Our ArgumentOur Argument

Economics Theory Data

Politics Theory Data Critique

Akerlof - “Market for Akerlof - “Market for Lemons”Lemons”

Health → category of credence goods

Assymetric information is a eo ipso problem in the health segment

Supply: No signaling assumption

Demand: Judging quality by market statistics

Formally: Q=D(p, µ), S=S(p), µ=µ(p)

Equilibrium pre-condition → S(p)=D(p, µ(p))

Good quality is crowded out sequently

Adverse selectionAdverse selection

Rawls - Theory of Rawls - Theory of JusticeJustice

Thought ExperimentThought Experiment

Hypothesis: Obama care does not ameliorate existing violation of 2nd principle

Approach too less egalitarian and flawed for both sides of market participants

I. Prohibition to summon pre-existing medicial conditions for dumbing

II. Public-private model → not universal health care might not maximize Rawls´ social welfare function

ConclusionConclusion

Reject Obama care due to efficiency shortcomings & violation against the theory of justice

Economic FactsEconomic Facts

In 2011, health care premiums increased by 9%

Estimated increase for 2012: 12%

Workers have the largest burden

Workers earnings only increased by 4%

GraphGraph

More FactsMore Facts

Tax credits for businesses simply don‘t work

90% of firms did not apply

Only 7% applied successfully

70% of the firms can‘t easily find affordable health care

Impact on AS/ADImpact on AS/AD

Higher work costs put downward pressure on investments

Aggregated demand is directly affected, decreases

New equilibrium for the economy at lower price level and lower GDP

Impact on AS/ADImpact on AS/AD

PoliticsPolitics

Democratic Capitalism Individuals should be free to pursue

their interest Private ownership of property Totally free market – no government

interventions

ConservatismConservatism

Conservatism is characteristic of Resistance to change Ambivalence regarding governmental activity

to improve human conditions Individual freedom Anti egalitarianism – distrust in human nature

Obama CareObama Care

Does not improve people’s condition

Health insurance should be voluntary

Obama Care will destroy both the free market and individual freedom

Federal government has no business regulating health

Tax increases are unaffordable

Obama CareObama Care

Tarnishes free market Public Plan Government Run Health

Encroaches on State Sovereignty Tenth Amendment ”The powers not delegated to the United

States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

ObamaCareObamaCare

Lower Quality Care

Government Intervention on Medical Decisions

Longer Wait Times

Harms traditional values of Freedom and Liberty Employer Mandates

Individual Mandates