What happens to the American economy when, as is inevitable, the health insurance industry collapses? *UPDATED*

AJ Strata, who knows complex computer systems, has a few choice words about the administration’s recent statements regarding its plans to fix the exchange.

Also, here’s something I’m not seeing discussed anywhere:

As you’ll recall, the anti-corporate Left concluded that GM was too big to fail and that banks are too big to fail (although not to big to shake down).  However, the same Leftists seem perfectly good with the collapse of the insurance industry.  When I say “collapse of the insurance industry,” I’m not just talking about the fact that Americans will be uninsured.  For the Left, that’s an outcome devoutly to be wished, since they can then socialize medicine.  I’m speaking, instead, about the actual collapse of companies that employ tens of thousands of people and have billions of dollars in pension plans.

Because insurance companies are no longer providing insurance (i.e., pricing their services using actuarial risk tables) but instead are simply being forced to pay for products by taking from the rich and giving to the poor (which makes them sound like Robin Hood, except they’re a Robin Hood who’s acting only because the Sheriff of Washington has a bow and arrow pointed at his back), they will go broke eventually.  And if the young and healthy refuse to buy insurance, the companies won’t just go broke eventually, they’ll go broke immediately.

Then what?

What happens to the American economy when Blue Cross and Blue Shield and AETNA and Kaiser and all the other insurance companies collapse in a distempered heap and, at the same time, hand their tens of thousands of employees pink slips, along with the assurance that all their retirement benefits are gone with the wind?

I’m thinking that, when that day comes around, 2008 will look like a trial run for total and complete economic collapse in America.  I have no contingency plans for that eventuality.  I can only hope that my family can salvage something from the wreckage, so that my last days aren’t spent at a level of poverty rivaling that of the average Calcutta street dweller.

UPDATE:  Yuval Levin is on the same page as AJ Strata when it comes to the problems associated with the “best and the brightest” swooping in to help out.