On May 31st, Foreign Languages Press will launch two new books: “Critique of Maoist Reason” by J. Moufawad-Paul, and “A New Outlook on Health,” a Maoist analysis of the health system in the US. “A New Outlook on Health” was originally published in 1975 by a political collective led by James Boggs. This version has been updated with footnotes and includes a new introduction that we are publishing below. If you wish to join the book launch, please register here.
A New Outlook on Health – Introduction
When this pamphlet was originally published in 1975, its authors wrote:
We have the most advanced material base of any society in history and the highest standard of living in the world. Our technology enablesus to produce goods to satisfy any conceivable material wants. Yet seven other societies have more doctors per capita than we do. In thirteen other countries pregnant women receive better care. Life expectancy for males in this country is shorter than in twenty-one other countries.
This quote about the contrast between the US’ advanced capitalist economy and wealth and the state of the health of its population is especially stark at the time of the writing of this introduction. The COVID-19 global pandemic, which started at the end of 2019 and began peaking in the US at the end of April 2020, has stripped the world of any illusions that the US could handle the outbreak better than any other country—as it was projected and as the Trump administration boasted. As we send this book to press, the current number of confirmed cases in the world is more than 4.7 million and confirmed deaths is more than 315,000 (although epidemiologists agree that the real numbers for both statistics are orders of magnitude higher). The US alone accounts for almost a third of all of the cases and over a quarter of the fatalities in the world, even though its population is only 4.25% of the global population. Reports of chaos in the medical system include:
- The Centers for Disease Control and Prevention refuse WHO test supplies and then send out faulty tests across the country;
- States fight to outbid each other and the federal government for scarce medical supplies;
- COVID-19 hospitals allot nurses one surgical mask per week;
- Hospital workers wear rain ponchos and trash bags as surgical gowns and bandanas as masks;
- The federal government gives Carte Blanche to private corporations to develop their own tests that are rushed to market without regulation or regulatory agency approval leading to wildly inaccurate results;
- Contradictory information about which health insurance companies would cover the cost of tests and treatment and how much individual patients would be responsible for;
- Elected officials call on the elderly to sacrifice their lives to save the economy;
- Federal health agencies actively advise the population that wearing masks is useless, then reverses course several weeks later to advise everyone to wear face coverings in public;
- Sick but uninsured people are turned away at health clinics and hospitals only to succumb to the illness at home;
- Bodies buried in mass graves because hospital morgues can’t keep up with the dead;
- The US president suggests that COVID-19 could be eliminated by beaming sunshine directly inside the patient or injecting disinfectant into the lungs.
These reports, and many more, are true.
When A New Outlook on Health was published, hospitals were flush with money from federal grants for expansion and modernization. Most Americans were covered by the then-nonprofit Blue Cross health insurance, and the method for hospitals to maximize profits was extended inpatient care with excessive testing. Today, on the other hand, the US is facing a deadly pandemic with hospitals lacking the most basic supplies like gloves, masks and disinfectant. How did we get here?
The answer to this question, as with most societal contradictions, lies in the path that capitalism and imperialist expansion has charted and the cyclical crises inherent in the capitalist mode of production. As this introduction will outline, capital investment into healthcare made human health a commodity. The medical industry followed the example of the car industry’s methods to eliminate “waste” to cut costs. And privatization eventually led to a crisis of overcapacity in the medical industry: private health insurance companies crowded the market with a myriad of health plans; pharmaceuticals churned out more and more expensive medications; and private hospitals grew to fight for a bigger share of the market. This expansion of capital into healthcare occurred while people increasingly could not afford the insurance, the medications or the hospital services. To try to resolve this growing crisis, the government used public money to subsidize the private sector in order to increase the number of “consumers.”
The US Auto Industry’s Cyclical Crises
In the US in the pre-deindustrialization 1970s the union movement, although already under attack and in a gradual decline, was still relatively strong. In particular, the United Autoworkers (UAW) held a lot of power in the years leading up to the massive relocation of auto manufacturing overseas. At that time, high school graduates who went to work in car factories could still expect to earn enough money to buy a house, a vacation cabin and cars and send kids to college, work with full healthcare benefits and retire with those same benefits and a pension.
However, in the early to late 70s the US economy faced skyrocketing inflation brought on by “cheap money” (low interest rates) to promote short-term growth, and a nearly four-fold increase in fuel prices when OPEC dared to flex its muscle against US imperialist expansion in the Middle East. US automobile corporations were faced with a situation where Japanese carmakers produced smaller, more fuel-efficient, more reliable and cheaper cars, which began to challenge the market domination of US carmakers. In contrast, US cars were big, heavy, unreliable “gas-guzzlers,” made with some of the most expensive factory labor in the world. In the early 1900s Henry Ford faced a similar situation when his workers were increasingly unable to afford the cars that they produced. He solved this contradiction by extracting more surplus labor1 from the workers through assembly line production. The result of the adoption of assembly-line production was more cars, produced cheaper and more quickly2—and at a much higher rate of alienation to the worker.3
In the 1970s, at the time this pamphlet was written, the automobile lobby had already succeeded in securing federal backing for building highways and quashing efforts to build public transportation, making car ownership a necessity in most parts of the US. Car sales were fairly steady (until the recession in the 1980s), but with Japanese carmakers increasing their production and building cheaper and more reliable cars, the US car industry faced a growing problem: how to continue to expand when the US market was already saturated, and while the US industry was losing its market dominance to the Japanese. Many began to move their factories from the Midwest to the southern states where workers were largely unorganized and states had “Right to Work” laws.4
With Ronald Reagan’s election in 1980 and the subsequent “liberalization” of trade, the “protectionist” trade barriers that had advantaged US carmakers came down. So too did the barriers to the US auto industry’s ability to open maquiladoras5 across the Mexican border where environmental measures were lax, and most importantly, labor was unorganized, not well regulated, and cost a fraction of what it cost to pay a UAW member. As they moved most manufacturing to Mexico, US car makers also learned from its competition, studying the Japanese manufacturing model called “Lean Manufacturing,” developed by Taiichi Ohno of the Toyota Corporation.
The Japanese manufacturing model came to the forefront in the 1980s6 as part of the race to make cars more quickly at lower costs, solving one crisis, but eventually driving the industry to its next crisis of overcapacity.7 The bits of manufacturing that remained in the US out of convenience because of its dependency on geographical location or more specialized skills or machinery began to employ “Lean Manufacturing Principles” to eliminate waste. The main “waste,” or cost that most impacted their profit margin, was permanent, unionized labor with health and retirement benefits. With the ever-present threat of plant shutdowns and relocation to Mexico, the UAW lost its base and what remained of its already faltering militancy.
Beginning in the early 2000s, the opening up of the car market in China saved the car industry’s overcapacity crisis; private car sales in China went from 5.6 million to 27.6 million at its peak in 2017. Domestically, easily approved auto loans8 helped drive the constant need for customers to buy new cars. Americans owed more than $800 billion in car loans in 2007, which, in addition to its crisis in overcapacity and the exponentially larger bubble created by the same predatory and aggressive lending practices in the housing market, led to the financial crisis and “Great Recession” of 2008. Rather than letting the market “correct itself,” as neoliberals always advocate, the federal government handed $80.7 billion of public money over to the auto industry. This money from the State saved the carmakers from going out of business but could not resolve the basic contradiction of overcapacity. With the saturation of the Chinese market, in 2020 overcapacity reached over 14 million cars per year; more than 14 million new cars are produced every year that cannot be sold. US auto loan debt reached $1.3 trillion in 2019.
Healthcare Adopts the Car Industry’s “Lean Management Principles”
What happened in the auto industry happened across all manufacturing industries in the US and in most imperialist nations.9 This changed both the access that workers had to healthcare, as well as their attitudes towards it. The number of unionized workers in the US plummeted (overall from 25.7% in 1975 to 10.3% in 2019 and in the private section specifically from 25% to 6.2%), as did the number of workers with employer-provided healthcare benefits. In addition, to replace the traditional health plans formerly enjoyed by a more unionized labor force, the Health Maintenance Organization (HMO) Act was passed in 1973 during the Nixon administration. This legislation funneled millions of dollars to help the private healthcare industry start up HMOs. Significantly, the Act also overwrote state laws that gave doctors the final say in determining medical treating, turning that power over to the insurance companies.
Healthcare, once a full benefit to which workers felt entitled, rapidly became a commodity that workers needed more resources in order to consume. With the decline of the manufacturing industry rose the corporatization of the service sector, with its irregular, low-skill, low-wage and oftentimes immigrant-based workforce. Employers in the service sector that provided access to health insurance were rare, and those that continued to provide access in any sector demanded more “employee contributions” in the form of monthly payments deducted directly from paychecks.10 HMOs normalized “copays”—low point-of-service fees initially marketed as giving individuals a financial stake in determining whether they actually needed to seek medical care. The cost of copays rose quickly, with higher fees required to see specialists and take specialized tests such as CT or MRI scans.11 Blue Cross Blue Shield, once the bastion of the traditional “Cadillac” healthcare plans for organized labor that is referenced in the New Outlook on Health pamphlet below, had its non-profit status removed in 1986 because the government deemed its purpose to be “commercial” rather than “charitable.” Although it retained some special provisions, it became a fully for-profit corporation in 1994.12
Those without access to employer-based health insurance were unable to buy health insurance on their own unless they were extremely wealthy; this left uninsured people with few options for medical care apart from emergency room visits (although it wasn’t until 1984 that it became illegal for emergency departments to turn away people because of lack of healthcare).13
Hospitals faced a growing population of people who could not seek treatment—who could not buy their services—when they were sick. Most people who ended up in the emergency departments incurring enormous bills they were unable to pay in full in the end. They often had to declare bankruptcy instead, which meant that hospitals didn’t get paid.
These contradictions mirror the crises that occur cyclically in other sectors as part of the capitalist economy. What has happened in healthcare in the US is a consequence of the relentless advance of imperialism, the penetration of capital into every sector of society. In this late stage of imperialism, where capital is scouring the planet, overturning every rock in every corner to find new markets to expand into, the public sector in imperialist countries has been its most recent solution. Sectors that were formerly public domain such as energy, water and transport were the first to be privatized. Then the onslaught began on education and healthcare, turning students and patients into consumers and commodifying the minds of young people and human well-being. Vital to this process was changing the discourse from the logic of “the public good” to the logic of “profit and loss.” In the last few decades, the notion that school districts and hospitals should perform financially just as any other corporate business became “common sense.” Profit and loss became the measure of the success and failure of something as fundamental as the development of young minds and caring for the sick and aged.
To support its continued expansion and search for more profit, the medical industry needed more customers to buy more of its products. With different market forces jockeying to make money off of the healthcare sector in a new neoliberal era, profit-making became more complicated. Hospitals, health insurers, pharmaceuticals all competed for more healthcare dollars. At the same time, fewer people had the ability to pay for all of the costs associated with getting sick. With the increased competition and as sick people could less afford to buy their products (just as autoworkers in Ford’s time couldn’t afford to buy the cars they made), hospitals followed the example of the car industry: eliminate waste to extract greater profits.
In 2007 the “Global Lean Healthcare Summit” was convened in the UK. According to its promotional material, “The event sold out with 320 people (over half from hospitals) attending from 147 organizations from the UK, Ireland, Denmark, Norway, Sweden, Netherlands, Belgium, Germany, Italy, Spain, Turkey, Poland, Switzerland, France, USA, Canada, Brazil, India, South Africa, Singapore, Australia and New Zealand.”
This summit introduced the concept of transplanting the principles of “Lean Management,” developed by Toyota’s Taiichi Ohno, who was inspired by observing customer behavior and inventory methods in supermarkets, to the healthcare sector. The application of “Lean Principles” in the auto industry helped carmakers resolve some of the contradictions it faced to expand and increase their profits. Now the healthcare industry looked to the same solution to extract increasing profits when medical treatments had become too expensive for sick people to afford.
With presentations from think-tanks, business schools, supermarket chains, hospitals and medical conglomerates all extolling the virtues of “Lean Healthcare Principles,” the forum foretold the health industry’s wholesale buy-in of the concept. The call was for a new management style, but also to minimize waste: waste in hospital beds and other infrastructure, waste in supplies, and most importantly, waste in labor. By eliminating waste, hospitals began to create scarcity. During the previous stage of capitalism, hospitals grew profits by bringing patients in and keeping them in; the new practice was to maximize profit by cutting costs. Hospitals that were unable to compete by stripping down their costs—such as the many run by religious orders—were forced to close. In 1975, there were 7156 hospitals in the US. By 2010, there were only 4985.
In implementing “Lean Principles,” the hospitals realized that it saved them money if there were patients waiting in the hallway for beds at all times, rather than having a few empty beds and no wait for transfer from the emergency department. It saved money to order supplies frequently rather than build large stockrooms to store and staff to manage them. It saved money when they hired fewer nurses to care for more patients and filled some of the gaps with low-wage, low-skill, non-unionized nurses’ aides.
A key part of “Lean Manufacturing” is “just-in-time inventory management.” It involves reordering the entire manufacturing supply chain. Rather than produce car parts locally and store them in giant warehouses awaiting orders, production of parts shifted to anywhere in the world where it was the cheapest and then shipped to the plant on demand, where they were assembled “just in time.” This method cut costs from infrastructure for storage, but most of the “savings” came from cuts to labor costs. The repackaging of imperialism into the concept of “globalization” meant that neoliberal policies removed barriers so that corporations could access the cheapest labor and natural resources for their production needs.
This brings us full circle to the 2019 COVID-19 pandemic and why the medical staff in one of the most technologically advanced medical systems in the world are wearing rain ponchos instead of surgical gowns and bandanas instead of masks. “Just-in-time inventory management” during ordinary times might cut some costs at hospitals. During a pandemic, it has proven to be fatal.
Crisis of Consolidation and Overcapacity in Healthcare
Simply eliminating waste to increase profits is not enough to survive in a capitalist economy. Companies that do not grow and out-compete others in the market to generate more returns for its investors go out of business. In the auto industry, in addition to eliminating “waste” by moving manufacturing overseas, practicing just-in-time inventory management, and gutting unionized labor, US carmakers increased production to try to fight off growing dominance of the Japanese carmakers—which increased their production exponentially and led to the crisis of overcapacity in the industry. The healthcare industry, too, followed a similar pattern.
In 1973, at the time of the passage of the HMO Act, there were only about 30 private companies offering HMO plans. In 1975 there were 183 and by 1986 there were 400. Mergers and acquisitions are essential business strategies to any major corporation in capitalist society in order to try to dominate the market. By squeezing out competitors, corporations can be better positioned to dictate terms to consumers, including pricing and standards. After Blue Cross became for-profit in 1994, private companies moved to consolidate their assets to dominate the market through acquiring and merging with struggling Blue Cross affiliates and other companies.
But many Americans were uninsured. In 2009, in the midst of the last Great Recession, health insurance companies increased their profit by 56% by raising the cost of premiums, (especially for people who were the sickest and therefore cost them the most money) co-pays and deductibles. As a result, 2.7 million people lost their private health insurance coverage. By 2010, 46.5 million people lacked health insurance—a number that continued to increase every year. While the American people identified their growing inability to afford to be sick as a crisis in healthcare, the medical industry identified it as a crisis of capital. The consolidation of the health insurance industry coupled with the consolidation of hospital systems meant that both payers and providers reached what (bourgeois) economists term “bilateral monopolies,” or a stalemate where neither side could go to other competitors to leverage lower or higher payments.14 Without more overall consumption of its commodities, that is, without increasing the number of sick people who could buy insurance and medical intervention, the capital investment in the industry was at risk.
Enter the Affordable Care Act (ACA, also known as “Obamacare”) of 2010. Subtler than Obama’s $80 billion bailout of the car industry, it was marketed as the solution to the healthcare crisis faced by Americans. In reality, the ACA was actually a public subsidy to the private health insurance industry. It required every person to buy health insurance through a “Healthcare Marketplace” of private vendors if they weren’t insured through their employers. Those who refused were made to pay a penalty (until it was eliminated in 2019).15
At its peak in 2016 the ACA enrolled about 12.7 million people through the Marketplace. Those 12.7 million people became monthly premium paying consumers of private health insurance plans. Through its various other provisions, including the expansion of Medicaid (for the poor), the total numbers of uninsured people in the US decreased from 46.5 million in 2010 to 27 million in 2016.16 The expansion of Medicaid was also a boon for private healthcare insurers; more than two-thirds of Medicaid recipients received care through federally funded but privately owned managed care plans. Altogether, in 2016 the ACA facilitated the introduction of more than 21.5 million people as new and regular consumers of private health insurance. This helped fuel another cycle of capital expansion in healthcare. Now in 2020, there are over 900 different private health insurance companies. Similarly, in 2020, the number of US hospitals increased by 1,161. In addition to an overall increase, between 2013 and 2017 almost 20% of all of the country’s hospitals were acquired or merged with another hospital. For-profit hospitals as a percentage of total hospitals grew almost 10% between 2000 and 2018.
In a broader sense, the passage of the ACA was the federal government’s use of public money to help solve both the consolidation and overcapacity crises brought by private capital investment in the medical industry.17
Unsurprisingly, neither the HMO Act of 1973, nor the ACA of 2010 actually did what they were marketed to the “public” to do: lower healthcare costs for the individual or the State. By 2019 individuals with employer-sponsored health insurance actually paid an average of $3673 more per year than before the ACA was signed. The average monthly cost for individuals unsubsidized ACA plans grew to $448 a month from $393 in 2013 (the first year the ACA took effect).
In 2019 federally subsidized ACA plans averaged $593 a month with a $514 a month subsidy and a total of $62 billion in federal subsidies went to private health insurance companies in the Healthcare Marketplace. In fact, the Congressional Budget Office reported that in 2018, the federal government spent more per person in subsidies to ACA ($6,300 per subsidized adult) than on Medicaid ($4,230); such figures make unconvincing the claims that a “single payer,” federally managed healthcare system would be too expensive.
Overall, total healthcare spending in the US is expected to exceed $4 trillion in 2020—up from $3.6 trillion in 2019. (34% of that $4 trillion goes to administrative costs. That is, $1.36 trillion goes to non-medical management of healthcare.) This represents a more than six-fold increase from 1975 after factoring for inflation. Health insurance companies alone took in $23.4 billion in 2018 with a profit margin of 3.3%. This level of penetration of capital into healthcare would not have been possible without the State subsidizing the private sector to increase the number of consumers. The contradictions inherent in the healthcare sector over the last several decades clearly and logically follow the path of other sectors—like the automobile sector—under neoliberalism. But when we factor in the idea that human health is qualitatively different from spark plugs or headlights, the contradictions become absurd.
Innovations such as “Lean Manufacturing” and the Healthcare Marketplace were and are created to solve problems of capital. And capitalism has proven to be nothing if not creative in the way it solves its crises, by shifting the burden of those crises to the poor in order to continue to extract more surplus value from workers and more resources from the planet to make more profit. At times, capitalism’s drive for profit may overlap with meeting the needs of society and the environment —as in the case of the creation of the public education system to prepare an educated and disciplined workforce. Most of the time, the overlap is incidental—as in the case of some new medications that actually cure diseases while they make its manufacturer a bunch of money. But we must not be confused about its purpose.
The overarching purpose of healthcare in capitalist society is not to care for health. If we confuse this capitalist project as caring for the well-being of humans, we will be confused about how to effectively confront these contradictions. “Lean Principles in Healthcare” and the ACA were innovative solutions to capital’s problem of shrinking profits in the medical industry at a time when capital necessitated expansion. Before the onset of the COVID-19 pandemic, a less than a decade after the ACA went into effect, the healthcare industry faced the same contradictions in a different phase of its cycle; after a brief cycle of new hospital and health insurance growth, we were seeing growing consolidation and a decrease in its consumer base, or people without insurance.
Now, in the midst of the COVID-19 pandemic, hospitals and insurers are concerned more with projections of “catastrophic” losses in terms of profits rather than human lives. In its aftermath, these capitalist business ventures will again require a massive bailout from the government with public funds to solve their crisis.
Why is the US in Particular Failing so Hard?
When “public” is no more—when all of the sectors that used to be considered public (education, transport, energy, public safety, ambulances, prisons, hospitals, government) have been or are in the process of being privatized—public health no longer exists, either in concept/culture or infrastructure. Fighting and containing pandemics require both a conceptual understanding of the “public” by the masses and a public infrastructure driven by public welfare rather than profit motive. The US has very little remaining of either.
The myth of “individual” freedom in the US has achieved a level of unquestioned primacy. Few people will act for the public good until they are directly affected—which is why social distancing and mask wearing were largely disregarded until transmission rates were so high that it was difficult to find someone who didn’t personally know someone who had contracted COVID-19. Some of the most advanced medical centers in the world reside in the US, yet none of them were adequately prepared to handle the onslaught of COVID-19 cases, even with several months to prepare. Very few hospital administrators were able or willing to spend the time and resources to prepare for the coming pandemic, because they have been so habituated to the logic of short-term capital demands.
Each state, each region, each county, each city, each hospital, each hospital unit is operating as a separate entity from the whole. When several state governors on the West and East coasts banded together to form pacts to avoid competing with one another and coordinate the reopening of their economies, it seemed a novel and refreshing idea. (A columnist from The New Yorker satirically suggested the governors might get together to form a country and quipped that it would be “amazing to have a President right now.”18) Big inner cities with large poor populations are pitted against smaller, wealthier suburbs. Hospitals in the same city, confronting the same disease in the same population, fight over scarce supplies. Nurses, doctors, nurses’ aides, cleaners and kitchen staff in the same hospital are given different levels of protective equipment, not based on exposure, but based on status decided on by hospital bureaucrats. It’s difficult to imagine any other advanced capitalist country of this size floundering so thoroughly in the face of such a grave threat.
Healthcare in a Different Economic System
A close look at the US provides a stark picture of healthcare under advanced capitalism, its system a model that is being pursued by the majority of countries in the world today. However, we have historical examples of how healthcare differs when it is not driven by capital. For instance, healthcare in China during its socialist period.
When the communists in China won the revolution and established a new socialist state in 1949, the country had seen over a century of war, famine and catastrophic natural disasters. The overwhelming majority of the vast population lived in the poor countryside farming with basic hand tools. There was very little national industry, and most people were illiterate. The complex tasks of providing healthcare and education piled on top of the more immediate tasks of feeding, clothing and sheltering 542 million people. And yet, by the mid-1950s, the majority of children were learning to read and write in elementary schools, and a whole system of more than 200,000 rural doctors who were trained to provide basic healthcare was established.19 Later, these rural doctors came to be known as Barefoot Doctors because they were of the villages and lived and worked in the fields with everyone else. Because of their continued integration in production and in village life, they were well situated to understand their potential patients and the context in which they might have fallen ill.
Hospitals were gradually built throughout the country on a county-wide level, so that medical resources were not concentrated in the cities.20 Rural doctors were trained to recognize when conditions were beyond their skill levels and transferred patients to the nearest hospital.
These hospitals did not have many resources, but they did have trained staff whose purpose was to care for the health of their patients, a priority dictated not by the bottom line of the hospital, but by the needs of the people, both individuals and the larger public. They had basic medicines and relied on family members to provide the lower-level day-to-day nursing care. Care was provided to patients at low cost, because wages and medical supplies were managed by the State as part of an overall plan to build the healthcare infrastructure in the entire country.21 Rather than being motivated out of concern for their own livelihoods, hospital workers approached their work on the principle that humans were the most important resource and that because China was a poor country, saving money and material resources was important for the greater good.
Much has been written about how China was able during this time to eradicate diseases such as malaria, typhoid and schistosomiasis—diseases that killed (and continue to kill) millions in poor countries around the world. They accomplished this predominantly through education and mobilization of the masses to improve nutrition and hygiene. One of the best examples of how a poor, socialist country such as China dealt with a disease threatening public health is the case of tuberculosis (TB) in the dairy industry. TB is a bacterial disease that attacks the lungs, is spread by coughing and can be fatal if left untreated. It can be transmitted to humans through cows by breathing in the bacteria or drinking contaminated milk. In the West, the method to stop the spread of TB in cattle was to immediately slaughter any cows that tested positive. However, in China, livestock was in short supply and the milk they produced was critical to raising the nutritional level of the people. Instead of slaughtering TB-positive cows, they isolated them in their own herds and treated the disease. Many recovered and were integrated back into the main herds. State farms and cooperatives were able to use this method because they did not face the same contradictions that capitalist dairy farmers faced, where labor costs and the bottom line meant that wholesale slaughter was more economical than isolation and treatment. (This example sits in stark contrast to the current situation in the US where the COVID-19 pandemic has disrupted the food supply chain to the cities, so that farmers are slaughtering millions of chickens and dumping tons of milk while grocery store shelves are bare. The capitalist economic system simply does not allow for getting excess food to hungry people, because its supply methods are dictated by the market and profit/loss, rather than human need.)
In post-Liberation China, all of the healthcare infrastructure, as well as the culture about the care of health that surrounded it, was built deliberately with planning by the State. The enormity of this task—how to provide the broadest access to the most advanced healthcare as possible given resources and conditions to the greatest number of people—was overcome through detailed planning based on thorough and ongoing investigation and following the ideological line that the welfare of the majority of the people, the public, was the determining factor. All of the training, construction of buildings, designing and manufacturing equipment, researching and developing medicines and medical techniques, were not organized by the logic of profit and loss. The costs and resources were weighed against other infrastructure and immediate needs, rather than expansion or contraction based on market forecasts.22
COVID-19 Unmasks the US Healthcare System
The US, unlike most countries in Western Europe, never saw social democracy. In spite of all of the social democrats’ betrayals, dirty deals and, ultimately, complete opportunistic embrace of their own national capitalism and imperialism, one positive consequence of their legacy remains the notion, albeit tattered, of the “public.” With the advance of imperialism, that legacy is, and will continue, to be necessarily under attack and destroyed. However, some vestiges still remain in countries like France, with its mostly intact “single payer” healthcare system, and the beloved National Health Service in the United Kingdom. In this sense, the US, stripped early on of its “public” culture and infrastructure, provides us with the clearest example of how healthcare develops under capitalism.
COVID-19 has provided a terrible lens through which we can understand the consequences of capitalism on public welfare. The “failure” of the healthcare system to effectively fight the pandemic is actually a logical result of the penetration of capital into every corner of society—itself a function of imperialist expansion. What is happening now—healthcare workers without protective gear who succumb to the coronavirus while trying desperately to save lives, farmers who destroy crops while people go hungry—is not a mistake or malfunction of the system; it is the consequence of the steady march of imperialism, largely impervious to the public good (unless it intersects with its expansion), in search of new investments and markets to solve its own contradictions. There is nothing to “fix” here from the perspective of the people, because it is not broken from the perspective of the bourgeoisie; what is there to repair in a system that is working as it should?
We, who believe that human beings are not cars; we, who believe that an economic system that holds the public—the collective good—as paramount: for the survival and thriving of the human race on our one and only planet, we must learn the lessons that COVID-19 has unmasked and proceed with our work accordingly.
1 Surplus value is a Marxist analysis of how worker labor is exploited by bosses for profit. That is, the amount of money that they are paid for their work is less than the amount of money that what they produce is sold for (minus the capital investment that an owner has to make for machinery and its depreciation). The difference in value, the surplus value is how owners make profit. The more surplus labor an employer can extract from each worker, the higher the percentage of profit they can extract from that labor.
2 Ford’s Model-T dropped from $900 in 1910 ($24,453 in 2020 dollars) to $395 in 1920 ($5,098 in 2020 dollars). While there were only about 500,000 cars on the street in 1910, in 1920 there were almost 26 million new car sales alone.
3 The boredom and stress of working on the assembly line doing the same repetitive labor every day for eight hours led to “Blue Collar Blues” in the 70s. Absenteeism doubled in a decade and workers and GM workers in Lordstown, Ohio went on a 22-day strike against the relentlessness of the assembly line.
4 “Right to Work” laws stipulate that unions are not allowed to negotiate contracts that require all members who benefit from the contract to pay union dues. These laws are presented as giving individuals the right to decide if they want to join the union, and in reality are a way for employers to promote disunity among the workers in an organized shop.
5 Maquiladoras are foreign-owned factories in Mexico where cheap labor assembles duty/tariff free products for export and consumption outside of the country
6 Japanese carmaker Toyota even tried to demonstrate the superiority of its model on US soil, opening a joint venture plant in Fremont, California with General Motors in 1984, a unionized shop. Winning over shop leaders to the Toyota way, the plant still faltered until it was shuttered in 2010. Toyota went on to build several manufacturing plants in the US, but none of them were ever unionized: organized workers made production less “lean.”
7 Overcapacity is a crisis of capitalism. As imperialism expands to try to conquer ever more markets, it must produce more and more goods at cheaper and cheaper costs to out-compete others. This results in contradictions in the industries like the car industry where manufacturers are still trying to expand production when there are already too many cars compared to the number of consumers.
8 Sub-prime loans both in cars and housing are loans given to people with poor credit (or poorly demonstrated ability to repay the loan) at high interest rates.
9 In the 1980s Ronald Reagan in the US and Margaret Thatcher in the UK coordinated efforts to push the neoliberal agenda, decimating barriers to imperialist expansion.
10 It wasn’t until 2014, after the implementation of the Affordable Care Act (ACA), that employers who employed 50 or more full-time employees were required to offer some sort of health insurance plan to their workers.
11 In 2003 “deductibles” and “coinsurance” were legalized, giving insurance companies the opportunity to offer health insurance plans that set a “deductible” amount that people would pay out of pocket before the insurance plan started paying anything, and “coinsurance,” which was a percentage the patient was responsible for after their deductible was met. For instance, if a plan’s deductible was $5000 a year with a 20% coinsurance, the patient would pay for all medical costs up to $5000. Any costs after that first $5000 would be paid by the insurer at 80% and the patient at 20%.
12 Blue Cross developed during the Great Depression in the 1930s, at first as a collection of community or employer-based benefit plans. When the American Health Association stepped in with guidelines for those plans organized the Blue Cross emblem, two of its tenets was that they should stress “public welfare” and run as a non-profit.
13 Even those with employer-based healthcare plans were not covered for “pre-existing conditions,” or medical conditions that existed before they began their insurance coverage. For instance, if a worker signed on to their health plan in 2000 and was subsequently diagnosed with stomach cancer, their insurance company could deny payment by collecting “evidence” that the cancer had already occurred before the first date of coverage.
14 In many smaller “markets,” the one large insurer would be forced to negotiate prices with the one large hospital system; each monopoly unable to pressure the other to raise payments or lower fees because of the lack of competition.
15 The penalty, known as the “Individual Mandate” was $695 per adult and $347.50 per child in 2016 (with a maximum of $2,085 for a family), or 2.5% of total income, whichever was greater.
16 In 2018, the number of uninsured climbed to 28.6 million. Numbers are rising because health insurance premiums and copays/deductibles are going up as compared to the “Individual Mandate” penalty. Figures are projected to be higher still in 2019-220 because of the elimination of the mandate.
17 Johnathon Gruber, an MIT professor of economics and the director of the Healthcare Program at the National Bureau of Economic Research, was a major advisor to the Obama administration on the ACA. He has been a staunch advocate for the funneling of public money to private corporations for medical research, which he claims would “jump-start” the economy by creating jobs. His “new” theory is actually a re-hashing of the same theory that in the Reagan Era was called “Trickle-down Economics”: giving public money to rich people and corporations will trickle down to poor people through job creation and bolstering the economy. This theory, or rather, propaganda, has been irrefutably disproven, yet continues to be recycled.
18 The Borowitz Report, April 13, 2020.
19 At the time of Liberation in 1949, China estimated that it had about 40,000 doctors who were concentrated in the cities, or one doctor for about 13,500 people. During the 1960s, over 1.5 million Barefoot Doctors were trained and working to provide basic medical care in rural villages. As a consequence, between 1949 and 1979, infant mortality fell from 200 to 34 per 1000 live births, and life expectancy increased from about 35 to 68 years.
20 In 1949 there were 2,000 hospitals and there was one hospital bed for 6,500 people. In 1979 there were 65,009 hospitals and one bed for 502 people.
21 State Communes contributed small amounts to the hospitals from their common welfare funds.
22 Almost all of the medical infrastructure in China after the capitalist coup was privatized and the remaining public hospitals were made into their own accounting units responsible for their own profit and loss. That change gave administrators and doctors license to follow the Western capitalist model, buying state-of-the-art equipment, importing brand name medications from Europe and the US and training highly specialized doctors—and then increasing the numbers of tests and fees to pay for it all.