Tag Archives: healthcare

The Biotech/Heathcare Scam Bubble Bursts

In early 2015, I expressed sentiment of healthcare and biotechnology being a ‘scam’, divided into two parts:

1. The ‘scam’ of exorbitantly priced treatments (orphan drugs) for rare diseases, which are paid for by taxpayers. Since policy makers have this fixed belief that every life is worth saving at any cost, drug companies have an economic incentive to charge whatever they want, particularly for rare diseases.

2. The Obamacare healthcare spending binge.

Here are some examples:

Study confirms medical costs rising for post-ObamaCare patients – along with premiums

U.S. Economy Doomed by Healthcare

This expansion of costs has many drivers, most of which result from the system’s perverse incentives for fraud, overbilling, marginal treatments and defensive medicine.Technological and medical advances offer more options for treatment, and can push costs up–but advances can just as readily push costs down, too.

The primary drivers of rapidly increasing costs are:

1. The cartel/crony-capitalist structure of U.S. healthcare
2. Defensive medicine to stave off litigation
3. Profiteering from needless or ineffective tests, procedures and medications
4. Fraud and overbilling
5. The concentration of expenditures in a small sector of the population
6. America’s inability and/or unwillingness to have an adult discussion over end-of-life care for the elderly.

$1000 bottle for nail fungus (Valeant stock has plunged from $200 to $30 on revelations of their overbilling scheme. Valeant’s business models depends on patients using their expensive drugs, versus cheaper alternatives)

Health Brief: Study Finds Medicare Overbilled by Hospices

Anthem sues Express Scripts over prescription drug pricing

Councilman questions city’s $1.6M prescription drug deal with Express Scripts

Even before Obamacare, the healthcare sector used inflated and or dubious pricing schemes to boost profits at the expensive of patients and insurers.

From 2010-2015 (during much of Obama’s presidency) healthcare costs spiraled out of control, both from biotech companies possibly charging too much for drugs, to hospitals and hospices charging too much for admissions. Insurers, taxpayers, and patients ultimately footed the bill, and now it seems the scheme may be coming to an end, as healthcare and biotech stocks have substantially under-performed the broader market since July 2015. In late August 2015, I sold my healthcare and biotech stocks, due to deteriorating price action. Then in September 2015, Hillary made her infamous tweet vowing to come down on high prices, which mauled the sector further, but thankfully I had already sold.

With either Hillary or Trump becoming president, expect some form of price controls, ending the 2010-2015 heathcare/Obamacare spending binge. Trump may try to undo or replace parts of Obamacare, and Hillary may try to put price controls on drug prices but keeping Obamacare intact. Whether or not either of these will succeed is up in the air, but there is a lot of political pressure for review and reform of healthcare costs, and this is hurting the healthcare sector which for years had been buoyed by indiscriminate spending.

Improving Society and Policy

From Jim: Fixing housing, health, and education.

The fundamental problem is the misallocation of public resources.

Replace costly, time-consuming diplomas with SATs, Wondericks, and other IQ-like proxies, to signal competence. Employers realize that GPAs are becoming diluted due to grade inflation. This also explains why there is a push by the left to make these standardized tests easier, making them less useful for identifying exceptional talent. But in some instances, IQ-like tests are allowed is the employer can disprove disparate impact by showing that the test is sufficiently applicable to the job, but this is often very costly for the employer. eliminating such litigation would help job-seekers and employers.

The fed govt. should refuse to provide student loans to those those are unlikely to graduate, using IQ tests as a form of means testing. Students with IQs below 110-115 are much more likely to drop-out, fail, or major in low-ROI subjects, wasting the money. The proliferation of student loans is a contributing factor to both credentialism and spiraling college costs.

Stop wasting so much money on special education, and focus more resources on the top 5%, who are, statistically speaking, more likely to contribute to the economy and technology than the bottom 5%, yet the bottom gets vastly more funding.

How about more funding to create the next Teslas, Ubers, and Facebooks, and less on low-ROI programs like disability and welfare. As the federal govt. fritters away money, billionaires are funding technology initiatives, which is a good argument for lower taxes to spur innovation and creativity.


Helping America’s Gifted Poor
Reviving the American Dream with ‘Purple Policies’
Purple Policies, Part 2

Healthcare? Ration by IQ for expensive procedures when payment is not an options; advocate euthanasia for costly incurable diseases when payment is not an option. For example, the organ donor list should be prioritized by IQ, all else being equal. 5% of patients are consuming 50-80% of healthcare resources, typically for rare diseases and end-of-life care, which is a big waste. If you’re a multi-millionaire and can afford costly end-of-life care and or experimental treatments that are unlikely to work, fine, pay for it out of your own pocket, but taxpayers should not.

Related: Affordable Housing, Healthcare, & Tuition: Putting Things in Perspective

Abortion and Crime Revisited

The left wishes this weren’t so: Abortion: History’s Greatest Crime Fighting Tool

Still not convinced? Don’t worry. There is more. The states with the highest abortion rates in the 1970s saw the greatest decline in crime in the 1990s, while states with low abortion rates experienced smaller crime drops. Furthermore, studies of Canada, Romania, and Australia have also proved a similar link between abortion and crime. In 1966, when Romania outlawed abortion and enforced the ban with “menstrual” police, the crime rate nearly doubled in the upcoming twenty-five years.

The left wants to believe (like Gladwell) that non-biological factors such as more government funding and civil rights caused the post-1990 decline in crime. As subscribers of the ‘blank slate’ view of humanity, the welfare left categorically rejects the idea that some people, perhaps more so than others, are predisposed to crime. The left wants to believe that it’s white people who are ‘keeping the disadvantaged down’, not maladaptive genes.

On the other hand, it’s possible that the the reduction of crime and the legalization of abortion is merely coincidental or one of many factors.

As expected, there was a backlash to the findings of Levitt and Donohue:

That such an idea, put like this, would raise the hackles of an extraordinary range of people should have surprised no one. Levitt and Donohue had stepped into the vicious ethical and political minefield of the American abortion debate–as well as the treacherous terrain of race politics, since African Americans have abortions at a higher rate than whites. But the authors, economists rather than ethicists, were unprepared for the response and initially seemed almost too stunned to prepare counterarguments. “What’s odd about our study,” Levitt now reflects as he prepares for publication of the work and, presumably, renewed assaults on its authors, “is it manages to offend just about everybody. [But] our worldview is an economic worldview–that people respond to incentives. I view it as being apolitical.”

Of course, if the implication were that aborting rich white and Asian babies reduced crime, I guarantee not a peep of outrage from the left over these studies. The left supports abortion not to make the world a better place by reducing crime and entitlement spending, but as a form of ‘female empowerment’.

Liberals, who are ‘pro choice’, took offense, mainly because they believe in ‘reverse-Darwinism’: ‘life’ for the least fittest and ‘choice’ for the most ‘fit’:

“We’ve been stunned by the angry response, particularly from the left,” Levitt said Monday. “Our intention was solely to understand this puzzling drop in crime, and it was really only after we’d begun working on the paper that these other politicized issues came to the forefront. This isn’t a paper about class or race. This is a paper about being unwanted.”

Source: Crime-Abortion Study Draws Criticism

And from Liberalism and the Perfectibility of Man:

The belief in perfectibility of man motivates liberals to support useless social programs that run headlong into the limitations imposed by biology. Similarly, this ties into the delusion that practice can make can make an imperfect man perfect (the 10,000 hour rule). It would seem antithetical to rationality to believe this superstition.

Instead of HBD-based solutions that are cheaper and more effective, the left would rather fritter taxpayer dollars on social programs that are less effective, in their futile quest to ‘perfect’ man.

But the in this write-up, the ‘right’ will not spared, either. Too many conservatives are caught up in the fuzzy, ambiguous concept off the ‘sanctity of life‘, ignoring that the death penalty and war contradict this supposed sanctity. I don’t necessarily oppose war or the death penalty, but let’s be logically consistent. The common argument is that the death penalty targets guilty people whereas abortion doesn’t. But then you invoke the utilitarian/consequentialist argument that sending innocent, young men off to war for a ‘greater good’ (peace, stability, etc) is a worthwhile trade-off. Logical consistency is more important than unwavering allegiance to a specific political party or sparing feelings.

Birth control would be ideal, but abortion, as disgusting as it is, can reduce problems such as suffering, entitlement spending, crime, and healthcare costs, maybe it’s time to get over the beleif that all life is sacred. Some say it’s ‘liberal Sanger eugenics’ but libs of today want nothing to do with HBD unless it’s homosexuality, which the left insists it’s biological, but much less so for education, socioeconomic outcomes or crime, all which are environmental and must be solved with ineffective social programs at great cost to taxpayers.

Conservatives preach the virtues of ‘strong families’ and ‘community’ as a solution to social problems and underachievement; however, dysfunctional families and bad communities are byproducts of bad genetics, with poverty and dysfunction having a hereditary component.

If environment does play some sort of role in crime and poverty, it’s reasonable to assume that abortion and birth control for at-risk populations could reduce these problems.

Another problem are people who are a drain on the system in terms of medical expenses, costing more in care than they return in economic value. The abortion plan and other posts address this problem, arguing that medical care, like any public good, is a finite resource and hence, from a utilitarian-standpoint, should be allocated optimally, which is also why euthanasia could also be advocated as a way of reducing medical costs, which are already spiraling out of control primarily due to ‘end of life’ care as well as costly treatments for rare diseases.

If scientists can locate genes that produce offspring that are at heightened risk of crime [1], low IQs , and welfare dependence, would it not be prudent from a fiscally conservative standpoint (and from a conservative tough-on-crime standpoint) to encourage or even mandate abstinence as a prophylactic? A right-wing argument can be made for birth control including even sterilization to control entitlement spending and crime. The social benefit to reduced crime as a result of abortion may be on the order of $30 billion annually. Likewise, if prenatal screening finds markers for high-IQ, abortion should be proscribed, even for at-risk households.

To those who argue that the abortion-crime link has been debunked, not so fast: A Formal Response to the Foote and Goetz Criticism of the Abortion Paper. Even if the the link between abortion and crime isn’t airtight, that doesn’t prove a biological link wont be found in the future.

[1] In addition to the elevated risk of crime from at-risk households, there are genetic markers for crime, as shown here, here, and here.

The Daily View: 1/17/2016 (lots of stuff)

From Fred Reed: The Inevitability of Eugenics

I predict within 50 years America will start giving Eugenics a serious consideration as a way to tackle the growing entitlement spending problem, which by then will be much bigger than it is now if trends persist. Liberals and conservative alike need to get over this squeamishness of genetic engineering, which like masonry or computers, is a tool that can be used to improve society. A hammer can break but it can also build.


Jim and XS have some thoughts on bitcoin.

As some may already know, I have been a Bitcoin optimist for awhile, here and here for example, as well as an investor in the cryptocurrency.

I’ll believe there’s a crisis when the price crashes and doesn’t recover; until then, ‘coin on’. One thing I’ve learned from following bitcoin over the past three years is that everyone has their ‘theory’ for why it will fail, and all have been shown wrong. Bitcoin just keeps coming back, rising like a Phoenix from every adversity thrown at it. The FBI seizure of Silk Road didn’t stop it, neither did price crashes in 2011, 2013 and 2014, or the failure of Mt. Gox in 2014. Now Bitcoin is booming because because of China. Wealthy Chinese are using Bitcoin to circumvent capital controls. As China’s economy slows and in anticipation of a falling Yuan, the wealthy are looking for anywhere to park their money.


The internet has made defensive writers of us all

Perhaps ‘defense writing’ has become so commonplace nowadays because there is less tolerance at both the individual and societal level for mistakes than in the past. In an era where an abundance of information can be found instantly online for free, ignorance has become inexcusable. With the government spending tens of billion of dollars a year on public education, no one should be ignorant, and ignorance is seen as both a personal failure as well as an institutional or societal one. This dates back to the ‘enlightenment’ ideals of centuries ago, when we expected science and reason to explain everything, and that still carries on today. Failure or ignorance is seen as un-enlightenment. But the problem is the majority of people are simply not smart enough to benefit much from mass education, forgetting much of what is learned beyond the basics of reading and writing, rudimentary history and geography, and some math.

Also, thanks to the internet and other factors, we’re in an era of fact checking, which means writers have to be especially assiduous to buttress against all possible holes that can be poked into their thesis. Hedging means being open the possibility of being wrong, so instead having to create a thesis that is impervious to factual criticism, just use verbal disclaimers in the form of hedging language so that you’re covered.


More American exceptionalism: Cancer survival rates higher in USA than UK

Long wait times, scarcity of drugs for NHS patients, and poor screening regimens may be to blame.


Some Thoughts on Healthcare
Universal Healthcare Not So Great
Affordable Housing, Healthcare, & Tuition: Putting Things in Perspective


From Social Matter: Unless You’re An Atom, Principled Libertarianism Is Not For You

This invokes the slippy slope argument: what if instead of a plumber it’s a butter churn business and now technology has made churns nearly obsolete. Should the government ban automated churners to save his business too? Cheaper plumbing (and cheaper butter production) means more people can afford plumbing and butter, which boosts standards of living. 100 years ago, automobiles were a luxury item; now they are everywhere, thanks to globalization, free market capitalism, and other factors. That’s the free market argument, but it does not take into account the individual who may lose his job when technology becomes obsoleted, or his job is replaced by someone who can do it cheaper. New technologies and markets create new jobs, replacing the lost ones, although there is no guarantee the Luddite Fallacy or Lump of Labor Fallacy must remain fallacies.


Hmm…but private investment has risen substacially over the past six years:

Dividends are worse than buybacks, due to tax issues and other inefficiencies, but no one attacks dividends. Somehow buybacks have become the scourge of the left.


The Trouble With Fascism

Kinda, but fascism is predicated on race whereas communism is predicted on class, the later which is obviously leftist. Fascism means maybe some government control over certain industries,but it’s not leftist like Marxism, which has more control over businesses, to the point of almost total confiscation of private property.

On a somewhat related note, the problem with populism is that it tends to promote bad policy (particularly economic policy) for the sake of getting votes by exploiting the fears and ignorance of the masses (especially about economics), which is one of the fundamental flaws of democracy. In that regard, both left-populism and right-populism may be the different sides of the same coin. For example, many on the right support low taxes, but it’s less realistic promise both a smaller deficit and lower taxes, but republicans have to promise both to get elected.


Everyday Economics: The Rise and Fall of the Chinese Economy

Am I the only one who is still on the fence about China? It’s too early to say there is actually a mess. There is evidence maybe growth is glowing, but it’s far too early to call it a catastrophe, even though the doom and gloom media has been calling it one for the past year. The debate is over 7% GDP growth vs. 5.5%.

The Rise and Fall of the Chinese Economy.

If by ‘fall’ he means 5.5% GDP growth instead of 7%. Alos, low oil prices should help China as well as other Asian economies.

Maybe a lot of this doom and gloom comes down to a a simple math misunderstanding, which is that ‘slowing growth’ is not the same as shrinkage. Slowing growth implies the second derivative is negative, but the first one is still positive, meaning the size of the economy is still expanding. An example is the function ln(1+x)

Rather, his video does a good job of explaining what could go wrong, but I’m not sold on the idea that there’s a crisis now. I would not be surprised if this blows over in a a couple months like it did in the past during past concerns over China.


The Handicap of a High IQ (Guest Writer Matt Baldoni)

He’s probably right on all accounts, but take issue with this:

Okay, more good science, kids! There is a negative correlation between involvement in organized religion and IQ numbers. Dumb people go to church, basically. Smart people don’t.

I’ve heard this argument, but I’m not buying it, and its not like the correlation between IQ and religiosity is incontrovertible. No one really knows. This is similar to the leftist ‘knuckle dragging’ stereotype of Conservatives, which by my own empirical observations is also false. Liberals, particularly welfare liberals, are prone to reductionism and oversimplification more so than Conservatives. This is due to tribe mentality, as well well as general ignorance of complicated issues.

Maybe offline this is the case, but online some of the smartest, well-written people I’ve encountered are religious and or identify as Christian – blogs and writers like Free Northerner, Vox Day, Bruce Charlton, Nick B. Steves, Mark Citadel, Zippy, WM Briggs, and more. It’s many avowed atheists, people who watch Colbert or Daily Show, who seem dull and conformist.


Interest Rates, Unicorns And What The Fed Means To Silicon Valley

Low interest rates helps America’s best and brightest innovate and create wealth, and is an example of pragmatic/utilitarian/consequentialist polity that helps the ‘greater good’ even if such policy is unpopular with a lot of people. TARP, QE, and ZIRP were ‘lifelines’ for America’s most productive, as a way of containing or mitigating the the damage from the weak, inept sectors (banking, housing) so that the healthier portions could thrive. It was a success, with TARP three years later returning a profit to the treasury, and the economy & stock market now in its sixth year of expansion. Although the private sector and the consumer deserve most of the credit, TARP helped too.

A common argument is that low interest rates create bubbles, but the end result is still better than if bubbles are never formed. Risk taking is necessary for an economy to grow technologically and not become stagnant.

Second, compounding this run up in asset prices is the appreciation of the dollar on the global currency markets. Because the world was anticipating an increase in U.S. interest rates, the value of the dollar has been increasing for the past two years, since the Fed started signaling that it would eventually raise rates.

This is due to the ‘flight to safety’ and the insatiable demand for safe, low yielding US debt. The dollar is so strong not only because of the flight to safety, but because foreign countries that don’t have reserve currency status are running up deficits to try to grow their economies. Other reason are given here.

Theranos, Part 2

part 1

From iSteve (STEVE SAILER) Theranos: The Elizabeth Holmes Reality Distortion Field

Another thing people have to realize about Theranos and other high-valued startups, these companies are funded by wealthy investors who are aware of the risks. They don’t need pundits lecturing them about the inherent risks of investing in hot startups. Everyone wants to play the nanny or the ‘I told you so’ game. It’s like going to the high roller table at MGM Grand and screaming at the gamblers there that the ‘expected value on baccarat is negative!’ Yeah, they know that, but enjoy playing anyway (though VC typically has a positive expected return).

Although there is a lot of hype, some of it is justified when you consider the enormous potential for savings using Theranos’ tests. According to the New Yorker, ‘a typical lab test for cholesterol can cost fifty dollars or more; the Theranos test at Walgreens costs two dollars and ninety-nine cents’, although the expansion of the partnership has been suspended in light of recent bad press.

More doubt: Theranos Trouble: A First Person Account

After two failed attempts to establish a Theranos account, I gain access to my numbers:

— Platelets: 430, given my condition, that’s high
— Hematocrit: 44.1, a passing grade, but uncomfortably close to the 45% limit

Stanford Hematology disagrees:

— Platelets: 320, no concerns, come back in two or three months
— Hematocrit: 41.1, ditto

However, the Theranos site for the CBC has 6 sub-tests:

Platelets, Automated
RBC Automated
WBC Automated
WBC Count, Automated Differential

A ‘complete blood count’ has at least ten sub-tests, not just the two (Platelet, Hematocrit) he listed. If he can’t list all of the items instead of the two examples he cherry picked, how can we trust his story? He’s probably omitting stuff. A CBC with only two results is by definition not a CBC. No hospital would run a CBC on only two items.

A normal platelet count is between 150-400, which his results fall within. Although the there is a large discrepancy between the Stanford platelet test and the Theranos results, that doesn’t mean discrepancies won’t exist for other testing methods and other hospitals. Certain tests work better with small blood volumes than others. Blood glucose levels can be reliably tested with a pinprick of blood using a home test kit, although the discrepancy is somewhat worse than under a controlled hospital setting, which is not too surprising.. Beyond the herpes test, which they have received FDA clearance for, Theranos has 120 tests in the works, and getting FDA clearance on maybe a dozen of them would be huge progress.

Theranos was founded in 2003; it took over a decade for Theranos to develop its proprietary testing machines and get its first FDA approval (for the herpes simplex 1 virus test). The media is treating this like a horse race, and don’t understand that biotech and healthcare, as an industry, is very slow – it takes many years and lot of money to get things going. This is because of regulation (human lives are at stake), high costs (lab equipment, computer simulations, employees, clinical trials, etc), and the innate complexity of human biology. It’s not like an app where you have have it coded in a month.

Abortion & Healthcare Policy

From Evolutionist-X” In Defense of Planned Parenthood

On numerous occasions, this blog has argued that Republicans could support abortion as a way of reducing entitlement spending and crime, which I discuss further here.

The usual rebuttal is that this is the policy of Margaret Sanger and other liberals. Maybe fifty years ago, but nowadays if a liberal like Hillary tried to frame abortion in the context of reducing entitlement spending and crime, her campaign would be over because of the left. When William Bennett made a comment about abortion and crime, it was the left who attacked him. Same for Steven Levitt in Freakanomics in which the chapter on how abortion can reduce crime received much criticism from civil rights groups, but also some criticism from the right. The welfare left supports abortion not to potentially make the world a better place, but due to a lack of impulse control, as a form of ‘empowerment’ for women. And just because a liberal supported something a couple generations ago, doesn’t prove it’s necessarily bad today or that Republicans should totally disregard any merit of it, and today’s welfare SJW liberals are much further to the ‘left’ than the classical/pragmatic liberals of generations ago.

From From Jonathan Gruber’s 1998 study:

…for the marginal child not born due to increased abortion access, the odds of living in a single parent family would have been roughly 70 percent higher, the odds of living in poverty nearly 40 percent higher, the odds of welfare receipt 50 percent higher.”… “From these results, we estimate that the legalization of abortion saved the federal government over $14 billion in welfare payments through 1994.”

Abortion is disgusting, but so is cleaning up crime scenes. I think rather than immediately dismissing it is ‘bad’ we need to consider the possible good that can come out of it, at least from a utilitarian/pragmatist perspective.

Some people find the idea of utilitarianism, as well as thought experiments such as the Trolley Car, to be an affront to their moral sensibilities, since sometimes the most optimal allocation of a resource often comes at a cost to something someone else holds dear. Some are unsettled by the idea that the value of a human can be reduced to a number, but if you have insurance (health, auto, home) – that is exactly what it is, an attempt to assign a monetary value to a human life in order to price a policy, yet when the argument is framed differently (trolley car or abortion), these very people become mortified at the premise that human life does indeed have a finite value, or that some lives may be more valuable than others. ‘Pro life’ taken to its extreme would be mean no war and no death penalty – both positions many Republicans, who identify as ‘pro life’, support. So why does this contradiction exist? I suppose because they rationalize from a utilitarian standpoint that the possible loss of some innocent lives (the occasionally wrongly executed individual, soldiers dying, or collateral damage) indirectly serves a greater good (preventing more deaths both directly and indirectly), justifying this utilitarian risk/reward trade-off.

But economics, which studies the allocation of scarce resources among people, is an inescapable part of our everyday lives, at both the individual and national level. The discussion or debate of how a finite amount of a public good (tax payer dollars, for example) will not simply ‘go away’ just because some people get offended; we need to learn to accept economic reality even if we occasionally get offended by the outcome. This is where some pro-lifers fail by holding all life, viable or not, to be sacred, which runs afoul of rules of economics.

My stance on it is, if you need round the clock care to perform everyday tasks, like going to the bathroom and eating, and you have to have someone make all your decisions till the day you die, because you’re physically in capable of doing so, you’re more of a burden than anything.

The Unpopular Puffin may have a point, and considering that it went viral on Reddit, many people apparently agree. In the recesses of our minds, we know that certain individuals are a drain on society, but we fear the consequences (loss of friends, employment) of voicing this unpleasant truth. And from Wikipedia:

In the United States, the average lifetime cost of a person with an intellectual disability amounts to $1,014,000 per person, in 2003 US dollars.[52] This is slightly more than the costs associated with cerebral palsy, and double that associated with serious vision or hearing impairments. About 14% is due to increased medical expenses (not including what is normally incurred by the typical person), 10% is due to direct non-medical expenses, such as the excess cost of special education compared to standard schooling, and 76% is indirect costs accounting for reduced productivity and shortened lifespans. Some expenses, such as costs associated with being a family caregiver or living in a group home, were excluded from this calculation.[52]

Let’s consider the case of an expectant middle-income mother whose ultrasound uncovers that her fetus has Trisomy 13 or 18, a highly lethal genetic anomaly; in the event it’s not a stillborn, it will cost about a million dollars a year to keep it alive. Economically, that is a poor use of a public good (tax payer dollars), especially since the baby, profoundly disabled, will never contribute in any meaningful way to society in its short existence. To the mother, the baby could be priceless, but to society it’s not. Even Trisomy 21, which is less lethal, is still very expensive. Sure, if the mother has millions of dollars she can use her own money to keep it alive – and that should be within her right – but when a public good is involved, the question of rationing inevitably comes up, as to be expected. That million dollars can be better spent helping babies that are much less disabled. The plan of prenatal screening, with required abortions for severe abnormalities, could make the process less painful for parents, since the pregnancy would be ended before it gets to the second trimester or beyond.

Rapid advances in biotechnology means we can use screening and genetic engineering to create a better society by choosing who we want in and which traits we wish to leave behind. Before dismissing this as ‘Nazi science’, there are many practical applications. Consider the Dylan Roof spree killing, as well as other tragedies such as Sandy Hook massacre and the 2012 Aurora shooting. As it turns out, there may be a genetic malfunction to blame, and some people may in fact be programmed to kill.

Related: Steven Levitt is Right, Not All Life is Sacred

Physician Assisted Suicide and Euthanasia May Lower Healthcare Costs

California Legalizes Assisted Dying for the Terminally Ill

To clarify the subtlety between physician assisted suicide and euthanasia:

Physician-assisted suicide refers to the physician providing the means for death, most often with a presciption. The patient, not the physician, will ultimately administer the lethal medication. Euthanasia generally means that the physician would act directly, for instance by giving a lethal injection, to end the patient’s life.

Despite being on the ‘right’, perhaps a good argument can be made for assisted suicide as a way to lower healthcare costs. Studies have shown that end-of-life care disproportionately contributes to health care costs in the United States:

I was pleasantly surprised to find that 41% of Republicans, according to a Gallup poll, support assisted suicide:

So being pro-euthanasia not as ‘liberal’ as some may assume. Part of the problem is the belief shared by both sides of the aisle that ‘every life is worth saving’. Lives stop being sacred/worth saving when they pose a threat to others or are too expensive, as shown by how 1% of the population contributes 20% to healthcare spending:

This is like reverse-Darwinism, survival of the un-fittest. We’re wasting tens of billions of taxpayer dollars a year keeping people alive who, in essence, are natures ‘mistakes’. If you have a lot of money and want to be kept alive another six months or so, fine…it’s your money, but not at taxpayer expense. The same liberals who call themselves ‘pro science’, their belief in Darwinism and survival of the fittest doesn’t apply in real life, as shown, for example, by the leftist outrage over UK TV presenter Katie Hopkin’s observation that allocating public hospital beds to dementia patients is a waste of public healthcare resources.

The only argument I think of for costly, tax-payer funded medical procedures is if they are for research purposes in the hope that successful treatments will lead to lower costs in the future for certain rare and costly diseases, but as evidenced by exploding health care costs, we’re far from that. Public healthcare should be prioritized to, first, American citizens, not illegals; second, to those who have conditions that are are most amenable to therapy; and, finally, for more expensive and difficult produces that involve scarcity such organ transplants, by IQ, with donor waiting lists ranked by IQ. All else being equal, it’s a better use of resources giving a higher IQ person priority over a lower IQ person.

Some argue that the free market will fix healthcare, but the system as it stands right now is out of control. Healthcare has become more like palliative care, spending billions prolonging lives long after they have stopped being useful. From an economic perspective, that sounds very inefficient that even a free market can’t fix it. In eliminating the social safety net, people who cannot afford healthcare would have to find way to raise funds through charity or family and friends, have insurance, pay out of pocket, or simply not get access to healthcare. Since many people, understandably , find the idea of letting sick or injured people who cannot afford treatment die to be repugnant, the role of the government is to allocate a public pool of resources to these individuals. However, this goes back to the trade-off between saving lives and optimal resource allocation. Any time you have a public good, rationing of some form is necessary or costs will balloon, which is what’s happening right now.

Another problem is the issue of insurance; millions of Americans are uninsured, drawing from public resources at little cost to them. That’s kinda why I agreed with the idea requiring people to get insurance or else suffer some consequence, but there many factors that dissuade people from getting insurance:

Many people already have company healthcare plans.

People with insurance can sometimes become underinsured.

A lot of young people draw off their parent’s plans.

Young people typically don’t need insurance.

Older people have medicare; others have VA benefits.

Low-income people have medicade, as well access to emergency rooms.

Millions of insured Americans have had plans canceled due to Obamacare.

The ACA (affordable care act) requires that insurance companies redistribute the costs of covering unprofitable, high-risk members on everyone else, which resulted in the cancellation of millions of plans that didn’t meet the standards of the ACA:

Some policies are being canceled because the law is doing precisely what it was meant to do: create an insurance market where Americans share the cost of getting sick more broadly.

In Obamacare’s central bargain, insurance companies agreed to stop turning people away or charging them more for being sick, in exchange for everyone buying a minimum level of coverage…

To dismantle that system, the law sets new rules for health plans sold after 2013, limiting how much insurers can vary premiums by age, gender, or health status. The new plans must pay for at least 60 percent of members’ medical costs on average. They also have to provide 10 areas of coverage, called essential health benefits, such as hospitalization, mental health treatment, and maternity care. In the past, people buying health plans on their own, rather than through an employer, could lower their premiums by purchasing more limited policies. Now that all policies must provide comprehensive coverage, people who’d bought limited plans on the cheap are seeing their premiums go up.

That means men are paying for maternity care. Is that fair? No.

In addition to cancellations and high premiums, other problems associated with Obamacare include high co-pays and doctors opting out of Obamacare exchanges. The result is more emergency room visits at great cost to taxpayers.

Experts cite many root causes. In addition to the nation’s long-standing shortage of primary care doctors — projected by the federal government to exceed 20,000 doctors by 2020 — some physicians won’t accept Medicaid because of its low reimbursement rates. That leaves many patients who can’t find a primary care doctor to turn to the ER — 56% of doctors in the ACEP poll reported increases in Medicaid patients.

State Medicaid costs are out of control.

Making euthanasia legal in the United States, as well as making physician assisted suicide legal in more states could dramatically lower healthcare costs and improve quality of live for caregivers. Doctors should encourage euthanasia and administer it themselves, perhaps with involuntary euthanasia in certain cases like in dementia.

Affordable Housing, Healthcare, & Tuition: Putting Things in Perspective

Vox Day writes:

The SJWs and cuckservatives celebrate diversity, but what they are also celebrating is poverty. America’s living standards have fallen considerably since 1973, but no one realizes it yet because the combination of technological advancement and debt-spending conceals that fact. But it gradually becomes obvious, as Americans become increasingly unable to afford houses or even college educations.

In that last line, Vox is sounding like Bernie Sanders. Maybe the political spectrum is actually a loop – with both extremes meeting on the opposite side, as the ideological left and right move in their respective directions tangentially along the edge of the loop. The far-right and the far-left are both critical of free markets, for example.

It’s easy to complain, but explanations and solutions are harder to come by.

In regard to healthcare and education costs, out-of-pocket costs are falling despite sticker prices rising. From the AEI:

But the chart above shows what might be the two most important reasons for rising healthcare costs over the last 50 years: a) declining out-of-pocket payments for medical expenses, which have fallen from 47 percent of total health spending in 1960 to a record low of only 11.9 percent in 2008, and b) expanding public funding of healthcare, which reached a record high of 47.3 percent in 2008. There’s now been a complete reversal—whereas consumers paid 47 percent of total medical costs in 1960, it’s now the government paying 47 percent of health spending, while consumers pay less than 12 percent out of pocket for healthcare. That reversal is a guaranteed prescription for rising healthcare expenditures.

The Emergency Medical Treatment and Active Labor_Act of 1986, which requires hospitals treat everyone regardless of citizen status or ability to pay, is a contributing factor, costing over $40 billion a year in unpaid hospital visits. That is the ‘universal healthcare’ the left says America is missing.

So while prices are rising, the costs are shifted from consumers and onto tax payers and employers. This is the reality the media and ideologues like Bernie Sanders ignore.

There is so much financial aid, as well as employer healthcare and other subsidies that substantially reduce out-of-pocket costs for healthcare and college, that the sticker price is seldom paid in full. I’ve never heard of anyone who couldn’t go to college simply because they didn’t have the money. However, higher education does need reform at both the student level (for students to stop majoring use low-ROI subjects) and societal (political correctness and lawyers being the driving force behind credentialism, as well as financial aid boosting prices).

From: College Tuition Inflation: Net Out-of-Pocket vs. Published Sticker Prices

The full sticker price is seldom paid. According to the article, only 1/3rd of private university student pay the full sticker price, and the most attractive students get the best aid packages. Tuition is only growing at 2-4% a year, which is anywhere from 0-2% greater than the CPI inflation, after adjusting for a myriad of subsidies, grants, and other financial aid.

Between 2006-07 and 2011-12, average published tuition and fees at public four-year colleges and universities increased by about $1,800 in 2011 dollars, an annual rate of growth of 5.1% beyond inflation. The average net tuition and fees in-state students pay after taking grant aid from all sources and federal education tax credits and deductions into consideration increased by about $170 in 2011 dollars, an annual rate of growth of 1.4% beyond inflation.

Average published tuition and fees at private nonprofit four-year colleges and universities are about $3,730 higher (in 2011 dollars) in 2011-12 than they were in 2006-07, but the average net tuition paid by full-time students in this sector declined by $550 in inflation-adjusted dollars over this five-year period.

Again, the liberals who complain about tuition ignore the role of financial aid and other grants.

Living standards have risen. Look at the technologies available today that didn’t exist decade ago, technologies that offer much more utility than in the past.

Homes prices and rent are expensive in some areas; much less so in others. It all depends on location, although as I earlier, rising rent is possibly forcing young people to live with their parents longer than normal.

The post-2008 tech boom, rich foreigners, scarcity, and private equity are contributing factors for the surge in home & rent prices in regions such Seattle and San Francisco. In the Northern California region, there are cheaper homes further north and east, but the commute is much longer and the homes aren’t as nice. But other regions, particularly the Midwest such as Utah, have seen prices stagnate.

NIMBYism is a contributing factor, as the restrictions and regulations to build new housing can be insurmountable. Before a low-income-housing tax credit (LIHTC) can even be evaluated, the state requires a vote by the legislative body in the county where the development is planned.

From Algezeera: Who gets to live where?: The battle over affordable housing

The credit seems like a straightforward way to help finance new apartments in wealthy neighborhoods that even struggling families can afford. But states are in charge of allocating the credits, and fair-housing advocates say states often undermine the credits’ potential to create integrated neighborhoods by favoring developments in high-poverty, racially homogeneous areas at the expense of developments in “communities of opportunity.” In addition, local opposition often jeopardizes developments in affluent areas, as is the case in Anne Arundel County

Although, I can understand the perspective of home owners who don’t want low-income dwellings in close proximity to their nice neighborhoods.

A recent paper by the New York Fed, The Impact of Building Restrictions on HousingAffordability, discuses whether the affordable housing problem is due to external supply and demand factors or because of construction costs. If home prices do not substantially deviate from construction costs, then efforts to make housing more affordable by boosting housing supply are likely to fail, since the lower-bound (construction costs) has been hit.

From the paper:

To get a better sense of the distribution of housing prices
throughout the United States, we turn to the American
Housing Survey (AHS), but for a quick look at the affordability
issue, it is useful to examine the 2000 U.S. census. The census
indicates that the self-reported median home value is
Sixty-three percent of single-family detached homes
in America are valued at less than $150,000. Seventy-eight
percent of these homes are valued at less than $200,000. The
American Housing Survey reports that the median size of a
detached owned home is 1,704 square feet. The construction
costs of an average home imply that this home should cost
about $127,500 to build, with a lower quality economy home
costing $102,000 to construct.
Together, these numbers provide us with the first important
lesson from housing markets. The majority of homes in this
country are priced—even in the midst of a so-called housing
affordability crisis—close to construction costs. The value of
land generally seems modest, probably 20 percent or less of the
value of the house. To us, this means that America as a whole
may have a poverty crisis, but its housing prices are basically
being tied down by the cost of new construction.

High prices in some regions could be due to zoning costs inhibiting construction of new homes

Our alternative view is that homes are expensive in high cost
areas primarily because of government regulation, that is,
zoning and other restrictions on building. According to this
view, housing is expensive because of artificial limits on
construction created by the regulation of new housing. It
argues that there is plenty of land in high-cost areas, and in
principle new construction might be able to push the cost of
houses down to physical construction costs

The paper concludes:

Measures of zoning strictness are highly
correlated with high prices. Although all of our evidence is
suggestive, not definitive, it seems to suggest that this form of
government regulation is responsible for high housing costs
where they exist.

For renters, the Fair Housing Act may be another factor. A 2015 Supreme Court decision in Texas Department of Housing v. Inclusive Communities Project held that disparate impact claims are cognizable under the Fair Housing Act, even if there is no intention of discrimination. The United States Department of Housing and Urban Development (HUD) uses the legal theory of “disparate impact” to determine violations of the Fair Housing Act, even in the absence of discriminatory intent.

Frum the Wall St. Journal:

Last week’s Supreme Court decision in Texas Department of Housing v. Inclusive Communities Project also could compound disparities in the name of reducing them. The case concerned federal housing law, but its impact will be felt in countless other areas. The Fair Housing Act of 1968 makes it unlawful “to refuse to sell or rent . . . or otherwise make unavailable or deny a dwelling to any person because of race, color, religion, sex, familial status, or national origin.” As Congress wrote the law, a plaintiff must show that there was intent to discriminate.

The text of a housing law clearly written to punish only intentional discrimination can be rewritten by judges to punish practices that have a disproportionate impact on a favored group, even when there was no intention to discriminate.

Justice Samuel Alito explains in his dissent how disparate-impact analysis backfires:

As Justice Samuel Alito explained in his dissent, proponents of disparate-impact analysis often harm the very low-income minorities they are trying to help. When St. Paul, Minn., tried to crack down on slumlords by ordering the cleanup and repair of rat-infested housing units with inadequate heat and sanitation facilities, it was slapped with a disparate-impact claim under the Fair Housing Act. Even though there was no evidence of discriminatory intent, the improvements increased the cost of rent, which disproportionately impacted minority tenants. “The upshot,” wrote Justice Alito, “was that even St. Paul’s good-faith attempt to ensure minimally acceptable housing for its poorest residents could not ward off a disparate-impact lawsuit.”

Disparate impact litigation is not only a contributing factor to credentialism and the weak labor market, – but also increased rent, since landlords pass the insurance and legal costs to the renter. For example, the threat disparate impact litigation makes it very difficult for renters to negotiate lower prices because if a minority pays the regular price and sees this discrepancy, he has possible grounds to sue.

But like all too many social science problems, there are no definite causes or solutions.

We’re Not Broke

The documentary We’re Not Broke went viral on Reddit. The synopsis is that the Republicans are wrong about America being broke, and that there would be more money for social programs and infrastructure if tax loopholes and other problems were fixed.

Despite being on the right, I agree with the ‘left’ that America is not broke. And up until 2007 or so, many Republicans also shared this sentiment until the debt hysteria took over, which puts me in a very small minority among the alt-right. But that’s where the agreement ends. Whereas the left wants more money for social programs and welfare, I support supply-side policy that broadens the tax base and spurs innovation by helping America’s best and brightest, as well as policy that keeps America safe, which is summarized below:

How the left wants to spend money:

Indiscriminate education spending, universal pre-k
Free tuition for everyone, student loan forgiveness
Indiscriminate entitlement spending
Universal healthcare
Low-tech infrastructure
Universal basic income

This blog:

More money for gifted education
Reduced or free tuition for high-ROI majors (STEM) and or high-IQ students, who have the greatest likelihood of not dropping out
High-IQ basic income
Lower taxes
High-tech infrastructure
Investment in high-tech, high-IQ companies (like Tesla and biotech, for example)
Defense spending to protect America’s economic interests. If America cannot defend itself, society will regress to the level of its aggressors.
Targeted healthcare (As America’s population ages, it’s possible public healthcare costs will spiral out of control more than they already have. Thus, costly procedures may have to be prioritized to individuals who provide the most economic value. Therefore, all else being equal, a high-IQ person, who provides more value to society, would have priority over a lower-IQ person, who contributes less. The idea is pubic healthcare expenditures should be allocated in such as way that it provides the highest ROI. An example of rationing that occurs today are organ transplant waiting lists. A solution is to sort the list not just by urgency but also IQ, with smarter people having priority over the less intelligent.)

The problem is not America’s debt or spending; it’s how money is being spent. In choosing between indiscriminate spending, versus spending that is targeted in such a way that it provides a high ROI (the optimal allocation of resources), the choice should be obvious. This is where I part with the Mises/Austrian school of economics in that debt is not bad always bad, especially when a country has reserve currency status* as America obviously does.

In the 90′s, Bill Clinton and Al Gore, to their credit, understood that government investments in information technology would pay dividends, but today’s left, rather than supporting pro-growth policy, instead attack technology for causing wealth inequality and displacing jobs.

*America is kinda in a sweet spot : if the economy is sluggish, the flight to safety causes rates to plunge as we saw in 2008 and 2011. If growth overheats, the growth will be enough to offset the higher interest rate payments. Japan has been in the former scenario for decades without any problems. If Japan, which has slower growth, worse demographics, and a much higher debt/GDP ratio, can avoid crisis, America, which is economically better in pretty much every way, certainly will, too. Emerging markets have the opposite problem: negative inflation adjusted growth, high interest rates, and capital flight during economic weakness. Furthermore, the surging US dollar is more evidence of the post-2008 flight-to-quality trend. With the exception of China, the rest of the world is economically in much worse shape than America.

The Healthcare Scam

Vertex’s Cystic-Fibrosis Drug Faces Big Test

Vertex, based in Boston, Mass., already has a hit cystic-fibrosis drug in Kalydeco, which has a wholesale annual per-patient price of $311,000 in the U.S., and had $464 million in global sales last year. But Kalydeco treats a relatively rare type of cystic fibrosis, with a market of only 2,000 patients in the U.S. Orkambi, which combines Kalydeco with another compound, could be approved for 8,500 patients, or 28% of the 30,000 people in the U.S. with the disease.

. Express Scripts Holding Co. ESRX +2,22% , the largest U.S. pharmacy benefits manager, says that price will overwhelm employer health plans

Gotta love how they feign concern. lol Everyone knows that tax payers front the bill. Every single time. Insurance companies & healthcare bill from govt., who bills from tax payers. If this were really a problem, health insurance stocks would not be at 52-week highs every year. Tens of billions of tax payer dollars wasted each year keeping people with these rare diseases alive who otherwise provide little to no economic value. I am bullish on healthcare because I don’t see any reason for this scam to stop. Policy makers seem to have this view that every life, no matter what the cost, is worth saving. So go healthcare! Go CURE, IBB, and so on. In buying healthcare stocks there is money to be made for average investors, even if these gains are rooted in wasteful policy.

Liberals, who claim to believe in evolution, believe in survival of the un-fittest. They believe in wasting resources on individuals who are an economic drain, when that $300k a year could be better spent on people who are a net-positive. In playing devil’s advocate, I suppose this Cystic-Fibrosis drug, if successful, may lead to cheaper drugs down the road, but since Cystic-Fibrosis is so rare it would be classified as an orphan drug, which are always, by definition, expensive.

This may seem kinda insensitive and harsh, but with healthcare spending showing no sign of slowing, the question is is every life worth saving?

Related: Universal Healthcare Not So Great After All