Friday, November 02, 2007

Rudy Is Right and Krugman Is Wrong

From the Manhattan Institute City Journal website:

Malignant Rumor

On cancer survival rates, Rudy’s right and his critics are wrong.
David Gratzer
31 October 2007

This week, Rudy Giuliani’s presidential campaign released a radio ad in which the candidate praised American health care for curing him of prostate cancer and wondered what might have happened to him under the socialized medicine practiced in the United Kingdom, where survival rates for that condition are far lower. In the ad, now running in New Hampshire, Giuliani says: “I had prostate cancer, five, six years ago. My chance of surviving prostate cancer, and thank God I was cured of it, in the United States, 82 percent. My chances of surviving prostate cancer in England, only 44 percent under socialized medicine.” He drew those statistics from an article that I wrote for the Summer 2007 issue of City Journal.

The ad has already aroused intense criticism, most of it claiming that survival rates in Britain aren’t nearly so low. ABC News’s Rick Klein, in a blog entry entitled “Rudy’s Fuzzy Healthcare Math,” writes: “To hear Rudy Giuliani describe it in his new radio ad, the British medical system is a scary place. . . . But the data Giuliani cites comes from a single study published eight years ago by a not-for-profit group, and is contradicted by official data from the British government.” Kevin Drum, blogging at CBS News, declares simply: “Giuliani is full of shit.” Ezra Klein of American Prospect agrees on his blog: “It’s—no pun intended—crap. England and America have vritually [sic] the same mortality rates from prostate cancer.”

Let me be very clear about why the Giuliani campaign is correct: the percentage of people diagnosed with prostate cancer who die from it is much higher in Britain than in the United States. The Organisation for Economic Co-operation and Development reports on both the incidence of prostate cancer in member nations and the number of resultant deaths. According to OECD data published in 2000, 49 Britons per 100,000 were diagnosed with prostate cancer, and 28 per 100,000 died of it. This means that 57 percent of Britons diagnosed with prostate cancer died of it; and, consequently, that just 43 percent survived. Economist John Goodman, in Lives at Risk, arrives at precisely the same conclusion: “In the United States, slightly less than one in five people diagnosed with prostate cancer dies of the disease. In the United Kingdom, 57 percent die.” None of this is surprising: in the UK, only about 40 percent of cancer patients see an oncologist, and historically, the government has been reluctant to fund new (and often better) cancer drugs.

So why do the critics think that Britain’s survival rates are as high as America’s? The main reason is that they are citing overall mortality rates, which are indeed, as Ezra Klein writes, similar across various countries. That is, the percentage of all Americans who die from prostate cancer is similar to the percentage of all Britons who do. But this misses the point, since a much higher percentage of Americans than Britons are diagnosed with prostate cancer in the first place. If you are a patient already diagnosed with prostate cancer, like Rudy Giuliani, your chances of survival—as Giuliani correctly said—are far higher in the United States.

Likewise, though Rick Klein is right that official UK data differ from mine, those data look at five-year survival rates—that is, they track cancer patients for five years and report on their survival. Their approach is different from mine. They don’t examine what we might call a “snapshot,” as my data do: that is, examining how many people with a particular disease die during a given interval of time—say, a year.

True, the OECD data are seven years old, as Rick Klein also points out. However, newer studies show a similar trend: Americans do better when diagnosed with cancer than their European counterparts do. Since the publication of my City Journal essay, the prestigious journal Lancet Oncology has released a landmark study on cancer survival rates. Its findings:

  • The American five-year survival rate for prostate cancer is 99 percent, the European average is 78 percent, and the Scottish and Welsh rate is close to 71 percent. (English data were incomplete.)
  • For the 16 different types of cancer examined in the study, American men have a five-year survival rate of 66 percent, compared with only 47 percent for European men. Among European countries, only Sweden has an overall survival rate for men of more than 60 percent.
  • American women have a 63 percent chance of living at least five years after a cancer diagnosis, compared with 56 percent for European women. For women, only five European countries have an overall survival rate of more than 60 percent.

These data, recently released, are now the best available. They too confirm Giuliani’s point: he was fortunate to be treated here.

I’m not denying that American health care has its problems. On the contrary, I’ve just written a book advocating reform. And the Giuliani campaign isn’t denying it, either—the mayor has advocated reforms of his own. But as Americans consider how to improve our health care system, we should understand what we do well and what other countries do poorly. Failing to do so would be the public policy equivalent of malpractice.

Dr. David Gratzer, a physician, is a senior fellow at the Manhattan Institute. His most recent book is The Cure: How Capitalism Can Save American Health Care. He advises the Giuliani campaign.

Let the Violins and Tears Begin

Well, now, some unions and other pressure groups have started running ads targeting Republicans who voted against the new, improved, improved and new, old-wine-in-new-bottles version of SCHIP. "What if your daughter didn't have health coverage...? What if you had to work two jobs to make ends meet, but still couldn't afford insurance? Would you still back George Bush's vetoes?" (New York Times, November 2)

Sniff. Why, oh defenders of compassion with other people's money, is it the case that some working people cannot afford insurance? Could it be because of the regulatory mandates for this and that coverage that you have supported for years? Could it be because of the absence of interstate competition in health insurance plans, a barrier that exists because of your allies in the various state insurance regulatory commissions? Could it be because of the restrictions on underwriting and rating---the allocation of premiums in accordance with expected costs---in the absence of which insurance for most kids would be very cheap? Could it be because of "guaranteed issue" regulations---don't buy insurance until you get sick---engendering the worst kind of adverse selection problem?

Or could it be... all of the above? Well, yes. Emphatically. And have the unions and pressure groups supported all this meddling in the competitive market for health insurance? Ditto. And now they're blaming others for resisting another long step toward a system in which government pays for "coverage," squeezes the doctors and hospitals for "savings," and then squeezes patients as well with rationing, underinvestment in technologies, and restrictions on the services that patients may obtain. Anyone who actually believes that this political balderdash is for "the children" shouldn't worry too much about vetoes. The Tooth Fairy will come to the rescue.

[cross-posted from]

Thursday, November 01, 2007

Are You Feelin' Lucky, Punk?

The august NY Times reported yesterday that the Chinese chemical firm "Honor International Pharmtech was accused of shipping counterfeit drugs into the United States" even as it "was openly marketing its products in October to thousands of buyers [in Milan] at the world's biggest trade show for pharmaceutical ingredients."

Yeah, yeah, but so what? After all, the prices are low, and isn't that what really counts? So what's the problem? Actually, there isn't one, in the context of the long-running debate over the importation of foreign drugs subject to price controls overseas, except in the case of contagious diseases. If someone takes a fake or adulterated drug because the price looked good, well, isn't that really their problem, the issue of infecting others aside? The proponents of parallel trade in pharmaceuticals---again, importation of "cheap" drugs from overseas---fail even to consider that problem, in their rush to subsidize their constituencies at the expense of others.

More generally, they are keen to ignore all the problems---contagion, the dilution of brand-name capital and the resulting implications for trust in the health-care system, the inevitable horror stories for individual patients given adulterated drugs without any warning at all, the bonanza for the lawyers---as they pursue price "discounts" with no consideration of any adverse implications at all. And they are the ones demanding truth in advertising from everyone else. Have they no shame? That question answers itself.

[cross-posted from]

Wednesday, October 31, 2007

Trust Me

There's a rather silly article in the October 1 issue of Pharmaceutical Executive in which twelve "brandmeisters" weigh in on the issue of how Big Pharma can restore "trust" where it now is lacking or weak. The various commentaries offer the usual war-on-insomnia platitudes about not overpromising, whatever that means, constant communication, putting the customer/doctor/patient first, and blah blah blah.

Actually, competitive markets solved this problem ages ago: Investment in such assets as brand-name capital, the value of which collapses if the firm fails to live up to its promises, sends a clear signal to the market that the firm makes more money by behaving in a trustworthy fashion than the opposite. Advertising is the most obvious example, even given the constraints and mandates enforced by the FDA; that is why virtually all consumers, given a choice between a brand-name drug and its generic equivalent at the same price, would choose the former. Other examples are a long-term commitment to charitable endeavors, indicating that the firm is not a fly-by-night, construction of specialized facilities not easily transferable to other firms, etc.

And so yet again we find a reason that the political attacks on pharmaceutical marketing are mindless, even as we can be amused in supreme fashion by accusations of "misleading advertising" hurled by the permanent Beltway establishment.

[cross-posted from]

Tuesday, October 30, 2007

Is There A Prize For Stupidity?

It sounds so simple. Eliminate patents and exclusivity for new pharmaceuticals, substitute a system of government-determined prizes for innovation instead, and presto! We can preserve incentives for research and development investment in new and improved medicines, while avoiding the high prices attendant upon the patent-protected monopoly positions of drug innovators.

If only it were that simple in practice. Anything---anything---that government touches becomes politicized, and drug development is no exception. Under a proposal offered by Senator Bernie Sanders (I-Pyongyang), new drugs would be approved by the FDA and patented. But exclusivity would be a thing of the past; instead, a government board would dole out prize dollars from a fund in accordance with a list of criteria, the latter obviously subject to changes driven by Congressional whim. The criteria would include: the number of patients who would benefit from a new drug, the extra benefit compared to existing drugs, and the degree to which a drug is targeted to "vulnerable" populations, global infections, or neglected diseases.

So: No openings there for politicization of drug development, nosiree. Let's see. Who can determine, ex ante, the number of patients who would benefit from a drug? How would the extra benefit be predicted? Ex ante! What is a "vulnerable" population, and how big is it? Ad infinitum.

Follow-on drugs would get smaller prizes, apparently regardless of how much better their effects are compared to the original. Thus would the "me-too" principle be enshrined in federal law. Who would appoint the Board? How politicized would it be? And since no one product could get more than 5 percent of the fund, can it possibly be the case that the one-time prize would equal the present value of the stream of returns from a blockbuster drug?

These problems, and many more, are so obvious that it is easy to conclude that the real objective is an end to patent protection and temporary monopoly pricing, and thus a reduction in government drug spending. The obvious adverse effects on future drug development in terms of distortion and reduced returns? That's someone else's problem. Specifically, future patients, and to a far lesser degree, future policymakers. The current system, whatever its distortions and rigidities, at least is driven by market forces to some substantial degree, a highly useful condition not to be discarded too lightly.

[cross-posted from]

Monday, October 29, 2007

Giving It a Myth

My correspondent, cited in my previous piece, included this paragraph in her response:

I never claimed that the myth had to be true or it did not; I define the term "Myth" as such: a story that codifies the collective moral codes of the people they represent. All moral codes are arbitrary, as can be proven by the fact that Nazis did what they did (their moral code excluded Jews as human beings), why homosexuality was condoned in ancient Greece and Japan, and even why the Torah condones slavery and genocide (as in the case of Amalek). All a Myth does, regardless of the truth behind it, is codify beliefs in story form.

Rather startling, my friends, the spectacular moral blindness promulgated in the halls of "higher education" today. Not to mention the lack of willingness to reason from a premise. I can imagine the demolition job a G.K. Chesterton or C.S. Lewis would do on this, but they are not here, so it falls to me to do my worst. This is a very lovely girl who essentially means well - I am permitted to be patronizing; I have daughters of my own - and is trying to sort out the world of ideas with, sadly, disappointing early results.

O.K. Let us count the ways:

1) Myth is a story that justifies the moral code of the people it represents.

Again, as I said earlier, this is a clever Orwellian construction designed disingenuously by anthropologists. By using a phrase that always historically meant "a story that is an expression of a fantasy, not a reality" to serve as the word to designate the central narrative of a given society, they undermine the notion of objective truth in either history or ideology.

My theory (offered in my role as public intellectual, without benefit of a degree in the specific discipline) better describes life and better predicts events. I said that the central narrative of a group or movement is the truth of its history and purpose. To the extent that falsehood creeps into the main recounting of events and presentation of ideas, to that extent is the society or grouping doomed.

Thus any effort to replace truth with a myth can only have staying power in direct proportion to the amount of objective verity that is inserted into the mix. Bill Clinton did not use his war contribution as a central theme of his candidacy, so his draft-dodging did not defeat him. John Kerry made his military service the centerpiece of his campaign, so when it turned out to be flawed that brought him down.

The reason why the Bible saved the people whose existence depended on it through 3300 years of ups and downs, including multiple defeats, destruction, dislocation, separation into small exilic clusters, and even a Holocaust, is simply because it is true. As such it always survives the temporary setbacks.

2) All moral codes are arbitrary, as can be proven by the fact that Nazis did what they did (their moral code excluded Jews as human beings).

Frightening, really. The proof that moral codes are arbitrary is from the fact that someone arbitrarily made a bad one. Can we prove that all marital vows are arbitrary from some commune which announced they are initiating communal free love as their form of marriage? Can we prove that all property rights are arbitrary from some dictator nationalizing everyone's businesses in his country? Grabbing the reins of power and proclaiming that your violation of universally accepted normative ethics is actually the introduction of a New Ethics is intellectually and philosophically meaningless. It proves nothing at first.

Later, when objectively awful damage is wreaked upon humanity by applying that code, it serves to prove the original code is the truth.

3) As to the Torah condoning slavery, that is true, but it does not promote slavery.

It accepts the fact that slavery exists in the economic reality of a pre-industrial world. It creates workplace protection for the slave, by revoking ownership if the master wounded the slave's body, even if he only knocked out a tooth. If a slave is killed, the murderer is culpable. These protections did not exist in secular or idolatrous societies.

Once the machine age replaces the slave, there is nothing in the Bible encouraging people to capture new slaves.

The genocide of Amalek is not condoned, it is commanded. This accepts the premise that the Creator can decide a particular nation has lost the right to live and may prophetically command another nation to administer that penalty.

The proof is in the pudding. If Jews took this as an invitation to wipe out infidels on their own volition, they would be a mean, aggressive society. Instead they have been gentler and less violent that any other nation of history. As the late philosopher-poet Abraham Elijah Kaplan, head of the Berlin Rabbinical Seminary, wrote (On the Trail of Awe) circa 1925: "Where are our bloodbaths, where are our massacres, where are our genocides?"

To sum up, the modern "secularist" ideology is a religion of its own, the faith of anti-religion. To escape the strictures of being instructed, it will deny truth, logic, good faith, morals, ethics, reason, intuition, conscience and finally, even the very fact of our humanity.

The Torah says to live by its truth or be an animal; they answer that as animals they are not bound by any code. So, you see, in the most profound sense of things there is no disagreement at all. The lady or the tiger? Turns out the lady thinks she is a tiger.

Send In The Clowns

The U.S. government's main disaster-response agency apologized on Friday for having its employees pose as reporters in a hastily called news conference on California's wildfires that no news organizations attended.---Reuters, October 26

It really, really, really doesn't get any better than this. Among the questions posed by the "reporters" for FEMA deputy administrator Harvey Johnson was this beauty: "Are you happy with FEMA's response so far?" Well, Harvey, what say you? "[I am] very happy with FEMA's response so far."

Well, there's a shock. What is not shocking---not one iota---is the phoniness that permeates Beltway policymaking writ large, a condition far more threatening than the pseudo questions thrown at mindless bureaucrats by pseudo reporters.

Consider the ongoing debate over expansion of SCHIP. The current proposal is for extension of the program to families with incomes well over $60,000; that is, to the phony poor. There is the ongoing eligibility of SCHIP for adults, that is, phony children. There are the preposterous projections of tax revenues to be generated by the increase in tobacco taxation proposed as a vehicle with which to fund SCHIP expansion; in a phrase, phony revenues. There is the five-year projection of SCHIP budget costs, in which the projection for fiscal year 2012 is a number two-thirds lower than current spending, inserted just for purposes of making the five-years spending projection more palatable; in a phrase, phony budgeting.

And let us not forget the long-term effects of government health-care compassion, as certain as the sunrise: a degradation of quality and access, as budget pressures yield powerful incentives for rationing, underinvestment in new technologies, and the other perversities familiar in all single-payer systems. In a phrase: phony health care.

So: We have phony phoniness at FEMA, which will have no adverse effects at all, and real phoniness in health-care policy formulation, which will yield enormous costs and increased human suffering over time. Which type has drawn the attention of the Beltway? The question answers itself.

[Cross-posted from]