> "The government" is not actually accruing wealth
I tend to agree with that. But there's no doubt it is dissipating vast amounts of wealth.
> it seems clear why government budgets have increase so much
There's a vast amount of waste in government spending, and waste as a result of heavy regulation. If you're really interested,
https://www.theatlantic.com/magazine/archive/2009/09/how-ame...
I do agree with you that there is a lot of overhead and waste in the healthcare industry and government in general.
But this insight is, to me, just not really actionable.
Almost every large organisation seems to end up with a good amount of bloat/overhead sooner or later, and this even includes former super-lean and super-focused enterprises (Intel, Google, AWS, ...), so I don't see how you could ever sidestep this problem completely with the government.
Just cutting regulators and government responsibilities in general also seems a really bad idea to me. Reading that article, how many of its complaints would be solved by fully deregulating and letting the market take care of things?
1) Avoidable infections exacerbated by laziness/cost cutting
2) Lack of price/cost transparency
3) Healthcare costs being wasted on advertising/middlemen
4) Doctors specializing in fields that pay well instead of the ones that are most needed to improve health outcomes
I'd argue that none of those would be improved by switching to unregulated private healthcare, and a bunch of them would very likely get worse.
Another thing to consider when cutting regulation are huge possible negative externalities in general.
Just take leaded gasoline as an easy example (because the bill for CO2 emissions is not in yet). The industry basically "self-regulated" until the 60s (and only because it became infeasible to continue hiding lead toxicity by paying or threatening scientists, which it had done for the previous decades): Total costs/damages were enormous-- probably millions of lifeyears lost, but industry/shareholders did not pay a dime after reaping the profits.
How could drastic cuts in regulations avoid disastrous outcomes like that?
Every large organization does indeed accumulate bloat/overhead sooner or later. For a profit making company, this means it loses its competitiveness and then falls. For government, this means it gets a bigger budget.
The leaded gasoline example is also a disaster. That does not generalize to every regulation being good. For example, regulations prevent victims of the Palisades fire from rebuilding. For another example, rent control.
Reading the article, the bit about Lasik eye surgery resulting in major reductions in cost is pretty illustrative.
Some years back, Frontline did an episode on dental care fraud. It seems the government set up a program to pay dentists to do major dental operations on poor people. Clinics then set up solely to do major dental operations on poor people, and raked in the government money. The trouble was, those people did not need dental operations. Frontline's "solution" was to propose heavy regulation. That won't work, either, because medical fraud to get government money is rampant and pervasive.
You might also consider the software business, which has pretty much zero regulation. It is also a gigantic engine of prosperity in the US, despite having driven costs down to literally zero. There have been many proposals to regulate it, but fortunately none have managed to do so.
> For a profit making company, this means it loses its competitiveness and then falls. For government, this means it gets a bigger budget.
I would argue that with companies, the expected outcome is that they accumulate and then stabilize at a "typical" level of bloat. For software, Google is a good example: Much more bloated than they used to be, but still competitive enough, and looking stable.
Governments also have some ways to de-bloat, mostly from internal and external pressure (like Greece).
I think that consistently getting services at no-bloat prices is just not realistic in general over longer timeframes; Netflix, Google, Uber, Amazon, ... give countless examples of excellent early price/quality ratios that got inevitably worse over time.
My hypothesis is that for our current understanding of what a government is supposed to provided (which did expand significantly since WW2, but mostly for good reasons) we have now reached a "bloat-stable" budget, and there is just no "easy" way to slash this budget without hurting the services (even though in a hypothetical bloat-free environment these could be provided for less).
Here is interesting data which seems to kinda support my point, with government spending as GDP percentage for the US, Germany (less GDP/capita) and Switzerland (more GDP/capita): You can see budgets rising post WW2 across the board, and then stabilizing in the 30-40% range (slightly higher for the poorest country, which makes sense). I would have honestly expected to see those trending up even for the last decades (which they don't really) and Covid was also less prominent than I would have assumed:
https://ourworldindata.org/grapher/government-spending-vs-gd...
Google is currently in big trouble because AI is taking away their advertising business.