Kenneth Arrow on Serious Medicine: "The basic reason why health costs increased is that health care is a good thing!"

Kenneth Arrow, who won a Nobel Prize for Economics in 1972, gave an important interview to Conor Clarke of The Atlantic in which he talked extensively about health care. Clarke asks, "As far as cost goes, could technology be the case? As society gets wealthier it might be rational to spend relatively more money on health as opposed to other consumption demands." And Arrow answers:

Oh, why health costs increase? The basic reason why health costs increased is that health care is a good thing! Because today there is a lot more you can do! Consider all these expenses that are diagnostic. Cat scans, X-rays, MRIs and now the proton-powered whatever-it-is. Something that is the size of a football field, cost $50 million, and has all sorts of diagnostic powers. A lot of these technologies clearly reveal things that would not be revealed otherwise. There's no question about it. Diagnostics have improved. Technology has improved. You know, sending things through your blood stream to help in operations, instead of cutting you open. It's incredible. But these things are costly. But for older people longevity is increasing by a month each year. Now, whether that creates other problems with retirement and social security is another question. But, nevertheless, preserving life is a good thing.

Elsewhere in the interview, Arrow serves up a fundamental SMS tenet: health care is not an economic good. At least not in any way that economists are really equipped to recognize:

It's not like buying automobiles. Whether you're sick or not is hard to predict. Some get sick and some don't.

Health care is the superior good that you don't want to consume, and if you do consume it, you rarely brag about it--there's no place for health care in the Veblenite typology.

And yet in the era of HIV and H1N1, it is your duty to consume health care, for the sake of everyone else. And it is also, ultimately, reluctantly, your desire to consume it, for the sake of yourself. Economists can struggle to Procrusteanize health care into their flat numerical models, but it just doesn't fit--we are all Theseus, reversing the roles.

Health care is a spirit in the woods--if you have your health, you are "rich beyond the wealth of kings," as Wordsworth wrote two centuries ago. But if you have to consume health care, you are better off, but at the same time, you feel sad. So health care is unwanted, then wanted, then unwanted again. Economists can't riddle that, nor can anyone else. We see it, but still we don't admit the reality of it.

Is Obamacare Welfare? How Much of the Great Society Do We Want To Bring Back?

Lloyd Green, a former Justice Department official in George H. W. Bush's administration, posts a piece for New Majority.com in which he asks the question: Is Obamacare just another word for welfare? As Green puts it:

Government option healthcare has become the flashpoint of the Great Welfare debate redux. The reality is that there is an insurance gap between between working whites and minorities, and the Obama Administration is asking taxpaying Americans to a) pay for closing the gap and b) making government both the insurer and regulator for all.

The Obamans and the Democrats have come a long way from the time--even if it was just a few months ago--when they argued that "health care reform" would make health care better.

They might get something through, but it is not going to be popular.

To Be Euthanized? Or Not To Be Euthanized? If Democrats Want To Save The Life of Their Health Care Bill, They Will Need Some Serious Medicine

President Obama assures us that the government is not going to get into the euthanasia business, but Charles Lane, a Washington Post's editorial writer, is notably so sure that the President is correct.

In his radio address today, Obama labeled as "outlandish" claims by critics that his health care plan "will promote euthanasia, cut Medicaid, or bring about a government takeover of health care. That's simply not true." OK, but maybe the President should take a closer look at Section 1233 of the House version of Obamacare. Charles Lane did, and here's what he wrote today in the WaPo:

...Section 1233 of the health-care bill drafted in the Democratic-led House, which would pay doctors to give Medicare patients end-of-life counseling every five years -- or sooner if the patient gets a terminal diagnosis.

On the far right, this is being portrayed as a plan to force everyone over 65 to sign his or her own death warrant. That's rubbish. Federal law already bars Medicare from paying for services "the purpose of which is to cause, or assist in causing," suicide, euthanasia or mercy killing. Nothing in Section 1233 would change that.

Still, I was not reassured to read in an Aug. 1 Post article that "Democratic strategists" are "hesitant to give extra attention to the issue by refuting the inaccuracies, but they worry that it will further agitate already-skeptical seniors."

If Section 1233 is innocuous, why would "strategists" want to tip-toe around the subject?

Perhaps because, at least as I read it, Section 1233 is not totally innocuous.

For Lane, writing in The Washington Post, which endorsed Obama last year, the words "not totally innocuous" can be read as, "critics are right to be worried, but I can only go so far here at the Post."

As Wesley Smith and many others, mostly on the right, have argued, over the past few decades, the specialty of "medical ethics" has been mostly taken over by a mindset that Smith calls "The Culture of Death." Such a phrase will be regarded as too incendiary by many, but the outlook that Smith identifies can be fairly summarized as secular, left-of-center, and Benthamite in its utilitarian outlook. Such views tend to cluster among the educated upper middle class--the intelligentsia that often takes its social and cultural cues from its peers in Western Europe. And yet "European" outlook is regarded with suspicion by many Americans--probably most Americans, who reject, for example, the government-sponsored euthanasia seen in, say, Holland, or even a hint of government-sponsored euthanasia. Which is why, Lane continues, liberals prefer not to get into this topic at all, because there's plenty of evidence to bolster their critics. (One supposes that they should be more careful about what they write, but maybe it's too late for that.)

But in the meantime, as liberals try to decide what they can say, and not say, conservatives feel no compunctions. They filling up the void, making their points with posters such as the above. Is the gist of this "Cash for Clunking Senior Citizens" poster unfair? Does it go too far? Maybe. But for many Americans, maybe most, there's plenty of truth in it. And out of such reservoirs of mistrust will come all sorts of conspiracy theories, to say nothing of political pushback on Obamacare.

And that's one way in which Obamacare itself could be euthanized. If the Obamans and the Democrats want to get a bill through Congress, they will have to put themselves firmly on the side of life--on the side of Serious Medicine.

Photo credit: The People's Cube.

Dean Kamen: Current Policy is "Backward Looking," Spend More on Serious Medicine

Dean Kamen, the legendary inventor, has some blunt words for those who want to crunch down on medicine in the name of "controlling health care costs." Kamen holds some 440 patents, for devices ranging from the miraculous to the fabulous--first wearable infusion pump, a portable kidney dialysis machine, all sorts of prosthetic limbs, and the Segway scooter.

It's fair to say that Kamen (pictured above in one of his inventions; he himself is perfectly ambulatory, he designed that machine to help others) has done more to advance the real health of Americans, and the peoples of the world, than just about anybody alive today. And yet he is not judged to be a "player" in health care matters.

And so it is unfortunate that Kamen's warnings about the current direction of health care policy probably won't get that much attention, because of the venue he chose: He shared them with Popular Mechanics, a publication that is not exactly a must-read for either "health care policy" experts or politicians.

Why is Popular Mechanics outside of this select circle? For reasons that perhaps C.P. Snow best explained in his 1959 speech-turned-into-book, The Two Cultures. A half century ago, Snow observed that literature and science have separated from each other, to the disadvantage of both--and to the bigger disadvantage of the rest of us.

Today, strange as it might seem, "health care policy" owes more to literature--political literature, with an infusion of politicized economics--than it does to bench science, or bedside medicine. That is, the politicking and chattering classes are more interested in political science than they are in biological science. And while this might make some casual sense, it makes less sense upon future reflection, because to real people, dry health care policy is less important than the "blood and guts" of doctoring and medicine. In the end, what matters in a life-and-death situation is not what a politician says or does, but what gets invented, or not, what gets treated, or not, and what gets healed, or not.

Here are some excerpts of Kamen's PM interview, as selected by Reuters' always alert James Pethokoukis:

We now live in a world where technology has triumphed, in many ways, over death. The problem with that is that it’s enormously expensive. And big pharmaceutical giants and big medical products companies have stopped working on stuff that could be extraordinary because they know they won’t be reimbursed, according to the common standards. We’re not only rationing today; we’re rationing our future.

If you project forward these horrific costs of treating everybody and you want to assume we are not going to respond to that by making the therapies better, simpler and cheaper and in some cases completely wiping out the [diseases], well you know what? We might actually get to that situation—if we stop investing in technology, if we stop believing that the future ought to be better than the past.

If somebody in this country wants to explain to me that we ought to be spending about twice as much supporting sports as on all of our pharmaceuticals, then stop spending.

I think this debate shows a fundamental lack of vision, a lack of confidence, a lack of understanding of what’s possible.

Kamen doesn't use the words, but he makes the case for a Serious Medicine Strategy. It's too bad that more people in DC won't know about it.

UPDATE: The Health Care Blog, a must-read for health care types, picks up on Kamen.

Not so Nice NICE?

Pat Buchanan, always a powerful polemicist, proved his skills yet again yesterday, when published a powerful column yesterday, entitled, "Time to go, Grandpa."

Buchanan tells his readers about what he sees as a not-so-nice NICE. NICE is the oft-used acronym for the National Institute for Health and Clinical Excellence, the Orwellian-ly named unit of Britain's National Health Service that sets the broader priorities for the NHS:

London's Telegraph reported Sunday that the National Institute of Health and Clinical Excellence, known by its Orwellian acronym NICE, intends to slash by 95 percent the number of steroid injections, such as cortisone, given to people who suffer severe and chronic back pain.

"Specialists fear," said the Telegraph, "tens of thousands of people, mainly the elderly and frail, will be left to suffer excruciating levels of pain or pay as much as 500 pounds each for private treatment."

Now, twin this story with the weekend Washington Post story about Obamacare's "proposal to pay physicians who counsel elderly or terminally ill patients about what medical treatment they would prefer near the end of life and how to prepare instructions such as living wills," and there is little doubt as to what is coming.

The Post portrayed the controversy as stoked by "right-leaning radio" using explosive language like "guiding you in how to die" and government plans to "kill Granny." Yet, is not the logical purpose of paying doctors for house calls to the terminally ill, whose medical costs are killing Medicare, to suggest a pleasant and early exit from a pain-filled and costly life?

Statism's illogic exposed for all to see in F.A. Hayek's "The Fatal Conceit: The Errors of Socialism"

Let us suppose the NICE plan in Britain is adopted. And an 80-year-woman, living alone, with excruciating persistent back pain, is visited by a physician-counselor. What is he likely to advise? What conclusion would Grandma be led to by a doctor who sweetly explains what treatment she may still receive, what is being cut off, and what her other options might be?

What other options are there?

Needless to say, many well-meaning people will strongly disagree with Buchanan's column, and his larger Catholic-influenced "culture of life" argument. By all means, let's all hear the debate, back and forth.

But I must say that I was not reassured tonight as I watched Rachel Maddow, on MSNBC, who interviewed a Nebraska small businessman who had appeared in a lefty TV spot to denounce one of his US Senators, Democrat Ben Nelson. The Nebraska man has a perfect right to his opinions, of course, but then Maddow said, at the end, thanks for your time, and if I am ever in your small town--with the sort of smile that indicates that she has no intention of ever being in Nebraska, to say nothing of the man's little town--I will be sure to leave a big tip.

Thanks, Rachel. You have just reminded us that you are a limousine liberal, par excellence.

Health Producerism as a Serious Medicine Strategy

This illustration is worth looking at closely, because it takes us back to the days when production was regarded as the fundamental economic strategy.

It was produced by The Grange, a farmers' alliance that peaked in the 19th century, it illustrates the tenets of producerism. If that word is unfamiliar, here's the Wikipedia entry on "producerism," it is more than a little critical, but as with most postings on Wikipedia, it's a start. In the middle of the picture is a farmer, and the caption reads, "I feed you all." That was the central argument of The Grange back then--and they were hardly wrong. Surrounding the farmer are others, also saying what they do. The soldier at top right says, "I fight for all." Next to the soldier, the minister says, "I preach for all." And so on. The artist is content to let each profession speak for itself in a terse but positive way, except for the man underneath the sign "general brokerage," aka wholesaler, second from the left at bottom. His caption says, "I fleece you all." That sums up the view of the Grange, and of producers in general, toward financiers, then and now.

It's a natural tension, of course, and there's plenty of need for both functions--producing as well as market-making. The challenge is to strike the right balance, so that markets are liquid, but also so that speculation doesn't become parasitism.

Back then, the clear preference was for producers. People who made things were valued more highly than people who financed things.

This producerist prefernce was manifest all through society, even as pressures were causing New York and Washington--financialist havens both--to gain power. Thus the 1912 Bull Moose Progressive Party platform--the third party that Theodore Roosevelt led in the three-way election that led to the victory of Woodrow Wilson. Yes, TR lost that election, but the 1912 marked the total victory of progressive thinking--the second- and first-place finishers, TR and Wilson, much as they disliked each other personally, were both progressives.

And so note, as indicator of state-of-the-politics progressive thinking back then, the focus on systematic education and R&D in these two Bull Moose planks:

The development of the creative labor power of America by lifting the last load of illiteracy from American youth and establishing continuation schools for industrial education under public control and encouraging agricultural education and demonstration in rural schools;

The establishment of industrial research laboratories to put the methods and discoveries of science at the service of American producers;

Producerism fell out of fashion in the 20th century, replaced by more money-minded schools of thought, such as monetarism and Keynesianism.

But the idea of producerism is not only powerful, it is also obviously necessary--in any century. And it applies to health care and medicine as much as any other industry. Whatever it is, you have to produce it first. You can't finance what you don't have. You can't speculate on what you don't have. And, returning to the issue of health care today, you can't get healthier on what you don't have. Indeed, you can't even ration what you don't have.