So, remember all those news stories blathering about Americans’ profligate spending habits…even before everything went kablooey, we were supposedly spending ourselves into oblivion, maxing out our credit cards for fancy-ass TVs and computers and SUVs?
Actually, not so much: turns out that when you look at a graph of consumption as a share of GDP (which is consumption, investment, government spending, and exports minus imports) but subtract out one particular item, things are relatively flat. In fact, since about 2002 they’re on a downward trend, although they rose from the mid-nineties until then, but they are still below what they were in the early 1960s. Put that particular item back in, though, and the graph suddenly sprouts precipitously upward in a near-steady rise from the early ’80s onward. (Source for all this is Left Business Observer.)
What’s that one item that accounts for, therefore, nearly all the increase in Americans’ consumption spending? Is anyone really surprised that it’s medical-related expenses?
This is one reason real health-care reform is essential: the rising cost of health-care is driving Americans broke. That’s not hyperbole: between 50 and 60 percent of bankruptcies (depending which source you look at) are traceable to medical expenses…and three-quarters of the folks whose medical expenses bankrupted them had health insurance…at first, at least.
Worse, US spending on health-care is far higher, proportionate to national income, than that of most nations, by a pretty large factor: the next-highest-spending nation is France, but the US outspends it by 37%. Yet US health indicators are pretty awful, with relatively low life expectancy and high levels of obesity, infant mortality, and mental-health issues. In other words, we spend more than everybody else, and get much less for it…and our doing so has become more and more expensive and is bankrupting increasing numbers.