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http://www.marketoracle.co.uk/Article18136.html

Obamacare and the Death of Detroit, the First U.S. City To Face Extinction

Mar 24, 2010 - 05:47 AM | By: Gary North

To understand what is going to happen to America's health care delivery system, we must first understand what has happened to Detroit.

Detroit is dying. Yes, I know that there are lots of books on "The Death of ... " That word sells books. But Detroit really is dying. It is the first metropolis in the United States to be facing extinction. We have never seen anything like this in American history. It is happening under our noses, but the media refuse to discuss it. To do so would be politically incorrect. Two factors tell us that Detroit is dying. The first is the departure of 900,000 people – over half the city's population – since 1950. It peaked at 1.8 million in 1950. It is down to about 900,000 today.

In 1994, the median sales price of a house in Detroit was about $41,000. The housing bubble pushed it up to about $98,000 in 2003. In March 2009, the price was $13,600. Today, the price is $7,000.

There is no surge of buyers to take advantage of fabulously low prices in Detroit. Can you imagine buying a home for cash for $13,600 in 2009 – a house that had sold for $98,000 six years earlier – and losing half your money? It's incredible.

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OBAMACARE

This brings me to the other subject: the health care law. It is not law yet, but it soon will be.
I know what is going to happen.

1. Cost overruns
2. Fraud
3. Additional coverage extended to groups
4. Rising deficits in the program
5. Lower payments to physicians
6. Lower payments to hospitals
7. Delays in payments
8. Rising taxes on the rich
9. Rationing by doctors, hospitals, government
10. Delays in treatment
11. More HMO care: assembly line medicine
12. A search for scapegoats

In 1977, I was involved in an early warning operation. Three teams of physicians and economists toured the country. We hit 30 cities in two weeks. We warned physicians in poorly attended meetings that something like Obamacare was coming. It has now arrived. The physicians we spoke to are mostly retired. They saw some of this happen on a minor scale, but they escaped.
I spoke about the percentage of the GDP (then GNP) devoted to heath care: about 7%. Today, it is 15%. Medicare and Medicaid have increased costs. The care is no better. Except for technology, it is arguably worse.

Obamacare will lead to an expansion of these forms of medicine:

1. Concierge
2. Wal-Mart
3. ER
4. HMO
5. Mexican

CONCIERGE. The rich and very rich hire their own physicians. They pay top dollar. The physicians do not take third-party payments, either from the government or insurance companies. They are independent practitioners. They make house calls. The houses they call on are very large.
For the upper middle class, there are fee-for-service physicians. They take no third-party payments. They do not make house calls.

WAL-MART. These are the walk-in clinics. They are price competitive. They treat minor ailments. They sell services on a one-time basis. They take credit cards. They may or may not cater to the Medicare crowd. They are assembly-line clinics. There are no major surgeries or other high-cost, high-risk services.

ER. Large hospital emergency rooms are mandated by law. The poor get treated there. In a life-and-death emergency, they work. People who would otherwise die in a couple of hours are saved. For walk-in patients, the ERs ration by time. Patients demonstrate their patience.

HMO. This style of medicine is efficient. It cuts costs by cutting services and cutting time. You see the physician on duty. You may not have seen him before. His job is to get you in and out as fast as possible. Time is monitored by the company. Computers make this easy.

MEXICAN. This is off-shore medicine. In Canada, when you can't get treated for months or years, you come to the United States and pay. This will not be possible for Canadians much longer, except for rich ones. Mexico will serve upper middle-class Americans as the USA has served Canadians.

It is possible to get very good surgical care in Asia and Latin America. You have to know who the good practitioners are. Asian hospitals sell for 25% the same level of services. There is less regulation there. Plane fares are cheap. A stay in a hotel is cheap.

There will be entrepreneurs who set up Websites off-shore that direct Americans to practitioners abroad. The Web allows this sort of advertising.

Physicians who practice alone or in small limited liability corporations will find that they cannot compete under the new payment system. Assembly-line medicine will replace the traditional doctor-patient relationship.

TRAPPED

Most physicians are trapped. They cannot sell their practices. The price of practices has been dropping.

Foreign-trained physicians who can pass the U.S. tests are coming to America. They are competitive.
Technical Services that can be digitized are being outsourced to India and other Asian nations.

Young American physicians begin with a lot of debt. They need income fast. They will be hired by the HMOs and clinics. They will not reach the salary level of this generation of physicians. They will be upper-middle-class income-earners.

There will be specialists, of course. Plastic surgeons who specialize in making rich women better looking will not be part of the new system. They will be able to do well. But for the typical practitioner, his career options have been dramatically restricted by the new law.

I think most physicians will stick it out until they retire at age 67. They owe money. They need the income. The law's most restrictive provisions will not kick in until 2014. They will adjust.

Residents of Detroit also adjusted. Then, without warning, the economy changed. Those who were still living in the city saw their capital disappear.

People put up with the devils they know. They do not look for a lifeboat when they hear the ship scrape the iceberg. They assume that it will be business as usual.

Then, one fine day, it isn't.

CONCLUSION

You had better decide which kind of medical care you can live with. Then you had better locate a practitioner soon. This is especially true if you want a fee-for-service physician. People with money will go to them. They are already hard to find. They charge more. It's not easy to become a patient. They are booked up.

while you are at it can you tell me what the numbers will be next week and then review the list and point out anything that isnt ALREADY happening(before the bill was signed)?

Detroit has been falling apart at the seams for decades.

The collapse of the auto industry didn't do anything to help. But the city has been in steady decline for quite some time.

Is ObamaCare gonna make things any better?? Nope.

But it sure can't make things in Detroit much worse.

I'm not entirely sure what correlation the author of the article was trying to make.

all the citys that are failing is because of the stupid people who are in that government . and when those people move on to the next city i can only hope they don't do it again . some people just don't understand what a government can and can't do .

Just what does the decline of the city of Detroit and passing a bill on medical care have to do with each other?

http://www.youtube.com/watch?v=1hhJ_49leBw

A little truth about how Detroit has found itself in it's current circumstance.

Yeah right, maybe we should all go back to sixteen hour days, six day weeks for a dollar a day, raw sewage running in our rivers and down our streets, no health care, no public schools, no public transport, no police or fire protection. Yeah feudalism that's what made this country great.

By all means...please point out what he said that wasn't accurate.

The fact that Detroit has been run by Liberals for the last 50 years or so...check.

The fact that the policies that people were told would HELP them, had the opposite effect...check.

Take a look at the Detroit News and Detroit Free Press and read up on just a few examples of the corruption that ran rampant through Detroit's leadership over the last couple of decades.

Also keep in mind that one of the many reasons that the auto companies failed in this country was because they were demonized by the Global Warming hacks ( hey look....LIBERALS...what a shock ) because they were actually building the cars Americans WANTED TO BUY. That, in combination with bad management, and the UAW out of control ( and don't get me wrong, I am not anti union because I do belong to one ) corrupt Liberal leadership, and you have what Detroit is today.

No one is asking for a " return to sixteen hour days and sewage running in our rivers ". Nice attempt, though.

You think we don't have Feudalism?? Look at D.C. once and you'll see that Feudalism is running rampant.

Only thing is, it's being done by the people who are supposed to be looking at OUR best interests.

So much for our Representative Republic.

Feudalism is pretty much the same idea like today in USA. Top 1% are super rich while the rest are dead broke peasants. Kings, princesses, barons (1%) and the rest who serve them but they are intentionally kept poor and work all day to make enough money to feed themselves but no more (97%).

Intentionally left some room (2%) for the controllers (local judges and puppets enforcing the law of the 1% makes)

Liberals and "global warming hacks" did not kill GM and Detroit. Bad management, corruption and greed did.

So nice to read intelligence.

Right. The top-heavy union contracts, the overbloated city 'administration', the never-ending 'gimme!' mentality, the 'nanny state in micro' that was Detroit, the 50+ years of Democratic rule had NOTHING to do with its demise ... ? Interesting how conveniently some things can be swept under a rug ... nothing to see here, folks - move along ...

I remember when GM hired Ross Perot to streamline their business (that was what he was famous for, fixing failed companies) and the first thing he did was to try to fire a third of the corporate management. GM wound up buying him out for $6 Billion to protect those managers

Too bad it's false " intelligence ".

Of course, I would expect no less from an apologist.

I did point out that there were many other factors...but the fact that he wants to completely disregard the fact that GM got punished for building the vehicles Americans wanted to buy only points out his severe bias and lack of objectivity.

Like the video said, Liberals have been running Detroit for right around 50 years.

Take a look at Detroit and you'll get a good look at America's future.

Kinda sad.

If GM was building products Americans and others wanted to buy, why have they been losing market share to Toyota, Honda, Nissan, and various others for the past thirty years?

Unions and "Liberals" did not kill Detroit. GM and other companies did when they started moving production out of the country so they could keep producing crap, boost the bottom line, over pay executive pencil pushers, and artificially hold up the stock prices.

You want to see Americas future? Don't look at Detroit. Look at Beijing, Ho Chi Min city, and any city in South America or Mexico.

Your argument is so completely based on your personal bias that it doesn't even bear arguing.

GM didn't have anything to do with the corrupt liberal leadership Detroit has had over the last 50 years. That was all those people who voted for the promise of more handouts.

The unions ( Especially the UAW ) had a BIG hand in killing off Detroit. The UAW placed themselves and GM in a position that was simply unsustainable. Things were going well, so the UAW and GM Management BOTH failed to look forward to the possibility of things not being so great. So, the union made demands ( Jobs Banks?? Seriously?? More money or we'll strike...while many were already making well over 100K a year?? Seriously? ) that the management at General Motors could not perpetually sustain. Once the economy started to fail, GM found itself in an untenable position. The UAW had a BIG hand in forcing GM into that position.

Then....once the NAFTA policy was enacted, GM saw a way to actually continue MAKING money, and sent jobs to where the labor was cheaper. ANY intelligent business person would have done exactly the same thing.

By the way...If you owned a business...and if you could build something where the labor is cheaper...have it fully assembled...and ship it here for a LOT less than it would cost you in labor and taxes to have it built here...can you honestly say you wouldn't??

Businesses are IN business to MAKE money. I don't know one business owner who would continue to stay in business if he/she couldn't make money at it.