1. Health Issues

2. NHS
• Started in 1948
• Beveridge report had iden:fied poor
healthcare as a problem during WWII (along
with educa:on and social security)
• Labour government made it a priority to
eradicate “Want, Disease, Ignorance, Squalor
and Idleness”
• The free market system before 1948 had not
worked well as a lot of the popula:on did not
have healthcare

3. Health care pre 1948
• Charging for healthcare led to this being
under‐consumed
• What problems may this under‐consump:on
have caused?

4. Health as an externality
• Healthcare has posi:ve externali:es
• Income is redistributed
• Less is wasted because of ill health e.g.
produc:vity
• Disease is not so easily spread because of
vaccina:on
• Less will need to be paid out through sickness
benefits

5. Problems since the start…
• Medical advances including new treatments and
beUer diagnosis have led to a massive increase in
demand for the NHS
• Educa:on was not delivered well e.g. ea:ng,
smoking, drinking alcohol
• Drugs were developed which are expensive to the
NHS
• The government ini:ally thought that the cost of
the NHS would FALL aWer a period as health
improved!

6. Supply and demand
• When the price is zero, demand is unlimited
• There will always be excess demand, unless
funding is unlimited
• Supply is determined by the budget for the
NHS and, poten:ally, through equipment and
staffing

8. Supply and demand in NHS

9. How do you deal with unlimited demand?
• Wai:ng lists were the tradi:onal way – and to
some extent s:ll are
• Introduce charges (prescrip:on, dental,
op:cian) for those who can afford
• Set up NICE – Na:onal Ins:tute for Clinical
Excellence
• Encourage preven:on – obesity, smoking,
drugs, alcohol
• Medicare Australia – AU$60 for visi:ng GP

10. NICE
• Aims to spend money where there is the
biggest benefit
• An economic decision is made whether or not
to approve a drug or procedure on the NHS
• This is not a quick process and NICE tries to
balance this by looking at how produc:ve
people would be, could they recover?
• High cost, liUle benefit treatments are usually
not given approval

11. Taxing harmful ac:vi:es

12. Taxing….
• Aims to reduce consump:on
• Reduce nega:ve externali:es by internalising
these
• Can alcohol be treated the same as smoking
tobacco?

13. Tobacco and alcohol
• Alcohol is less inelas:c (more elas:c)
• Tobacco is always harmful
• Moderate alcohol is not!
• Thousands of jobs related to alcohol (and tax
revenue)

14. Discussion
• Should the government be involved in our lives
by saying what we should and should not do?
• Should fat pa:ents be made to wait for
treatment?
• Should we be doing more to reduce alcohol
consump:on?
• Should healthcare be provided free at the point
of care?
• What are the failures of UK healthcare?
• How could these failures be eradicated?

15. Environment

16. Environment
• There is discussion about the effects on the
environment of human ac:vity
• It is generally accepted that humans have
caused damage
• Most damage is done by developed na:ons
• Some developing countries are rising fast to
become big polluters, and many more are
likely to follow

17. Who should pay?
• Developing na:ons argue that developed
na:ons should pay for the damage as they are
causing most of it, and that developing
na:ons have liUle resources to deal with the
issue

18. Poten:al solu:ons

19. Kyoto
• Signed in 1997
• Developed na:ons aimed to reduce carbon
emissions by 5.2% below 1990 levels by
2008‐2012 (recession analysis point)
• 141 countries ra:fied the agreement
• EU chose a ‘market’ solu:on – tradable permits –
buy and sell permits as required with financial
gain or loss – s:ll a generous allowance but
(analysis) the scheme is in place so allowances
may fall and it may have more of an impact

20. Kyoto and the non‐signers
• US and Australia refused to sign
• Australia has since signed
• US sees Kyoto (and Copenhagen, 2009) as a
serious threat to the development of its economy
• Analysis – if the US does not reduce and there are
serious environmental problems in the US, who is
to blame?
• Could the oil spill in the Gulf of Mexico be a
consequence

21. The problem with China
• China has had a growing economy for a long
:me and this is having an impact on its
emission
• The growing economy has led to an increase in
demand for raw materials and consumer
goods, which all have a pollu:ng effect
• In addi:on, cars and airplane journeys are
increasing which create more pollu:on

22. China

23. China
• ¼ of the country is now desert
• Every major river system has been affected by
untreated sewage
• 70% of the world’s discarded computers end up
in China, some parts reused and the rest dumped
in landfill sites – toxic effect
• Acid rain causes problems in neighbouring
countries
• Much development has not taken account of the
environmental (or social) impact of these –
causing nega:ve externali:es which will last for
years

24. China
• The demand for resources has led to forests
being destroyed in the Philippines, Thailand
and Cambodia
• In order to get resources from Africa, the
Chinese have helped to build dams, roads and
bridges in Africa without care and
considera:on for the environment

25. Discussion
• Should the US and China have signed up to Kyoto
and why?
• How can UK consumers/government help to
convince China and the US to be more
environmentally aware?
• Do the nega:ve externali:es only affect one
country?
• Is the carbon trading scheme in the EU the best
way to go about reducing pollu:on?
• Have we learned anything since the ozone crisis
in the late 1980s?