Monday, January 30, 2006

Why should you need the government's permission?

When government kills people

The FDA has now approved inhalable insulin. It sounds really cool -- I'm talking about the new form of insulin, not the government's approval. There's a great potential to save many lives, because so many patients (I was shocked) didn't want to inject themselves. If anything, I'm sure inhalable insulin will be of great comfort to children who, as I can attest from personal experience (running in terror out of a doctor's office at 5 years old), are often afraid of needles.

Why should any government agency have the power to forbid people to take medicine that could save their lives? Don Ho had to travel to Thailand to undergo a "risky" procedure that strengthened his heart muscle with his own stem cells. The FDA has yet to approve it, and Ho could have well died before government bureaucrats did. As I said before, the state essentiall tells people, "You'll just have to die. We won't let you take this stuff, because it could kill you."

Update: conversely, as I wrote last Tuesday, eleven federal bureaucrats at the FDA are using their power to effectively ban propellant-based inhalers, like Primatene Mist. This affects millions of asthma patients, who must now pay more money (and go through greater inconvenience) to get prescription inhalers. Doctors, of course, love the extra business.

The people who oppose the personal choice to accept risk are the state-worshippers who fallaciously believe government can (not just should) eliminate risk from our lives, like Paul Krugman, who recently said:'s neither fair not realistic to expect ordinary citizens to have enough medical expertise to make life-or-death decisions about their own treatment. A well-known experiment with alternative health schemes, carried out by the RAND Corporation, found that when individuals pay a higher share of medical costs out of pocket, they cut back on necessary as well as unnecessary health spending.
(Quote courtesy of Don Luskin.)

The underlying issue isn't whether people have medical expertise: it's whether they have the right to choose. People do tend to make rational decisions. Not always correctly, granted, but that is not mutually exclusive with rational decision-making. If it weren't for the nanny state's bureaucratic mazes to "protect" us, people would revert back to their natural tendency of being careful about a new product. As a medicine's potential health hazards increase, people will more closely scrutinize whether it's worthwhile. The proper role of government is not to approve or ban these substances, but to provide remedies for families who were defrauded or injured. The latter includes criminal negligence.

Isn't government's approval better, though, so that one person doesn't die from dangerous medicine or a risky procedure? Hardly, because more people might suffer and die because their access to the medicine was delayed, not even denied. As I recounted in my entry about Ho, my father chose to use some possibly deadly "clot-buster" drugs after his stroke. They saved his life, but how many more lives could have been saved if previous patients had had my father's choice? Furthermore, the free market provides incentives and remedies. People will tend to avoid risky new medicines that were not carefully tested, and they will judge the risk based on their personal perception of how much they have to lose. On the other hand, it's in companies' interest to test medicines thoroughly, and not just because of product liability suits, but because testing makes the product more attractive.

And by the way, Paul, do you think that "when individuals pay a higher share...they cut back" is a novel economic principle? Perhaps that's something that originated only after the mean Republicans supposedly started trying to take away health care from people. I thought it was elementary microeconomics, and of course Milton Friedman's great principle, that when people can no longer spend other people's money on themselves, they'll naturally spend less. And as a matter of consumer preference, "necessary" is purely a matter of personal choice. By definition, the people made the decision that the treatment is less necessary than the money they could have spent on it.

I really can't bring myself to believe Krugman ignores such basic micro, so we can only presume it's part of his old game: tax "the rich" to give social services to everyone else. He forgets that the wealth of "rich people" does spread throughout the economy. I cannot say often enough that Bastiat was so right, that government spending means depriving the private sector of that same spending, so there is no net economic benefit. If government spends $100 so someone has health care, that's $100 less that would have been spent on landscapers' salaries, waiters' tips, etc. -- now that is a zero-sum game, unlike Krugman's myth that people get rich at the expense of others. Worse, higher taxes (like the 1990 luxury tax) tend to backfire and discourage the wealthy from earning and spending as much, so there is less revenue for the welfare state, encouraging it to raise taxes even more.



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