Look, our society functions at all because most people are good people. Not everyone is good, so good people who are scared of bad people have given government power over all people. The problem is, power corrupts good people.
Government gives power to insurance (and to other healthcare related companies, and really to a myriad of other players in other industries) primarily by:
- introducing regulations that make competing with incumbents nearly impossible
- giving tax breaks to favored corporations and behaviors
Why does government do this? Again, because the good people in government have been corrupted by power. The people they give power to help them stay powerful by giving them campaign contributions and other favors. It's a vicious cycle.
I'm not sure how to answer your last question, "what actions do you think companies might take to benefit customers if not for government involvement?" when every corporation does things to benefit it's customers. That's why any and every corporation exists, to benefit it's customers. Customers are anyone that benefits the company. Apple makes great products that benefit their customers without the government telling them to do it. In industries like healthcare in the U.S. right now, we are not the people who are primarily benefitting the corporations. The way things are bought and paid for right now I don't think we benefit health "insurance" companies at all!
> “That's why any and every corporation exists, to benefit it's customers.”
That is an incredibly optimistic belief you have about the purpose of corporations. In reality, corporations only have the responsibility to benefit their shareholders.
Making sure your customers are happy and keep giving you business is certainly one route. And I think most companies at least start out this way.
Though it’s funny you use Apple as an example, since they’ve been widely criticized in recent years due to the parasitic App Store practices enabled by their stranglehold over the smartphone industry.
Government does get corrupted by money, but that money ultimately comes from rich corporations. Eliminating government involvement could just make corporations abuse their power in other ways.
And I would reply that your view is incredibly pessimistic.
Making your customers happy is the only route they have. When governments or other third parties get involved then you and I might no longer be the customer, but I can assure you that the corporation is still serving their customers.
That's the number one problem with our current situation in the US with healthcare. You are not your doctor's customer. You are like, 3 layers away from being his or her customer.
No, it’s not the only route they have at all. There is a long history of companies screwing over their own customers to make money. I can’t honestly believe that you aren’t aware of this.
Just look at how Wells Fargo a while back was opening up accounts and charging fees to customers who never authorized it.
Or Purdue Pharma that gave kickbacks to doctors to prescribe opioids and misled the public about how addictive they were.
Or payday loan companies that suck people into vicious cycles of debt. Or the numerous companies that profit from gambling addiction.
Or the big banks that gave out dubious mortgages and lied about risks to investors, which precipitated in a global housing meltdown and recession in 2007.
Or how cigarette companies lied about the dangers of smoking, leading to countless deaths.
Companies will lie, cheat, and scam their way to profits if they have to. Not all of them, and not all of the time, but the endless quest for more money is always corrupting.
Sigh. Sorry that I didn't specify "long-term route." Some of those examples are of companies making moves that made them money in the short term but hurt them in the long run. In a free market, customers can easily stop giving money to corporations that do that. I might point out that in a couple of those scenarios heavy government regulations and/or protections made that difficult for people to do. I would also point out that those examples are a small percentage of companies overall because again, most people are good people. Things will never be perfect, but we don't list off the examples of successful companies giving customers what they want because there are so many.
Also, you have to understand that public corporations get cash from people buying their products and services and from investors. The investors are therefore just as much their customers as you and I are. Often it feels like investors preferences are given far more deference than your and my preferences. In a free market, we can pay attention to that and make choices accordingly.
Finally, your opioid example is very pertinent to the original topic. You and I were not Purdue Pharmas customers in that scenario. The doctors and insurance companies were. We are just a weird cost of doing business caught in the middle.
Theoretically customers can give their money to some other company, but we have seen massive consolidation across most industries over the course of decades. Many important markets are dominated by only a few large companies.
The free market works when there is actual competition. If we want a healthy free market, then we need vigorous antitrust action to block mergers and break up companies that get too big.
I also would recommend that government should stop making regulations and tax breaks that favor one company over another. I think that would be even more effective than just antitrust enforcement.
And what actions do you think companies might take to benefit customers if not for government involvement?