What happens to the American economy when, as is inevitable, the health insurance industry collapses? *UPDATED*

AJ Strata, who knows complex computer systems, has a few choice words about the administration’s recent statements regarding its plans to fix the exchange.

Also, here’s something I’m not seeing discussed anywhere:

As you’ll recall, the anti-corporate Left concluded that GM was too big to fail and that banks are too big to fail (although not to big to shake down).  However, the same Leftists seem perfectly good with the collapse of the insurance industry.  When I say “collapse of the insurance industry,” I’m not just talking about the fact that Americans will be uninsured.  For the Left, that’s an outcome devoutly to be wished, since they can then socialize medicine.  I’m speaking, instead, about the actual collapse of companies that employ tens of thousands of people and have billions of dollars in pension plans.

Because insurance companies are no longer providing insurance (i.e., pricing their services using actuarial risk tables) but instead are simply being forced to pay for products by taking from the rich and giving to the poor (which makes them sound like Robin Hood, except they’re a Robin Hood who’s acting only because the Sheriff of Washington has a bow and arrow pointed at his back), they will go broke eventually.  And if the young and healthy refuse to buy insurance, the companies won’t just go broke eventually, they’ll go broke immediately.

Then what?

What happens to the American economy when Blue Cross and Blue Shield and AETNA and Kaiser and all the other insurance companies collapse in a distempered heap and, at the same time, hand their tens of thousands of employees pink slips, along with the assurance that all their retirement benefits are gone with the wind?

I’m thinking that, when that day comes around, 2008 will look like a trial run for total and complete economic collapse in America.  I have no contingency plans for that eventuality.  I can only hope that my family can salvage something from the wreckage, so that my last days aren’t spent at a level of poverty rivaling that of the average Calcutta street dweller.

UPDATEYuval Levin is on the same page as AJ Strata when it comes to the problems associated with the “best and the brightest” swooping in to help out.

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  • SADIE

    The only solution is to frame out the discussion as a “human rights issue” – isn’t everything and can’t we all play in the same sandbox. I think it should brought up before the ICC as ‘health trafficking’ not unlike sex trafficking.. and the negligible difference … is that in the former you pay to get screwed. Voila. Problem solved.

  • http://ymarsakar.wordpress.com Ymarsakar

    “(which makes them sound like Robin Hood, except they’re a Robin Hood who’s acting only because the Sheriff of Washington has a bow and arrow pointed at his back)”
     
    You forget what it really sounds like, which is Enron under Clinton and the Democrat’s Fannie Mae housing economy.

  • http://ymarsakar.wordpress.com Ymarsakar

    Robin Hood is fictional for most people. They weren’t a Hoodie, and they weren’t alive back when the Sheriff was on their backs either. It’s fantasy. It’s entertainment.
     
    But Enron and Fannie Mae conjures up negative feelings far above what one might feel coming out of a “movie”. Propaganda must have emotion as its fuel source, else it is not effective.
     
     

  • Mike Devx

    My favorite line of the year is that Obama is blaming the collapse of the ObamaCare website on the government shutdown.
     
    Four years of project planning and project execution, undone by a few days of government shutdown?
     
    FOUR YEARS of effort undone by a few days of shutdown in this month?  I don’t think I have ever heard an ass-clown say such a buffoonish ass-clown remark like that, ever.  In my entire life.  It takes the cake, and eats it, too.
     
    The gross stupidity and utter incompetence is outdone only by the breathtaking arrogance.  Obama and his minions are getting exactly what they deserve.  It would be satisfying to watch, if only people weren’t being harmed every day by this outrageous failure.  The harm will escalate, and I don’t think they understand how to alleviate the harm. It’s going to get very bad, here, very soon.
     
     

  • SADIE

    I don’t believe for a moment that what we see as ineptness of the O’care site is anything other than a feature, not a bug. The rules/regs were not written until after the 2012 election and the programming was a ‘no bid’ award to a Canadian company that had been fired. They/We will muddle in the swill for the foreseeable future. Any attempt by saner minds to prevail will result in the Dems insisting that “only if we had gone to a single-payer system” none of this would have happened. The financial cost for all of us will be astronomical and the feds will up the monthly printing scheme to a trillion dollars a month, because $85 billion a month just doesn’t buy what it used to.
     
    I agree, Mike, there is no satisfaction in watching the barn burn. Keep your pitchforks in the house – we’re gonna need them.

  • http://www.amazon.com/Occupy-Innsmouth-ebook/dp/B009WWJ44A/ref=sr_1_1?ie=UTF8&qid=1361504109&amp raymondjelli

    They have already destroyed the Life & Health professionals who sold health insurance. They are totally out of the loop.  Now that function will be taken care of by the lovely navigators you can find at places like Acorn.  Come in for insurance and come out with an abortion. Even if you are male. Hey somebody will get paid.
    This is not redistribution. It is even worse.  This is impoverishment.
    By the way no one is talking about the Biggert-Waters act which will substantially raise flood insurance costs, make getting flood insurance in flood zones more difficult with a need to pay engineers for a flood elevation certificate just to receive a quote and it will remove grandfathering which means those who paid for flood insurance previously when not in a flood zone will not get their promised savings should these flood maps be rezoned.  It will substantially hurt the coastal real estate markets because it is another severe headache added to the already difficult process of buying a home. 
    You will be substantially poorer in the future and the government wants you to applaud it for simply saying it is for your own good.

  • Ellen

    I know that I feel the pinch every day at the grocery and gas pump.  Plus utilities go up and up and up and if The Won and his minions at the EPA had their way, we’d all freeze in the dark.
     
    We have GOT to change things.  We have GOT to.

  • Jose

    Of course the administration is blaming the shutdown.  Government cost cutting = denial of health care. That will be their rallying cry from now on.
     
    I can already hear Harry Reid proclaiming that the tea party wants to deny treatment to a child with cancer.

  • pst314

    Remember the Cloward-Piven strategy? For many on the Left, a total economic collapse is not a bad thing.

  • jj

    What happens? We raise another Pina Colada in salute on the beach in Belize, and we say: “tough noogies, (or maybe “hard cheese,” it being descended from England), you earned it.”

  • raven397

    One must understand that a primary goal is exactly to destroy the existing health care system, above all the companies.  The Party hates any entities outside its control.  When Blue Cross, Aetna, etc., go under, their wealth will be destroyed [great for the Party], the employees will largely go on welfare [new Party voters] and the paper shuffling will be done by govt employees [good Party and ACORN members}

  • Libby

    Health insurers must be destroyed in order to implement single-payer healthcare. Sorry they didn’t see that one coming back when Obama was threatening them to shill for the Obamacare bill or else be destroyed once it’s enacted.
    I think the other goal is taking control over peoples’ health, which means the authority to micromanage and invade every aspect of our lives (Michelle’s reminders to drink H20 will look quaint 5-10 years from now). Having all of our personal information gathered in the Obamacare Hub, and granting “plan navigator” activist groups access to it, ensures that Democrats will win most/all future elections.

  • http://ymarsakar.wordpress.com Ymarsakar

    GM was saved because the unions wanted their cut of the money, which the stock holders and bond guys went bankrupt to cover. Obama said Obey, and they obeyed.
     
    Park rangers were told to Obey, and they obeyed. Insurance companies will obey, pay unions a “cut”, or be destroyed. At best, they can only hope for nationalization.
     
    That is the “future” people have stuck their head in the sand trying to convince the rest of us doesn’t exist except in our “extreme” and “crazy” world.
     
    How’s that world feeling so far? First taste is free, you know.