US health care stands Adam Smith on his head

“It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity, but to their self-love,” wrote Adam Smith famously in The Wealth of Nations, laying the intellectual foundation for the assumed benevolence of free markets. The argument was that, in a properly structured, competitive market, the supplier of a good or service, although intending only his own gain, is “led by an invisible hand to promote an end which was no part of his intention . . . By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it.”

Had Adam Smith lived to observe the political economy of 21st century America's health care, he may well have stood his famous dictum on its head, writing: “Although, by providing health care on an uncompensated basis, American physicians and hospital executives seek to …