I Aim To Misbehave

The UK’s top public doctor says the failure to find a cure for Ebola represents underscores “the moral bankruptcy of capitalism”. Does that mean we can expect an Ebola vaccine from a socialist country any day now? Or one developed by the public doctor’s public system? That’s not what he means. What he might be referring to is the dramatic recovery of two missionary healthworkers in Liberia following the administration of the experimental Zmapp serum.

This will be cited as proof that the cure for Ebola was only “50 white people away”. Professor John Ashton, president of the UK Faculty of Public Health, an independent body for specialists in public health in the United Kingdom said as much. No cures for blacks. “They’d find a cure if Ebola came to London,” he said.

But who’s ‘they’ kemo sabe? Not his public system. ‘They’ is the morally bankrupt capitalist system that he hates so much. Now if only we could put the morally bankrupt capitalist system under the control of public doctors then all would be well.

Would the public doctors really decide to develop a cure for Ebola? The sad fact is that if they tested Zmapp on black Africans during this Ebola outbreak the media would claim they were being used as lab rats. The only acceptable way to test the new uncertified medication in Liberia was on two white Americans. That way if the serum failed the UN wouldn’t sue. As it is the Kentucky Bioprocessing, a subsidiary of Reynolds American, is not out of the woods yet. If it failed critics would note that the drug supplied was made from tobacco plants.

The U.S. Food and Drug Administration must grant permission to use experimental treatments in the United States, but the FDA does not have authority over the use of such a drug in other countries, and the aid workers were first treated in Liberia. An FDA spokeswoman said she could not confirm or deny FDA granting access to any experimental therapy for the aid workers while in the U.S.

Why do ‘they’ succeed? Ironically, it is because ‘they’ can fail, if necessary time and again. Megan McArdle notes that medical innovation comes, almost by definition, from attempts at doing the impossible. Throwing resources at iffy causes is a form of luxury spending. But one side effect of trying to ‘uselessly prolong life’ is the emergence of treatments and even palliative devices that over time expand the frontiers of medical science. McArdle quotes Glenn Reynolds’ experience with his family’s ailments:

My mother had a hip replacement. … Not too long ago, she would have been chairbound.

My father had prostate cancer…It was treated with radioactive “seed” implants. He’s now been cancer-free for several years, without the side effects of earlier treatments — or, worse, of cancer.

My daughter had endoscopic sinus surgery … A head CT scan done on a fancy new in-office machine showed a nasty festering infection … Before laparoscopy, her condition would probably have remained untreated, and she would have been another “sickly” kid. …

The normal critique of socialized medicine is to point out that people have to wait a long time for these kinds of treatments in places like Britain. And that’s certainly a valid critique. I’m sure my mom and daughter would still be waiting for their treatments, while my father and wife would probably be dead.

The key point, though, is that these treatments didn’t just come out out of the blue. They were developed by drug companies and device makers who thought they had a good market for things that would make people feel better.

Luxury spending is normally unreasonable. Olga Khazan, writing recently in The Atlantic, argued that developing an Ebola cure would be a criminal waste of resources. In her article “An Ebola Vaccine Is Not the Answer” Khazan said, quarantine is by far the cheaper alternative. She presented this chart as proof, writing “malaria kills a child every minute. Meanwhile, here’s a look at how many people die from Ebola compared with other deadly diseases”

Not Worth Curing

And she’s right. From a statistical point of view, it is a waste of resources. Who can argue? Dr. Kent Brantly and Nancy Writebol that’s who. What arguments like Khazan miss are that statistics represent aggregates. But the aggregates are made up of individual bets. And it is in the individual outcomes that progress is made.

Was it cost effective to send a private jet to Liberia with an experimental vaccine that was at best a long shot? No. Definitely not. There was nothing reasonable about it. The odds were overwhelmingly that both Brantly and Writebol would at best, receive no benefit. Yet if a cure emerges for Ebola it will be from the efforts of unreasonable people like the two missionaries and not the oh-so-reasonable public health mandarins.

Barry Werth, writing in the MIT Technology Review notes that pharmaceutical R&D is supported by what might be termed defects in the US insurance system.

Because of medical insurance, co-pay reductions, and expanded access programs for the uninsured, relatively few Americans pay more than a few thousand dollars per year for even the most expensive drugs. The primary customers in the United States are not patients or even individual physicians, although physicians can drive demand for a drug; rather, the customers are the government (through Medicare and Medicaid) and private insurance companies. And since the insurer or government is picking up the check, companies can and do set prices that few individuals could pay. In the jargon of economics, the demand for therapeutic drugs is “price inelastic”: increasing the price doesn’t reduce how much the drugs are used. Prices are set and raised according to what the market will bear, and the parties who actually pay the drug companies will meet whatever price is charged for an effective drug to which there is no alternative. And so in determining the price for a drug, companies ask themselves questions that have next to nothing to do with the drugs’ costs.

This generates tremendous costs — which is bad — but what it also creates a market for innovation. Walter Russell Mead, writing in American Interest notes, that after the US system has picked up the R&D tab via high prices, the rest of the world gets to buy it at marginal cost.

A new pill for hepatitis C is unmasking a huge global inequality in pharmaceutical costs—one that disproportionately burdens the United States. The FT has a must-read report on Solvadi, a drug developed by Gilead Sciences that costs $84,000 for a 12-week course of treatment for American patients, but sells for a song in other countries—as low as $11 per pill in Egypt, for example. As a result, an increasingly noisy movement in America is starting to ask why this is:

“The answer is because it can,” says [Chief medical officer of Express Scripts] Dr [Steve] Miller, one of Gilead’s fiercest critics. “Sovaldi has shone a light on the fact America is subsidising healthcare innovation for the rest of the world.”

This is unfair to the US consumer, but there’s no denying that many routine medical procedures were once exotic and luxury health goods. This is not entirely good news. Over time medical innovation does two contradictory things: it decreases the cost of individual procedures but increases the total spending on health care. Take Sovaldi, which costs $1,000 a pill or $84,000 a full treatment. It’s expensive, but not by comparison with a liver transplant, which costs $600,000. Yet in the aggregate, Sovaldi will devastate schemes like Obamacare. So Oregon is restricting it.

The reason is simple. Liver, transplants might cost individually more but in the aggregate cost less. You can treat 100 of 1000 patients with liver transplants at $600,000 each — and bury the rest. That is still cheaper than treating 1,000 patients at $84,000 each. But maybe life extension should be the growth industry of the 21st century. Our decadent capitalist civilization spends a declining percentage of income on food, shelter and clothing and there is nothing illogical about devoting a greater share of resources to the ‘unreasonable’ goal of keeping grandma comfortable and alive.

Whenever you discover a new cure, you have a problem. When most diseases were incurable, health care was cheap because you hired a grave digger and that was it. It’s when a cure is discovered that one can start ranting about the unfairness of it all. Ebola doesn’t illustrate the moral failure of capitalism; if anything it underscores the creative dilemma of private unreasonableness.

Those of us who have been trained to submit to the calculations of the unimpeachably reasonable mandarins should remember that in a free society nobody is required to be sensible so long as they do no harm. Because new information is in the outlier, eventually the boundaries of knowledge are pushed back. Once upon a time both the Internet and GPS were being denounced by the Left as a waste of money, or products of the military industrial complex. Now they want the UN in charge of it.

As a movie about space adventurers says, progress comes from those who are unreasonable. Having experienced the bettering attacks of cosmic government, the hero says: “sure as I know anything I know this, they will try again. Maybe on another world, maybe on this very ground swept clean. A year from now, ten, they’ll swing back to the belief that they can make people…better. And I do not hold to that. So no more running. I aim to misbehave.”

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