The Cobra Effect: Lessons in Unintended Consequences - Foundation for Economic Education

The Cobra Effect: Lessons in Unintended Consequences - Foundation for Economic Education:

• Human beings react to every rule, regulation, and order governments impose, and their reactions result in outcomes that can be quite different than the outcomes lawmakers intended.

"Every human decision brings with it unintended consequences.
...Other times unintended consequences have far-reaching, dramatic effects. 
The US health care system is a case in point.
It emerged in its present form in no small part because of two governmental decisions.
First, wage and price controls during World War II caused employers to add health insurance as an employee benefit.
Why?
The law prohibited employers from raising wages, so to attract workers, they offered to provide health insurance.
Then, in 1951, Congress declared that employer-provided health insurance benefits would not count as taxable income.
This made it cheaper for employees to take raises in the form of increased tax-free insurance benefits rather than in the form of increased taxable wages.
Unintended consequences happen so often that economists call them “Cobra Problems,” after one of the most interesting examples..."
Much more here. read all.