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> unregulated insurance market; price gouging. with sufficient competition, it is impossible to price gouge. So if there is supposed price gouging, then there
by chii 2y ago
> unregulated insurance market; price gouging.
with sufficient competition, it is impossible to price gouge.
So if there is supposed price gouging, then there must be insufficient competition. Therefore, the source of the lack of competition would need to be removed (ostensibly, by gov't - such as increasing business loans so that new insurance companies can be started).
- kstenerud 2y agoOr, you need to be pragmatic, realize that you're not gods and won't create a perfect system that can't be exploited, and instead tackle the issue from multiple angles while revising your approach as the exploiters attack. Don't let the perfect be the enemy of good enough.
- d0mine 2y ago"good enough" assumes a lot about the rules of the game here. Imagine, the game is: "heads I win, tails you lose" and then read your comment.
- dr_dshiv 2y agoOr, the market lets the gods do their work, rather than the government acting like one. —esoteric capitalism
- Panzer04 2y agoWhat are you trying to say here?
- kstenerud 2y agoI'm saying that running a government is a lot like running a ship: You can't just let the currents and tidal forces ("the invisible hand") run the show unconditionally because even though they can propel you great distances at very low cost, they'll eventually throw you upon the reefs. And you can't just let the rowers and tillers (legislators & executive) run the show unconditionally because they'll end up exhausting themselves with little to show for it as they fight against the winds and currents when they should cooperate. It's a balancing act that requires some science, some experience, some luck, and a steady hand - and a capable and honorable captain and crew who believe in the mission.
- Panzer04 2y agoI still don't follow. If I'm reading it right, and the prior context, we shouldn't allow private insurers to charge the prices they want for insurance? What do you want us to do? Ultimately someone has to pay for the bad outcomes happening here - either that's homeowners in risky areas, insurance shareholders or the general taxpayer, depending on where you fall. If you don't make the ultimate originators of the risk pay for it (people in risky areas) they won't stop doing the stupid thing and others will bear the cost. Arguably that is the greatest strength of the "free market" - directing the efforts of everyone in the same, positive, direction.
- kstenerud 2y agoBecause although in the recent LA case we're dealing with rich folks who could shoulder the increased burden, often it's the poor areas that are riskier, and where the people there have little choice over where they can live. There's no universal solution. A "free market" approach will work in some areas, and fail spectacularly in others. Same goes for a full-on centralized control approach. And in all cases, you also have the confounding factor of bad actors gaming the system - and your current tools may be insufficient to meet the challenge. So you need a human guiding hand to make sure things don't go too far out of whack. This isn't an either-or decision. Stability doesn't care about whose motives or approaches are more "pure".
- derektank 2y agoI mean, there's sometimes simply not enough capital available to support the creation of further competition in a sector. And government subsidies in the form of cheap business loans are sort of robbing Peter to pay Paul. You're simply allocating capital from one sector (the one being taxed) to another