November 28, 2013
Roughly one third of all doctors are in the top one percent of the income distribution and the vast majority are in the top two percent. This likely explains both the reason as to why the government is not looking for ways to bring more doctors into the country and the reason the NYT is not raising the question in an article discussing a shortage of doctors willing to accept Medicaid reimbursement rates.
We have deliberately changed immigration rules and standards to make it easier for foreign computer engineers, nurses, and even teachers to enter the country and meet demand in these occupations. There is no economic reason why we would not do the same for doctors. The potential savings to consumers and the government and gains to economy would be several times larger for each qualified doctor that we brought into the country than for every nurse or teacher.
If the government were not actively engaged in efforts to redistribute income upward, regularizing a flow of doctors, with foreign students trained to U.S. standards, would be a major focus of trade agreements like the Trans-Pacific Partnership. (We could design a mechanism to ensure that earnings of foreign doctors are taxed and repatriated to home countries so that developing countries could train 2-3 doctors for every one that comes to the United States. Even an economist could figure out how to design such a mechanism.)
Anyhow, it is remarkable how trade is so selectively defined that enormous potential gains that would disadvantage the wealthy never even get mentioned. While the protectionist barriers that cause doctors in the U.S. to get twice the pay as doctors in other wealthy countries never get mentioned, we get endless hysterics over a couple thousand dollars a year going to families receiving food stamps.
Try to swallow that one with your turkey.
Addendum:
The vast majority of the items on the agenda at NAFTA, CAFTA, the TPP and other recent trade agreements are not formal trade barriers. There are investment rules and various restrictions that made it difficult to for U.S. firms to establish operations in Mexico and other countries. These trade agreements focused on eliminating these barriers so that it would be easy. That is what we should be doing with doctors. (Here’s a partial list.) We don’t because the doctors are too powerful, and the promoters of free trade in the economics profession and the media don’t talk about it because ???
As far as the folks saying that I don’t care about people in the developing world, try answering my argument. Is it impossible to train more doctors in the developing world? If so, please tell us why. It is a hell of a lot cheaper to train doctors (to U.S. standards) anywhere other than the United States. If there is some reason why we should not take advantage of this fact, please let me and others know. If you just want to which righteously, maybe we can create a special section, for that.
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