The perils of socilized medicine

There is much ado from the political right about the perils of "socialized medicine". One of the claims used to support this position is that "big government" will be making decisions about the allocation of scarce resources. This is framed as violation of our civil liberties - apparently the right to acquire whatever scarce resources are available if one is willing and able to pay the market price. The government should not making these kinds of allocation choices.

Why then is there not a furore at the CDC's recommendation yesterday concerning the allocation of limited supplies of the H1N1 vaccine? In this not government rationing? Isn't this government interfering with our right to choose? No: it's just a recommendation. Those making the final decisions on allocation of the vaccine are doctors.

Oh, but isn't having doctors making allocation decisions (like who should get the heart transplant) based on something other that willingness to pay also a violation of our civil liberties? That sounds like socialized medicine all over again. It's all rather confusing.

Not at all: doctors - at least the good ones - will simply sell to the highest bidder like the any rational homo-economicus. And the others must therefore be... (gasp) ..."socialist".

Globalization and trade

Data from the World Trade Organization show that since the end of the Second World War there has been an exponential (in the mathematical sense of the word) increase in trade between countries (red line in the chart). One striking aspect of this is the lack of sensitivity to the price of oil (blue line), which seemingly contradicts Jeff Rubin's thesis in his new book "Why Your World Is About to Get a Whole Lot Smaller: Oil and the End of Globalization". In fact there is a positive correlation (0.48) between oil prices and trade, which remains (0.43) when trade flows are lagged two years.

However, Rubin's predication is that oil will increase in price by an order of magnitude within a very few years - presumably then the current (lack of) relationship will change?

If he's right, then do we still have the infrastructure to reverse the off-shoring that has been going on steadily for the last decade or so? This is not just a question of physical assets, but skills, some of which take time to learn.