The United States keeps having problems with huge financial bubbles bursting. Each time the bubble burst, there is a great deal of suffering.
These massive economic collapses have one thing in common. They all involve large centralized markets that are overleveraged.
In my day, I've seen bubbles pop in technology, in the Internet, in energy, in mortages, in credit default swaps, in savings and loans, in the airline industry, in hedge funds, etc..
The one area that I have not seen a bubble pop is health care.
I've seen bubbles form and pop in both times of high regulation and low regulation. Neither regulation, nor deregulation is the cause of the bubbles. However, there does seem to be a relation between the form of the regulation and bubbles.
All of the great bubbles that I've seen form and pop happened in centralized markets.
The centralized stock market is the most common source of large systemic bubbles. However, we often find large system wide bubbles forming in those areas of the economy regulated by the Federal Government. The recent troubles with Freddie Mac and Fannie Mae are cases in point. The Savings and Loan Crisis two decades ago was another case in point.
The current "Health Care Reform" transfer regulatory power over health care from the individual states to the federal government. Central to the "reform" is a bizarre health care exchange.
Centralized regulation appears to create centralized systemic faults.
In the wake of a horrific economic collapse of our centralized economy, our government is centralizing the one segment of the economy that did not collapse.
I fear that one of the effects of the current legislation is that it will put health care into the same bubble forming and bursting pattern as the rest of the centralized economy.