Which two American institutions are the among most expensive and least effective? Public education below the university level is clearly the first, strangled by a governmental near-monopoly, and William Tucker explains how American health care is similarly impeded by regulation.

A complicated system of mutual dependency distorts the incentives. "The FDA is like the FCC and Big Pharma is like the regional Bells" is what Mr. Kessler hears from Don Listwin, a former Cisco executive who now heads the Canary Foundation, a Silicon Valley-based effort to promote preventive medicine. In other words, in medicine as in telecom, the big players end up exploiting regulations more than opposing them, if only to preserve their monopolies. The Food and Drug Administration--understandably but narrow-mindedly--wants "cures" for cancer and other diseases. Thus tens of thousands of chemicals are screened, only a handful make it even to Phase I trials, and by the time a new drug is approved a billion dollars has been spent. Even then the new drug may help only 10% of patients.

Yet if someone were to invent a device with a wide, preventive usefulness--say, a nanotech implant that would spot the proteins that indicate the first minute presence of cancer--it would have to go through the same process of billion-dollar testing. Since the government and insurance companies are reluctant to add anything to their repertoire of coverage--and since such a device would be targeted at the much broader pool of people who are not sick--research might well stall in its earliest phases for lack of reimbursement-funding. ...

In one hilarious sequence, Mr. Kessler recounts trying to draw his own blood sample, in the hope of checking his cholesterol. But clinics won't draw blood without a doctor's orders. Drugstores think you want the syringe to shoot heroin. Unless you want to just gouge your own finger, you're in the clutches of organized medicine. Imagine how tightly it grips something a bit more sophisticated.

As I wrote earlier about America's health care problem:

Rather than require all practicing physicians to be certified by a government-approved authority, the government should simply require that physicians disclose their credentials and leave the certifications to private organizations (as is done in most professional fields). This would open the door for thousands of lower-cost, lower-skill physicians who would be more than able to treat common maladies like colds and broken bones. You don't need an MD to set a broken arm, so why should you have to pay for one? Because currently the government says so. Medication is similar. Consumers need the government to ensure that drug companies disclose all the potential side-effects of their products, but we don't need the FDA to tell us what we can and can't put in our bodies if we're willing to take known risks.

In the attempt to protect us from ourselves, the government stifles medical innovation and restricts the market, driving costs up and severely limiting the options available for treatments of every sort of illness.

13 Comments

Mark said:

I don't think we should look at health care through the prism of "health insurance". We should be paying doctors and hospitals directly.. not using a middle-man by the name of "health insurance".

And as for public education being being the first in the line of extremely expensive government programs.. that's false. Medicare and Medicaid are all far more expensive at the federal level than public education. Also, public education is often remarkably effective. Maybe it wasn't in your former area of residence.. but in other parts of the country it is indeed a very effective and relatively efficient institution. Stop looking at public education through LAUSD-tainted glasses.

David Diel said:

I have to agree with Mark that public schools are very good in some places. Even in Florida, a place that ofen gets a bad rap for pubic education, I found the schools in Casselberry, Winter Park, and Winter Springs to be wonderful, even ideal.

However, let us not forget that parents who spend quality time and limit their kids' TV usage can do more good than any school.

Mark said:

DD: Certainly. Schools aren't a substitute for good parenting.

LT said:

Related to this topic, I've got to vent. My very healthy young family of three will be paying 515 a month for health insurance not including orthodontics or dental.

UGH!

LT: Wow, that seems like a lot to me. Where do you live? I suppose I should remember that there are a lot of fringe benefits to working for a larger company :)

Sybil said:

Once again, Mark feels the need to justify his salary whenever the holy word "education" is uttered.

The facts are otherwise: a mountain of data from different researchers with different methods shows that inflation adjusted per pupil spending in public schools doubled (almost tripled in some states) over the last 40 years, while standardized test scores have stalled. Furthermore, per-pupil spending at private schools has remained substantially lower than public schools, yet private schools regularly outperform public schools on standardized test scores when controlled for SES and other factors.

Public schools are a blackhole of government spending. Teachers are overpaid for their productivity and the amount of time they put into the job (two-three months vacation is an outrage).

It's amusing that those who complain about the materialistic bent of capitalist culture are the first to champion spending money as the solution to everything.

Mark said:

Once again, Sybil feels the need to talk about things with which he/she's unfamiliar: my job. I'm not a teacher or an administrator. I'm in information technology at a relatively small-town public school district in Wisconsin.

My district is among the many in the state that bring up the rear in per-pupil spending. We're among the 10 lowest in the state.. and lowest in the general area.

The "mountain of data" you speak of is irrelevant to my district and many others with which I've had personal experience because it's simply not the situation for them and, beyond that, many other public school districts across the country. Whether you believe it or not, the fact remains that there are quite a few public school districts across the country that don't waste money and whose students do excel at standardized tests and other assessments.

So you go right ahead and explain to me how your "data" from "researchers" stacks up against my personal and professional experience.

Mark: I think that point is that despite your experiences, the data shows that your public school district is in the minority. Most public school districts aren't faring as well.

Sybil said:

Mark, glad you like your job, but all this talk about your experiences and your hands-on expertise about public school pedagogy & finances, and you're working IT besides Lake Woebegon Elementary.

I'm just having fun with you, of course. But at some point you really need to consider what counts as good evidence when it comes to political and social debates that aren't particularly dependent on the status of Small School #9 in Nowhere, Wisconsin.

I crapped a twelve-incher today, but I know an outlier when I see one.

Mark said:

MW: That might be true of most "inner-city" public school districts.. but many more sub-urban and rural public school districts fit closer to my school district than the ones referred to by you and Sybil.

Sybil: This "Small School #9 in Nowhere, WI" isn't unique.. or even wholly uncommon. It's a reflection of the most significant difference between public schools; urban/inner-city and sub-urban/rural.

Milwaukee's public schools are the poster child for everything you mentioned about public schools.. whereas most sub-urban and rural districts are not. And that's not just in WI either.

Here's something you may not have noticed about the study from The National Center for the Study of Privatization in Education: looking at public and private school students’ performance across four SES quartiles (low SES, low-mid SES, mid-high SES and high SES), public school students outperformed private school students in each one. Public school 4th graders’ average scores were 6-7 points higher within each quartile, and public school 8th graders’ average scores were 1-9 points higher.

I cannot speak to whether or not what you crapped is an outlier.. but what I can tell you is that districts like mine are not outliers.

Sybil said:

Mark, I'm willing to look at the data, but it would remain an anamoly among studies comparing public and private schools. The National Center for the Study of Privitization in Education sounds like an anti-vouchers research group. Any time you form a research group with the aim of producing data favoring your presuppositions, the data itself can't be taken very seriously.

So I would have to know more about this organization and more about the details in the study.

Mark said:

Sybil: Well, I had a link to the data on here.. and to the NCSPE's website.. but that post appears to have been removed for some reason. Looking over the other publications on their site, though, I don't get an "anti-vouchers" vibe from any of it.

What objective and unbiased source are you getting your information from?

Mark said:

Here it is.. removal turned out to be a simple mistake.

NCSPE website

The data

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