The Creeping Cost of Bureaucracy or Baumel's Cost Disease

I'd never run into Baumel's Cost Disease before, but I find it most intriguing as it explains much of the runaway costs associated with healthcare, education, and government.  It also calls into question of how much we can cut from health care costs, especially when huge increases to the bureaucracy running it are proposed.  More paperwork means more labor, which means more money required, with any costs cut through other methods most likely negated.  Actually, I wouldn't be surprised if the increased costs of managing health care would dwarf all savings from streamlining other aspects. 

The intimidating thing about Baumel's Cost Disease is that it applies to education and all forms of government.  The more rules and regulations piled on will increase expenses that will never go down.  Eventually, you get to a place where you can't afford any of it.  Sound familiar?

Hat tip to Instapundit for the link.