Friday, February 20, 2009

An Atypical Perspective on Health Care in the NY Times

Last month, the New York Times Magazine published a sprawling cover article by David Leonhardt on how the Obama administration might "remake" the American economy ("The Big Fix"). One of Leonhardt's arguments was that the U.S. spends too much on health care, often without commensurate results, and in his article he suggested spending less on health care and more on education (this view seems to be gaining traction on the left). Despite the length of his article, Leonhardt didn't offer much by way of empirical data in support of his claim about the limited benefits of health care spending or the potential benefits of spending more on education (his argument in support of more emphasis on education included this observation, "The two most affluent immigrant groups in modern America — Asian-Americans and Jews — are also the most educated," without addressing any of the obvious questions that observation raises).

Last Sunday, the New York Times business section offered a different perspective on health care spending, from William Hawkins, the CEO of Medtronic ("The Boss: For Medtronic’s Chief, Success That Hits Home"). Excerpt:

Advances in technology enable us to do things today we weren’t able to do years ago, such as monitoring and managing patients remotely. Twenty years ago when we implanted a defibrillator, it cost $100,000 and wasn’t nearly capable of the performance of today’s devices that are a fraction of the cost.

My family has also been a driving force behind my journey. I have a photo in my office of three of my relatives. My father, 83, has eight coronary stents, some of them ours. My 91-year-old uncle, an injured World War II veteran, suffered from a tremor for years that made his hands shake. When he was 89, doctors implanted one of our deep brain stimulators, which controls movement. When they turned it on, for the first time in 40 or 50 years his hands stopped shaking and he got his life back. My father-in-law, who is 86, has a Medtronic heart valve, stents and a pacemaker.

One of the reasons I’m working is to make sure I can take care of my family so we can enjoy a long life together.

It sounds like Mr. Hawkins's relatives have gotten some positive results from their health care spending. Would we really be better off as a country if that money were thrown into the latest sisyphian federal program to improve public education instead?

The image above, of the deep brain stimulator, is from Wired.


Metzito said...

Hola Senor,

What are the obvious questions it raises?

Please explain to a poor immigrant.

JK said...

I don't think that's the best example to make the case for health care over education. Helping an 89 year old eke out a few more years doesn't help anyone else in society besides immediate family, and seems to be the true Sisyphean endeavor. But ensuring, say, talented children being able to develop their talents more during their formative years could have a relatively huge impact.
Of course, the devil is in the details and it's not fruitful to argue about vague "spending" vs "spending" without specific proposals to refer to.

Side note -Mancur Olson's thesis in the Rise and Decline of nations is essentially what Carroll Quigley found in his research also - described in his classic book "The Evolution of Civilizations". Quigley described the phenomena as "social instruments becoming social institutions". The institutions have a life of their own, neglecting their original purpose as organelles of the greater society, and become parasitic organisms that impede society's ability to adapt to changing conditions, among other things.

DaveinHackensack said...


Blogger just deleted my long response to your comment, so let me try to reconstruct it.

"Helping an 89 year old eke out a few more years doesn't help anyone else in society besides immediate family, and seems to be the true Sisyphean endeavor."

It's not just about helping him "eke out a few more years", but improving his quality of life. And the same technology Medtronic developed to treat him, can of course be used to treat younger patients*. Medtronic (and companies like it in the health care sector) also create a lot of high-paying jobs in America. That's something I think many advocates of more socialized medicine here seem to overlook. They also seem to overlook the extent to which countries with fully socialized medicine free-ride on the R&D and innovation conducted in the U.S.

"But ensuring, say, talented children being able to develop their talents more during their formative years could have a relatively huge impact."

We are already doing a pretty good job of this as a country, with things like gifted & talented programs, scholarships, merit-based admissions to magnet public schools, etc. When people talk about education reform, they are usually talking about the less-talented kids. Every child deserves a chance to fulfill his potential, but the approach of many pundits and educrats seems to be to try to shoe-horn almost every kid into a college-prep track, even though most don't have the aptitude for it, and college isn't a panacea for economic advancement anyway. A better approach would be to test children like they do in some parts of Europe, and offer a more practical (vocational) high school education to most students, and try to create the conditions where there will be meaningful, good-paying jobs for them when they graduate.

*There is a good economic reason to develop treatments for the elderly though. They tend to need more treatments, and in first world countries at least, they tend to have accumulated some money. If first world countries with fully-socialized medicine want to leave their elderly on the proverbial ice flows, American companies can profit by offering them innovative treatments.

JK said...

"It's not just about helping him "eke out a few more years", but improving his quality of life."

That is noble, but a true improvement in the quality of life would be delaying senescence, as opposed to propping up failing organs and painfully delaying the inevitable by an ultimately negligible time frame. That's why I said it is not the best example for the health care > education position.

Europe's education system from what I've read is stiffly stratified, I don't think they generally have a good model for us...except in countries like denmark where schools operate like a business and non-productive ones get shut down. I'm all for the de-institutionalizing of the education instrument, to use Quigley's terminology, but much of Europe doesn't have much to offer in that regard. More charter schools, teacher accountability and some kind of voucher system are the reform we need, IMO. You don't see disadvantaged high schools in Europe doing things like this, for instance. The current education system does little to plumb the depth of American talent. If I were king of the US there are several programs I could think of to incentivise learning and invention by otherwise disinterested and neglected students.

I do think your blanket assessment that most children "even though most don't have the aptitude for [college]" is a bit too snobby, especially considering the wide range of college options available, but nonetheless retooling the education system toward a vocational focus would require significant investment that could otherwise go to health care, a position you don't seem to take in this post.
In my public education experience, most kids weren't shoehorned into the college education path, they were just ignored and got rubber stamped through school. But granted, there is a large enough pool of student who can't or won't pursue college that need to be provided a path to make a decent living. That's harder to do now with the decline of american manufacturing, and actually could be part of the argument for some level of "buy american" protectionism.

DaveinHackensack said...


"painfully delaying the inevitable by an ultimately negligible time frame."

That's not an accurate characterization of the brain stimulator described in the article. It wasn't about keeping the man alive indefinitely, but treating a debilitating condition he'd already had for 40 or 50 years.

"but nonetheless retooling the education system toward a vocational focus would require significant investment that could otherwise go to health care"

I think we could get much better educational results with the same or less money than we are spending currently. I agree with you on the benefits of vouchers. The automotive X prize story you linked to is interesting. Thanks for that. I think I'll link to it in a separate post.

If you want to replace "college" with a more general term to describe post-high school education, than I'd say a greater percentage of students would have the aptitude for it, but "college" tends to usually mean just that: core classes that include writing English papers, etc. It's not snobbish to say that most Americans don't have the aptitude for that, it's just accurate. If I said that folks who do have the aptitude for English 101 are superior to those who don't, I could see how you'd claim that was snobbish, but I don't think that.

"That's harder to do now with the decline of american manufacturing, and actually could be part of the argument for some level of "buy american" protectionism."

American manufacturing isn't in decline -- we still make more stuff than any other country -- we just require fewer people to do it, which causes the same problem you refer to. Before going for Smoot-Hawley II though, I think there are a few other things we can do to help create more good-paying blue collar jobs. For example:

1) Encourage more foreign manufacturers to set up factories here, by lowering corporate taxes, reducing the threat of litigation costs, lowering energy costs, etc.

2) Allow more oil drilling and mining on federal lands and in federal waters.

3) Restrict unskilled immigration and enforce our current immigration laws. Transition to an immigration system similar to that of Australia where we try to attract more highly skilled immigrants -- some of whom may end up creating more jobs here.

JK said...

That's pretty much the argument Charles Murray makes in his book Real Education.
I think providing broader and more diverse methods of study and training are positive. But the paternalistic determination of what children are or are not capable of should not be a function of the education establishment, as it is in some European countries. The free market of the real world will handle that, but what government can do is to make avenues available for advancement that otherwise do not exist, for those who have the ability to take advantage of.

"Mr. Murray says that he is deeply concerned about the dangers of overestimating the abilities of students. To which one might reply: Aren't the dangers of underestimating their abilities vastly worse?" - Ben Wildavsky, in the WSJ review of Murray's book.

As far as Australia, it's easier for them since they are an island. Most of the overseas immigrants I've met, from whatever nation/continent, are of decent quality. If we were next door to rural China or India, then I'm sure we'd complain about their poor immigrants the same way we complain about (most) Mexicans (for the record, most Mexican immigrants I've encountered are decent people, but just unskilled and there's too many of them). Setting up a border wall is not going to happen because construction has already begun on a North American superhighway. In lieu of that, a better use for our government resources (than say, Iraq) could be helping the Mexicans clamp down on the drug trade and stimulating the economy over there so that people don't feel desperate enough to risk life and limb to come here.

JK said...

I meant, water-locked continent. Not island. Gotta proofread when the discussion is edjamacation.

DaveinHackensack said...

I can see your point about the paternalism of government enforced aptitude tests, and in a voucher system with a lot of different types of schools it might not even be necessary, as students may self-select the schools that fit their aptitudes.

That Australia is an island wouldn't prevent it from being inundated with poor, unskilled immigrants, if it didn't have a policy to prevent that. A lot of economic migrants have taken to the high seas in recent years. For example, plenty of migrants from sub-Saharan Africa have migrated to Spain in open boats with outboard engines.

We have no power to fix Mexico's economy directly. Fortunately for Mexicans, their country is a democracy, so they can demand that their government make some of the structural changes that could improve Mexico's economy. One way we can encourage political (and hence, economic) reform in Mexico indirectly is to enforce our own immigration laws and to restrict future illegal immigration from Mexico. If Mexico were unable to export its poorest people to the U.S., it might focus more on providing economic opportunities for them at home. If Mexicans don't want that, why doesn't Mexico apply to become a state? At least that way, we'd have the authority to fix the place (e.g., establish law and order, break up Carlos Slim's monopolies, privatize Pemex, etc.) and benefit from its plentiful natural resources and coastlines.

China and India are different animals in the sense that the both essentially contain their own Mexicos. They have the challenges of unskilled migration to their cities, but they have the authority to do something to develop their poor, rural areas.

DaveinHackensack said...

Your original statement was correct. Australia is both an island and a continent (well, to be precise, it's more than one island if you count its outlying islands like Tasmania).