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In one sentence, IMO of course, passing something through should be much cheaper than actually building something or adding value unless you're bilking people.
by jbooth 16y ago
In one sentence, IMO of course, passing something through should be much cheaper than actually building something or adding value unless you're bilking people. In another sentence, insurance companies don't administer care, they just move money around.
Compare to the overhead as a % of revenue for the social security administration, for example. They're a simpler passthru so it's not a completely fair comparison but insurance is closer to SS than it is to manufacturing.
- barry-cotter 16y agopassing something through should be much cheaper than actually building something or adding value unless you're bilking people. The amount someone gets paid for doing something depends on how much value they capture, not how much they add. In most cases where all parties contract freely, you can't capture more than you add, but anyway _Value added and paid are often wildly out of whack_ "Bilked" is a moral judgement. If you're saying you think insurance is unjustly fair then since that's a fact about you not about insurance, sure it can be true. But it's like "profiteering", a moral/political statement, with no economic content.
- jbooth 16y agoAdam Smith would differ with you, in the ideal case. Value capture and rent seeking aren't how capitalism are supposed to work. Heck, if that was the best capitalism could do, I'd be inclined to try communism.