View Full Version : How ending the gold standard made medicare unsustainable

02-22-2014, 11:46 PM
I decided to start making a youtube series about some political and economic issues I think the public needs a better undestanding of. My first one was on health care costs in the US and why they're so much higher here than in Europe. Some things I discuss in the video are the fact that the US funds more research than countries with universal health care because we have more competition in our market, how tax policies and regulations designed to encourage people to purchase health insurance are increasing administrative waste and discouraging competition, how ending the gold standard made medicare unsustainable, and how medicare is the single largest driver of higher medical costs in the US compared to Europe.


My next video will most likely be covering the minimum wage, inflation, and other factors that contribute to wealth disparity.

02-23-2014, 09:09 PM
Difficult to say that Medicare was better under a gold standard (more sustainable?) since it only existed for about six years under a gold standard (and a weak gold standard at that). Medicare was signed into law in 1966 and Nixon closed the gold window in 1972.

Single payer in Europe helps keep costs lower- we spend about $42 out of every $100 of medical expenses on overhead while in Europe that runs about 16 percent. All the different insurance plans and their complicated and various paperwork requirements are a major factor.

02-23-2014, 10:24 PM
Zippy, did you watch the video? Medicare still would have been a bad idea without ending the gold standard but at least with a system that required some hard assets in order to store currency, it meant that workers who were paying into medicare were stockpiling a resource to prepare for their retirement, which would offset some of their increased consumption once they stop working and stop producing. However, while we have high insurance overhead costs here compared to the rest of the world, that is partly because we have tax codes that discourage competition (anyone whose employer has a health insurance plan is essentially locked into that plan), but even those administrative costs make up a smaller portion of the difference in what we spend here vs Europe than increased spending on retirees because of medicare. We spend about the same amount on the health care of people 18-65, but twice as much on people 65-75 and three times as much on people 75+ compared to Europe. The average medicare recipient receives more back from medicare than they paid in.

02-23-2014, 10:27 PM
The bad idea was believing that government wouldn't spend every dime that was sent them. The best idea is to get government out of the healthcare business.