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Comment by rossdavidh | Hacker News Reader

Speaking as an American who has been to Europe, used their mass transit (and mostly liked it), but has skepticism about a lot of European political processes working here: yes, absolutely. All 3 of your points are spot on.

Healthcare does have an impact, in that the comparison of labor costs btw US and Europe often doesn't account for the fact that the cost of labor in the US includes health insurance, generally, whereas the cost of labor in Europe does not. This is the flipside of comparing tax rates between US and Europe, where Europe's rates look very high, but include healthcare generally, so the same cost is booked as labor in the US but as general government spending in Europe.

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Healthcare in Europe is also paid by the workers, with their taxes.

The real difference is that it's 2-3 times as expensive in the US.

> The real difference is that it's 2-3 times as expensive in the US.

Yes. Which may be caused by the same three issues:

1. Doctors afraid of being litigated by patients, doing unnecessary treatments and paying costly insurance.

2. Corruption and bribery leading to things like Medicare being unable to negotiate drug prices and doctors prescribing addictive opioids to the tune of billions of dollars.

3. Inverted competition: Hospitals run a for-profit business while patients will prefer the best and most expensive service they/their insurance affords them. Who chooses a treatment based on price when your health is at stake? Also, somehow, drug prices are much higher than anywhere else, even completely generic stuff like insulin.

Nobody looses, except everyone else

As an outsider from Europe, you seem to understand the situation here better than most Americans.

People who live outside of a system but are heavily exposed to it can often develop insights that those who are immersed will overlook.

Case in point: see this video of foreign journalists expressing their views of American culture.

https://www.youtube.com/watch?v=hcTXPT5LrL8

That is, for sure, a big difference, BUT...whether or not that cost is considered "labor cost" or not, i.e. whether or not it's part of the cost of digging tunnels, is different. The healthcare is being paid for out of general taxes, not as part of the budget for that tunnel, so it doesn't get accounted for as part of the cost of the tunnel. And probably shouldn't, but in the U.S. it is.

It's part of labor cost in many other countries too, since it's a percentage of the wages, so if health care is very expensive wages have to be high. (As a first order guess.)

But simply the problem is that the US economy is brutally productive, so the price of every input (labor, raw materials, capital) is priced according to their opportunity costs. If the same labor could make something that would then lead to a lot of profit in some other sector, then construction has to pay that high labor cost too.

http://rationallyspeakingpodcast.org/show/rs-236-alex-tabarr...

Never mind who pays what ultimately, the marginal costs are borne differently so you could in principle spin up some temporary construction labor for cheaper.

(Other laws make employment less liquid, somewhat reducing this benefit. IMO those laws should be changed, but only with the non-work-related benefits increasing commensurately (UBI). (Definitely not trying to bolster the Macrons here.))

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