I was laughing when I read this:
Gladwell indicates his confusion on the issue of moral hazard by offering as another supposed illustration, "If your office gives you and your co-workers all the free Pepsi you want -- if your employer, in effect, offers universal Pepsi insurance -- you'll drink more Pepsi than you would have otherwise."
That is not moral hazard. That is the law of demand.
Gladwell confuses the law of demand with moral hazard! No wonder, the guy is being used as a punching bag -- read the last two lines of Arnold Kling's TCS article.
I, too, agree with catastrophic coverage. However, the Leftists have warped the idea of medical insurance. To them it means that the government controls and monitors the entire health industry.
Once in a debate with a socialist guy, I said that auto insurance doesn't imply that one should get paid for normal usage of a car like the cost of gas, repairs etc. So, why should the government pay, with health insurance, for every single medical treatment? His reply was quite revealing. He said that with that kind of catastrophic health insurance, only the poor would utilize it and so we'd end up with a segregated system where the rich get a better service, because they have money, and the poor are stuck with lower quality doctors.
His logic was the same with his opposing school vouchers. He wished for free education and free health coverage for the poor. To that end, he wanted the government to have TOTAL control over the education and health institutions. Therefore, everyone, the rich and the poor, would have the same and equal access.
I call it the equal distribution of misery.
Link via Chicago Boyz.