First, an anecdote.
When I moved from the United States to Spain and created Jazztel in 1998, I opted to offer health insurance to my employees—a very North American concept. I asked them if they would prefer that Jazztel pay for a private health insurance plan, or instead, that I give them that money directly. It wasn’t substantial, something like 60 euros (75 dollars) a month. It surprised me to learn that hardly anyone chose the private health insurance plan, that few were interested in private health care, that they were remarkably content with the public health system and that they preferred to earn 60 euros more a month.
Later, I was given the chance to check out the Spanish public health care system for myself, partly due to my mountain biking injuries and also because of my children’s various accidents. I saw firsthand that it was really very good and very free. Especially coming from the US where health care costs some 600 euros (750 dollars) per month and, you have to pay for additional things that are included as insured here in Spain.
Now, let’s “fast forward” to 2012.
We have a bankrupt Spain being bailed out by the EU day-to-day. A bankrupt health care system and with massive defaults, but still with good quality medicine and full of new hospitals freshly equipped with the latest “bubble” models from when we still had credit. All this accompanied by a great debate over the topic of copays and the plan to charge 710 euros (890 dollars) a year to illegal immigrants. Seeing the situation and being an entrepreneur, it occurred to me to make a business out of this tragedy.
Or let’s just say: make the tragedy less tragic by constructing a business to help it.
Spain is the fourth largest tourist destination in the world. We receive almost 60 million tourists per year and almost all of them come from countries where medicine is more expensive. Why don’t we sell our medical services—that are so good and so cheap—to our tourists? Why don’t we launch medical tourism to a larger scale? Why don’t we transform public health care into an export-oriented industry?
How do you do this? The government could launch a big publicity campaign in which they offer medical insurance to foreigners and allow them access to public health care for 100 euros per month. And for those foreigners who travel here without an insurance plan, they would be charged 40 euros (50 dollars) each time they wanted medical attention and not be seen for free as they are now. North American friends that had health problems in Menorca, for example, couldn’t believe it when after receiving medical treatment, were released without being charged. They were willing to pay 100 euros for a consultation; 40 euros would seem like a bargain. Foreigners don’t expect it, but they receive free medical treatment in Spain.
From here we can start to promote medical tourism. Come get yourself treated with the Spanish national health system! We are the longest-living of all big countries in the world!
If the government ensured that one million of the 60 million tourists pay this medical tourism insurance, it could obtain 1.2 billion euros (1.5 billion dollars) a year. To North Americans, being able to come to Spain and while here, go to the doctor for free, all for an insurance premium of 1,200 euros annually, would be very beneficial. The Germans pay 300 euros a month for insurance. And we won’t even speak of the uninsured people in many countries who have money but not enough to afford insurance in their country. In Argentina, for example, insurance that provides the same quality of service as Spanish health care costs about 300 euros per month. I know that getting a million customers isn’t easy, but the market has 60 million. Later we will have to determine the costs of treating these patients, but I find it possible to make a profit. Especially when there is so much infrastructure already in place.
I think the Spanish government has a possibility to finance a part of the health of its people with medical tourism, and that this opportunity should at least be studied. I know many Spanish people think that health care should be free for everyone, but it isn’t—we pay for it ourselves and we can find more customers overseas. It’s time to be creative and sell medical insurance to foreigners with the Spanish national health system.
Before you read my post, you must read this Economist article.
Are you done? Do you now understand how terrible the future looks not only for the periphery of Europe but for Germany as well? Is it clear that as we stand we are headed for the perfect storm? OK, let’s move on to what I think Europe should do to get out of the crisis, which is basically to start the United States of Europe.
Consider this: it will cost Germany and all of Europe more if there is a wide default, and if Spain and Italy leave the Eurozone. So I think it’s time for Europe to unite and risk inflation as the USA did before.
If you had to summarize the reaction of the FED to the multi-trillion default of 2008, you’ll find that the FED risked inflation and won. That the FED stood there providing unlimited credit, and so did the Treasury. And that thanks to a gigantic state intervention, the US banking system, car industry and many other industries along with the economy as a whole were saved. And there was no inflation. Europe needs to do the same now, but for that, it needs to become the United States of Europe from a regulatory point of view. The other choice is the end of Europe, massive defaults and devaluations and possibly a tremendous shock to the global economy.
How does EU become the United States of Europe?
1) Europe starts the European Treasury. An agency that regulates how all tax revenue is distributed, and can give or withhold government expenditures from EU member nations depending on revenue. Short of that, I don’t see how the EU can prevent a country like Greece from meeting its deficit targets, for example. This European Treasury has to set 5 year objectives for all European nations to go into fiscal surplus to begin paying down European debt.
2) This European Treasury needs to consolidate all European debt into one debt pool regardless of nationality to eliminate risk spreads and with a credible deficit reduction package to bring down all euro interest rates to something slightly higher than Germany’s rates today.
3) The European Central Bank needs to become the regulator of all European banks and offer deposit guarantees for all European banks to stop the massive South to North capital flight that is taking place. All European banks would subject to the same rules, regulators and bank deposit guarantees.
As I see it, the future in Europe is United we Stand, Divided we Fall.
Do countries want to lose so much sovereignty? I think given the alternative, they should. As it is, Europe is a continent in which each country is married but it can mess around. That regime won’t work. It’s either Europe or divorce. Europe needs to unify a lot more as a result of this. One European traffic control, one European army, one European anything that is managed at the Federal level in USA. The USA has found a balance between cities, states and federal that Europe needs to emulate. Otherwise, the euro will not hold.
The enemy? Local powers. But if we were able to do away with tons of people who worked at European borders, European currency agencies we can do away with local patent offices, local traffic controllers, local air forces, local armies, local 100 other things, imagine how efficient we would be. How much better off. How much better prepared to compete globally.
PS: This is a first draft, will be modifying/improving this article as I do more research and get comments.
It was agonizing being a Jew in Spain when Israel invaded Lebanon, when it attacked Gaza and when it shot the Turkish boat. I was against those three acts, as I felt that Israel was over reacting and responding with much more violence than it had received. Still I had a feeling that the tremendous anger of many in Spain was too targeted towards Israel and Jews in general, that it had an antisemitic undertone.
Now that I see how Spain doesn’t react in any comparable way to the massive killings of Syrian civilians by Bashar Al Assad, in a war that has already left over 25K dead, I am coming to the conclusion that I was right, many in Spain are just antisemitic.
It is not that Israel does not commit injustices, it does. And it is estimated that around 1000 people died in the Gaza attack and around 1300 in Lebanon and that is way too many, especially since most were civilians. So I want to make it clear that I opposed those wars.
But the number of casualties in Syria is shocking in comparison and nobody in Spain has done any demonstrating comparable to the massive protests against Israel. Because it was incredible how much Spaniards went to the streets to protest against Israel on each of those three events. I had to hear people call me “genocidal” just because I am Jewish, call all Jews Nazis and other attacks. My children were harassed at school over these incidents as if all Jews were part of them. Still I thought that I had to be understanding because Israel was committing injustices.
But now that I see how little people care about Bashar Al Assad killings I am coming to the conclusion that if Israel kills it’s huge news in Spain, now, if an Arab dictator does commit something that is closer to the definition of genocide however, there are no massive demonstrations in Spain. But if Israel boards a Turkish ship it is front page news and material for huge demonstrations. Not that Spaniards are physically violent because they generally are not, but they are extremely vocal in their dislike of Israel. A Spaniard will say horrible things about Israel and about Jews and it will feel normal. Indeed in Spanish of Spain (not of Latin America) calling somebody Jewish is an insult.
I love Spain but if there is one thing that it is hard in this country is to be Jewish, something that only 1 person in 2000 is. There is tremendous prejudice. Spain is a country in which most have opinions about Jews but most have never met a Jew in person. I wish more went to Israel and then see that while Israel it is clearly a country that has to improve a great deal is is light years ahead of its neighbors.
For the record I have visited Israel, Lebanon, Jordan, Egypt and Syria.
Here’s an article I wrote in Spanish about the challenges of being Jewish in Spain http://www.elmundo.es/elmundo/2008/07/21/lapurezaestaenlamezcla/1216636800.html
Here I emphasize that there is a great deal of cultural prejudice in Spain and it is not at all only a Jewish problem.
Here is a survey of Antisemitism in Europe that ranks Spain very poorly.
My wife Nina and I were at the Olympic stadium last Thursday courtesy of Fon partners BT. The experience was very, very different from watching the Olympics on TV. While you are at the Olympic stadium there are many sports going on at the same time. Many times the crowd is confused or cheering for one event when another one is going on. Including Olympic medal ceremonies. On Thursday we saw Caster Semenya, the controversial female South African runner who was accused of being genetically a man and who went for a mysterious silver medal when it was obvious to most she could have gone for gold. I felt sorry for her but I can see why her rivals argue what they argue about her. We also saw Bolt running pass everyone else, including the other 2 Jamaicans who won the silver and bronze. It was one Jamaican celebration for a little country who deserves it. All this is in the slideshow.