, stick with it.  In capitalism, the goal is to produce a desirable good or service. If people want it and you can supply it, then it is your right to make money off of it. Individually, these two core ideas can be benign. In combination, however, they have created and perpetuated a fatal network of problems in healthcare. The root cause of our healthcare issue can be traced back to American business.
Healthcare is a business. A service is provided, and payment is expected accordingly. By basic economic law, if demand goes up, charge more. Since demand is high, the price is high, and accessibility is consequently low. The key driver behind the healthcare issue is the outrageous demand for medical services. Millions of people are getting sick and need medical attention. Tracking the issue further upstream, we discover the reasons why so many people are getting sick.
In Exposed and Lives per Gallon, Mark Schapiro and Terry Tamminen delve into the medical problems associated with everyday consumer products from oil and autos to electronics, cosmetics, cleaning supplies, and even food. The American market is chock full of chemicals, hormones, fertilizers, heavy metals, and other synthetic ingredients. An astounding number of these are known to cause cancer, hormone disruption, and respiratory problems like asthma. An even more astounding number of these have never been tested. They circulate the market under an “innocent until proven guilty” assumption.
Obesity is an emerging American epidemic and is expected to cause an enormous increase in the demand for healthcare over the next few decades. The epidemic has been spurred by the food industry. Fast food and junk food companies are running “successful” businesses at the expense of health. As their profits increase, so does the demand for healthcare.
The most cost-effective way to ameliorate the rising costs and falling accessibility of healthcare would be an investment in preventative healthcare. We could reduce the demand for medical services by preventing people from getting sick. We need a requirement for businesses to ensure that their consumer products and components of their products do not have associated medical repercussions.
A much bigger problem arises because drafting and enforcing this type of preventative healthcare is a political issue, and politics have become afflicted with legislative paralysis. Politics are a business. Like any other citizen, politicians need to make money. They do so by offering a service. That service is to write, influence, or stifle legislation.
Like any other business, politicians have customers. There are two basic ways to make a lot of money. The first is to sell a cheap product to a large customer base. For example, musicians get rich by selling millions of albums at fifteen dollars apiece. The second way is to sell a very expensive product to a small customer base. Lamborghinis, for example, are sold at a tremendously high price to only a handful of people. Politicians do the latter – but at an astronomical scale. Think of a car company. They sell hundreds of millions of cars worth tens of thousands of dollars each. In the business of politics, a car is a “cheap” commodity. A politician’s customer is the entire auto industry – and that’s just one customer. It is a politician’s job to provide the desired service to their customers – that is, to influence policy in the customer’s interest.
Treating politics like a traditional business is essentially sanctioned by the system of American capitalism. A service is provided at a cost. And in this free market, the demand for political service is so high that it sells at a whopping price – a price only affordable by enormously wealthy industries. Coincidentally (or not), those wealthy industries are also the ones whose products cause the most damage to consumer health. This is what has perpetuated our healthcare crisis.
Political lobbying and corporate influence are well-known problems in the American legislative system. What gets less recognized, however, is the role of social responsibility in business. In traditional business and capitalism, fiscal responsibility to shareholders is the main, if not only, priority. It is the “higher purpose” of business. Under this paradigm, big business has literally sickened society and created a plethora of intricate problems that no one seems to be able to solve. Business has become a detriment to our country.
The argument for social responsibility comes from the fact that these industries lobby politicians and continue to push their products even though they are completely aware of the dangers they pose to consumer health. They are conscious of the fact that one of the main reasons why they are so fiscally successful is that they do not list human cost as a liability on their balance sheets. All of this is done for the sake of profit.
It’s time to reevaluate the purpose of business. Business and societal health are in conflict. In a world where money is power, business reigns and society finds itself at a loss. The rules need to be rewritten to give society – our health – a fighting chance. Or better yet, the paradigm of business needs to shift to form a compatible relationship between the two.
Shouldn’t business improve society and benefit our health? Is there a way to urge businesses to serve society in the process of collecting profits? There is, and the European Union is already leaps ahead of us on this path. It starts with regulation. The EU has passed directives that ban thousands of potentially harmful substances from being sold in consumer products. They have also been the world leader in setting standards for chemical fertilizer use and responsible food production. Most recently, they have passed REACH – Registration, Evaluation, and Authorization of Chemicals – a bill that demands transparency from businesses, mandating them to identify all chemicals in their consumer products and gain permission to release them into the market (Schapiro). Under these regulations, European businesses are developing healthier but still functional products. So their profits are protected as well as consumer health.
Mark Schapiro explains the fatal assumption of American consumers – if a product is on the market, then it is government-approved, and it must be safe. But in the American system where our government is governed by business, we are unknowingly putting our trust in the irresponsible corporations that are the root cause of our healthcare crisis. Will corporate America allow our government to pass regulations that threaten their profits? Or will our true leaders be able to step up against traditional businesses that threaten societal health? We have yet to see if we can tame our own beasts.

No comments:

Post a Comment