References

2 Lujo Brentano, Der Arbeiter-Versicherungszwang, Berlin, 1881, pp. 94 if. "Compulsory sickness insurance," wrote Brentano almost 60 years ago, "is not to be considered as an isolated economic measur~. It is part and parcel of the great economic program which is built in all its elements on the same basic idea. Not only are the chief advocates of the railroad nationalization, of the governmental monopolization of all insurance, the nationalization of vital industrie~ of the. gov ernmental administration of the banks, and of the transformation ot agricultural credit institutes into State organs1 the same persons who propose to force the workers into obligatory panels-the inherent unity of all these measures and projects calls for no 'filroof. Once we are that far, the situation then will be simply that the economic hfe of each individual will be woven in the' most intimate fashion into the activities of the State and dependent on the measure of its administration. "

'8 Quoted in Manya Gordon's Workers Before and After J;.enin (E. P. Dutton and Cp., 1941) p. 290. CHAPTER TWO: 1 M. J. Bonn, Wandering Scholar, New York, 1949, Chapters II and III. 2 See, for a typical example, article "Health Insurance" by J. L. Cohen in the Encyclopedia of Social Sciences, Vol. VII, 1932, p. 294: "It was Bismarck's great achievement that he took advantage of the expanding mutual aid move ment, led the humanitarian sentiment of the 1870's and 1880's and made accept able. the thesis that compulsion, was inevitable." "Bismarck made it clear that the thorough-going paternalism removed the legitimate causes of socialism." The learned author not only makes a humanitarian out of a Bismarck, but also implies that there is no more socialism left but of an illegitimate sort. S W. A. Sollohub, "Social Security in France," Harvard Business Review, Spring 1937, pp. 283 ff. CHAPTER THREE: 1 Bismarck's Christianism is' well illustrated by his statement (quoted by Eyck, Bismarck, Vol. III, p. 371): "He who has a pension for his old age is much more satisfied, and much easier handled than he who has no such prospect; ..• he will take much more on the chin, will show much more attachment to his job than the other; why, he expects a pension."

2 G. de Lagarde, Securite Soeiale, Legislations Nationales Comparees, Paris, 1945 (unpublished manuscript). S Sir William Beveridge, Social Insurance and Allied Services, The Macmillan Co., New York, 1942. CHAPTER FOUR: 1 An incomplete (and unsatisfactory) bibliography of literature on free panels is to be found in the official·Public Health Reports (Washington, D. C.) of May 23, 1947: ~'Voluntary Health Insurance in Western Europe," by St. J. Perrott and J: W. Mountin. See also the publication of the International Labor Office: L'Assurance Maladie Libre, Geneve, 1927#. About the evolution of Swiss panels: Kinkelin, Gegenseitige Hilfsgesellschaften der Schweiz, Bern 1903. Reports of in dividual free panels. or of their federations are the main current source of infor mation about them. Consult: Barb::araArmstrong, The Health Insurance Doctor, 148 . Princeton U. Press, 1939, pp. 101-164, on Denmark (detailed but superficial); A. Gourdin, Les Societes de Secours Mutuel, Paris, 1920 (on France) ; L. Brentano, Zur Geschichte der Englischen Gewerkvereine, Leipzig, 1871, for the origins of English panels.

2 The American counterpart, but without the community type of organization, sponsored by doctors rather than by the patients themselves, is the prepaid health scheme. Cf. the (unevitical) compilation of Herbert D. Simpson, Health Protec tion: A Study of Pre-Payment Medical Service Plans, Chicago, 1946. 8 Their knappschaften counted 190,000 members in 1869, and 410,000 a decade later. 4. The best and most up-to-date international survey of compulsory sickness security legislations is the Analyse Comparee de la Legislation Etrangere sur l'Assurance-Maladie, as of March 20, 1947 (printed as manuscript) of the Swiss Federal Office of Social Insurance. The comparable publications of the Interna tional Labor Office (Geneva): Die Obligatorische Kranken-Versicherung (1927) and Die Sozial-Versicherung im Jahre 1929 (1930), are purely legalistic and antiquated. Currently, the International Labor Office publishes in English the text of sickness insurance laws of a number of countries.

CHAPTER FIVE: 1 For abundant samples of mercantilist (16th to 18th c~nturies) policies along the lines of what is called today Full Employment and Social Security, see C. W. Cole, Colbert Vol. II. New York, 1939, pp. 472 if.; C. W. Cole, French Mercan tilism 1683-1700 New York, 1943, pp. 212 if.; L. E. Heckscher, Mercantilism, London, 1935; E. Lipson, The Economic History of England,Vols. II and III, London, 1934, and article "Merkantilismus n in Handworterbuch der Staatswissen schaften, Vol. VI, 4th ed., lena, 1925 (with bibliography). 3 Professor Antonelli in the Revue d' Economie Politique, 1947. 8 Pierre Drouin, in Le Monde of February 8, 1949, part of a series of excellent articles on the French scheme. The other articles appeared FebnIary 3, 4, 6-7 and 10, 1949. CHAPTER SIX: 1 ceo ••One knows that patients are going for things like bottles of cough mix ture and aspirins and so on which they did not go for before," was the explanation given by the accountant-general of the Ministry of Health .before the Select Com mittee on Estimates (May, 1949. p. 59).

2 French official statistics, incidentally, are very meager. Reliable current data are obtainable from the federation of French panels, known as F.N.O.S.S. (Federa tion Nationale des Organismes de la Securite Sociale). They are published and incisively analyzed in the privately circulated Letters of the Comite Central des Institutions Sociales, under the direction of G. de Lagarde. The official exchange value of the french franc has depreciated from about 2~ cents before the last War to less than one-third of one cent by the end of September 1949. Currently, the deficit of the French sickness security is covered by funds taken from the old age security. CHAPTER SEVEN: 1 Current official publications, the latest available, on the Swiss system's leg!s lative set-up and the statistics of its operation, all by the Federal Office o~ SOCIal Insurance (Bern): Die Obligatorische Krankenversicherung in der Schwe'l, as of January 1, 1949; Statistik uber die vom ~unde Ane~kann~en Kranke.nkasse,n and Tuberkuloseversicherungstriger, 1947; Causes-M alad,e SWIsses It CalSses d Assur ance Contre 14 Tuberculase, 1938-1943 (1946).

149 2 German statistical data compiled from the following official sources: W. Dober nack, "Entwicklung undStand der ,·Deutschen Sozial-Versicherung,'" in the Jahrbuch der Kranken-Versicherung, 1929; Statistisches Jahrbuch fur das Deutsche Reich, annual; Unger-Wiegelow, TabellenwcrkderDeutschen Kranken-Versich erung, 2. ed., 1932; Die Kranken-V'erSipherull~ 1937>(i,n the series "Statistik des DeutschenReiches," vol. 529),.' Be~Un" 1~3~;x1Ji.e.i"1j)eutsche .' Sozialversicherung, 1938, published by Germany's Federal Insurance .Agency,Berlin (1939). S Ministere du Travail et de la Prev9yance Sociale (Bruxelles): Rapport, Gen eral sur l'Annee Sociale 1947, 2 vols.; do., "LesBaremes de l'Assurance Obliga toire," in Bulletind'InformationduF. N. A. M. I., November1, 1948. CHAPTER EIGHT: 1 For the early development of m.edical relations in the compulsory schemes, the best treatisesar~ T. Plant, Der Gewerkschaftskampf der Deutschen Aerzte, Karls ruhe,' 1913; H. Korkisch, Die Arztfragein der Sozialversicherung (a symposium), Prag, 1926; and the dissertation of G. Augustin, Die Arztfragein der ••• Sozialen Kra",kenVersicherung, Berlin, 1931, with extensive international bibliog raphy; Finkenrath, Die Kassenarzt/rage im In-und Auslande, Berlin, 1931. Best up,:-to-date summary of the doctors' and pharmacies' legal status in the German scheme: Gustav W. Heinemann, Kassenarztrecht, Berlin, 1942. The complex regu lations of entering panel practice in Germany are fully reprinted, and interpreted in Fr. Thieding'sDie Zulassung zur Kassenarztlichen TatigkeitJ,Hamburg, 1948.

2 According to one expert, medical incomes,were declining since-the 17th cen tury; Kurt Finkenrath, in Gross-Berliner Aerzteblatt of September 18, 1926. 3 Based on the Report of the Interdepartmental Committee on the Remunera tion of Consultants and Specialists (Spens Committee Report) of the Ministry of Health, 1948 (Cmd. 7420). Ie Ministry of Health, Report of the InterDepartmental (Spens) Committee on the Remuneration of General Dental Practitioners, 1948 (emd. 7402). 5 G. W. Morey, "The Position of the Specialist To-Day," in Fellowship for Free dom in Medicine, Bulletin No. 6, October, 1949 (London). CHAPTER NINE: 1 Antonelli, Ope cit. 2 For the treatment Lloyd George meted out to the British Medical Association that willingly offered its cooperation-the learned study of the late Professor Herman Levy, National Health Insurance (Cambridge, 1944) produces rich docu mentation. It is the best analysis of the Lloyd George panel system.

S But by appealing to, the Supreme Court' of Australia, the doctors of that Dominion succeeded in stoppin~, the government's attempt to force them ,into issuing special' prescriptions for C free" medicine. CHAPTER. TEN: 1 The Nomenclature Generale des Actes Professionelles, published by the F.N. 0.8.8. (.2. ed., Paris, 1948) gives the' "nomenclature," in capital letters and num bers, of all medical "acts." The same designation may serve for any number of them: K x 25 may mean a throat, ear or eye operation-at the identical fee. to the respective surgeons. This technique of remuneration is supposed to guarantee professIOnal secrecy. CHAPTER ELEVEN: 1 "Liberal" labor economists take the same attitude of ignoring or pooh-poohing the corruption charges. Typical was the otherwise outstanding German book on labor problems, Die Arbeiter/rage, 2 vols., Berlin, 1926, of the very dignified and 150 learned Professor Heinrich Herkner (Berlin). When it came to the crucial ques tions of compulsory medicine, he lost academic dignity and scientific temper.. The problems simply are ignored by R. M. Woodbury, Social Insurance, an Economic Analysis, New York, 1915; and by most other "economic" writers on the subject.

See also Frieda Wunderlich, Der Kampf um die Sozialversicherung, B.erlin, 1930. 2 Similar "statistics" are forthcoming from satellite countries. The Polish Work~rs' Tribun~ (Warsaw) reported lately that in one Silesian coal mine 19.5 per cent of the staff had not worked in July, 1949. "At the Siemianowice mine the July absenteeism rate was 17 per cent, of which justified absenteeism amounted to only 1.5 per cent. 'The. rest,' a party secretary charged, 'are loafers who manage to bring a doctor's certificate.' " S Partly, this is the doctors' own undoing due to their tendency to emotionalize the issue. The voluminous' German professional literature is, in particular, loaded with exaggerations about corruption in the sickness scheme. But the following books, among others, contain much material that the writer could ascertain with reasonable accuracy: Erwin Lieck, Die Schiiden der Sozialen Versicherungen ..., Munchen, 1927; W. Lincke, Krankenstand und Arbeitwille, Berlin, 1930; W. Stap pert, Krankenschein Gefallig?J Munchen, 1928; Stefan Feigenbaum, Die T endenz zur Sozialisierung der Aerztlichen Hilfe in Deutschland und Oesterreich, Berlin, 1923; A. Schlossmann, Die Krise des Aerztestandes, Leipzig, 1930; Fr. Wolff, Der Krank~ und die Krankenversicherung, Munchen, 1928.

4: Seventh Report of the Select Committee on Estimates, 1949, p. 28. 5 The chief exposer of abuses and "rent-hysteria" in the German workmen's com pensation scheme was Professor Ludwig Bernhard. Unfortunately, his biased pre sentation reduces the value of the rich material in his Unerwiinschte Polgen der Deutschen Sozialpolitik, Berlin, 1912. A high official of the Swiss obligatory acci dent insurance system pointed out actual frauds in that scheme, based on co operation between doctors and patients: Otto Keller, 25 jahre Suval, 1946. CHAPTER TWELVE: 1 G. Scott Williamson, Physician Heal Thyself (Faber and Faber, London, 1944). This scintillating little book deserves widest publicity, notwithstanding some of its dilettantic aspects in matters of social, as different from medical, policy. 2 Ferdinand Deter, M.D., "Revolutionary Thoughts on the Reorganization of the Sickness Insurance," in the German magazine Versicherungs-Wissenschaft und Versich~r"ngspraxis, No.7, 1948.

8 The testimony of a top official of the German social insurance administration may be worth quoting: "The physician must give way to the demands for benefits and certificates if he wishes to preserve the good will of his clientele. It is not conscious intention or malice against the panel that drives the physician to act this way; he cannot do otherwise, he must take the patient's side or else he cuts off the branch of the tree on which he sits." A. Grieser, in the official periodical Die Reichsversicherung, August, 1930. 4: Even some official indication of this is available. See the Seventh Report of the Select Committee of Estimates (House of Commons) on the Administration of the National Health Services, May 1949, p. 21. 5 The importance of such non-medical elements for the medical history of each case is forcefully stated in the autobiography of an outstanding heart specialist, Professor John Plesch, janos, the Story of a Doctor (A. A. Wyn, Inc., New York, 1949).

6 On the family doctor: David Riesman, Medicine in Modern Society, Prince ton, 1939; and on his epidemiologic significance: Thomas Francis "The Family Doctor," in Th~ journal of the A.merican Medical Association, Oct. 1, 1949. 7 Quoted by Dr. L. H. Bauer, Private Enterprise or Government in Medicine (Springfield, Ill. 1948) p. 47.

151 CHAPTER THIRTEEN: 1 There are some 80 different techniques.of deductibles in use to substitute for the. price. mechanism, to reduce •the scheme expenditures, .and to "punish" the bene.. ficiary by burdening him. with some part. of them, including the Bruning method of a charge ·On the sickness ticket which the patient has to .fetch before going. to the doctor. See. the dissertation of Elsa Schnurren'berger, Die. Ausgabensteigefung ..•• in der Schweizerischen sozialen Krankenvefsicherung, Bern, 1939. (After this present book went into·print, the British government announced the increase of a one shilling, or 14¢, charge on each prescription.) 2 A short and enlightening survey of such futile methods of pharmaceutical con trol ~s oll'ered ~n o. de Lagarde's art;cle. "Les AssurancesSoc~ales," ~n the sym posium Ll.gislation Sociale :Appliqule, Paris, 1943, p. 121. 8 The process is vividly described by Mrs. J. K. Irvine: "How British National Health Prescriptions are Priced.." in :American Druggist, July 1949.

4: "After these cuts," the chairman of one regional hospital board said, "the service will be put back 20 or 30. years. Most of what was gained in the thirties will be lost." (Daily Te18~raph, London; May 20, 1949.) Note that the "neces sity" to refinance the hospltals was a chief argument for their nationalization. 5 The official Rapport General sur • • • I'Assistance publlque, by Monsieur de Fontenay, to the Conseil Municipal of Paris (1947)_ describese:x:tensively the financial and technical plight of the massively subsidized public hospital system of Paris. An even more vivid picture of. mismanagement and corruption is painted by Roland Marchais, "Du cote de I-Assistance publique de Paris,uinLe Monde, April 20, 21 and 22, 1949. About the deplorable conditiono£ London's "voluntary" hospitals, see the Liberal Party's report, Health for the People, London, 1942, pp. 12 ff. They are becoming more deplorable under the new scheme. See also R. M.

Cunningham, "Hospitals Under Socialized Medicine" (in England), .The Modern Hospital, 1949. 6 Le Figaro (Paris )of May 15, 1949. 7 By Professor P. T. Swanish: The Cost of Dental Care Under Health Insur ance, published by the Chicago Dental Society, 1938. CHAPTER. FOUR.TEEN: 1 A summary of elaborate procedures in controlling the British doctor (includ ing "Investigation of Excessive Prescribing", "Investigation of Certification", "In vestigation of Record Keeping", "Recovery of Cost of Substance Held Not to Be a Drug", "Power .••to Consider Complaints", etc.) in Statutory Instruments, 1948, No. 507. 2 The Federation of French Social Security "organisms" (called 'F.N.O.S.S.) employs some· 80 people for the sole purpose of clarifying and interpreting the texts which. the Ministry of Labor shoots at panels. Pierre Drouin in Le M onde, February 3, 1949. B Cf. A. Abramson: "Social Insurance in Soviet Russia" in The Journal 0"

Political Economy, Chicago, 1929; L. P. Borberg: "Ueber die Sozialversicherung in Sowjetrussland," in Reichsversicherung, 1928; B. G. Dansky, Sozialnoe Stracho vanje ranshe i sevodnja (Social Insurance Before and Today), 2. ed., Moscow, 1928. 4 Very little literature exists on the "sociological" aspects of sickness insurance, such as the operation of small and large panels. The most exhaustive study of German plant panels is that of Rudolf Schwenger, Die Deutschen Betriebskran kenkassen, Munchen und Leipzig, 1934. About Swiss plant panels: Carlos Ochsner Die Schweizerischen Betriebskrankenkassen (dissertation), Uster 1938. .See als~Barbara Armstrong, Ope cit. . , 5 On the political· a~d financial consequences of unification as demanded by the Western. German SOCIal Democrats, see the thorough and critical study of Pro.. fessor Fritz Curschmann, Jedermann und die Reformpliine tur deutschen Sozial152 versicherung, Niirnberg-Mimberg, 1947, and J. Eckert, Zur Neugestaltung der Deutschen Sozialversicherung (1948). Complete bureaucratic control is the con sequence of the sickness scheme unification in Germany's Eastern (Soviet) zone as shown in detail by Professor Hermann Dersch, Sozialversicherungsrecht in der sowjetischen Besatzungszone Deutschlands, Berlin, 1949. A similar system has been introduced early in 194& in Czechoslovakia-one of the first acts of the Gottwald regime. See Czechoslovak National Insurance, Prague, 1948, with introduction by Evzen Erban, communist Minister of Social Welfare.

CHAPTER FIFTEEN: 1 "It should be remembered that the rise of the totalitarian state was coincident with the general reception of the idea of the service state and that both have Marxian socialism in their pedigree. Each in its way postulates an omnicompetent administration by supermen. If experience may be vouched, that means m the end supermen under the direction of an ex-officio superman." Roscoe Pound, "The Professions in the Society of Today," in N,w England Journal of Medicine, September 8, 1949. 2 Ludwig von Mises, Human Action, Yale U. Press, 1949, p. 613. 8 Honor Croome, "Liberty, Equality and Full Employment," in Lloyd's Bank Review, London, July 1949. 4: Pierre Laroque; "From Social Insurance to Social Security: Evolution in France," in International Labor Review, June 1948, p. 588. Actually, a modern istic school of French economists (e.g., Louis Alvin, Salaire et Securite Sociale, Paris 1947) speaks of a salaire d'inactivite-a wage for not doing anything-as a new constituent of workers' income.

5 Gilbert Jackson, "Resurgam: The Gold Standard vs. Modern Substitutes," The Canadian Banker, Spring 1949, p. 3. 6 Lewis MerianL"Social Security in an Unstable World," American Economic Review, May 1941, pp. 335 ff. 6& Dr. Harold Hillenbrand, "Britain Pays Through the Teeth," in Nation's Busi ness, December 1949. 7 L. Brentano J Die Arbeiterversicherung gemiiss der heutigen Wirtschaftsordnung, Berlin, 1879.