Thursday, May 12, 2011

Human Genome Project generates a 20,900 percent return on investment. Could such wealth--and health-creation have any bearing on Washington DC's framing of the healthcare issue?

Fast Company's Ariel Schwartz takes note of a new report calculating the economic value of the Human Genome Project; the return on investment--$3.8 billion begetting $796 billion, for a more than 20,000 percent increase--makes even Apple’s massive stock appreciation look small:

The project has, in fact, driven $796 billion in economic impact and generated $244 billion in total personal income, according to a new report from Battelle. Sometimes, pricey long-term science projects are well worth it.

According to the report, the nascent genetic research industry generated $67 billion in U.S. economic output and created 310,000 jobs in 2010 alone. "We were surprised by just how large the economic impact had been," says Greg Lucier, CEO of Life Technologies (the foundation that sponsored Battelle's research). "What was even more interesting for me is that we're just getting going. The ability now to read genes quickly and economically is opening up entirely new vistas of opportunity." 

These are good numbers, of course, although they are basically unheard and unobserved by the political class in Washington.  

Why? Because the future benefits of scientific transformation are not factored into policymaking.  As a general rule, the Congressional Budget Office will not "score" anything that doesn't involve "normal accounting"--measured in the most linear manner.

The IRS, to be sure, is happy to collect the tax money from added profits, of course; and ordinary Americans are happy to have the better health and more jobs, but the CBO doesn't calculate scientific advance in its projections.    Perhaps, as a matter of policy, the CBO is wise not score "anticipation," but that self-imposed limitation only means that policymakers elsewhere in the government should factor in the inherent limitations of the CBO, and should be looking elsewhere, as well, for policy inputs and metrics.

Unfortunately, Washington does not see the limits of we might call "CBO-ism."  Instead, CBO serves as a crutch to both parties, although it is more valuable to the Democrats.   Thanks to CBO scores, both parties can claim justification for their fiscal policies, although the Democrats--being the party determined to defend the big-government status quo--seem happier with the CBO and its number-crunching works.

But even if the Republicans get less satisfaction from the CBO, they still tend to rely on it, because they can use CBO numbers to show that they are moving toward balancing the budget--or that the Democrats are not.

Yet thanks in part to the enormous power, the common shared fallacy of both parties is that they seem to think that such budget-balancing is the most important thing that they can do--even if they disagree, of course, on how to get to a balanced budget.  And that common commitment to the centrality of a balanced budget--whether it is to be achieved by tax increases or by spending cuts--only further blinds the parties to the promise of profound scientific transformation.

But there's another way of looking at fiscal policymaking: And that is, if the economy is growing--or better yet, booming--the deficit will disappear.   And for that matter, many other problems will disappear, too.

That's the thing about scientific transformation, and one of its subsets, Serious Medicine.  The strength of scientific transformation is that it obviates partisan fighting, allowing society to move up the escalator of progress.  But of course, that's also the downside, because in the heat of the political moment, both parties seem to prefer the partisan fight, as opposed to the conciliation that comes from problem-solving.

No wonder the Human Genome Project gets so little traction in DC policy circles.

Fortunately, the march of science continues, as Schwartz explains in her Fast Company item:

And that nearly $800 billion is just the start of the money that will start rolling in as technology improves. "In my view, DNA sequencing will become as ubiquitous as the stethoscope in medicine," says Lucier. This could happen sooner rather than later; the same sequencing services that cost billions of dollars 10 years ago cost only thousands of dollars today.

"Companies like ours have been investing hundreds of millions of dollars in development [of DNA sequencing technology. Our knowledge of chemistry and computing have been combined to where you can do things at the molecular level quickly," explains Lucier. . . . At the end of the day, we'll bet the $3.8 billion turns out to be a fantastic investment.

The reality of scientific transformation is what Washington bean-counters can't get their heads around.  For reasons I explained for the Manhattan Institute’s Medical Progress Today, politicos and Washington-oriented policy mavens can’t deal with outside-the-Beltway forces, such as technology and the transformation it begets.   

Instead, the Beltway political class seems enraptured with its own version of numerology--that is, a fascination with purely financial transactionalism, as scored by the great idol of Powertown, the Congressional Budget Office.   And that numbers-obsession, dealing within the zero-sum environment of accounting, leads Washingtonians, right and left, toward healthcare rationing schemes.  Rationing schemes, of course, which were soundly rejected by the voters in 2010 and will be again in 2012. 

Perhaps after both parties find themselves rebuked by the voters, one or both parties will look up and notice that the real secret to politically acceptable healthcare is better health.  Although, of course, there's still time for the parties to wake up before 2012 and realize that science holds the key to a better healthcare platform.   

If so, even the bean-counters will be happy, once they get over their bad case of "not invented here." Because better health also means lower healthcare costs over the long run.  

1 comment:

  1. The Human Genome Project is the gold mine that keeps on giving, .... and will for many more decades to come; if, we don't blow ourselves up in foreign affairs.
    Washington bean-counters can't get their heads around scientific transformation because they can't answer the simple question: "How much is your mother worth"? ...... Answer: "She is priceless"!
    The Rule of 72 in Mathematics is not derived, it just is! The CBO needs to learn that scientific transformational numerology falls into the same type category.
    When we the citizenry vote again in 2012, I for one know that I will be looking to 'ration' the number of idiots on the Hill.
    Having children in the medical field and a mother who was priceless, I really appreciated what you wrote today and the SMS torch you are carrying and have been for some time for all of us.