The Affordable Care Act: A Litmus Test for American Capitalism?

EDITOR’S NOTE: An original version of this essay was published at Counter Punch. The author has given us permission to republish here.

There is a pressing issue in American health care that warrants at least a modicum of airtime from radio talk show pundits—a softheaded lot that continues to spin the Affordable Care Act, or Obamacare, as a textbook failure of state meddling in the marketplace.

Though they do not earnestly care, the free market mouthpieces on talk radio (who shamelessly misinform their listeners about the government’s role in economics) continue to wrongly attribute the turmoil surrounding Obamacare (in states like Arizona and Tennessee) to a much larger failure of government.

It is always the same old story that floods the airwaves: The market fails because the state refuses to recognize its role in relation to free market exchange, and it fails not only to know its place but also fails to act accordingly.

Despite all irony, however, it seems that radio’s reactionary tub-thumpers and free market warriors feel no need to address a basic precept of capitalist enterprise, namely that the state creates the market (which is partly why genuine anarchists would never prefer the tyranny of markets to the tyranny of the state). As Robert Reich notes, “Civilization … is defined by rules; rules create markets, and governments generate the rules.”

Briefly consider for example, the elemental things without which capitalism would struggle to perform as it does: property, the rule of law, contracts and even bankruptcy. Now, consider the fact that nature holds no place for industry, markets, or the rule of law, which facilitate property rights and ownership. Indeed, such things are not essentially natural, an idea that Thomas Hobbes indicated centuries ago in his book Leviathan.

There is a specific interpretation of Obamacare that radio does not talk about. That is, by being passed into legislation, the Affordable Care Act effectively became a mechanism that created millions of new customers and secured an even broader base. So why does Obamacare have a freshly painted target on its back?

Well, it seems logical that one response might entertain the fact that insuring some people is riskier than insuring others. Another response to the same question might broach the fact that capitalist enterprise in the US does not want additional competition in any sector, let alone private insurance. No, what capitalist enterprise wants is monopoly, and so they never interrupt the pundits who argue the same old subterfuge: The government is a threat to the market, a threat that makes us all less free!

Invariably, what private insurance wants is less competition and a different kind of government, but not the elimination of government altogether. The Affordable Care Act, it can be argued, is a kind of litmus test for the free market agenda that currently runs roughshod over public needs. Moreover, it reveals that the state truly has no serious desire to interfere with the monopolistic aspirations of private industry, nor does it desire to directly compete with private interest.

US Representative Raúl Grijalva, of Arizona’s 3rd congressional district, has recently observed the effects that private insurance companies are having on “affordable health care.” He writes:

Recent news of Aetna’s departure from most Affordable Care Act marketplace sent shockwaves throughout our country. One of the places the impact was felt most strongly was my home state of Arizona, where nearly 10,000 people in Pinal County may be left without a single marketplace plan. News that Aetna had threatened in advance to leave the exchange system if it didn’t get its way in a merger deal is infuriating for Arizonans who are now completely vulnerable as a result of their ploy. It highlights the systemic problems of relying on only for-profit insurers to supply our nation’s health care, and re-opens the debate surrounding a public option for health care.

In a word, the masters of industry for private insurance share much in common with the class of capitalists that Adam Smith describes in his work, The Wealth of Nations: “All for ourselves, and nothing for other people, seems, in every age of the world, to have been the vile maxim of the masters of mankind.”

As the radio continues to make waves about a fictitious governmental war on private interest, a war that does not exist (though, if it did, it would look a lot like total deregulation and unfettered capitalism), the state benefits from the same message, too: Big Brother gets to sit on his hands and do nothing for the most vulnerable. Meanwhile, private interest continues to monopolize.

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Mateo Pimentel writes for political newsletters and publishes in academic journals. He currently pursues a Master of Science in Global Technology and Development, and he composes and records music in his free time. Follow him on Twitter @Mateo_Pimentel.