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Friday, October 15, 2004

Please Don't Do For Our Seniors...

...What you did for our children!

The news about a drastic shortage of flu vaccinations came as no surprise to anyone who realizes the danger of relying on another country for a vital product. While I'm a proponent of open trade - as a way to keep our market honest, for starters - I also think we should constantly be looking for ways to keep production of vital products and services here in the United States.

(For the record, calling tech support because your Sims game isn't working right isn't vital, and therefore can be done by someone from a non-English speaking country...however, the consumer backlash of this outsourcing of tech-support will come back to bite the American software and hardware manufacturers in the near future.)

Anyway, back to flu shots...

What we are seeing in the flu shot scenario is a microcosm of where many on the left who want a more socialized healthcare system would want us to go in general. Universal Drug Benefit sounds wonderful. Everyone should have access to every drug ever made that could not only save their life, but improve the "quality" of life, right? I mean, people shouldn't have to live without the ability to "get it up", so Viagra all around, right? (Part of this fascination with the "quality" of life is the preoccupation of some with infanticide and euthanasia, but that's for another post.)

Everyone having access to a medication sounds like a great idea, except that reality diverges from the idyllic Universal Drug Plan in so many ways.

The flu situation demonstrates what I mean.

The genesis of the flu shot shortage comes from the same thinking as what appears in the above. Here are some key reasons behind a program called the Government Vaccine Buying Program:
  1. Every child should have access to a flu shot.
  2. Flu shots should be available cheap enough that economic status isn't a barrier to receiving the shot.
  3. If the Flu shots are cheaper (or even free), we will have greater numbers of children who are given the shot.
  4. The way to ensure more children get the shot is to use the purchasing power of the Federal Government to buy the vaccine on behalf of children.
  5. The way to ensure the governement doesn't break the bank in buying up all this vaccine is to impose price caps and regulations to limit the profit the "greedy" drug companies make (those bastards!).

So, how did the plan implemented based on the above guidelines work out?

For starters, we learned that not every child will get a flu shot, even if they are cheap or free. The percentage of children covered tops out around 75%. Providing a child with an immunization is a noble and compassionate goal. But, even if given on a proverbial silver platter, not every parent wants a flu shot for their child.

We also learned that when the Federal Government imposes price caps and profit caps on American drug companies, there comes a time when the motivation to research, develop, test, produce, and market a drug is no longer there. Tiny profits (or even, in this case, actual losses) combined with an ever-increasing threat of gigantic liability rewards for sometimes-ridiculous lawsuits cause the American companies to throw up their hands and say, "Enough. We aren't in the business of producing things to give them away for free."

So, we were left to depend upon a foreign manufacturer of an important product. That supplier made a mistake, and WE are paying for it. We are paying for it because in an effort to do something good, we ignored the reality of how the world works. And, if we aren't careful, it won't just be flu vaccine that we have to worry about, it will end up being all of our prescription drugs.

It is a fine line to balance: on one hand, it seems "greedy" to charge $30 or $40 per dose for a drug it costs only pennies to manufacture. On the other hand, the cost of production is only one small part of the actual cost of a drug. The money spent on research, development, and testing over the sometimes-several-decades it takes to develop a new medication is staggering. To undercut that profit margin which allows for continual development of new prescriptions is a ticket to a stagnated industry, and ultimately, if there is no profit, to the end of the industry altogether.

Imagine, if you will, the idea of everyone owning their own car. A new car, even, because the old cars that some poor people drive are gas-guzzling, foul-smelling, death traps without modern safety features. Think of the number of lives we could save every year by providing everyone with a brand new car, not to mention to cleaner air and less dependence upon foreign oil!!!

But, those greedy car companies charge between $20,000 and $35,000 for a modern, American-made car. And you know the actual cost of the metal and aluminum and fiberglass for a car is probably less than $2,000. If cars only cost $2,000, almost everyone could afford a new one, and those who can't, we could buy them one!

Of course, we wouldn't FORCE anyone to take one of the cars we provide for them. They could buy some other car, if they wanted to waste their money. We wouldn't FORCE them to join up with our Universal Car Coverage plan, but who in their right mind wouldn't choose to?

Yeah, the car companies will complain that we aren't considering the labor costs of tooling the parts, then assembling them. And we aren't thinking through the fact that they pay people to design and refine the cars. Or the cost of having an HR department, and a payroll staff, and a legal staff who deal with all of the regulations imposed by the Department of Labor, the EPA, and various other Federal Agencies. They will balk at losing $15,000 or more, per car (and under our plan, that's PER AMERICAN) but they are just being greedy.

And we'll all be surprised when they close their doors, right? How greedy.

Hopefully, this event will produce a corrective action within the healthcare industry.

But I'm not holding my breath.


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