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There were many comments here and over at Kevin Drums’ blog in response to my previous post on school gardens and progressive values. I think much of the criticism reflects a misreading of (and in some cases clearly not reading whatsoever) what I wrote, which in turn probably reflects a lack of clarity on my part. So let me try and respond to some criticisms and clear up some confusion.

Much of the criticism stemmed from a belief that I was arguing something like the following:

Low income people don’t like gardening, don’t garden, and/or shouldn’t garden

This is not what I said. Gardening is obviously a hobby that is enjoyed by people of all income levels. My point here is that as a strategy for increasing vegetable consumption for low-income families or, for that matter, anyone who works a lot, home gardening has very little potential. Obviously, some blue collar workers do grow gardens in window boxes, and some live in single-family homes with yards where they can have larger gardens. But given the amount by which Americans are falling short of their daily recommended vegetable intake, window boxes and backyard gardens for families who have the free time, energy, and desire to maintain them are not going to get us very far.

The problem here isn’t just with gardening as a solution, as Alice Waters’ and her organization clearly sees them as just part of the solution, but that gardens represents a broader slow food philosophy that underlies the entire movement. This focus on slow food is where progressive values get in the way of practical solutions.

For instance, I’ve argued that it’s important to focus on ways of making vegetables cheap, easy, and delicious.  In contrast, supporters of the slow food movement, and some commenters,  seem to believe that low-income and working people have a lot of extra free time to spend on gardening, food preparation, and frequent trips to the store for fresh vegetables. Quite frankly I never expected to see so many people claim that low-income  people have a lot of free time on their hands; judging by the responses I got it would seem Americans are suffering from a glut of free time. I believe this presumption is unpractical and problematic.

Slow food is a luxury which many low-income and working people simply won’t be willing or able to make time for. While it’s okay for schools to teach kids to the ideas of slow food as a small part of a broader healthy schools program, a practical solution must also focus on fact, cheap, easy, and delicious vegetables.  The mission of Alice Waters’ Chez Panisse Foundation goes completely against this idea:

Our mass consumer culture has created an unprecedented crisis of diet-related disease among our nation’s youth… Not only are children eating unhealthy food, they are absorbing the values that go with it: the notions that food should be fast, cheap, and easy; that abundance is permanent; that it’s ok to waste.

For those that would defend the local/fresh/organic focus by arguing this it’s really just as cheap, fast, and easy as other vegetables, keep in mind that this organization thinks those qualities are negative, and to be avoided.

The other thing to note from that part of the mission statement is that it doesn’t represent universally shared values, but the progressive values of the slow food movement. Tying a healthy foods movement to progressive values like this will limit its success in parts of the country outside liberal urban areas. While it’s reasonable to show kids that food can be more enjoyable if you embrace slow food, pushing slow food as a more prerogative is not.

For instance, the idea that local and organic foods are great is not a fact or universal value, but a progressive value. Many parents disagree, and it’s completely reasonable to believe that eating local foods for the sake of local foods is wasteful and foolish, and that specialization and economies of scale mean that farms should be industrial and located wherever they can be grown most efficiently. Many parents won’t want to spend their tax dollars buying local, organically grown food at a premium. The majority of consumers have certainly expressed this preference.

I’m not arguing that schools shouldn’t necessarily serve any local, organic, or fresh vegetables. But rather that these things are useful only to the extent that they are an effective means to a desirable end. Do they make kids healthier, or cost less, or help them form lifelong preferences for vegetables?  To the extent they do, then they should be used.

For local and organic foods, I’m skeptical that they are useful means to desirable ends, and therefore skeptical that much if any money should be spent on it. To the extent that the goal of using organic is that it’s healthier, then I would argue that schools shouldn’t spend money on it, since it’s not any healthier. To the extent that the goal of using local is to support local farmers, then I would also argue that schools shouldn’t spend any money on it, since charity for farmers isn’t a desirable objective for schools.

The problem is that the mission of these organizations is to make local, fresh, and organic an ends in-and-of themselves. It doesn’t matter if buying 10% more organic foods won’t make the kids eat healthier; children must be taught that organic is good. It doesn’t matter if only serving students fresh vegetables means they won’t eat frozen vegetables; they must learn that only fresh, local vegetables are good.

If you don’t believe that pushing local, fresh, and organic are objectives of the organization then you should read their websites and statements. In their food procurement criteria list, Waters’ organization includes these requirement:

  • Local. The average meal travels 1,500 miles before it gets to our plates. Find local farmers, ranchers, and dairies from which to buy directly
  • Organic or sustainably produced. Buy from farms that take care of the land.

In a statement before Congress, the executive director of Chez Panisse foundation made the argument for local foods explicit:

Buying and eating locally is a very simple concept that could have a huge impact on the environment if big public systems like schools districts, cities, parks and hospitals and private businesses all began to do it.  Imagine the way that we could stimulate local economies and reduce food miles by simply choosing to eat what is in season and buying locally from sustainable farms?

It’s impossible to make the case that getting the schools to buy foods from local farmers or those that “take care of the land” is simply in students best interest and not mainly about promoting a particular set of values. Asking schools to spend their money to benefit local farmers is egregious, and certainly not a universally shared value.

It is also telling that one of their strategies to deal with the higher expensive of organic foods is not to purchase organic to the maximum extent useful, but the “maximum extent possible”.

It is clear that progressive values are the focus of these programs, and this is at the expense of practical lessons, like how to make frozen vegetables taste good. This is extremely unfortunate, because frozen, out of season vegetables from far away are as important and deserving a part of a nutritious diet as local, fresh vegetables. Yet Waters’ organization actively works to completely remove frozen vegetables from school lunches.

If you think healthy school lunches and school gardens are good, you should agree that these organizations pushing for them need to remove the emphasis on progressive values and focus more on practical solutions. Slow food may be useful part of a healthy schools program as a means to an end, but pushing those values for their own sake should not be the objective, and certainly should not come at the expense of more practical lessons.

Its important to remember: more people die from contact with the medical care system than die from breast cancer, prostate cancer and lung cancer combined. Indeed, these numbers are on the conservative end as they count primarily people killed by hospitals.

Numbers on the health care system writ large are hard to come by but some – admittedly controversial – estimates put medical care as the leading cause of death in the US, and by a fairly wide margin.

I often use “Drink Plenty of Fluids” as an example of common medical advice that not only has little scientific basis but might very well kill the patient.

The basic intuition, of course, was that people, when sick, often loose a lot of fluids and may become dehydrated. In turns out that the body is a complex equilibrium system (not unlike the economy) and that dehydration might be exactly what it wants. In particular, in some cases fluid loss is an effort by the body prevent excess build-up in the lungs or brain.

Now Robin Hanson notes the same thing might be true with breaking fevers. While in extreme cases fevers can be deadly, in many (most?) cases they are likely quite helpful and could even save your life

There has … been one randomised trial … in patients in intensive care … In 2005, [researchers] … studied 82 critically ill patients who did not have head injuries or other problems that make a high temperature risky. Patients were randomised to get either the standard treatment of antipyretics if their temperature went past 38.5 °C, or only receiving the drugs if their temperature reached 40 °C. As the trial progressed, there were seven deaths in people getting standard treatment and only one in those allowed to have fever. Although this difference was not quite large enough to be statistically significant, the team felt compelled to call a halt, feeling it would be unethical to allow any more patients to get standard treatment. …

Jennifer Pollom has a long piece up at Economics 21, which argues that long term spending, not taxes are the problem. By my reading Pollom makes three big points

  • Revenues, even after accounting for the Bush tax cuts, are not that far out of line with historical norms.
  • Spending on the other hand is growing like gangbusters
  • The core of the spending problem is Health Care

Pollum also makes some important comparisons, noting for example that tackling spending growth without touching entitlements would require either scrapping the military or scrapping the entire rest of the government. In fact, even the latter wouldn’t completely do the trick.

Here core argument is essentially correct but there are some important caveats to be made.

First, Pollum, like just about everyone else, leans heavily on this set of graphs.

Revenues and Primary Spending, by Category, Under CBO’s Long-Term Budget Scenarios Through 2080

You see that last date over there in the right-hand corner. If you squint you can make it out. It says 2080. That’s 70 years from now. I know what you are thinking. However, I have to keep making this point: a whole lot can happen in 70 years.

Seventy years ago Hitler had just starting bombing British factories, but the America First Committee was determined to ensure Roosevelt kept his pledge to keep us out of war.  They had good reason to be hopeful, after all public support was with them.


A year later that hadn’t turned out as expected. The next 70 years held a lot of surprises as well. The birth of the modern welfare state, the baby boom, Women’s Lib, the Civil Rights movement, the rise and fall of communism as a geopolitical force. I could go on.

The point is American life and Americans’ relationship to their government changed in ways that experts in the 1940s could not have imagined. It is hubris beyond all measure to think that these projections are even a semi-precise portrayal of what is going to happen. We have to always keep that in mind.

Second, this whole Health Care thing. It’s really a ball of knots. However, there are a few things we just have to keep straight.

To start with, the spending issue on health care isn’t a government issue. Its a national issue. Its really a global issue, but we don’t need to go there. The whole country, public and private is being squeezed by the rising cost of health care.

Now you might say, yes but if people were given responsibility for their own health care expenditures they would make more rational choices. The problem is, people have never had responsibility for their own health care expenditures and there is little reason to think that they ever will.

One reason is obvious. The people who are in most dire need of health care aren’t in any condition to be responsible for anything. That’s why they need health care. Second, their loved ones typically aren’t in the most rational state of mind either. In fact, Robin Hanson makes a fair argument that the entire notion of health care is rooted in emotion and fear.

However, even beyond that health care has always been mostly paid for by someone else. Even before the government got into the business of explicitly buying most of the health care in the United States,  health care was actually paid for by insurance companies.  In fact, it is from the study of insurance companies that the notion of moral hazard arose.  The problem people noticed was that when people were spending the insurance company’s money they tended not to be so careful about what they bought. Rascals, I know.

That’s basically the same problem that we have with government. The fact that you have a private entity creating moral hazard doesn’t do much to change its fundamental properties.

We could go back even further, before the rise of medical insurance, and we’d see that most health care was bought either by the local governments, the military or the church. Again, most people were insulated from the cost.

Now, we could say that Health Savings Accounts will solve all that, and in truth they’re not a bad idea. However, they’re not really a solution either. Half of all health care dollars are spent by the sickest 5%; people who would blow right through their HSA caps. The bottom 50%, that’s most of us, account for less than 3% of all spending.

So what’s my takeaway? Its that whether the government buys health care or whether the private market buys health care is not likely to change the fundamental dynamics. Most people don’t make their own fee-for-service decisions, they never have, and they probably never will.

However, there is a bright side, which is this: something that can’t go on forever, will stop. I stole that little gem from Ben Stein’s dad, in case you didn’t know. In relation to health care what that means is that I don’t expect excess cost growth, that is health care cost growing faster than the economy, to go on forever.

Literally, it can’t go on forever. Eventually health care will be the economy and then the two numbers by definition have to match. However, even before we get to that point someone is likely to balk. What we would love to see is a bunch of rational agents, each calmly and carefully deciding exactly how much of their income they are willing to fork over. But, like I said above, that ain’t gonna happen.

What we will see is a national freak-out. One in which all sorts of caps and legal constraints are placed on the growth of health care costs. If we someday have a single payer system this will be done quietly behind the scenes as is now happening in Canada. If we still have a mutli-payer system then its going to be a political firestorm but the end result is going to be the same. Artificial constraints will be placed on the growth of health care costs.

What that means for that big CBO graph is that health care costs are almost certainly not going to keep rising at the same rate for the next 70 years. Something is going to stop them.

So what’s left to be done. Am I saying that we just put Alfred E. Neuman at the helm and forget about it?


There are some important choices to be made. For example, when the clampdown comes we want it to come in such a way that minimizes inefficiency and leaves open the potential for some technological advances to continue. This will not be an easy task, as our most potent tool, the decentralized free market, is not available. However, it is an important task and one that we should begin thinking about.

Oh, and I lied. Turns out I’m a rascal as well. There is a lot more to read on spending, taxes and health care. We haven’t even talked about taxes for example. But, I had to get you through this monstrosity of a post somehow. I couldn’t very well depend on your rational informed consent could I?

I wanted to get something out quick about the USDA’s soda report and its implication that a modest soda tax could cause children to loose 4.5 lbs.


I assumed that the 4.5 number came from an equilibrium METs analysis. Basically to do that you note that living one’s life requires burning some number of calories per pound of body weight. The units we use are Metabolic Equivalent Tasks (METs).

Then the embarrassingly simply model says that if we reduce calories by X we will get weight loss. However, as the body looses weight it will burn fewer calories in daily activities. Thus calories-out will be reduced. This rate is determined by your METs assumption.

At some point calories-in and calories-out will re-equilibrate and we think of that as net equilibrium weight reduction. Now setting aside all of the endogeneity / partial equilibrium problems with this simplistic analysis, the USDA report doesn’t even go that far.

No what it does reads to me as unthinkable. They multiply 43 calories per day times 365 days a year and divide by 3500 calories per pound of fat to suggest that children will loose 4.48 ~ 4.5lbs of fat per year!

Per year my friends. Per year!

I often sense from the comments that the extremity of these types of claims fails to sink in. Lets just do a little abstraction.

So, child is loosing 4.5lbs per year. Mind you child’s weight is nowhere in this analysis even implicitly. 4.5lbs a year – that sounds pretty good. Indeed at that rate an eight year old formerly soda guzzling kid could loose 45lbs of fat by her 18th birthday.

But wait a second. What if our child only has 15 lbs of excess body fat. What then. Does she become gymnast level ripped, incapable of menstruating?

Does she fail to grow? We know that mass balance is a fundamental law of nature not a social convention. The laws of physics don’t know if she’s “too thin.” If the calories don’t come from fat, of which she only has 15 lbs, they have to come from somewhere. Perhaps, her growth is permanently stunted? Perhaps, her brain development is impaired? Perhaps she suffers all of the maladies associated with underweight childhood development?

All of these thing are possible from persistent caloric restriction but they seem a bit strong as a result of a soda tax?

“Well that’s taking it to extremes.” you say. This analysis doesn’t work at the extremes. Its just about averages and point estimates.

Here is the important point, however: this analysis makes no distinction between moderate and extreme extrapolation. There is no “distance from baseline” component.

The fact that you know this analysis doesn’t work in extremes means that at minimum the model is imprecisely constructed with relation to scale. Further, I would add, there is simply no reason to assume that the model works over “reasonable” scales but simply fails over extreme ones.

The model can, I would argue does, begin to breakdown as soon as the first gram of fat is lost.

This is a large part of why weight loss science looks and acts like voodoo.

Someone takes a really complex equilibrium system. They indentify a property or set of properties. Re-inserting that property into the entire system is mathematically intractable and indeed, we don’t completely understand the system anyway.

So the analyst linearizes the assumption. If all else is held equal they say. Yet, the scale over which the human metabolism will match a linear approximation is tiny. The body immediately acts to undue whatever effect you tried to create.

So maybe, maybe if you are lucky and you hit the body with the equivalent of sledge hammer’s worth of adjustment you can temporarily squeeze out five, ten maybe even 20 lbs of pure adipose tissue. However, the metabolism soon adjusts and acts to overcome even that enormous effort.

This is the core of the problem we face. Any effort to address this problem that does not recognize this difficulty is doomed to failure.

I cannot beat this drum enough, because people continue to try these types of methods, continue to fail and continue to be shocked at that failure. And, even if that type of hamster wheel insanity was ok as a private choice, if definitely shouldn’t form the basis of public policy.

Let me say will all the force I can: We must not pick winners and losers based on analysis that fails to recognize key elements of the public problem.

It is deeply, deeply irresponsible to do so.

Note: A previous version of this post attributed the report to the FDA when in fact it was from the USDA

Sullivan points us to an USDA study suggesting that a 20% soda tax could cause the average child to loose 4.5 lbs. In particular the study suggests that such a tax would work by reducing caloric intake by 43 calories a day.

Now before we get into the details of the study lets run this by the well established “Hooey Limit Test.” I say to you, “hey looking to loose that last stubborn five pounds, just consume 1/3 less of a soda per day. Not a whole soda mind you, that’s worth a full 15 lbs. Just leave the bottom third in the can.”

Does that sound reasonable or like a bunch of Hooey to you?

If that’s the world we live in then how are we to make sense of the endless struggles that millions of women (and men) go through to loose five pounds, say nothing of a greater battle against obesity.

As a side note, this is what makes me skeptical of explanations like “sugary drinks” for obesity. Wouldn’t someone have noticed by now that people who don’t like sugary drinks are never fat? Wouldn’t that be everywhere? Its not a hard observation to make.

Whatever the secret to weight loss is, it must be elusive. It must be something that is either difficult to find or difficult to execute. Otherwise people would have succeeded by now.

Now, on to the study. What it does is pretty straight forward. They look at consumer behavior. They then estimate the change in consumer purchasing behavior that would come from a change in soda prices. How less soda would consumers buy. How much more bottled water, milk and juice.

They then net out the calories. Since, soda is more calorie dense on average, substituting away will cause a reduction in calories. They then turn caloric reduction into a equilibrium reduction in weight.

Regular readers will note that the immediate problem is that they assume consumption is exogenous. That humans choose their caloric intake for some set reasons unrelated to body composition. They then independently choose their caloric expenditure. We subtract one from the other and composition pops out as the residual.

Now, obviously no one, not even the authors of the study believe that this is accurate in real life. At a bear minimum humans are both aware of and care about their body composition. Getting fatter is costly and so, as we observe, will cause people to take actions to loose weight.

Indeed the FDA waives all these concerns away in typical academic fashion

Assuming that everything else remains equal (e.g., constant physical activity level and no shift to foods other than beverages), a reduction of 3,500 calories leads to a 1-pound loss in body weight

Which is akin to saying that assuming no insurgency the wars in Iraq and Afghanistan should go swimmingly.

Personal attempts to control body composition obviously affect the results in a feedback mechanism that is familiar to economists. However, even deeper than that body composition is critical to the survival of all animals from nematode worms to Blue Whales. In response animals have evolved mechanisms for regulating that composition. One of the most powerful we are all familiar with, its called hunger.

But hunger is not the only one. There is satiation or fullness, restlessness, exhaustion, and all the variants there of. These emotions are balanced through a complex set of hormones which in a healthy adult causes calories-in to be matched to calories-out with a less than .5% error.

When we see obesity, something must have gone wrong with that mechanism. Now Bob Lustig suggests that drinking soda is what goes wrong, but because of the effect of sugar on insulin levels. Gary Taubes says carbs generally. Seth Roberts says our physiological association of calories with taste. David Kessler says food industry generated hyper-palatability. Until repeated large scale studies showed otherwise the official government line was high percentage intake of fat.

My readers know that while I am sympathetic to the carb, read insulin, based theories I am not even convinced that the culprit is nutritional. Every possibility from endocrine disrupters to biological agents to autoimmunity needs to be taken seriously.

What we do know, however, is that something has gone wrong metabolically. And the key to ending obesity is finding out what that something is and fixing it.

In any case its not as simple as adding up beverage changes and then netting out calories as if a change in beverage calories has no feedback mechanism against composition or calories expended.

Note: A previous version of this post attributed the report to the FDA when in fact it was from the USDA

Dennis Prager says you can’t believe all those studies saying that US health care is worse. After all they came from untrustworthy lefties.

If you believe that Americans have lousy health care, it is probably not because you have experienced inferior heath care. It is probably because you were told America has lousy health care.

Only later in the report does the discerning reader have a clue as to how agenda-driven this report and this study are. The otherwise unidentified Karen Davis, president of the never-identified Commonwealth Fund, is quoted as saying how important it was that America pass President Obama’s health care bill.

Could it be that Ms. Davis and the Commonwealth are leftwing?

They sure are, though Reuters, which is also on the Left, never lets you know.

This article highlights lots of intellectual problems

1) He thinks these studies are wrong / biased / etc. Shouldn’t one then be able to produce some alternative study that addresses whatever methodical problems you have with this one.

As Yudkowsky likes to say “The dumbest man in the world could say that the sun is shining but that doesn’t make it dark outside”

That is, it is not enough to show that your opponent is a fool, biased, evil or untrustworthy. You must actually show that he is wrong. Evil fools are sometimes right, if only by chance.

Indeed, Arnold Kling, a self-avowed libertarian, supported by CATO, the leading libertarian think tank, went out to prove exactly that. He came back saying that, no the crazy liberals were actually correct on that point.

They misunderstood the reasons, he said. The reasons were not greedy insurance companies. The reason was quite simply that much of our medical costs go towards premium medicine which is not particularly useful.

2) People who don’t agree with Dennis Prager are automatically on the Left. Karen Davis is a lefty, no doubt. But Reuters? The financial news service accused of shilling for Goldman Sachs? What do you have to do these days to get your right wing card?

It seems that agreeing with Dennis Prager is the only criteria.

3) Prager doesn’t even address the obvious retort, often ignored by those who complain of bias, that all of these journalist and researchers and think tank folks are on the left because that’s the answer they came to after studying the issues.

If it turns out that everyone who investigates something winds up supporting the other team, doesn’t that raise the possibility that the other team is right?

I am willing to take both sides to task on this. If for example, minorities consistently score lower on math tests, it could be that the test is biased. OR it could be that on average minorities are worse at math.

Similarly, if all the experts endorse “left-wing” positions, it could be that the experts are all biased. OR it could be that the left-wing position is objectively correct.

One should at least consider these possibilities.

Whenever I talk about the small role that medicine has played in expanding life expectancy I like to point out that there are many procedures which by all accounts do wonders for the patient. However, rather than comforting us, this leads us to suspect that the mediocre returns from medicine writ large are because some doctors are killing many of their patients.

Hospital transmitted infections are an obvious culprit yet another one seems be to radiation.

As you can see from the chart Americans get MOST of their radiation exposure from medical procedures. But to me that’s not what truly troubling. What is truly troubling is that unlike natural sources there are many people in this country who have never or only very rarely been exposed to medical radiation.

That means there must be some others who are just getting gobs of it. Way more that the 899 millisiervert US average.

You may remember that there was significant debate over health care reform a few months back. At the time I acknowledged that while I couldn’t follow all of the byzantine implications of the new law, as far as I could tell, in many ways, it was a whole bunch of nothing.

Nothing on net on the budget side because it cut some programs and expanded others – raised some taxes and expanded some other tax credits. All in all it looked mostly to be a wash.

Nothing on the health side, because marginal spending on health care is unlikely to have any measurable impact on health.

In its latest report the CBO seems to at least agree with the first point.


One the problems with Sea Steading is finding people who are willing to put up with the high price and daunting environment all in the pursuit of a little freedom. However, one group you might want to target is those pursuing experimental drugs not yet legal in the West.

According to Megan McArdle the biggest part of a drugs cost in the clinical trial. I would have assumed that the R&D costs were concentrated further back into the research end. Yet, if she is right then there is the potential for some extremely beneficial gains from trade.

If drug companies can find a potential compound cheaply and Sea Steaders are willing to self-experiment then billions of dollars could be made and possibly hundreds of thousands of lives saved.

The obvious benefit for Sea Steaders is early access to drugs and access to drugs that would have been unprofitable to put through a clinical trial. The advantage for drug companies is that even causal observation of the results and side effects from the Sea Steaders experience could help to focus their mass market clinical trials on the most effective drugs. Its essentially human research on the cheap.

This comes from F.M. Scherer’s paper on pharmaceutical innovation written for the Handbook of the Economics of Technical Change:

New chemical entities does not include biologicals, new formulations and uses of existing products, and new combinations of previously approved products, but it is a standard measure of pharmaceutical innovation. Another useful piece of information from Scherer provides is a sample of estimates over time of the cost of clinical trials, which have increased substantially.

Now read Megan McArdle’s excellent new piece in The Atlantic on the decrease in pharmaceutical innovation. It is not an optimistic piece, and in true McArdle style she concludes that maybe we haven’t fixed the hard problem because it’s a hard problem that can’t be fixed. She tries to offer a bit of good news at the end of the piece, but it is a minor condolence:

But even if nothing works, look on the bright side: at least we won’t have to pay for so many pricey new drugs.

Robin Hanson says that his students liked the idea of publishing all medical data, eschewing privacy concerns in exchange for the ability to better examine the impact of lifestyle, environment, genetics and health care in determining health outcomes.

For researchers this could mean vastly better analysis. For consumer, it might mean being able to accurately shop the best doctors, hospitals and most importantly, procedures.

Since, I was kid this seemed like a good idea to me. Indeed, my younger self always wondered why the government didn’t just give out free medical care in exchange for data. At the time I thought science was omnipotent and if we couldn’t cure a disease it must be because we didn’t have access to the right data. Public data I reasoned, would lead to virtual immortality.

I am not quite – quite – as naive as all that today. Nonetheless, I see the benefits as much greater than the costs. I strongly suspect that privacy concerns only really matter when its only one or a few people whose information is private.

Everyone has something “wrong” with them. Some embarrassing medical fact or potentially “damaging” information. Yet, potential employers, lovers, and lenders can’t discriminate against everyone. 

If anything it seems that public medical information would work to erase the stigma associated with certain diseases. Can it be shameful that grandma is going senile when everyone knows that seven other women on the same street are too. Is it embarrassing to take Viagra when over half the men your age at your workplace are known to do so as well?

Subbing for Ezra Klein, Mike Konczal analyzes food prices and purchasing decisions. He concludes that the poor have it worse than some would believe

The poor have more purchasing power because, in part, they are buying food that isn’t very healthful. And the important thing about this different inflation rate quantification for income inequality is that nobody
gets diabetes.
The long-term health costs of "choosing" a different inflation rate for your food isn’t estimated, nor are they included to see if it all balances out economically.

There are important points here that I am sensitive too. However, I simply must drive home the point that the underlying logic is built on a mountain of speculation. We don’t have a really solid explanation for why people are poor. We don’t really have a really solid sense for what food is healthy nor how food contributes to long term disease. We have mountains of speculation. However, recognizing them as such is important because we have seen such mountains before.

Here are a few links to some promising treatment to a form mental illness recognized during the 20th Century

The application of anticipatory avoidance to the treatment of homosexuality

A learning approach to the treatment of homosexuality

Treatment of Homosexuality by Individual and Group Psychotherapy

The authors of these well published scientific studies developed methods which they sincerely believed to be effective in treating a psychological disorder.

We now know that not only is homosexuality not a disorder but it is almost certainly not “psychological” in the sense meant by these authors. That is, at this point it seems all but certain that people are either born gay or straight and that no series of life events can affect this.

The drama here is easily lost, so let me repeat. These were scientific papers reporting the successful psychological treatment of what we now know to be congenital traits. To be even more blunt -  they were reporting empirical success in accomplishing something that is not even logically possible.

Moreover, at the time they were well within the conventional wisdom and strongly supported by a theoretical framework. This was not quackery – yet it was deeply, deeply wrong.

To wit – it is very, very easy to get carried away with a theory of disease, disability or affliction. Passions run high. Prejudices run deep. Really useful data is frustratingly hard to come by. And fueling it all is the conviction on all sides that “something” must be done. Even if that something is to justify away the problem.

So I am strongly urging everyone involved to be careful assembling our very shaky models of health on top of shakier models of nutrition and then combining those with our almost complete ignorance of the deep causes and consequences of poverty. Such an assemblage quickly becomes an edifice of supposition and the foundation of potentially hurtful policy.

I am have my own prejudices on these issues and in full disclose they run slightly counter to Mike’s. However, this isn’t about who is right. This is about the need for everyone to tread lightly.

In response to a previous post on price discrimination by hospitals in India, commenters Apex and Chris L wondered how it is possible for price discrimination to make everyone better off, and even if you wanted to charge more to rich people, how could you do that in practice?

The general idea is that price discrimination allows firms to overcome fixed costs and thus offer products and services that they otherwise wouldn’t. But I’ll give a specific example using a really simple model.

Say there are four potential consumers of a hospital’s services. Three of them value the service at $5 and the fourth (the rich one) values it at $8. The fixed costs of a hospital are $5 and the marginal cost of treating one patient is $4. If the hospital charges a uniform price of $5, then all four will buy the service and the hospital will have revenue of $20, marginal costs of $16, and thus a total costs of $21. Thus the hosptial will not offer services at this price, since total costs are above total revenue.

At any uniform price above $5 and three of the four patients will not buy the service, and the maximum value the rich customer would pay ($8) is not enough to cover the total cost of treating him ($5 + $4 = $9). So under uniform pricing the services aren’t purchased by anyone, and thus everyone  is worse off.

However, if the hospital can price discriminate by charging $5 to the three poor customers, and $7 to the rich customer then the total revenue is $22, total cost is $21, and thus profit is $1.  In this case price discrimination allows the hospital to offer the services, and so being able to price discriminate makes everyone better off.

(The simpler case is where price discrimination doesn’t make all customers better off, but does increase overall welfare by making those with lower valuation and the firm better off by more than the higher valuation customers are worse off.)

How could hospitals do this in practice? They could do it rather directly by offering customers discounts if they can prove they are on food stamps (3rd degree price discrimination). Or they could allow customers to self-sort (2nd degree price discrimination) by charging a lot more for last minute reservations, better parking spots, or other “luxuries” and add-ons, which will tend to be demanded by people high time value of money (e.g. richer people).

Tyler Cowen quotes Raghuram Rajan on health care in India:

Hospitals in the United States could learn more from each other, as well as from hospitals elsewhere, including India, where costs have been brought down by bringing mass-production techniques perfected in manufacturing to health care….Greater competition between hospitals could also bring down costs; an easy way of encouraging cross-border competition is to authorize Medicare and Medicaid reimbursements for procedures performed by authorized hospitals in other countries, like Mexico and Thailand.

This reminded me of a paper from last years Health Affairs which compared the cost of open heart surgery at a hospital in India staffed largely by U.S. trained doctors, to the typical cost in the U.S. They found that the costs were $6,000 in India compared to $100,000 in the U.S. The obvious explanation is low labor costs, but the authors argue that does not explain the entire difference, and that innovation and efficiency played an important part.

One of the Indian hospitals the paper looks at, called Care Hospital, uses a textbook application of price discrimination:

Care, for example, has deployed a “multi-tariff ” system for the provision of standard services, charging higher fees for comparable services to higher-income segments of the patient base. This tiered pricing model is one of the cornerstones of the Care business model, allowing the organization to provide services either with minimal margins or below full cost (but above variable cost) to approximately 75 percent of its patients.

Having to charge a uniform price would mean that the quantity of medical treatment would be lower, and the price discrimination allows them to increase output. This is a literally an example you will find in economics textbooks under “how price discrimination can make people better off”.

Outsourcing medical care by allowing U.S. citizens to take their Medicare and Medicaid to get treatment in other country’s (where people understand the benefits of price discrimination) seems like low hanging fruit for bringing down health care costs.

In response to my last post on salt regulations, several commenters expressed some further points that are worth addressing. Much of it amounts to the argument that the regulations are, from the consumer’s perspective, a free lunch.

Commenter JzB argues that, for the most part, lowering that lowering salt in packaged foods will not result in significant taste changes, and to the extent it does, it can be fixed by adding salt:

So some of the salt is there for good reason, but the amounts used are overkill. I’m suggesting reductions of 25 to 50% will be transparent, or close to it. And also adjustable on the plate, if so desired.

The notion that reductions in sodium of the scale argued for by the Institute of Medicine can be achieved without significantly impacting the food as experienced by the consumer is, I believe, incorrect. In agreement with me is the actual  IOM report:

Current and ongoing industry reformulation has demonstrated that substantial reductions in sodium can be achieved based on existing technology and science. However, given the need to significantly reduce the sodium content of the food supply to achieve recommended population intake levels, additional innovations and research will be necessary to secure reductions while maintaining product taste, texture, safety, and shelf life.

These innovations will be necessary because, as the study points out, companies have already been taking advantage of the low hanging fruit in sodium reduction:

…some of the “easy” food reformulations to reduce the sodium content of processed foods have been achieved by the major food manufacturing companies, and in these cases, efforts to continue lowering the sodium content now require more creative and intense efforts.

You certainly get the sense when reading the report that the authors do not believe that the regulations will be simple, costless, or that our understanding of if and how the regulations will work is anywhere near certain. And remember, these assessments are from advocates for the regulation; it is almost certain that representatives of the food industry would be even less sanguine.

Another point that supporters of the salt regulation have made is that if you slowly reduce your salt intake, you won’t notice the decrease in saltines of foods. The IOM report, however, cautions that this a) this is far from certain, and b) may not apply to all foods:

…while data from perceptual studies may point the way to quantitative levels at which changes in the presence of a substance may not be perceived, much is yet to be learned about the application of such work to the wide range of food products and to other practical considerations in the real world….

Elsewhere they offer even more reasons to worry that sodium cannot be reduced without consumers tasting the difference:

First, the time course of changes in preference for salty foods in response to changes in salt intake is not well understood. Second, there are questions on the extent of a salt reduction that can be accomplished in a single reformulation without greatly altering the palatability of food…Third, it is unknown whether individuals are able to acclimate to lower-sodium foods when some high-sodium foods remain part of their diet.

The last point in the above quotation is worth unpacking a little. The report cites some disagreement among IOM committee members about whether exceptions to salt regulations should be made for certain foods. This discussion highlights that when faced with the possibility that their relatively lighter-touch regulation won’t work, some of the study’s authors would be willing to recommend more draconian measures:

…it is not known whether sensory accommodation would occur if salt were reduced in a single product category such as soup of bread or if the majority of the diet were low in sodium but consumers occasionally consumed foods that might be exempted from sodium reduction (anchovies, olives, etc.). This gap in current knowledge has been a concern for some committee members in determining whether exemptions should be considered for salty foods consumed in small quantities.

In previous quotations, the authors worry that it may be impossible to lower the sodium to a level acceptable in some foods, and here they recognize that the availability of these foods could prevent people from having their salt tolerance lowered. If foods like anchovies or olives aren’t amenable to sodium reduction without significantly altering their palatability, some of the committee members seem okay with those foods being effectively banned. This shows that the failure of a relatively lighter-touch regulation may simply lead policymakers to take a harder line with more draconian regulation. If you’re looking for the next slippery slope, this is a good place to start.

The problems mentioned above do not even get at the possibilities of public choice problem of allowing special exemptions, higher food prices due to higher R&D costs for food producers, increased barriers to entry, increased incentives for industry consolidation, lower levels of future innovation in new food choices, and that regulators will make “mistakes”  and set suboptimal levels.

If you want to argue that the benefits of these regulations outweigh the costs, that’s an argument to have. But let’s be realistic about the costs. The old maxim is a useful one: there is no such thing as a free lunch.

It has been said by many commentators that the potential regulation that limits the amount of salt in foods does not limit freedom because, after all, you can add salt to anything. So really, it increases net freedom since people who like salt can still add it, and people who don’t now have the option to have less of it. There are several problems with this.

First off, I’m no chef, but it strikes me as obvious that for many foods there is a difference between cooking, baking, and generally preparing food with salt as an ingredient and sprinkling it onto food after the fact.  Since I know little to nothing about cooking, I’ll go no further with this except to say that it strikes me as obvious, and ask does anyone seriously disagree with that? If you do, buy some low sodium pepperoni, and then sprinkle salt on top. Same thing as regular pepperoni? I seriously doubt it.

The second problem is that food products, like many products, are actually a commodity bundled with a service. When you buy a loaf of bread you are not just buying a random collection raw ingredients put together, you are buying the service of the bread-makers best guess at the mix of ingredients that you will enjoy most. When I buy a loaf of bread at the grocery store, I’m buying the service of the baker taking his best guess at what level of salt the customer likes. This way I don’t want to have to deal with the iterative process of sampling every loaf of bread I buy, adding salt, and thinking about whether the salt level is just right. I’d prefer to pay to have that service performed for me by the baker. In a similar vein, at a nice restaurant part of the service I’m purchasing is the expertise of the chef in adding, among other things, the best tasting amount of salt. This regulation prevents me from purchasing that service.

You may prefer to have things the other way, and be able to select the amount of salt in all your food, and this law would increase your ability to do so. But the value to consumers of being able to select their salt amount is far less than the value to consumers of having their salt amount selected for them. How do I know this? If consumers valued it, then they would be willing to pay for it, and businesses would offer it. Since businesses offer a lot of one and little of the other, it’s a good indicator that consumers value one much more than the other.

The debate as to whether so-called “nanny state” laws lead down a slippery slope is an empirical question that will be answered; either the paternalistic laws will continue to encroach on personal freedom, or they will reach an equilibrium. Let me file this under evidence that the slippery slope is real:

Smoking is already illegal inside the state’s bars and restaurants, and now Kane County will research the legality of implementing an outdoor smoking ban as well.

Note that this is not smoking in public places outdoors, but smoking on private property outdoors.

I think it would be useful to for critics of the slippery slope theory of paternalism to demarcate now what future policies would constitute evidence that they are wrong, because my guess is the point of demarcation will move right along down the slope with policy. Several years ago many of todays critics of slippery slope theory would have said that an attempt to regulate salt would constitute evidence. But now, farther down the slope, salt regulation is just sensible policy.

Maybe this is just me, but I was surprised by how old aspirin is:

Bayer A.G. of Germany had become one of the world’s leading producers of synthetic dyestuffs, created through the manipulation and synthesis of organic chemical molecules.  In 1896 Bayer established a laboratory to synthesize and test dyestuff formulations for medicinal effects in humans.  One of its candidates, acetylsalicylic acid, proved to be as effective against fever and headaches as its parent molecule, salicylic acid, but with far milder side effects.  The new formulation was named “aspirin,” which was patented, trademarked, licensed, and sold profitably by Bayer throughout the world.

This is from a sweeping paper on pharmaceutical innovation from F.M. Scherer.

Retail clinics have traditionally been locations to get treated quickly for a short list of simple medical issues. A new program called “Monitoring Made Easy” from CVS’s Minute Clinics will now focus on helping customer/patients manage long-term health problems like asthma, hypertension, diabetes, and high cholesterol. CVS spokespeople are careful in their statements to say that they are not intending on replacing primary care providers, but rather “support patients between visits to their primary care provider or to provide assistance to patients who may not receive regular care.” They also assure that part of the program will be recommending patients to a primary care provider.

Their internal company research shows that 60% of Minute Clinic patients do not have access to a primary care provider, and to the extent that clinics can reduce search costs this program could conceivably increase the usage of primary care services. The president of Minute Clinic offers support for that notion, arguing that:

“Our practitioners are therefore in a unique position to help patients identify a primary care provider and create a path of care that includes monitoring at MinuteClinic to stay on top of their condition,”

However,  as a continuing encroachment into services they have typically provided PCPs have to view this as a competitive threat; if clinics can provide these services for people who don’t have primary care providers, they can just as easily provide them for those who do. At least the American Association of Family Practitioners seems to think so, as they have recently begun opposing retail clinics because of expansions into other services just like this.

More competition is almost always a good thing. And with 32 million recently insured under Obamacare, there will almost certainly be areas experiencing a shortage of primary care providers. But there are places I can imagine clinics making consumers worse. For instance, if PCPs were overcoming fixed costs by price discriminating on services that they now have to compete with clinics on, then lower profits there may cause market exit or prevent market entry. This could mean consumers have less access to other services PCPs provide.

I don’t have any empirical reason to believe this is the case. And in general, more competition on this front is a good thing for consumers.

Alex Tabarrok posts a graph on organ donors by country that shows the U.S. doing pretty well.

But is population the most accurate denominator? Donations are going to be a function of perceived need, so a very healthy country that needs 100 organs per million people and gets 99 is going to look worse on this graph than a country with the same population that needs 1,000 but gets 100. I suspect a large need is why the U.S. appears to do so well.  A more appropriate denominator might be the number of organs donated plus the number of people on the waiting list.

A new gallup poll illustrates the relationship between smoking, education and income.


The relationship mirrors health issues


The real challenge, however, is to tease out the causal relationship between these four factors. Are people poor because they are unhealthy? Are they uneducated because of the same social forces that drove them to smoke? Are there genetic factors underlying all of this?

Joel S comments

The genetic argument doesn’t hold water: how many of our grandparents were obese? Not many, and they had the same genes.

We search endlessly for a cause for obesity when it is common for an adult man in America, whose caloric requirement (to maintain the same weight with a sedentary lifestyle) might be 2000 or 2500, to be ingesting 4000 or more per day.

There is no mystery: a person who is ingesting only their maintenance number of calories per day will not be obese. Our caloric intake, combined with sedentary lifestyles, explains the obesity epidemic entirely. It’s not sugar, per se, and it’s not fats, per se.

I appreciate Joel bringing these issues up. I never know whether discussing these basics will insult my readers or not.

On genetics: How is it possible that obesity can be strongly genetic if our grandparents weren’t obese?

The nerdy argument is that while the incidence of obesity has risen over time the variability in obesity attributable to genetics has actually remained constant. This is one of the remarkable stylized facts that a Theory of Obesity would need to explain.

In more common terms it works like this. In our grandparent’s day very few people were obese but a few were overweight and in general some were pudgier than others. Well, it turns out that if you carry the genes that produced overweightness in our grandparents time then you are almost certainly obese today. If you carry the genes that produced pudigness in our grandparent’s day then you are very likely overweight today.

The general level of fatness is rising but the relative fatness of people in the population is as genetically determined as ever. Moreover, genetics has a lot to say.

There is a very interesting parallel with height. In the same way as obesity, height has been increasing over time. Yet, height is strongly genetic. Indeed, height seems to be only slightly more genetic than obesity.

Even more fascinating, the rise in height slowed down just as the rise in obesity was speeding up. If you look at the rise in body mass you actually see a smooth trend that extends at least back to the early 20th century. However, for the first part of that trend people were getting heavier because they were getting taller. Now they are getting heavier because they are getting fatter.

One radical hypothesis that I have toyed with is that obesity is the result of improving nutrition. In short, we see that height, intelligence and obesity are rising over time at similair growth rates. We think the first two are due to increases in nutrition. Is it possible the same is true for the third?

Its clear that being obese is undesirable in the modern world but its not immediately clear that its less evolutionarily maladaptive than being 6’2” or having an IQ of 135.  In all cases you have resources going to create tissue that probably wouldn’t have conferred much of an advantage in our evolutionary past.

I don’t endorse this hypothesis, but I think its important to keep even radical suggestions in mind.

On Calories: Don’t we just eat more and exercise less?

We definitely eat more. Its not clear that we exercise less or that sedentary behavior can explain anything. In fact households that make their living doing manual labor are more likely to be obese than those who make their living as professionals.

We do eat more though. Doesn’t that explain it?


The question is why do we eat more. Eating behavior in all animals is actually fairly tightly regulated by numerous feedback loops. Most animals do not “watch what they eat” and most do not get obese. At least not those who are not genetically prone to do so.

More importantly humans in the 1950s and 1960s were mostly normal weight yet most of them were not on tightly regulated diets. Most thin people today probably could not tell you how many calories they ingested each day nor how many they expended. This regulation is carried on subconsciously by hormone mechanisms through out the body.

The regulation mechanism is also highly fine tuned. In order to stay within one pound of your current weight over a year, calories-in have to match calorie-out with 99.7% accuracy. The calorie testing equipment that determines what goes on food labels is not even that accurate, so it seems implausible that people are achieving this through conscious equation of calories-in with calories-out.

So, for thousands of years the regulation mechanism worked despite people living in environments that were quite different from our hunter-gatherer past. However, in the past 30 years it has broken down completely. That begs for an explanation.

For the nerdier, I would also suggest that the sudden breakdown is why I am skeptical of “many independent causes of the obesity epidemic” theories. Why should it be the case that all of sudden lots of independent forces came together all to breakdown the calorie regulation mechanism in the same direction?

That is, if we were seeing just as much spontaneous anorexia as spontaneous obesity then maybe I could buy the “things just went haywire” hypothesis. However, it looks like something particular went wrong with the down-regulation mechanism of calorie management. This was probably a single cause or at least a single complex of causes. Not independent events.

There is a lot more to say but this is enough for one post.

Marc has a thoughtful piece in the Atlantic where he discusses his own struggles with obesity, his discussion to undergo bariatric surgery and our current obesity policy.

This observation is especially poignant

IF WE CAN’T EASILY cure obesity, we’ve got two choices: we rely on medical science to ameliorate its effects, in which case we consign the obese to a miserable life waiting for that one pill or Nature article that solves it all; or we get serious about helping to prevent people, and especially children, from becoming overweight and obese in the first place. (Eighty percent of people who were overweight at ages 10 to 15 are obese at 25.) This is the province of policy makers: state legislatures, school boards, members of Congress, executive-branch members, even corporate boards.

However, it is important to accept that we know as little about preventing obesity as we do about curing it.  There is no significant evidence that I am aware of to believe that preventing obesity is any easier than curing it.

It is possible that the modern rise in obesity involves some form of addiction and that some people are more genetically prone. In the same way that many can drink all they want and never become alcoholics, some can eat all they want and never become obese. In this case prevention might seem to make a lot sense.

This may be true. I don’t know of strong evidence to suggest that is. However, even if it is true it doesn’t tell us what we need to do to prevent obesity. We can’t ask that people abstain from food.

We could ask that they abstain from all “unhealthy food” though that would require a good grasp on exactly what healthy food is. This is something that we do not have.  Note that as little as 12 years ago most doctors would have considered pasta a health food, while virtually few would today.

However, even that is not likely to be the answer. Ice cream and soft drinks existed in the 1950s yet the obesity epidemic was under control. If there is a specific tipping point, then we don’t know what it is.

To make social policy and to be sure we are not doing more harm than good we need a serious Theory of Obesity. One that accounts for all of the stylized facts. One that can explain the rise in the epidemic, the strong genetic association, the  tens of millions of failed attempts to loose weight and the stunning success of bariatric surgery and Fen-Phen.

It must also be able to explain how for 5000 years since the formation of the first human cities our environment was close enough to our evolutionary environment to avoid obesity but in the last 35 the entire world has suddenly tipped into a spiraling obesity.

These are not easy questions. This is not an easy problem. By far the most important thing we need at this juncture is humility. When we start monkeying around with government policy that impacts the very sustenance of individuals then the potential for doing more harm than good is great.

A new NBER paper from Jonathan Gruber and Samuel Kleiner argues that hospital strikes are deadly:

Controlling for hospital specific heterogeneity, patient demographics and disease severity, the results show that nurses’ strikes increase in-hospital mortality by 19.4% and 30-day readmission by 6.5% for patients admitted during a strike, with little change in patient demographics, disease severity or treatment intensity.

I don’t have time to read this closely right now, and the endogeneity problem here is probably pretty tricky, so caveat lector. In any case though, the implications here are interesting. Many public sector unions regarded as essential are forbidden from striking. Should the same rules apply to nurses? Or should hospital unions be outlawed altogether? Gruber has been a favorite economist among progressives like Ezra Klein for his health care work, so it will be interesting to see how this paper is received.

Though not nearly as strong as it sometimes appears the liberal U seems to be present in this Gallup poll on the Health Care Reform


The poor support it overwhelmingly. The affluent support it mildly and the middle class is against it.

What’s ironic is that according to the Washington Post calculator you stop getting benefits from HCR right around 90K.  Just another nail in the coffin of the “people vote their wallet” hypothesis.

In an article in the Philadelphia Inquirer today about a new study on selling organs, George J Annas, a professor of health law, bioethics, and human rights who opposes compensation, had this to say about whether donors should be allowed to be compensated:

“I think it is out of bounds,” Annas said. “We know we can live with the system we have now. We have no idea about what another system would do.”

A few paragraphs earlier came these statistics:

Last year, 6,453 people in the United States died waiting for an organ. Nearly 92 percent of them died waiting for organs that living donors could have supplied – 4,456 needed a new kidney and 1,452 a liver.

I think Dr. Annas needs to modify his statement: some of us can live with the system we have now, but last year 6,453 could not.

The following is my Facebook response to a friend who argued first that Obamacare was the death knell for Capitalism, and second that my proposal to remove all medical licensing and prescription requirements was anarchy.

Imagine for example a system where I wanted to buy a table but first:

I have to go to a state licensed interior decorator to see if the table was appropriate. Based on over a decade of required training she would inspect my house to see if a new piece of furniture was appropriate.

If she wasn’t quite sure she might send me to a dining room specialist who would run a series of tests on my dining room before giving me clearance.

Then I would go to the furniture store, where I could only buy from someone who was licensed and trained in dispensing furniture. This person also need years of advanced education insure that some furniture I buying on the advice of one decorator didn’t clash with other furniture I was buying on the advice of another decorator.

That furniture in turn could only be dispensed to me if the a government agency had shown that not only was the furniture safe, but that more people thought the furniture was beautiful than thought a rock was beautiful when I stamped "award wining rock" on it.

Now, in such a world furniture is likely to be very expensive and I don’t even know for sure when in my life an interior decorator is going to approve me. So, to smooth my consumption I might want to buy furniture insurance that would pay for the furniture if I was approved.

Now the government steps in and says "40 million Americans have no furniture insurance and may have homes that are dreadfully decorated"


So, they devise a plan to subsidize the purchase of furniture insurance in exchange for proposals that will limit the total amount of furniture bought by old people. Being frail and in need of sitting down old people get free furniture.

But no! This is the breaking point. The requirement to see an interior decorator, the licensing of furniture dispensing, the approval process for each piece of furniture. That I could understand. But subsidies for the poor! Reductions in the amount of FREE stuff given to the elderly.
This is an assault on the foundations of capitalism! It must be stopped!

Storm the BASTILLE! Liberte! Liberte! Liberte!

Andrew Sullivan is the latest to point out that the Health Care Bill would be more popular as law than as a proposal. And, he has some data to back that up


There is considerable polling evidence that passage of health insurance reform will do two things: it will create a critical impression of the country moving forward in tackling its problems and will reassure and revive Democratic voters. Mark Blumenthal notes a fascinating aspect of a poll from NB/WSJ above. It showed reform to be unpopular in the abstract but much more popular if it became law:

"If the current health care legislation becomes law, will you consider it to be a step forward or a step backward?" Asked this way, the margin closed: 44 percent said it was a step forward and 49 percent said it was a step backward, leaving just 7 percent unable to answer

The key lesson I’m learning from the last three Presidency is that the voters reward good news, not good policy. If the have jobs, feel safe and the number of dead Americans they read about in the paper’s isn’t too great you get to stay in office. If not you have to leave.

To wit, its probably best to ignore public opinion entirely and simply ram through an agenda that you think will work. If you’re wrong you won’t get to stay, but you will have the made the best stab at what you want anyway. Both Bush and Obama seemed to govern this way and by and large I think its worked out for them.

Whatever the public may think of Bush, we have a fledgling democracy in Iraq and that’s what he wanted.  If Obama rams through health care we will have near universal coverage and that seems to be what he wants.

The American Association of Family Practitioners has revised it’s position on retail health clinics from mildly concerned to oppositional. This is in response to what the association sees as expanding scope of services offered by the clinics, which are small health care outlets typically located in pharmacies, grocery stores, and other retail locations that have historically focused on treating a handful of very standard illnesses like strep throat, bronchitis, ear infections, and pink eye.

These clinics have always represented a threat to the AAFP, since they primarily staff physicians assistants and nurse practitioners and are an obvious substitute for their members. This is not the first organization of health professionals to object to the retail clinic model. The American Academy of Pediatrics has previously issued a policy statement listing their concerns about quality of care and safety and officially opposing the use of retail health clinics for infants, children, and adolescents. The AMA, and the American Academy of Family Physicians have called for increased regulation.

A symposium last year in Health Affairs on retail clinics included articles showing that 90.3% of visits to retail clinics were for clinics typically served 10 common and simple illnesses. Furthermore, clinics treated these patients at lower cost than traditional health providers, specifically, $50-$60 cheaper per treatment, and they serve a population that is currently underserved by primary care providers. Other studies, which I can’t find right now, have shown no difference in treatment quality between retail clinics and traditional caregivers. So if retail clinics are treating common illnesses, at lower cost, with the same quality, what is the problem?

The AAFP is worried that clinics are expanding the scope of services they offer. According to a 2008 interview with an industry expert by the AAFP, clinics have the following expansion of scope in mind:

You can see the expansion with things like camp physicals, screenings and preventive care. Consumers need a health care provider; they want something done quickly, simply and conveniently. That core brand promise is now being applied to a whole new range of services, including injections, vaccinations and weight loss counseling….

This is supported by a recent study from Health-Leaders InterStudy, which confirms that in some markets retail clinics are expanding the services they offer. The more services these clinics provide the more they are competing with the AAFP’s members, so this move represents an increasing threat to them.

The expansion of scope is not surprising either, while retail clinics are popular and growing in numbers, there have long been concerns about clinics profitability. In recent years have been several incidents where large retailers, including Wal-Mart and CVS, will close several clinics at once. The issue appears to be that clinics have to serve a lot of customers a day in order to be profitable, and one easy way to overcome this would be to expand the scope of services.

Entrenched industry groups have been successful in the past in getting states to impose burdensome regulations on retail clinics, and this increasingly oppositional stance by the AAFP may add to that.

obese.jpg obese image by abinidab

Readers of this blog know that I am skeptical of both of traditional anti-obesity methods and indeed, feel that prevention in general is oversold. Much of life expectancy is effectively luck, the genes you happen to be born with, the mutations you happen to acquire, the particular cerebral artery that clot happens to get stuck in, etc.

You might think that I side with those who say that obesity is not a big deal. Nothing could be further from the truth.

Obesity seems to related to life expectancy, though perhaps not as strongly as commonly suspected. Our most aggressive estimates put it at a little less than half as bad as smoking.

However, this is not not the reason to that obesity is major concern,  a far greater concern than smoking in my opinion. Its a concern because people don’t want to be fat. Being fat makes them unhappy. Being fat changes the way that society relates to them. Being fat makes them less likely to find love and to make friends. Obesity produces a lower quality of life even if it has no health effects whatsoever. This matters. Indeed, it matters way more than health.

If you think Aubrey de Gray might actually succeed in breaking Actuarial Escape Velocity then making it past 70 might be one of the most important goals in your life. If Aubrey’s right then making it past 70 could mean you get to see the technologies that will extend your life to 1000. That’s a pretty big deal.

Ignoring that remote possibility, however, its much more important that one lead a non-miserable life than a long one. Many obese people report that being fat makes them miserable and that’s what matters.

Greg Mankiw mocks Team Obama’s endorsement of price controls on health care.

Very, very strange.  You would think that all those future Nobel-prize-winning economists working for the President would explain to him the history and economics of government price controls.  Imposing price controls certainly wasn’t President Nixon’s finest hour.

Maybe President Obama should instead follow in President Ford’s footsteps and start wearing a WHINE button on his lapel, forWhip Healthcare Inflation Now, Egad

Its not immediately clear to me that this isn’t a viable strategy, however.

If you believe that a large portion of the health care industry is rent dissipating then putting clamps on it might not be such a bad idea. That is, we spend lots of money on health care because we want to buy “the best care available” regardless of what that care is. However, this just encourages the creation of new therapies that we now have to buy in order to have “the best care available.”

Here is a though experiment that helps illustrate:

Your child is in the hospital and the doctor says that therapy X will cost $500K but will increase child’s chance of survival by 23%.  $500K is your life savings plus everything that you could borrow plus a little more you will have to get from friends and family. Maybe the church could help. Maybe . . .

For a millisecond perhaps you think that its not worth it. Your kid is still probably going to die. But, you push that feeling down. My God this is YOUR CHILD. Its worth it.

Now imagine the same situation but the doctor comes in and says the $500K treatment is going to increase your kid’s chance of survival by 17%. Do you say “Well I was almost on the fence at 23%, so I am going to let my kid go at 17%”

I am betting not.

What you are buying is “the best shot”, not any particular chance of survival. Thus, if I spend billions increasing the best shot only by a few percentage points you will buy my new treatment, even though the actual change in your family’s prospects are extremely small.

In many cases people will pay more just for uncertainty. Imagine the following: we have a treatment that we know is only effective in 5% of cases. That sounds pretty bleak. However, we have this brand new treatment that is not without risks. Yet, if it works could save 90% of patients. Many people would instinctively be willing to pay more for the second treatment.

However, the second treatment is new and risky. Its possible that it won’t help anyone. Its possible that it could make your child worse. However, the fact that you don’t have to admit to the bleak 5% odds makes the treatment enticing. Again, you are not buying life. You are buying a reprieve from thinking about the death of your child.


Its important to remember that this argument doesn’t suggest that all health care is useless. It doesn’t even suggest that all of the “latest care” is useless. Only that it is less useful than the price might suggest.

My Deaton and Muellbauer is a little rusty so, I’d have to spend some time looking through the actual economics of a rationed market.

Nonetheless this seems like a step towards dividing the baby in half.

Robin Hanson contrasts the public’s demand for health care regardless of the evidence of it’s efficacy, with the public’s demand for grocery stores and “car entitlements”:

If we were considering a vast new grocery store or car entitlement, the public would hardly “forget” to wonder if that would really give us more nutrition or a faster commute.  But the US public has little religious-style fervor on grocery stores or cars.

If only it were so, Robin! The public’s doesn’t worry about whether a new grocery store will provide them more nutrition, but whether it will provide them with organic foods. In the same way that the public assumes more health care means more health, they assume organic foods provide more nutrition despite the fact that all evidence suggests that they don’t. The fervor for unproven food policies as at least as religious as it is for health care.

Also, I’m not sure what “car entitlements” are, but I’m pretty sure that the public would just want to know how many “green jobs” they would create.

UPDATE: Study does have several controls including importantly mother’s education and BMI. It also attempts to measure intra-family effects. My previous analysis is invalid.


Marion Nestle dings the Obama obesity program for not focusing on food advertising. Nestle sites an American Journal of Public Health paper whose conclusion is

Television viewing may be a sedentary activity, but it is not for that reason that it is associated with obesity in children. The relationship between television viewing and obesity among children is limited to commercial television viewing and probably operates through the effect of advertising obesogenic foods on television.

There is a well known correlation between TV watching and childhood obesity. The study seeks to control for activity level and the type of TV watch by using time-diaries.  Their results show that type of TV watched is a predictor of childhood obesity but activity level is not. Kids who watched commercial free television were less likely to be obese.

However, as far as I can tell they make no attempt to control for exogenous family characteristics. No socioeconomic factors. No family dummies. No randomization.

The simplest story then, is that parents who are conscientious are going to both monitor what their children watch on TV and what they eat. I, of course, would be sympathetic to more complex stories involving backwards causation from obesity to type of TV watching.

When looking at childhood obesity we need to keep a few facts in the forefront of our minds. First, children and parents share the same genes and given the results of previous research we should be very conscious of potential genetic links between parent and child life outcomes.

Second, human personality is to a large extent determined by the interaction of the genes with the social hierarchy. In some sense we can think of much of human behavior as the genes doing the best they can with what they got, in an effort to climb the social ladder.

Obesity has strong social effects. Thus we should expect it to have strong effects on behavior. A fat kid is not going to face the same social incentive structure as a thin kid. A fat parent is not going to face the same social incentive structure as a thin parent. And a parent of a fat kid is not going to face the same social incentive structure as the parent of a thin kid.

Thus we should expect obesity in children to have strong effects on how the parents see themselves and how they interact with their children.

Marc Ambinder has some interesting pieces up at the Atlantic on the First Lady’s efforts to combat childhood obesity. I obviously have a lot to say on that but am short on time. In the mean time I will point you to Robert Lustig’s Nature article on childhood obesity, which was a watershed for me personally.

The article is a bit dense for those without a science background, nonetheless, it is extremely valuable. I recommend opening Lustig in one window and Wikipedia in another and just making the hard slog.

Here is the abstract

Childhood obesity has become epidemic over the past 30 years. The First Law of Thermodynamics is routinely interpreted to imply that weight gain is secondary to increased caloric intake and/or decreased energy expenditure, two behaviors that have been documented during this interval; nonetheless, lifestyle interventions are notoriously ineffective at promoting weight loss. Obesity is characterized by hyperinsulinemia. Although hyperinsulinemia is usually thought to be secondary to obesity, it can instead be primary, due to autonomic dysfunction. Obesity is also a state of leptin resistance, in which defective leptin signal transduction promotes excess energy intake, to maintain normal energy expenditure. Insulin and leptin share a common central signaling pathway, and it seems that insulin functions as an endogenous leptin antagonist. Suppressing insulin ameliorates leptin resistance, with ensuing reduction of caloric intake, increased spontaneous activity, and improved quality of life. Hyperinsulinemia also interferes with dopamine clearance in the ventral tegmental area and nucleus accumbens, promoting increased food reward. Accordingly, the First Law of Thermodynamics can be reinterpreted, such that the behaviors of increased caloric intake and decreased energy expenditure are secondary to obligate weight gain. This weight gain is driven by the hyperinsulinemic state, through three mechanisms: energy partitioning into adipose tissue; interference with leptin signal transduction; and interference with extinction of the hedonic response to food.

Emphasis mine

I don’t agree with all of Lustig’s conclusions as written in the article. This is in part because the accurate answer to some of the questions is: “I really have no idea and neither does anyone else.” Yet, that’s hard to get published.

Cowen and Douthat comment on vouchers. Kling chimes in

In my view, the question is not whether you like vouchers are not. Vouchers are inevitable, given the alternatives. Alternative 1 is to keep what we have, which is an open-ended commitment to reimburse health care providers for all procedures performed on people over the age of 65. That is not feasible–the budget blows up. Alternative 2 is to have government impose strong rationing of medical services to seniors. I think that is an unlikely alternative. It’s not just that I think that government would do a poor job. When it comes down to it, do politicians really want to be put in that position?

I am strongly sympathetic to this view. On one level vouchers do seem like the most realistic form of rationing. But, I wonder whether they are politically stable.

Are we not just committing to a regime in which voucher sizes are constantly raised? Won’t political ads in 2050 simply say: “The biggest problem facing America today is the failure of vouchers to keep up with insurance rates, leaving millions of hard working seniors without life saving care”

I just don’t see how the government can credibly commit to low voucher levels. The government can’t even credibly commit to lower reimbursement rates for MDs. Some way or another we have to cut off excess price growth at the source and I am unconvinced that vouchers will do it.

In an interview with Matt Lauer the First Lady says that the obesity crisis is “imminently solvable” and “doesn’t require any new technology.”  So, it looks as if we can shelve Qnexa and Vagus Stimulation Research, Michelle has got this one covered.

I’m giving the First Lady a hard time of course, but its important that the contours of the obesity problem be public knowledge. I used to think that experts were wholly incapable of seeing how the future would evolve. We would get these dazzling predictions of flying cars, cures for cancers and the end of poverty. Yet, they never panned out.

Deeper investigation into these issues often shows, however, that many experts were skeptical about achieving these goals in anything like a short time frame. Yet, the imagination of the intelligentsia was entranced and it became popular to speculate about great achievements that were just around the corner.

Obesity is the same way. There is no indication whatsoever that obesity is “imminently solvable” and I would bet that the solution, when it comes, will involve radical new technologies. I am sure that the First Lady has in mind Behavior and Lifestyle Modification (BLM), the idea that we can teach people to live and eat differently.

However, BLM has been an overwhelming failure in long term weight management and there is no reason I know of to think that will change. We can haggle over why BLM is failed. Maybe the interventions weren’t big enough. Maybe the people weren’t dedicated enough. Maybe big agribusiness has hooked everyone on salt and fat.  Maybe . . .

Still, if we can’t get it to work in a clinical setting, with brilliant doctors, fancy equipment and patients who have volunteered, then we should be extremely skeptical that this can be successfully rolled out to the general public.

In an interview with Ezra Klein, Republican Rep. Paul Ryan describes the alternative to comparative effectiveness research in his budget proposal:

“What I also have in this bill is the health care services commission. It is a system whereby all these stakeholders in health care – providers, doctors, insurers, consumer groups, hospitals, unions – all come up with standard metrics that are standardized that we hold for price and quality and best practices. It’s a lot different than a comparative effectiveness approach.”

I haven’t read the bill, so maybe I’m misunderstanding him here, but it sounds to me like Ryan’s alternative to comparative effectiveness research conducted by some sort of independent agency is to explicitly have the decision made by haggling between impartial interest groups. Feel better now?

Via David Friedman a paper suggesting that the high rate (>600K cases) of HIV/AIDS among African children results from infections received during visits to the doctor.

The common belief that 90% of HIV transmission in Africa is driven by heterosexual exposure is no longer tenable. Evidence supporting a much larger role for parenteral HIV transmission in medical settings in Africa has recently been painstakingly detailed 9,21. The HSRC report, if confirmed, adds to this evidence. The lessons for all doctors, including obstetricians and gynaecologists are clear: They must educate their patients in the dangers of non-sterile injections and ensure that their own practice is beyond reproach. Patients could be shown the package of a new needle (or bring their own) and single-dose vials used for injections. Similar improvements in the sterility of injections in the informal sector also need to be made. We must protect patients from their own medical care system in all countries with similar epidemiological characteristics

If true, the really shocking part is not that medical care is in large part responsible for this medical nightmare, but that we missed it until now. With all of the attention put on African HIV/AIDS is it really possible that we didn’t see that medical care itself was the problem? Sadly, I believe that it is.

Tyler Cowen highlights an important point

There is a growing awareness among researchers, including advocates of quality measures, that past efforts to standardize and broadly mandate "best practices" were scientifically misconceived. . .

Orszag’s mandates not only ignore such conceptual concerns but also raise ethical dilemmas. Should physicians and hospitals receive refunds after they have suffered financial penalties for deviating from mistaken quality measures? Should public apologies be made for incorrect reports from government sources informing the public that certain doctors or hospitals were not providing "quality care" when they actually were? Should a physician who is skeptical about a mandated "best practice" inform the patient of his opinion? To aggressively implement a presumed but still unproven "best practice" is essentially a clinical experiment. Should the patient sign an informed consent document before he receives the treatment? Should every patient who is treated by a questionable "best practice" be told that there are credible experts who disagree with the

I’ve probably been guilty of wishful thinking in regards to comparative effectiveness research. There are serious ways in which what works in the lab deviates from what works in the field. It is easy to get over confident when hundreds of billions of dollars in savings are dangled in front of your eyes.

At the same time, however, I still think its a mistake to “trust doctors” on these issues. Comparative effectiveness research may not be a magic bullet but there is little evidence that doctors in the field are any better.

Public medical spending should still be supported by strong science even though more humility is need in pushing scientific results.

It’s conventional wisdom that preferring the status quo just because it’s the status quo is a bad idea. In fact it’s such conventional wisdom that it’s been labeled a cognitive bias. But maybe in some venues, a status quo bias makes sense. Commenter MC, at Megan McArdle’s blog, defends the status quo thusly:

Note that this isn’t to say the status quo is perfect. It’s just that we have full information about it, because the experiment has been run and the outcome is there for all to see. We can see the good points and the bad. But with any hypothetical change, we really don’t know what is going to happen. The benefits that proponents of the change promise may occur, or they may not. There will almost certainly be unintended consequences. We don’t really know.

I think some defenders of health care reform have exacerbated rather than ameliorated people’s instinct to prefer the status quo. In fact, their rhetoric sort of justifies a preference for the “devil we know” as Megan McArdle puts it. I say this because time after time, defenders of the sorts of health care reforms Democrats are floating have guaranteed us that the policies we get will become more progressive than the bill that is passed, and that this is just a first step towards a health care system containing more of the reforms they want but can’t seem to pass. I discussed this on my very first post at this blog with respect to Ezra Klein. I quoted him as saying this:

…. success does breed success. Medicare and Medicaid began as fairly limited programs. Medicaid was pretty much limited to extremely poor children and their caregivers. Medicare didn’t cover prescription drugs, or individuals with disabilities, or home health services.

But once the programs were passed into law, they were slowly and continually improved. They became more expansive, with Medicaid growing to cover not only poor families but also poor adults, and the federal government giving states the option, and matching dollars, to include more people under the program’s umbrella….It is not hard to imagine health-care reform following a similar path…..The public plan could be strengthened, or the government could begin to set payment rates for insurers who participate in the exchange… Subsidies could expand, and new funds could be used to encourage the development of integrated care organizations rather than simple insurance companies.

Ezra seems to think that if we pass this bill, policymakers are more likely to expand, strengthen, and “improve” whatever programs they create, with improve being a subjective term in this context. So in deciding whether we should prefer the health care reforms Ezra defends we should keep in mind that what we see is not what we will get. For some people that added uncertainty will mean more status quo bias than if we were simply going to get whatever policy was passed, rather than a first step towards a more expansive policy.

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