Originally published at Notes From The Bunker. You can comment here or there.

,Rawles linked to this article about Greece. Pay close attention to this paragraph:

Greece’s health insurance system relied on pharmacists like her buying full-price medicines on credit and distributing them at heavy discounts before claiming the difference from the state. As the state-run insurance schemes have gone bust, that money has stopped. She has not been paid since September last year. The 31-year-old kept faith with the old system until the money owed her topped €50,000 (£40,350). That debt is about average and the reason 1,500 pharmacies have closed since 2009.

The day before, a patient had come in needing Seroquel, a medicine for schizophrenics. They could not afford the €42 fee for the fortnightly treatment and had to be turned away. “I feel very bad, but if I get into debt with suppliers, I’ll go to jail,” she says.

So pharmacist buys [drug] for $50. Sells [drug] to patients for $20. Government gets the bill for the difference of $30 (plus, presumably, some profit for the pharmacist.) When government has no money, pharmacist is on the hook for the $30. Choice is then to either sell the drug to the patient at the price the government was being charged ($50 + profit) or stop buying drugs when patients can’t pay for them. This is a perfect example of what I meant a few posts back about why austerity measures are hated by these countries populace. Faced with the ‘real’ cost of their medication, Greeks cannot afford them. Without the government subsidizing the cost of the drugs, the pharmacist won’t buy them because they’re not going to buy what they cannot sell. The result, very predictably, is that there are now drug shortages looming.

Any business or industry, in Greece or anywhere else, that relies on ‘easy’ government money to make things function is skating on thin ice these days. As things progress I think we’re going to see more situations like this in more countries where government has artificially been keeping prices low through subsidies and can no longer afford to do so…pissing off the population who, having come to rely on those products and services at low prices, will be outraged at having to pay ‘their fair share’. Political fallout, naturally, will be severe.

I suppose it might be a good idea to analyze and examine our own systems and see where such weaknesses are so we can have workarounds ready for when/if this sort of belt-tightening comes a-knocking at our national door.