Friday, July 30, 2004
After I torched Sean Hannity in an arm wrestling match this morning, I heard him mutter something to Paula Zahn about his “lingering tennis elbow.” To which I say, whatever happened to personal responsibility, Hannity? I mean, you didn’t hear Tony Snow making excuses when I pinned his ass, did you...? You whiny little bitch.And:
Smoked a fatty with a clatch of Willy Nelson roadies during an early afternoon sound check, and I’m happy to report that there really are two Americas. There must be. Because weed of this quality doesn’t come from any America I know of, that’s for damn sure.And:
Woke up under a pile of windbreakers and ponchos in the backseat of James Taylor’s tour bus at about 3 am EST, one of the Kerry daughters passed out nude in the aisle, Tipper Gore folded over JT’s lap like a fleshy pink topcoat. The bus was cruising through Connecticut on its way down to the Carolinas, the driver told me, so I begged out, and he was cool enough to drop me at a Denny’s just off highway 91 near Waterbury, where I spent most of the night stuffing my face with pancakes and chatting up the waitress, Bethany S., a UConn junior with an easy smile and small, perky breasts.Nick Genes reviews the scene outside the Fleet Center walls.
When her shift ended Bethany took me back to her place and let me crash for a few hours, then gave me a lift to the airport this morning, so I hooked her up with a handful of Lorazepam and one of those fiendish Willy Nelson joints I’d begged off Lester the roadie. The last two quaaludes I saved for myself, to help take the edge off on the plane ride home. I should be back in Colorado in about 3-4 hours, I figure—and when I get there, I plan to drive my Jeep into the mountains, fire up the remains of Lester’s stellar herb, throw in a John Denver CD, and reflect on the past 4 days. Talk with y’all sometime after that.
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Chris and I went to dinner last night and discovered a new and entertaining game that's fun for the whole family. We decided to see who could drive the average cost of their soft drink closest to zero. Coke, which both of us were drinking, cost $1.50 with free refills. Of course, you know what that means. . . marginal cost is zero. This makes it especially easy to drive down average cost since total cost is not rising at all with consumption.Well, I'm afraid to ask. How'd it turn out?
As it turns out, we both made it only to about the 14th glass mark, driving marginal cost down to just under 11 cents. Not too shabby, but a far cry from our ambitious goal of below a penny. In addition to learning how close to our goal we could get, we also learned about the wonders of the human bladder. Finally, our contest gave us pause to contemplate something we have both known for some time--economics, in the wrong (right?) hands, can have a warping effect on one's life and behavior.
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Despite all of this, Medicare's decision to cover obesity received no significant public debate. The Department of Health and Human Services simply issued a decree. That's probably because the public would never have supported it. According to a Time-ABC News poll, 87% of Americans said the primary responsibility for obesity lay with the obese person. In a recent Associated Press poll, three in four overweight Americans blamed themselves for their problem and 8% blamed their families.In many of libertarian debate when I question the legitimacy of a state act and ask what an individual's recourse is when laws and regulation violate liberty, I'm always amazed when people say things like, "then you can organize a public call to overturn the legislation by voting for your Congressmen." This one always make my draw drop. Lets set aside for a second how useless one person is when you get one vote out of thousands for three congressmen out of hundreds. What happens when those congressmen, as a group, delegate their powers to a bureaucaacy of anonymous people? Who the hell do you vote out of office then. Accountability has left the building.
For all intents and purposes, Medicare's proposal amounts to a new entitlement program, one with the potential to rival the recent prescription drug benefit in size and scope (for all its flaws, at least the drug benefit was passed by Congress, and after a lengthy public debate).
Before debating the merits of a state act, you have to debate whether the state can legitimately act in the first place. And this discussion is sorely missing in the current political climate.
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Perhaps I'm a simpleton, but why is it not a violation of due process of law whenever such a gargantuan bill is enacted into "law" by legislators who do not read the entire bill?
Few members of Congress, I understand, read each of these humongus bills from beginning to end. Indeed, few members of Congress could read such things; these bills are too long and tedious. And yet, whenever any of these massive packages of words receives a majority vote of each house of Congress and then isn't vetoed by the President, every word in the bill becomes "law" -- despite the fact that no one (or at least not every member of Congress and the President who approved it ) read the bill from top to bottom.
Has anyone ever thought to challenge this method of making "law" as a violation of the due-process clause?
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You can read expert opinion about this here. I'd like to personally thank Dr. Bard-Parker, along with Dr.'s Centor, Smith, Rangel, Baker, Kevin, Galen, Boyle, and others for offering us medical students a wonderful free medical education on their own times. In many ways, this type of analysis is superior to the education that is presently putting me in six-figure debt. You do a great service for medical science and education. Thank you.
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Thursday, July 29, 2004
I saw the following caption at ESPN.com today referring to the Texas Ranger's impressive infield:
Blalock, Texieira, Young, and Soriano are on a historical pace.The "historical" just didn't sound right to me. And I started wondering what the rule is for using an -ic word (like historic) and an -ical word (like historical). So I email this question to Neal Whitman. His reply:
I've casually wondered about this question, but never enough toHe goes on, frm the Cambride Grammar of the English Language:
actually look into it. Sometimes it seems to me that putting an -'al' on after an -'ic' is intended to send the message, "This isn't just the ordinary meaning you know with the -'ic', this is something really special!" This has been my best guess when I see neo-pagan literature talking about 'magical' (or better yet, 'magickal') stuff. Maybe that's what's going on here. However, I'd agree that 'historical' isn't quite right. If they mean that they are going at a pace that has some special significance in history, then they are going at a historical pace (e.g., the exact same pace that the Fonebone expedition went at in 1844). But if they just mean that this pace right now is making history, I think what they want is 'historic.' Why this way and not vice versa? Why historical fiction and not historic fiction? I don't know.
"The ending -'ical' looks like a combination of -'ic' and -'al', but is best regarded as a single suffix, a variant of -'ic.' For a great many nouns... both formations are found: analytic/analytical.... A number of pairs exhibit differences of meaning and/or collocation...." (p.1710) Several examples follow, including historic/historical. And that's about all they have to say, except to note that any meaning differences disappear when you turn the adjective into an adverb: "except for 'publicly,' the adverbs corresponding to both -'ic' and -'ical' end in -'ically.'In other words, there doesn't seem to be the general rule I was looking for (no real surprise). Here's Bill Bryson form Bryson's Dictionary of Troublesome Words:
Historic, historical:"The Landmarks Preservation Commission voted yesterday to create a historical district on a gilded stretch of Manhatten's East Side" (New York Times). Generally speaking, something that makes history or is part of history, as in the example above, is historic. Something that is based on history or describes history is historical ("a historical novel"). A historic judicial ruling is one that makes history; a historical ruling is based on precedent. There are, however, some exceptions to the rule - notably in accountancy ("historic costs") and, curiously, in grammar ("historic tenses").Again, no special rule, only special cases. If anyone has any help, let me know.
Economic, economical: If what you mean is cheap and thrifty, use economical. For every other sense, use economic. An economic rent is one that is not too cheap for the landlord. An economical rent is one that isnot to expensive for the tenant.
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John Kerry: I will not cut benefits or privatize Social Security.
Well, shit, John. I guess that only leaves one. Dont' be afraid to say it.
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Can we keep them and kick out Alabama?
Now that's what I call a fair trade!
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As the Democrats meet in Boston this week and continue to decry the loss of American jobs overseas it's important to remember that this national debate about "protecting" American workers has an important moral dimension that the Democrats are ignoring. However that same moral argument may eventually swing left-wing voters to support free trade. As Joseph Stiglitz reminds us in this essay, we have to remember that trade benefits both American consumers AND the poorer farmers and workers in the developing world who walk much closer to the edge of real poverty than American agro-business or labor unions.This reminded me of a quote by Johan Norberg in a Reason interview last year:
He writes that: "Now that rich countries no longer need to worry about losing the developing world to Communism, they have an opportunity to redefine the global economic order according to the same principles on which they built successful national economies: fair competition and social justice."
The way to achieve social justice (a term that makes most libertarians and conservatives cringe) is through free trade. It's a wonderful synethsis of the moral language of the left with the economic common sense of liberatarians.
If American liberals really believe in helping out the less fortunate through government programs, is it possible to swing some of them to our side on this issue?
Reason: This opens up a larger question about increasing globalization. If trade laws come down to special interest politics, how do you defeat those interests? How do we get to a point where the U.S. and the European Union finally gives up on protectionism for textiles and agriculture?In "Fair Play", Steve Landsburg echoes these sentiments:
Norberg: I think the first thing that is necessary is moral outrage. We need to explain what’s on the line, what the cost is to poor people in the least developed countries. People are dying because we in the West are unwilling to change and to actually live by the free market rhetoric we often spout. We also have to explain to the public that it’s not merely developing countries that lose out by these policies. We do too.
Protectionism is wrong because it robs individuals of a basic human right: the fredom to choose one's trading partners. The freedom, for example, to buy any car, at any price, from any willing seller.And Landsburg continues with a most elementary, yet I think correct, perspective:
But protectionism is wrong also for another reason. It's a reason that my daughter understands and Pat Buchanan doesn't, and it sits at the core of what it means to be a decent human being. My daughter knows that all people are created equal, and that nobody's right to prosper should be altered by being born on the wrong side of an imaginary boundary line. It would never occur to her to care more about an autoworker in Detroit than about an autoworker in Tokyo or Mexico City.
Forget all that stuff about how much it costs American consumers to save the job of an American worker. Suppose Buchanan were right; suppose he did have some miracle formula that could save American jobs at zero cost to consumers. His views would still be repugnant, because they start from the presumption that an American worker is more worthy of protection than a foreign worker. What moral foundation could support such an ugly division of humanity?
She (his daughter) is an active trader in the schoolyard market for decals, trading cards, and milk bottle caps. Sometimes Cayley wants to trade with her classmate Melissa but Melissa prefers to deal with Jennifer, from the other fourth-grade classroom. Cayley knows how disappointing that can be, but she also knows she can't force Melissa to trade with her. More important, she knows it would be wrong to try.(If you haven't already, you need to go buy his book.)
Cayley is too morally advanced even to imagine asking her teacher to intervene and prohibit Melissa from trading with "foreigners." Only a very unpalatable child would attempt such a tactic.
Update: This seems to be getting a lot of play in the blogosphere today. Slate's Will Saletan via Alex Tabarrok:
Obama, like other speakers at this convention, complains about "companies shipping jobs overseas" and workers "losing their union jobs at the Maytag plant that's moving to Mexico." At the same time, Obama holds himself out as a symbol of a diverse, welcoming America. How can Democrats be the party of diversity at home but xenophobia abroad, the party that loves Mexican-Americans but hates Maytag plants in Mexico, the party that thinks Obama's mom deserves a job more than Obama's dad does? I understand the politics of it. But what about the morals?Update #2: Matt Welch has more form the convention.
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Wednesday, July 28, 2004
Now I can't stand Moore. But as a critic of the war and an occasional guest in the No Spin Zone who routinely has his mike cut off whenever I appear, I have to admit I was sort of pulling for the left's crying on the outside clown. I hoped at the very least that he would have held up his considerable end of the argument. But he didn't; more than that, his grasp of the facts seemed pretty weak or nonexistent.Matt Welch on the Democratic speeches:
If you are one of those people who are aglow after two days of Democrat rhetoric -- and I've actually met many humans like that, these past 48 hours -- you probably haven't noticed a subtle theme that crops up again and again, like a nervous and revealing tic. Namely, that being a professional six-figure politician should be confused with noble "service," while throwing them your hard-earned money amounts to a brave and selfless sacrifice. Check out this chilling passage in the transcript of Howard Dean's war-avoiding speech tonight:He continues with:Our greatness is also measured by our goodness. It is in the capacity of our minds, the size of our hearts, and the strength of our democracy.Not belonging to a political party, and believing fervently in Brian Doherty's excellent maxim that time well spent is usually time away from politics, it is possible that I'm jaundiced. That said, the vision of a disabled woman handing over her last quarters to another moneybags politico who dreams of taking more of the stuff by force strikes me as, at minimum, nausea-inducing.
As I've traveled America, I've seen that strength. I've seen it in the people I've met and their desire to take our country back for the American people. I saw it in a college student in Pennsylvania who sold her bicycle and sent us a check for $100 with a note that said, "I sold my bicycle for democracy." I saw it in a woman from Iowa who handed me $50 all in quarters. She saved it from her monthly disability check, because she wanted to make America well again.
It's a short and tragic road from that kind of self-important analogical inanity to what one might describe as governing-induced megalomania (or at least, near-total lack of perspective). From Al Gore last night, about Kerry:And here's the aforementioned article from Brian Doherty:He showed uncommon heroism on the battlefield in Vietnam. I watched him show that same courage on the Senate floor.
Italics mine. It may be my failure of imagination, but I just can't visualize how dealing with the daily possibility of being blown to hell by the Viet Cong compares with uncorking a particularly tasty filibuster.
Where do we live? We live with ourselves and with other people, both in person and virtually; we live with our work; we live with the objects of cultural production that help us make sense of our lives and our work, or merely, in ways often indefinable even to ourselves, delight and divert us. We ought not, to the extent we can help it, live in George Bush's America, or John Kerry's.And finally this jewel from Medpundit guest-blogging at Overlawyered:
One of government's most pernicious effects is the way it colonizes our consciousness, in a manner deeper and more significant than advertising or markets ever manage. I would call upon my fellow citizens to loosen the mental bondage government has over them, to ignore it rather than engage in pointless and hopeless efforts to change it, but I don't think I really need to.
Increasing lack of voter participation is often cast as sad, hopeless, a betrayal of our ancient Greek tradition of civic virtue, active participation in the business of the polis, as a vital responsibility of a good man. Still, Washington has made itself an unworthy object of civic virtue, selling itself to us primarily as either nursemaid or tyrant. Sure, it tries to take lots of our money and tell us what to do about everything from diet to what we can say on the radio.
But there is still, God bless America, plenty of room to ignore it and to live the life of a free human being, not a civic robot. In those niches come the possibilities of widespread change that should really excite even the most government-besotted pundits: people as free as they can manage to be, making a free choice to create something new, in the form of new methods of art and commerce, new ways to relate to and impact the natural environment. And what it can generate is so inspiring that even a week's worth of Democratic convention coverage won't make me forget it.
A North Carolina woman sued a hospital for failing to correctly diagnose her husband's cancer. Except they did diagnose it correctly:It seems that 1 in 1 quintillian is being overly generous to the plaintiffs. Unless there is a huge missing detail from the story, this should not have ever approached a courtroom.
Punta Gorda resident Linda Brown filed the medical malpractice lawsuit in 2001 after her husband, Gerald, died in November 2000. Linda Brown alleged that Charlotte Regional contaminated tissue samples during a lung biopsy in 2000 which resulted in the wrong cancer diagnosis of small cell lung cancer. The plaintiff's attorneys also say that Gerald Brown never had small cell lung cancer. He had only a recurrence of non-Hodgkin's lymphoma and wasn't treated appropriately for that disease before his death.
Brown's attorneys argued that due to hospital technicians not wearing gloves or due to unsanitary conditions, Gerald Brown's tissue was contaminated with someone else's DNA.
The defense argued that's nearly impossible because someone would have had to actually have lung tissue containing the cancer cells on his fingertips while when he handled the sample.
The hospital's attorneys argued during opening statements last week that the chances of Gerald Brown's DNA being contaminated was 1 in 1.09 quintillion. In fact, the chances of that happening may be even greater since that one-in-a-quintillion person would have to be in Punta Gorda, inside Charlotte Regional, having a lung biopsy at the same time and have small cell lung cancer. But no one else in the hospital was undergoing a lung biopsy at the same time as Gerald Brown on March 22, 2000.
The jury ruled in favor of the hospital, but the case took four years and several hundreds of thousands of dollars to defend. That's OK with Mrs. Brown, because now she knows "the truth." Apparently, neither she nor her lawyers, thought of having an autopsy to discover the truth. But then, autopsies cost money, with nary a chance of making money. Not even a 1 in 1.09 quintillian chance.
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- Give us some drug war love. I find it insulting that some people give the Dems a free ride on this one - they are historically just as zealous about the WoD as Republicans. It time for you guys to really stand up for civil libeties and for the disenfranchised in a way that really matters (and doesn't involve any socialist rhetoric). But apparently, this will not happen any time soon.
- For the love of God, support free trade. Unilateral free-trade. Without exception free-trade. It's a violation of basic liberty to control who someone trades with. And it makes us all poorer, in addition to the poor foreigners who are often much worse off in the first place. This is the Great Liberal Shame.
- In a related vein, drop the collectivist rhetoric. It's insulting. Many countries throughout history has gone to shit for embracing such nationalistic, socialistic nonsense. It makes for good speeches, but terrible government.
- Quit talking about multilateralism like it's a panacea. I think it makes sense to get some help from our allies, from a utilitarian point-of-view. But, if an international action is proper on its merits (and I'm not saying whether Iraq was or wasn't) it doens't make it any more proper to have agreement.
- Be open to social security and Medicare reform ideas. The institutions are bankrupt - both morally and financially. You can do it. If George Bush can spend like he just hit the Powerball, you can touch the third rail.
Oh yeah, and flushing John Edwards down the nearest toilet wouldn't hurt things a bit.
Here's Radley Balko with questions (that you will never hear uttered in a debate) for each candidate.
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So let me address the basic argument of the tobacco and food nannies who claim that paying for prevention saves money over paying for the later obesity-related diseases. Indeed, that is their most persuasive arguments for various intrusions on liberty. I am looking at an article from the New England Journal of Medicine (10/9/97, pp. 1052-7) that examined this claim with regard to smoking. The authors went beyond the basic arithmetic of the (social) health care costs of a smoking individual vs. that of a non-smoking individual at a given age. They looked at the health care costs over a lifetime, because, a crude as it may sound, a person who lives until their 100 years old costs society a pretty penny for Medicare and Social Security, no matter how healthy their lifestyle is. They estimate, based on their data, that "while health care costs for smokers at a given age are as much as 40 percent higher than those for nonsmokers,...In a population in which no one smoked the costs would be 7 percent higher among men and 4 percent higher among women than the costs in the current mixed population of smokers and nonsmokers." They conclude, "If people stopped smoking, there would be savings in health care costs, but only in the short term. Eventually, smoking cessation would lead to increased health care costs."And yesterday I discussed offering birth control from the incentives of private versus public insurers:
An interesting fact that occurred to me is that Medicaid covers all and any type of birth control, while no insurance companies do. This made perfect sense after I thought about it. Insurance companies profit by spreading risk over a population. If a population grows, but the statistical risk stays the same, they will see more profit. So these companies would not want to cover birth control as it would decrease profits. On the other hand, children of Medicaid mothers have their health care costs covered by the state, so Medicaid's interest lies in giving all eligible women birth control so that no more wards are conceived.In light of recent news (discussed here and here) about Medicare offering free introductory physicals, I wondered if the same principle might apply. Many people try to sell socialized health care on the fact that it will lead to better "preventitive medicine." They may ignore that such medical practice does not prevent as much as it delays. When people are on public doles for their health care bills, it is actually in the best interest of the budget to have people knock off as soon as possible, whereas the private insurer is interested in keeping you healthy paying premiums as long as possible.
Imagine two different people becoming Medicare-eligible at 65. One, who takes poor care of himslef, is destined to have a heart attack at age 70. The other is in good health, but is destined to have a heart attack at 88 (because age is the greatest risk factor of heart disease - no way to prevent that). The older, healthier person will actually incur more public health care costs. My question is: if preventitive visits are at all successful at prolonging life, and actually increase public costs for Medicare (already with something like $13 trillon dollars of unfunded liabilities), will it contribute to undermining the system? Will they have to push back the eligibility age? What are its implicatioin for more comprhensive socialized health plans?
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It's a simple supply-and-demand problem. Forcing companies to offer coverage for birth control increases the cost of doing business, which increases the price of insurance, which forces the marginal consumer to drop out.
The real entertainment comes when people argue that regulation forcing coverage for such-and-such treatment, test, etc. will save the companies money. I love that one. If companies across the board don't offer coverage for some treatment, either they are profiting from this, or they are losing money. If it increases profits, then how could you justify taxing it away from them. And if they are losing money from holding back, well they are being punished by the market. And if all companies are missing out on the opportunity, their is a huge hole to be exploited.
Either way, it is hard, using their own argument, to justify such regulation. Actually, these laws serve the nefarious purpose of taxing and redistributing through the back door. Lawmakers force an insurance company to cover X treatment, raising the cost for everyone to benefit the few in the pool who would need it. This is just a way to implicitly socialize health care costs (albeit poorly, as the money is distributed inside the insurance pool, a population that generally is better off) without taking the political hit of "socialized health care."
All redistributions should be explicit to force the proper political debate in an open forum. If we want to guarantee birth control to all women, we can have that debate, but doing it implicitly through insurance companies bypasses such debate.
All state regulations that force coverage of some treatment/procedure are bad for that reason, but birth control fails another test. As I have discussed before, insurance serves the purpose of voluntary socialization of statistically rare but exorbitant costs. Birth control is neither rare (virtually every woman alive has taken, is taking, or will take broth control) nor exorbitant ($15-35 a month for ~ 25 years; depo provera can be cheaper).
An interesting fact that occurred to me is that Medicaid covers all and any type of birth control, while no insurance companies do. This made perfect sense after I thought about it. Insurance companies profit by spreading risk over a population. If a population grows, but the statistical risk stays the same, they will see more profit. So these companies would not want to cover birth control as it would decrease profits. On the other hand, children of Medicaid mothers have their health care costs covered by the state, so Medicaid's interest lies in giving all eligible women birth control so that no more wards are conceived.
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Tuesday, July 27, 2004
The Bush administration has been going to court trying to block tort cases involving pharmaceuticals and medical devices:
The administration contends that consumers cannot recover damages for such injuries if the products have been approved by the Food and Drug Administration. In court papers, the Justice Department acknowledges that this position reflects a "change in governmental policy," and it has persuaded some judges to accept its arguments, most recently scoring a victory in the federal appeals court in Philadelphia.Since everything these days seems to draw battle lines for Democrats and Republicans, I'm sure this will be no different. Alex Tabarrok offers his non-partisan two cents:
Allowing consumers to sue manufacturers would "undermine public health" and interfere with federal regulation of drugs and devices, by encouraging "lay judges and juries to second-guess" experts at the F.D.A., the government said in siding with the maker of a heart pump sued by the widow of a Pennsylvania man. Moreover, it said, if such lawsuits succeed, some good products may be removed from the market, depriving patients of beneficial treatments.
Getting a new drug or medical device approved by the FDA is a long and expensive process. The FDA is risk-averse and pays much more attention to the risks of approving a bad drug than to the risks of failing to approve a good drug. As a result, every economist who has ever written a serious analysis of the FDA has come to the conclusion that less regulation would mean more new drugs and more saved lives. (See FDAReview.org for more information. Gary Becker offers a recent statement.).And the part to raise some controversy:
Approval, however, does not end a firm's problems because even then it faces the risk of a debilitating lawsuit. Consider how bizarre this is: A team of statisticians, physicians and medical researchers pours over years of clinical data to pronounce a product safe (always noting that this means safe relative to the product's expected benefits) and then a jury of 12 randomly selected Joes and Janes second guesses them, awards plaintiffs billions of dollars and drives the firm into bankruptcy. This has happened more than once.
FDA approval ought to be a "safe harbor." Many states already have laws along these lines but they have been weakly enforced. The Bush administration's efforts to limit lawsuits against firms that have passed FDA approval is a therefore a necessary and welcome piece of common sense. This doesn't mean that you can't sue a drug manufacturer. If the manufacturer lies to the FDA or to your physician or if they don't produce the drug according to specification then by all means sue away. Every drug, however, has side-effects and every drug works differently in different people. That means that there has to be some sort of cost-benefit test to decide if a drug should be marketed. There is an argument for using tort law instead of the FDA to do this test - an argument that gets weaker the more out out-of-control the courts become - and there is an argument for using the FDA instead of tort law but there is no argument for adding tort law on top of FDA regulation, that is a double jeopardy disaster.The bottom line is that, especially with regard to drugs, in the classic debate between preemptive regulation and restitutive torts, we've accepted both. And with that, we accept double-counting of many of the costs with no added benefit. I need somebody to make me a convincing argument why we shouldn't have to choose one or the other (and precisely which one).
Personally, I favor reasonable torts (for fraud and negligence) over regulation, but reasonable people could disagree. Regulation pits politics vs. science, while torts often (or seem to) pit emotion vs. science. Of course, I would assume tort controls come to the right answer more often than any political system, but that it my personal bias. The problem is that opponents of the Bush administration's action fail to address the "double jeopardy" described above. Also, they use very shaky examples to back up their claims that such policies violate their right to a day in court:
Kimberley K. Witczakof Minneapolis said her husband, Timothy, 37, committed suicide last year after taking the antidepressant drug Zoloft for five weeks. "I do not believe in frivolous lawsuits," Ms. Witczak said, "but it's ridiculous that the government is filing legal briefs on the side of drug companies when it's supposed to be protecting the public. My husband would be alive today if he had received adequate warnings about the risk of self-harm." Ms. Witczak sued Pfizer, the maker of Zoloft, in May. The government has not intervened in her case.Maybe there are better arguments for their basic position, but they haven't shown them here. JAMA recently published a study that showed the rates of suicide were equal across groups just starting different drugs for depression. It has been hypothesized that the increase in suicide rates at the first few weeks of beginning drug treatment were caused by some increased "energy" to carry out suicidal thoughts (where before treatment these patients were too down to get out of bed to kill themselves).
Thomas W. Woodward of North Wales, Pa., whose 17-year-old daughter committed suicide last year after taking Zoloft for a week, said, "I've been sickened to see the government taking the side of pharmaceutical companies in court." Mr. Woodward has not filed a suit.
This long seemed implausible to me, if for no other reason that no alternative version had been put forward, and maybe more importantly, no actual mechanism had been hypothesized to why a non-stimulant mood enhancer would give somebody increased energy to commit suicide before actually improving their mood. Not that it couldn't happen, it just seemed there was a lack of good scientific skepticism on the subject. The above study with accompanying editorial pointed to a possible simple statistical association where the patients had higher rates of suicide at the beginning of treatment than months later because they happened to be at somewhat of a nadir when they sought (or were brought by loved ones) to treatment. Certainly a much more plausible explanation, at least as a default without some evidence that the original explanation actually exists.
Anyway, the point is that the plaintiffs above were seeking restitution based on the "fact" that there was increased suicide rates directly after initiation of treatment. Nevermind that there was no evidence that such correlation was causal.
In the end, it probably won't matter. We'll get more unreasonable verdicts and more ridiculous regulations. All this will lead to really out-of-control drug prices. And then somebody will come up with the grand new idea that we should pay for all the people who can't afford their drugs. (When nobody can afford the drugs, who pays for them then?)
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Monday, July 26, 2004
World-renowned chess player Bobby Fischer is currently being detained by Japan’s immigration authorities, with possible deportation to the United States. Fischer is being charged with violating international sanctions against Yugoslavia in 1992 by attending a chess match in that year there.I hope Bobby Fischer is acquitted on all charges...and then I hope he goes away for good.
Now, I’d like nothing more than to see the Fischer crouched and rotting away in the corner of a prison cell, routinely ‘roughed up’ by fellow inmates. The man, after all, is a Nazi sympathizer known for his ferocious anti-Semitic remarks (never mind that his own mother was Jewish). A man who enjoyed humiliating his chess opponents, and admired Hitler for “imposing his will on the world”. A man who openly cheered the 9-11 attacks, claiming the US should be “wiped out”.
But, in spite of all this, I’m having trouble classifying traveling to Yugoslavia for a chess tournament in 1992 as a “crime”. I have to disagree with a federal government dictating where an individual can and cannot travel. No doubt Fischer’s Hitleresque viewpoints have landed him in far hotter water than if, say, Arnold Schwarzenegger had competed in a weight-lifting competition in a travel-embargoed nation. However, the free movement of non-criminals across borders would seem to be the least of the federal government’s worries right now, with time and resources better left to other matters (although it wouldn’t hurt to keep a watchful eye on this head case who shouted “Death to the US” in a 2001 radio interview overseas).
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Friday, July 23, 2004
Speaking of which, I have some Orthodox Jewish friends who don't like it when I wear my usual sleeveless/low-cut tops on TV -- sends the wrong message, they say, and I suppose they could be right. But ever since Sept. 11, I've become fonder of anything that offends the Islamofascists. "Step on a crack, break old Hitler's back," kids used to say during World War II. These days I sometimes think to myself: "Dress like a tart, break an Imam's heart."
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But there's a complication. We don't really know whether taxpayer costs are higher, on balance, than they would be if everyone were thin.He adds that this move could be a boon to down-and-out trial lawyers:
In the case of smokers, economic analyses indicate that taxpayer savings from less health care in old age and fewer Social Security payments (because of shorter life expectancies) outweigh the costs of treating tobacco-related diseases. Something similar could be true of obesity.
University of Chicago economist Tomas Philipson, whose work on weight trends is widely cited, says "it's not clear whether obese people are costing us more or costing us less." In all likelihood, however, we don't have to worry that subsidizing weight loss will inadvertently raise taxpayer costs by making people thinner and thereby extending their lives, because obesity treatments are notoriously ineffective.
Taxpayers may not benefit from Medicare's new policy, but John Banzhaf cites one group that he thinks will: trial lawyers. "If obesity is thought of as a disease related to eating like anorexia or bulimia, it is something at least in part beyond the 'personal responsibility' and 'free will' of the individual," Banzhaf writes in a recent press release. "Therefore, a plaintiff's tendency to overeat is not a complete defense to an obesity lawsuit."
Even if the government starts to treat the condition of being overweight as a disease, it does not mean the behavior that makes people overweight is a disease as well. Gonorrhea is a disease, but promiscuous, unprotected sex is not.
Still, I suspect Banzhaf is right that such subtleties will be lost in the emerging debate about what Secretary of Health and Human Services Tommy Thompson calls "a critical public health problem." Smoking, once seen as a behavior that raises the risk of disease, is now routinely described as a disease in itself.
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Thursday, July 22, 2004
Word out of Boston is that security for the Democratic National Convention may top $50 milion. That's $40 million over budget (the Democrats over budget? Imagine.). You can add that sum to the $14.5 million the party gets in public funds to throw the big shindig in the first place. The DNC plans to ask Congress to write a check for the shortfall. Congress will sign off, of course. Because it's 99% filled with the two parties that'll be cashing the checks. The Republicans will of course get to the penny whatever the Democrats spend.
That's almost $130 million in public funds so politicians already on the public payroll can dine on cavier and hookers in Boston and New York, and throw two gauche parties to celebrate...themselves.
Oh yes, and so they can "nominate" their candidates for president and vice president -- candidates who sealed up their respective party's endorsements months (in W.'s case, years ago). That I guess is the intoxicating "democracy" part of the scam that's supposed to get me all dumb, drunk, and oblivious to the fact that I paid for all those damned balloons.
Talk about adding insult to injury.
It's not enough that I have to tolerate the policies of these two nauseating parties and their candidates. I have to pay for their nationally-televised group masturbation sessions, too.
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Much has been written about the recent Medicare decision to define obesity as a disease. While understanding that this does not have definitive policy implication as of yet, I believe it most likely will. Here are some points I'd like to bring up for discussion.
- Many take issue with something like obesity being defined as a disease, instead of a risk factor for disease, as it has classically been defined. Yes, I think that obesity probably should nt be defined as such, but I am not sure if it matters. Medically, if an obese patients walks into your office (specifically for that reason, or for another related reason), you would treat him or her just the same. The big problem I have with it that some bureaucracy claims to define these terms, because it's obvious that non-medical political forces are at work wreaking havoc.
- And if obesity can be defined as a disease and treated through social insurance based on political power, what's next. I'm only half-joking with this: Will Wilkinson points to a WebMD article that claims a study finds frequency of sex is a better predictor of happiness than money. If true, and with the stated prevalence of depression, will the government subsidize treatment for lack of sexual experiences. I'd like ot think this would not be funded by Medicare. Let's just move on.
- Radley Balko makes the salient point that "we are talking about the elderly here." As I understand, the elderly, as a population, are not particularly obese. However, today's obese people will be old someday, so costs could become a problem.
- In the link above, one supporter likens this to smoking-prevention programs. Uh, not quite. Even if expenditures like this save money (see below), again, how is paying money for obesity treatments for those in their 60's going to do anything to prevent obesity?
- So let me address the basic argument of the tobacco and food nannies who claim that paying for prevention saves money over paying for the later obesity-related diseases. Indeed, that is their most persuasive arguments for various intrusions on liberty. I am looking at an article from the New England Journal of Medicine (10/9/97, pp. 1052-7) that examined this claim with regard to smoking. The authors went beyond the basic arithmetic of the (social) health care costs of a smoking individual vs. that of a non-smoking individual at a given age. They looked at the health care costs over a lifetime, because, a crude as it may sound, a person who lives until their 100 years old costs society a pretty penny for Medicare and Social Security, no matter how healthy their lifestyle is. They estimate, based on their data, that "while health care costs for smokers at a given age are as much as 40 percent higher than those for nonsmokers,...In a population in which no one smoked the costs would be 7 percent higher among men and 4 percent higher among women than the costs in the current mixed population of smokers and nonsmokers." They conclude, "If people stopped smoking, there would be savings in health care costs, but only in the short term. Eventually, smoking cessation would lead to increased health care costs." Smoking and obesity are not the same thing, but I think it is important to keep this in mind nonetheless.
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Wednesday, July 21, 2004
It has been speculated that this action was facilitated in no small part by the Bush tax cuts. The much maligned cuts are so maligned not because the budget is not "balanced," but because, without subsequent spending decreases, these cuts simply move tax liability into the future. However, taxes and budget accounting can't be analyzed linearly and arithmetically, so it is oversimplifying to say that a decrease in some taxes mean that poor people get less welfare or that our children have to pay more.
Before the cuts the highest tax rate on dividends was 38%, but today they are %15. This is often thrown in under that offensive and hateful phrase "tax cuts for the rich." I dislike Bush as much as the next guy, but anyone who lets this phrase past their lips should be ashamed, and I'll explain why.
Microsoft has been sitting on this huge mountain of cash for a while, and any company in such a situation has two choices. They can pay the money out to their shareholders, or they can reinvest it, trying to make more cash and add value to their stock price through growth. This decision rests on the answer to many questions. Do he we have a business venture that makes sense to the company? What do our shareholders expect from us? What are the tax implications? In Microsoft's case, they have recently engaged in some questionable ventures that were not profitable (and some people probably could have predicted their lack of success). So why did they undertake these investments. Because the tax rate on dividends was so high. In a natural state without taxes, I would predict they would have found distributing their cash in the form of dividends to be a better move. But, this was not a natural state; this was a state that found it necessary to tax dividends for high earners at 38%.
Thus, Microsoft was forced by tax policy to invest in ventures that turned out to lose money. So, not only did the government not get tax revenues of the dividends at a low rate, they actually lost tax revenues because Microsoft had slightly less profit. (And let us not forget that these profits are already taxed at 30-35%).
But that is not the end of this tale. Because it is not silly enough that such "progressive" tax policy quite possibly reduces government revenue. Maybe in the end, for the sake of argument, it was a wash - no reduced revenue. All that happened was some rich guys did not get a big dividend check. So who cares?
There is a principle in economics that discusses the legal incidence of a tax (who physically writes the check) and the economic incidence of a tax (who really pays). The classic example is that of the excise vs. sales tax. It does not matter who hands the government the money when a consumption transaction takes place , the buyer or the seller (legal incidence). In the end, the economic impact is the same, and it is a function of slopes of the demand and the supply curves for whatever market you happen to find yourself in. The increase in price due to the tax is the same, and the share of this increase paid for buy the buyer and seller respectively are the same, under either a sales tax or an excise tax.
Well, dividends are another classic example of this counterintuitive phenomenon. Before I said that Microsoft had to choose to reinvest its cash or pay in dividends. But dividends don't just sit in some fatcat's bank. They are mostly reinvested in other businesses. To restate, Microsoft shareholders choose between reinvesting within Microsoft, or reinvesting outside the company. When one understands that any investment leads to better jobs and wages, one understands that one would not want to create disincentives for successful investment. But that is what the high dividend tax does. It forced Microsoft to select less successful investments, yielding fewer jobs and less wages. On top of that it delayed the donation of $3 billion dollars going to the world's poorest. Hardly the desired result for those who decry "tax cuts for the rich."
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People take all sorts of shots at drug companies; a few warranted, most not. They price-gouge. They lie about costs. They try to trick you into wanting their products by manipulative marketing. And to stop all this we need to regulate them into submission. Less advertising. Price controls. Complete disclosure.
But the overbearing complaint about drugs is their prices. (Not costs, but prices. Know the difference.) What a wonderful article over at Forbes.com today with the headline: "Cutting Drug Prices Would Fix Medicare Flaw: Analysis." Here's the money line:
A 45 percent price cut would let Congress eliminate a gap in coverage that will occur when Medicare's outpatient prescription drug benefit takes effect in 2006, the authors conclude.Read that again. Read it aloud and be amazed by the sound of stupidity. If we cut prices in half there will be a huge windfall for Medicare and the federal government. Well, no shit! If we simply steal 50%(!!!!) of pharmaceutical revenues (as "We The People"), we'll be richer. What a great idea! Why didn't we think of that before. Why don't we just cut the price in half for everything. Then we'd all wealthier.
Well sane people understand that would be a bad idea. And I shouldn't really have to explain why. Cutting revenues by 45% would not only decrease pharmaceutical profits, it would vaporize them. There would cease to be profits. Anybody who would vote for this please stand up (so we know who you are!)
Like other "problems," all this nonsense about price controls (which is essentially what they're talking about) is used to complicate a simpler issue. Yes, pharmaceuticals have higher profit margins than almost any other industry. There is basically one, and only one reason, for this: patents. You want to decrease drug prices, decrease patent protection. You want to increase drug prices, increase patent protection. Prices same, patents same. There you have it. Patents exist because theoretically products with high first-unit costs, but low (or almost zero) later production costs, will be underproduced. Patents, granted by law (with authority from the Constitution - what a novel concept), are supposed to protect intellectual property rights, give temporary monopoly power, and increase innovation.
Here's the thing. One could make a cogent economic argument that our current level of patent protection could be incorrect (and that level is set by Congress so you can be pretty sure that it's wrong one way or another). But I've seen precious few arguments along those lines. How unfortunate, because that is the key to putting this to rest once and for all. Decrease patent protection, and reap what you sow. Maybe it will be a bumper crop. Maybe not. Hell, we may not need them at all. Who knows? But until we start asking the right questions we'll be flailing around blindly in an endless, pointless debate.
That's the end of that rant, but let me segue quickly into a related topic from the same article:
Clearly, a price cut of that magnitude would impact the pharmaceutical industry.This is actually a small piece of evidence that current patent protection is too powerful. Me-too drugs act to produce the same effect of a previously markets (but patent-protected drugs) without violating the patent. In this way, they are a market mechanism to undercut patents and thus decrease price. And drug companies are surely not the worse for the wear. Of course, anti-market types use them as an example of wasteful drug company behavior. Figures.
"It's going to reduce the amount of research and development that they would be able to undertake," Anderson said.
Exactly how that would play out, though, is pure speculation. Would they protect investments in research that leads to new cures for diseases? Would they curb investment in developing "copycat" drugs that mimic products already on the market?
"If by changing prices we're going to lose some of the 'me-too' R&D, then I don't think that's such a bad thing," said Vicki Gottlich, an attorney in the Washington, D.C., office of the Center for Medicare Advocacy.
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The news media supposedly serve two very important functions - to inform the public of just about anything worth knowing, and as a watchdog for government abuses (indeed, the reason for Amendment #1). No doubt these are valuable and worthy goals. And in some respects they are fulfilled. But what happens when news media spread disinformation? What happens when they not only ignore government abuses but almost become complicit with them? Does the free market for ideas lead to a stupid public dominated by a tyrannical government?
Frequent readers would be absolutely shocked to see me make such a claim, and indeed you will not be shocked today. But let me cite two examples where I think the news media fail their goals (and if somebody objects or would add to my list of goals, feel free).
Exhibit A - The link between childhood vaccinations and autism has been soundly debunked. Some of the very few scientists who have claimed to have found a link have retracted their conclusions very publicly. But the news media will not let it die. Not only do they not adequately report that the fears are totally unfounded, they try to rekindle the fire. Any parent who denies their child vaccination (note: not to indict these parents; they think they are doing best for their children) and subsequently loses him or her to a preventable illness can thank the media for spreading disinformation and fear in the name of creating headlines.
Exhibit B - While the war on drugs also suffers from massive media-disseminated disinformation, more importantly, the media ignore the injustice of the WoD that they are charged with reporting. Every day local and federal police abuse their power and trample on principles of life and liberty all in the name of a drug-free America. Every time DEA agents bust in the wrong house and kills a completely innocent person, near silence. Every time President Bush gives rhetorical support to drug-testing all public school children, the media, blatantly fear-mongering, willingly add that marijuana is more potent then ever. The media are supposed to let us know when government agents with guns kill innocent citizens for no good reason. How the left-leaning media find right-wing religion when it comes to the War on Drugs is an absolute mystery. And it stands as their greatest failing.
So what's the solution? Thomas Jefferson has been quoted as saying "eternal vigilance is the price of liberty" (although, Alex Tabarrok turned that one on its head). Well, it's no different with liberty of speech and the press. We must be eternally vigilant, as scientists and citizens, to perform the functions of the media when they fail to debunk disinformation or call out government abuses. For when they fail it not passive; sometimes they spread disinformaiton and facilitate abuse of power.
Update: And I think blogs are one good way to do that (be eternally vigilant). Already the blogosphere is a decentralized group of intelligent people who have some important things to say (and some not-so-important things to say, too). There are presently numerous sites devoted solely to media watch-dogging. To which I say, the more the marrier.
Update: Jacob Sullum, arguably the general of the small press army devoted to report honestly on drugs and prohibition, has more.
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Last night I made my debut at the Louisville Backgammon Club. A blind draw pitted me against someone I was told is the best player in the club. Confidence was never lost on me, and I know a little about how to play, so I figure I had a punchers chance. A few lucky roles and a few ballsy moves later I am leading 6-2 in a 7-point match. Unfortunately, in a fate befitting a Cubs fan, I let the lead disappear before allowing my opponent to squeeze out a win. I was pretty pissed, but I didn't let it show - I got beat by a better player and everyone was giving me congratulations for giving him a tough match.
It turns out that the tough match was against 1994 World Backgammon Champion Frank Frigo! I'm glad they didn't tell me ahead of time, because a) I might not have played so well, and b) I might have lost continence. It was reminiscent of Matt Damon taking it to Johnny Chan in Rounders, only Damon got the best of his champ. Frank is one hell of a nice guy; he gave me a few pointers and he went on to win the tournament in a cakewalk.
Anyway, I'm going back in two weeks. And this time, I'm going to beat the world champ!
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Tuesday, July 20, 2004
Free markets are the most efficient mechanism for exchange of goods and services because they promote the features and price at which willing sellers and buyers agree to exchange. When free markets are present, the price and features of goods or services offered respond to the desires of the aggregate of buyers. Knowledge on the part of buyers as to what sellers are offering and on the part of sellers concerning what buyers want is necessary. Perfect knowledge is desirable but rarely present.I'm sure this will spark the same old debate: somehow, the market for health care is different. I will discuss that at a later date, but for now, let me just drop this for thought: there are two very different issues that often get confused. Their is an issue with poor being unable to afford care, and the issue of regulation to engineer certain outcomes. Every debate I have ever had about the state of health care in the US has resulted in me trying to explain why the two should not be confused. Redistribution to the poor is exemplified by Medicaid and is a legitimate debate. I personally believe we should have a very milited welfare state, but I think about this every day, and I'm always open to new arguments. On the other hand, many (mostly liberals in favor of social care) often like to employ market regulation to improve access for the poor. This often yields very perverse outcomes and mostly reduces access for the poor.
On top of this, if market regulation leads to decreased access for poor consumers, then it creates the need for more redistribution. So every new injection of regulation, which imposes costs itself, creates a marginal vacuum that will need to be filled by redistribution. You pay for it twice. It never ends, of course, until there is nothing left to redistribute. Thus, if our system is "broken," over-regulation is what is breaking it.
Stay tuned to The Health Care Blog for Matthew Holt's (presumably anti-market) response.
In other related news, Arnold Kling writes that while our growing expenditures for health care is a good thing, it can lead to creeping socialism:
Economic historian and Nobel Laureate Robert Fogel foresees a 21st-century economy in which consumers will be focused primarily on leisure, lifelong learning, and health care. To me, this suggests that there will be major ideological battles over the size of government.Kling also points us to am article in the NY Times about new MinuteClinics popping up in grocery stores and shopping malls around the country. These clinics are quick (5-15 minute), cheap (<$50), and usually run by licensed nurse practitioners (with physicians on-call for consultation). Their function is to allow people to get care for minor illnesses when they may have trouble scheduling or affording a regular office visit. Of course, one would think cheap and convenient medical care, especially for the poor and uninsured, and especially achieved via a market mechanism, would be a good thing. But the article quotes some physicians who have a problem with them.
While most of the Left has conceded that the goods-producing sector is better governed by free markets than by central planning, that sector's relative importance in the economy is on the decline. It is precisely those sectors where Fogel sees growth -- education, health care, and longer retirement -- where the Left insists that the government must remain in charge. But if we "limit" government control to just education, health care, and Social Security, then in fact we will have brought socialism in through the back door. In this essay, I want to focus on how to avoid such an outcome for health care.
Most argumets fall along the lines of a) apparent minor illnesses sometimes turn out to be serious, and b) recurring minor illnesses could be signs of an underlying issue that could be picked up by a physicians. It seems that the two quoted physicians just have a problem with these clinics being run by N.P.'s. My reply would be:
- If NP's are incompetent to understand this, then we shouldn't let them practice.
- If they are competent, then we should.
It's that simple. Most physicians, I get the impression, would not welcome socialized care. But if they try to defend their turf so fervently that there is a decreased supply of care, then socialized care is what they will inevitably get.
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Saturday, July 17, 2004
So far my guys (according to Win Share board at Hardball Times): Ivan Rodriguez 16, Hee Seop Choi 12, Juan Cruz 3. Total 31.
Cubs' guys: Derek Lee 12, Michael Barrett 9, Greg maddux 4. Total 25.
What does this mean? Well if I was running the Cubs we'd be 2 wins better and several million dollas richer. OK, maybe not, but if Jim Hendry has taken my advice, he'd have gotten a free lunch. As it stands, he owes me 60 bucks.
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The English Language Needs A Word for when advocates on both sides of an ongoing debate switch rhetorical positions, and yet they insist on decrying the inconsistency of their opponents while overlooking their own inconsistency. You can see it in politics whenever there is a change in power. Advocates from the party that loses power switch to the standard what-you-say-when-you're-the-opposition arguments, and those from the party that is now in power switch to the standard what-you-say-when-you're-in-power arguments. You never have to wait very long before one side tries to outfox the other by trotting out what their opponents said back before the power switch: "Aha!" an advocate for one side will say, "But back in 199_, you took the opposite position!" Well, of course: back then, everyone took the opposite position. I don't know of a word for this particular phenomenon, but I think we need one.I've always wondered why principled liberals and conservatives alike claim such undying love to Democrats or Republicans and vehement hatred for the other party. Democrats and Republicans are simply political parties, no more no less; their liberal or conservative "principles" are of mere convenience. In other words, they have no principles at all regardless of their claims. The parties are oligopolists in the market for power, and they should always meet our suspicion, if not our disgust, no matter which philosophy you subscribe.
Update: Libertarians hold the unique position of getting kicked in the head and the ass at the same time from both sides (while of course dishing it out to both sides). Here is Radley Balko's recent article with five questions for each VP candidate. And here is his latest post at the Liberty and Power blog:
Thought I would share these two emails in response to my last Fox column which arrived within about an hour of one another:Update: This post has reminded me of a passage form Steve Landsburg in "The Armchair Economist:"The tone and language of your questions directed at Senator Edwards clearly expose you as a patsy for the Republican Party, and most of the questions you pose for Vice President Cheney are "softballs" that my grandmother could knock out of the park. Do me a favor, when you get home tonight, go up in your attic where the box of books you kept from your college years is stored and find one of your basic texts on journalism. Read it! Read it again! And try to remember what the words "fair and balanced" really mean.And...Typical democrat questions; from a truly liberal. The real questions should be about keeping God in schools and prayers and on our money and in our country. Partial birth abortion should be stopped unless you democrats like killing babies! Protect our free speech and keep our constitution secure. Kick out the anti-gun liberals and the bush bashers, who can't see the trees for the forest. Tax cuts are good and they have helped us all. The biggest question we should ask all democrats, is do you constantly Lie?, and do you think no one notices the Lies you tell every day? It is hard to imagine that all you democrats think you will not have to answer for the Lies you tell every day. Is telling Lies worth ruining your life?, the answer is yes, so far. No reply is necessary if you are a democrat, because I wouldn't believe you anyway.I forwarded each email to the other. I thought they might like to meet.
Driving through northwest Washington, DC, I remarked on the opulence that is so conspicuous in that corner of the city. My friend Jim Kahn, in the passenger seat, wondered how such great wealth could have accumulated in a city that is notorious for producing almost nothing of value. I was too quick with the obvious cynical response: Most of it is the moral equivalent of stolen, partly through direct taxation and largely through political contributions that constitute the collection arm of a vast protection racket.I don't like to quote such a long passage, but I certainly could not has said it better myself.
But Jim was quicker than I and saw that according to economic theory, my explanation was not cynical enough. In the presence of competition between the parties, all of those ill-gotten gains should be used to buy votes. If the Republicans are in power, pocketing $100 billion per year, then the Democrats can offer to duplicate Republican policies exactly plus give away another billion per year to key constituents. Unchallenged, this strategy would enable them to buy the next election, pocketing a net $99 billion. But the Republicans would counter by offering to give away an extra $2 billion and settle for $98 billion for themselves. Our experience with competitive markets tells us that there is no end to this bidding war until all excessive profits are competed out of existence.
When an industry is dominated by two highly profitable firms, theory tells us that if there is no price war then there is probably collusion. In the case of the Republicans and Democrats, the requisite collusion is on display for all to see. It is called bipartisanship.
When Republican and Democratic legislators meet to "hammer out a compromise," they are engaging in an activity that could land any of their private-sector counterparts in jail. We do not allow the presidents of United and American Airlines to hammer out compromises regarding airfares. Why do we allow the majority and minority leaders of the Congress to hammer out compromise regarding tax policy?
Adam Smith observed that "people of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in conspiracy against the public, or in some contrivance to raise prices." That truth is the basis for the antitrust legislation that attempts to prevent such conspiracies and contrivances from getting off the ground. When the president of United runs into the president of American at a picnic, he is forbidden by law to say "I will not undercut you on the Chicago-to-Los Angeles route provided that you do not undercut me on New York-to-Denver.." Yet we allow Republican leaders to greet Democrats with offers like, "I will support housing aid to your urban constituents if you will support agricultural programs for the farmers in my district."
When people get rich running airlines, I can surmise that it is because they have an extraordinary talent for delivering good air service. When people get rich in the political establishment, I am reluctant to surmise that it is because they have an extraordinary talent for delivering good government. Economics provides an alternative explanation: the absence of political antitrust legislation.
I propose that all political compromise - indeed, all discussion between candidates, officeholders, or officials of competing parties - be fully subject to the same provisions of the Clayton-Sherman Antitrust acts that regulate the activities of every private business in America. I predict that political antitrust legislation will confer on voters the same benefits that economic antitrust legislation confers on consumers. Once the wealth of northwest Washington is depleted by resulting political price wars, politicians might be forced to compete by offering more efficient government.
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Friday, July 16, 2004
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Wednesday, July 14, 2004
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The Department of Health and Human Services will announce this fall a plan to improve access to mental health services. The initiative follows the release last year of a report commissioned by President George W. Bush recommending that "schools should . . . play a larger role in mental health care for children," screening public schoolchildren for mental illness (with parental consent) and providing counseling and referral services.I tend to be against things like this until someone can convince me otherwise. I'm sure it's good for some interesting discussion. Should public schools, already with too much on their plates, be charged with being psychiatrists? I'm not a conspiracy theorist (no, seriously), but I'm always a little suspicious when the government is excited to become involoved in mental health. It reeks of potential for abuse.
The HHS should reject these recommendations.
Update: Here's the BMJ article unveiling the news. (I think Cameron Page blogged something about this awhile back.) Neal Boortz has more. Apparently, this has the full endorsement of the pharmaceutical lobby. Chris Basten says the disease, by definition, can't be the cure:
Nevertheless, why is it that so few even blink when the State mentions that it will be screening a good portion of us for mental health maladies? The State is the fosterer of mental health problems. It creates wars, debilitates relationships, destroys families, and annihilates critical thinking skills.And Mother Jones doesn't like it either.
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Friday, July 09, 2004
DWR gives us this wonderfully heartwarming story:
But in Marshfield, Tavares said he has received only positive feedback about the program and he firmly believes it's a needed resource. As an example, he talked about the recent case of a DARE graduate who called the police on his mother after finding marijuana in the house.And both blogs point to this recent National Review article (and this one) calling for the end of marijuana prohibition. Say what you will about The National Review, they have the guts to think outside their political box. That's more than you can say for most publications. Here is retiring founder William F. Buckley's comment:
Marijuana never kicks down your door in the middle of the night. Marijuana never locks up sick and dying people, does not suppress medical research, does not peek in bedroom windows. Even if one takes every reefer madness allegation of the prohibitionists at face value, marijuana prohibition has done far more harm to far more people than marijuana ever could.Randy Barnett has been commenting recently at The Volokh Conspiracy about the case he will be arguing in the Supreme Court this fall dealing with medical marijuana. This represents my absolutely favorite thing about blogs. Anti-drug prohibition is something I feel very strongly about. Randy Barnett is an accomplished legal scholar who will be arguing a Supreme Court case important to prohibition repeal. Through blogs, I can get frequent updates, from the man himself, about his case. And I can possibly enter into the dialogue with him and others. What a great thing.
Finally, this is my first post from my brand new Dell Inspiron 8600. I would like you thank my parents for this wonderful gift. I don't know if it will make the quality of my blog any better, but it sure looks good where I'm sitting.
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Wednesday, July 07, 2004
And not just Germans. The French, who in 2000 trimmed their workweek to 35 hours in hopes of generating more jobs, are now talking about lengthening it again, worried that the shorter hours are hurting the economy. In Britain, more than a fifth of the labor force, according to a 2002 study, works longer than the European Union's mandated limit of 48 hours a week.In the race pitting Europe vs the USA for victory in "Communism: Part Deux," I take solace in the fact that America is second rate. When the economy and the atmosphere of freedom in Europe finally crash, I hope that we in America are not in too deep to change direction.
Europe's long siesta, it seems, has finally reached its limit — a victim of chronic economic stagnation, deteriorating public finances and competition from low-wage countries in the enlarged European Union and in Asia. Most important, many Europeans now believe that shorter hours, once seen as a way of spreading work among more people, have done little to ease unemployment.
This rings true also for the debate on national health care. Ronald Bailey reports.
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The Bush administration on Tuesday proposed tariffs on shrimp from China and Vietnam, saying exporters have been dumping shrimp in the United States at artificially low prices.So now we have to choose between one incumbent candidate who talks a good free-trade game but goes behind our backs, and the challenging candidate who says out loud that protectionism is a good thing. Happy voting!
The proposed tariffs on Chinese exporters range from almost 8% to 113%, the Commerce Department said. Vietnam exporters face duties ranging from 12% to 93%.
U.S. shrimpers and processors — struggling from rock-bottom prices since 2001 — filed the anti-dumping petition on Dec. 31, seeking duties on shrimp from six nations.
Update: Voluntary Xchange has comments. I should restate what I said to be more precise. We have to choose between one incumbent who talks a good free-trade game but goes behind our backs, and one who says out loud that protectionaism is a good thing but in the past has been much more supportive of free-trade. So, pick the guy who says what we want to hear is probably lying, or pick the guy who says what we loathe and hopes he stabs his supporters in the back (which he just might do).
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Tuesday, July 06, 2004
If you read blogs, you sometimes get frustrated when the links lead you to newspaper registration. Even if you don't have to subscribe or pay money, you are asked to provide personal information, such as age, gender, zip code, and perhaps even hobbies. Newspapers have moved increasingly to registration over the last year, read more here.The idea is that by going to "free" (TINSTAAFL) newsites requiring registration, the price you pay is the sign-in. And just like a business that would shut down if everyone paid them in counterfeit dollars, an online newsite will shut down (or scale back) if you "pay" them in counterfeit registrations.
Not surprisingly, consumers are striking back. Many write in false names, ages, and email addresses. BugMeNot.com allows readers to bypass registration procedures for most of the major paper sites. In essence they have already registered for you. Just insert the web address you want and you arrive there immediately.
I'm not endorsing this practice, and I haven't a clue about its legal status. The economics are easier to predict. To the extent that people can bypass registration, newspapers will cut back on their free web offerings. So, whether you like it or not, you are contributing to a public good when you register dutifully.
My question is this - how does this principle apply to the growing popularity of TiVo and digital video recorders that allow viewers to skip commercials. For broadcast channels, the total price a consumer pays is the sum of the price for the television and the time spent watching commercials. For cable TV its these plus the subscription price. Recognizing that this technology has not penetrated the market much yet(but also that it will at some point in the future) will the ability to skip commercials entirely, and thus decreasing the price paid for television programming (without actually decreasing costs), subsequently lead to a decrease in quality and/or variety of television programming? Will this lead to quickly rising subscription rates for cable TV? And what of broadcast TV?
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The complaint, often heard, is that when drugs switch, they are dropped from insurance coverage, and thus actually become more expensive. People who believe that over the long run they lose because drugs become OTC, implicitly believe that insurance companies pay for drugs out of kindness:
She came up with an answer that might sound counterintuitive at first: she turned to a similar heartburn drug that required a prescription. But it was covered by insurance, meaning that her net expense was less.Heads up, people. When insurers pay for chronic, relatively inexpensive meds (we're not talking cancer meds here) that a large part of the population utilizes, then we consumers pay for these drugs through higher premiums instead of out-of-pocket. Actually we pay more, because we must pay a premium on top of the actual average cost of the drug.
While high prescription costs hog the spotlight, more and more consumers are being hit with another expense: over-the-counter drugs that aren't covered by insurance. Allergy drugs like Zyrtec and Claritin, as well as heartburn medications like Prilosec, can now be bought without a prescription, and drug makers are pushing to sell cholesterol drugs directly to consumers, too.
"It's good news and bad news," said Robert I. Field, director of the health policy program at the University of the Sciences in Philadelphia. "The bad news is, you're not going to have insurers who'll want to cover O.T.C. drugs."
Think of this way. If every single person in a health insurance risk pool took Prilosec, would there be a need to insure against it? Of course not - there is no risk when the probability of an event approaches 1. Well, the need for Prilosec specifically does not begin to approach 1, but the need to take some kind of chronic OTC med begins to when you look at a pool of Prilosec, Claritin, statins, etc.
In addition, when drugs switch to OTC we save on indirect costs of seeking gatekeeper permission to consume meds. Included in this are occasional visits to the office simply to get a prescription.
It's possible that in a short-run scenario, the increase out-of-pocket expenditures outweigh the decrease in insurance premiums (or it's present-day equivalent, a decrease in the rate of growth). These are simply transaction costs that are dwarfed in any long-run analysis. By all accounts, this is a win-win for consumers.
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