Will the inexorable rise in medical costs around the world someday pose a major challenge to contemporary capitalism? I submit that in the not-so-distant future, moral, social, and political support for capitalism will be severely tested as would-be egalitarian health systems face ever-rising costs.
Rising incomes, population aging, and new technologies for extending and enhancing life, have caused health costs to rise 3.5% faster than overall income for many decades now in the United States. Some leading economists project that health expenditures, which already constitute 16% of the US economy, will rise to 30% of GDP by 2030, and perhaps approach 50% later in the century. Other rich and middle-income countries, although typically spending only half what the US does today, won’t lag far behind.
Countries in Europe and elsewhere have shielded their citizens from a part of this rise by piggybacking on US technological advances. Ultimately, though, they face the same upward cost pressures.
Hasn’t the start of the twenty-first century marked the death of all other ideologies, with China’s raw capitalism putting pressure on gentler forms in Europe and elsewhere? The problem is that attitudes towards healthcare are fundamentally different.