The phrase “commanding heights” was first used by Lenin to describe the key elements of a national economy. At the time, that amounted to industrial production. A book and television series of the same name described the battle between the central planning statists and the free marketeers. We all know how that ended.
This paper proposes that for the 21st century, the commanding heights have changed. Industrial production today is a much smaller portion of the economy. The new commanding heights are health care and education, or so they argue. If they are correct, we may be on the wrong side of the war. In terms of health care, we are increasingly moving toward a centrally planned system. Medicare and Medicaid are about half of all health care spending today. Obamacare will put government firmly in the driver’s seat. Government already dominates education, although there are glimmers of hope with charter schools and the like.
The reasons for the failure of central planning are well known and well understood. I see nothing that is inapplicable to health care or education. The growing risk is that American education and health care will grow the attributes of Soviet era industrialization.