There is some debate in this blog about how to insure the unhealthy people. Those who are healthy felt that they should not be subsiding the unhealthy people and they like the current system of insurance purchased from insurance companies operating on commercial grounds.
This self-centered approach is not helpful to people who are not in good health, especially those who were born with congenital conditions and did not take care of their health in the past (and now wish to make a change).
Some countries realize that they cannot just let these people be uninsured. America is now addressing this problem and is taking bold steps to make a reform.
I like the approach adopted in Australia. Every family can join a health insurance plan without the need for underwriting and to pay the community rate. The Government provides attractive tax incentives and make it attractive for people to join a plan, rather than be uninsured. The healthy people are willing to join, due to the tax subsidy.
I believe that a similar approach is being adopted in Japan, Germany, Switzerland and other European countries. The systems are not identical, but the general approach is probably as I have described (but I may be wrong).
I do not like the American or Singapore system, as there is a high layer of administrative cost and uncertainty about the coverage, due to the proliferation of different plans and exclusions of pre-existing and other conditions. The confusion is not helpful to consumers and the actual benefit to consumers is lower than the premiums that they have paid. I believe that a better and more streamlined system can be found.
Tan Kin Lian
Monday, November 9, 2009
A free market has to be regulated
The headline of a Straits Times report said "MAS flags two risks for property buyers". MAS is warning about the risks of a weak economy (which may cause property prices to drop) and a strong economy (which leads to higher interest rates). Property buyers should not be paying high prices which they may not be able to service.
This move is timely to prevent an asset bubble in property - the same type of bubble that caused the collapse of the US and global financial system last year.
Some people think that a free market should be unregulated. This is not correct for many markets where one party, usually the seller, has more information that the other party, usually the buyer, and can take unfair advantage of the buyer. This situation applies to the property market, financial market, insurance market and for many professional services.
For the free market to work well, it has to be regulated to ensure that information is made easily available to all parties and that a code of fair practice and professional ethics is observed. A free market is not one which allows some people can take advantage of other people to make an excessive profit.
There is now a trend towards stronger regulation in America. I hope that this trend is followed in other countries.
Tan Kin Lian
This move is timely to prevent an asset bubble in property - the same type of bubble that caused the collapse of the US and global financial system last year.
Some people think that a free market should be unregulated. This is not correct for many markets where one party, usually the seller, has more information that the other party, usually the buyer, and can take unfair advantage of the buyer. This situation applies to the property market, financial market, insurance market and for many professional services.
For the free market to work well, it has to be regulated to ensure that information is made easily available to all parties and that a code of fair practice and professional ethics is observed. A free market is not one which allows some people can take advantage of other people to make an excessive profit.
There is now a trend towards stronger regulation in America. I hope that this trend is followed in other countries.
Tan Kin Lian
Albert Einstein
Someone asked if I knew Einsten. I knew of him (but he did not know of me). Besides being the genius that discovered the theory of relativity, Einstein was a peace activist and a strong socialist.
He was purported to have created a logic quiz, called the Einstein Intelligence Quiz. I saw this quiz 30 years ago, but could not solve it at that time. I learned how to solve this quiz recently and to create similar quizzes at various levels, including a more difficult level than Einstein's Quiz.
You can buy the TKL Intelligence Quiz books here. Enthusiast can buy volumes 3 and 4 in soft copy (PDF).
He was purported to have created a logic quiz, called the Einstein Intelligence Quiz. I saw this quiz 30 years ago, but could not solve it at that time. I learned how to solve this quiz recently and to create similar quizzes at various levels, including a more difficult level than Einstein's Quiz.
You can buy the TKL Intelligence Quiz books here. Enthusiast can buy volumes 3 and 4 in soft copy (PDF).
Economist and forecast
MM Lee had forecasted the economic growth to be 3% in 2010. A blogger commented that MM is not an economist and questioned how MM got his figures.
I am not an economist myself, but I will also make my own guess. Those who don't like my guess are free to ignore it. They are not required to challenge me.
I never knew that economic forecasting is the purview of economists and that other lesser mortals are not allowed to venture their guess. I am told that if you meet 20 economists, you are likely to get 40 forecasts and most of them are likely to be wrong. So why should this privilege of guessing wrongly belong only to certain people?
Albert Einstein once met a person with an IQ of 160. They discussed quantum physics. He later met someone with an IQ of 110. They discussed engineering. Then, he met someone with an IQ of 70. Einstein asked him, "what is the economic growth likely to be for next year?"
So, here is my guess. Economic growth for 2010 will be 0% to 2%. My guess is lower than MM. Why? I think that the stimulus would have run out and that people will realize that the underlying problems of the global economic system is quite serious. If I am wrong - attribute it to my IQ of 70.
Tan Kin Lian
I am not an economist myself, but I will also make my own guess. Those who don't like my guess are free to ignore it. They are not required to challenge me.
I never knew that economic forecasting is the purview of economists and that other lesser mortals are not allowed to venture their guess. I am told that if you meet 20 economists, you are likely to get 40 forecasts and most of them are likely to be wrong. So why should this privilege of guessing wrongly belong only to certain people?
Albert Einstein once met a person with an IQ of 160. They discussed quantum physics. He later met someone with an IQ of 110. They discussed engineering. Then, he met someone with an IQ of 70. Einstein asked him, "what is the economic growth likely to be for next year?"
So, here is my guess. Economic growth for 2010 will be 0% to 2%. My guess is lower than MM. Why? I think that the stimulus would have run out and that people will realize that the underlying problems of the global economic system is quite serious. If I am wrong - attribute it to my IQ of 70.
Tan Kin Lian
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