‘The Cost Disease ’ by William J. Baumol
Health care costs keep climbing, and Democrats and Republicans agree that this spiral is unsustainable. William Baumol, however, rejects the conventional wisdom. An NYU economics professor, Baumol argues in “The Cost Disease’’ that it is inevitable that cost increases in labor-intensive industries will outpace inflation but that they will be offset by future productivity gains. The principal threat to health care, Baumol claims, is the illusion that we cannot afford it without making devastating cuts in other vitally important areas.