Is Alan Greenspan right?

Over Christmas I spent some time reading “The Age of Turbulence; Adventures in a New World”  by Alan Greenspan, who was quite successfull with his main task – managing the US internal inflation. However, looking from the Euro side of the world the US $ lost more than 70% during the reign of Mr. Greenspan. This is pretty close to hyperinflation in South American states. Alan Geenspan’s positive outlook for the US industry is mainly based on the steadily growing high productivity of US workers as compared with the rest of the world. This is quite surprising when you compare the productivity of a Toyota worker versus a GM worker and the resulting products. We also see high productivity increases e.g. at automobile manufacturers like Daimler or BMW in Germany. However, the increase of productivity is mostly a result of more parts and services bought and less parts and services made by the company itself. A worker e.g. at Nike has a high productivity because he is mainly adding a high margin on top of the labour provided by the far east. Certainly such a position in the high end of the value chain is highly desireable and profitable. However, it can erode in a rather short time frame because it is not based on high investments in manufacturing or broad and unique skills of engineers and workers. The profits of these operations can also be diverted easily to other countries, when e.g. China and the emirates are buying banks and other highly profitable companies in the States. 50 % of the profits made by the top German companies are already transferred to other countries despite the fact that the Euro is a rather hard currency. It will be interesting to see wether the US can continue to lead the high margin, end of the value chain industry and keep the profits in the country.           

How to reorganize the US Health Care System

It is obvious that the US Health Care system is broken. Although US citizens spend more money on health than citizens of France, Germany, Switzerland etc US citizens get rather poor health services. Slovenia spends about 10% of US but achieves about the same health standard as measured by the criteria of the World Health Organization.  Michael (Sicko)Moore has shown some examples of European health care systems. Certainly the US health system will change if the democrats will win the next election. However, US should look more carefully in some succesfull health care systems in Europe to really pick the best features and forge a good public health care system. A couple of very good suggestions came from an English senior manager, who was looking into the English system as an outsider. He strongly recommends to strictly seperate public from private health service. Public health care pays for 80 % of the cost of hospitals, doctors and health professionals. Nevertheless the health care industry works mostly for the 20 % cream on top of the base funding. Without the public paying for the base infrastructure and services the private sector would not be able to work profitable! Another good advice was to throw out all business oriented consultants from outside the hospitals and let the working people organize by themselves. The “business orientation” trend in Germany is eating up about 30% of the doctors time to fill out all kinds of forms required for adminstration and detailed billing. As a result there are less doctors available to actually do the work. Young doctors are frustrated and leave the country e.g. for Switzerland or Norway where paper work is reduced to a minimum. Due to the “splendid isolation” of US there is not much “know how” about advantages and disadvantages of different health care systems in Europe. Hopefully US will learn from the people and not only from health care managers about good and bad features of the health care systems in Europe.