New at Cato Unbound: Clay Shirky on Journalism after Newspapers

Newspapers, as we know them, are doomed. Should we worry? What's next for journalism? Will there be journalism? That's what we're talking about in this month edition of Cato Unbound, “How We Will (or Won't) Survive Without Newspapers,” which kicks off today with a smart lead essay from Here Comes Everybody author Clay Shirky, “Not an Upgrade — An Upheaval“. A taste:

Like driving, journalism is not a profession — no degree or certification is required to practice it, and training often comes after hiring — and it is increasingly being transformed into an activity, open to all, sometimes done well, sometimes badly, but at a volume that simply cannot be supported by a small group of full-time workers. The journalistic models that will excel in the next few years will rely on new forms of creation, some of which will be done by professionals, some by amateurs, some by crowds, and some by machines.

This will not replace the older forms journalism, but then nothing else will either; both preservation and simple replacement are off the table. The change we’re living through isn’t an upgrade, it’s a upheaval, and it will be decades before anyone can really sort out the value of what’s been lost versus what’s been gained.

The Path to Corporate Welfare is Paved with Essential Legislation

I had meant to blog about this passage in the New York Times, but I'm a lazy blogger these days and Tyler got to it and ably noted the “Nice place you got here. Would be a shame if something happened to it,” tone of Daschle and Baucus. I want to mention one further thing. When I talk to folks on the left, a lot of them really earnestly claim to deplore corporate welfare. But, when it came down to it, a lot of those same folks wanted to brag about promising to deliver corporate welfare to Wal-Mart. What gives? It makes me wonder how they think corporate welfare happens? Do they think it's usually not as part of some legislative quid pro quo? Maybe the idea is that Wal-Mart publicly backing a coverage mandate in exchange for nixing a requirement to kick in for employees on Medicaid does not count as corporate welfare because the overall legislative aim is worth it. But, of course, once you count in the full set of deals, the actual legislation probably won't be worth it for anybody but the parties to the deals. You can see Daschle and Baucus as craftily strong-arming corporations and interest groups into getting with the plan. (I guess that's how they like to see themselves.) Or you can see corporations and and interest groups strong-arming Congress (or manipulating the vanity of congressional powerbrokers) for advantageous regulation. It is, of course, both. When corporations see that politicians plan to get their pound of flesh, they maneuver to give half a pound in exchange for a deal where their competitors give two.

Will Health-Care Innovation Survive Obamacare?

I have the sense that many defenders of an even-more-fully-government-run health care system have a hard time taking this question seriously. But they should. It's just a fact that much of the world's medical innovation comes from the U.S. This goes a good way toward explaining with why survival rates for many potentially mortal health problems are highest in the U.S., and also partly explains why U.S. costs are so high. Indeed, that a certain strata of Americans spend so much, often on stuff that makes no difference, also partly explains the high U.S. level of innovation. Profligate U.S. spending on state-of-the-art treatments acts as a subsidy to the health care systems of other countries, who get to free-ride off American innovation and (often “wasteful”) market experimentation. As Megan McArdle put it:

At the highest macro level, life expectancy, Europe generally outperforms us.  But it's not clear how much of that is health care, and how much things like our murder rate, and our famously sedentary lifestyles.  When you drill down into many diseases, we outperform them.  And many argue that we outperform them on hard-to-measure “lifestyle” issues:  how fast your torn ACL gets repaired, how quickly (or whether) you get a hip replacement, etc.  Such quality of life issues are nearly impossible to measure, though this hasn't stopped many people from trying.  But I don't really trust the figures they generate.

Europe gets a great deal out of all of this.  We figure out what works, then they adopt it.  But we get a great deal too–we get earlier access to controversial treatments, and our future generations get all the treatments we've discovered so far.

Megan mentions Virginia Postrel's terrific Atlantic piece about her ordeal with breast cancer and the expensive but effective drug Herceptin, which may well have saved her life. And which New Zealand's government health system wouldn't pay for initially…

Looking at the crazy-quilt American system, you might imagine that someone somewhere has figured out how to deliver the best possible health care to everyone, at no charge to patients and minimal cost to the insurer or the public treasury. But nobody has. In a public system, trade-offs don’t go away; if anything, they get harder.

The good thing about a decentralized, largely private system like ours is that health care constantly gets weighed against everything else in the economy. No single authority has to decide whether 15 percent or 20 percent or 25 percent is the “right” amount of GDP to spend on health care, just as no single authority has to decide how much to spend on food or clothing or entertainment. Different individuals and organizations can make different trade-offs. Centralized systems, by contrast, have one health budget. This treatment gets funded, and that one doesn’t.

If I lived in New Zealand, I wouldn’t be dead, just a lot poorer. But if every place were like New Zealand, far fewer complex new drugs would get developed in the first place. And my odds of survival would be much, much lower.

The biggest challenge for advocates of less hindered market competition in health care is that it is so hard to see what is lost to excessive regulation and government rationing. Glenn Reynolds, writing in the Washington Examiner, does a terrific job illustrating what could be lost to a system of government rationing. For example, his family:

[M]y wife, a longtime vegetarian and marathon runner, had a freak heart attack at the age of 37.

It wasn't from too many Big Macs. After some rough patches, she's now doing well, thanks to an obscure and expensive anti-arrhythmic drug called Tikosyn, and an implantable cardioverter/defibrillator. Not too long ago, she'd have been largely bedridden. These medical innovations made the difference between the life of a near-invalid and a life that's close to normal.

My mother had a hip replacement. Her hip didn't break – she basically wore it out with exercise. When the pain got too bad, she got it replaced, and now she's moving around like before, only painlessly. Not too long ago, she would have been chairbound.

My father had prostate cancer; his doctor suggested waiting but on biopsy it turned out to be pretty aggressive. It was treated with radioactive “seed” implants. He's now been cancer-free for several years, without the side effects of earlier treatments — or, worse, of cancer.

My daughter had endoscopic sinus surgery this spring. She had been sickly and listless, complaining of constant migraine headaches, missing a lot of school, and generally looking more like a zombie than a teenager. Several doctors dismissed her problems, or prescribed antibiotics that didn't help much, until we found one who took the extra step.

A head CT scan done on a fancy new in-office machine showed a nasty festering infection, the surgeon cleaned it out, and now she's like a normal kid again. Before laparoscopy, her condition would probably have remained untreated, and she would have been another “sickly” kid. Better to be well.

The normal critique of socialized medicine is to point out that people have to wait a long time for these kinds of treatments in places like Britain. And that's certainly a valid critique. I'm sure my mom and daughter would still be waiting for their treatments, while my father and wife would probably be dead.

The key point, though, is that these treatments didn't just come out out of the blue. They were developed by drug companies and device makers who thought they had a good market for things that would make people feel better.

But under a national healthcare plan, the “market” will consist of whatever the bureaucrats are willing to buy.

I plan to write something longer about why this is such a tough issue to crystallize and communicate. My hunch is that our thinking about any issue like this, where enormous humanitarian benefits are side-effects of systems driven largely by self-interest, is badly distorted by the Knobe Effect.

Urban Farming

This idea is hilarious here in Iowa, where we wonder if some city folk have ever seen real farms. “The reality is that farming is an inherently space-intensive enterprise,” as even Manhattan native Matt Yglesias can recognize86 percent of Iowa is farmland (down from over 90 percent just a decade ago). That's a bit shy of 30 million acres. That's about 2000 Manhattans. The mind-blowing productivity growth in agriculture over the 20th century stands as one of the great achievements of human history. It involved immense strides in pest and weed control, farm machinery, bioengineering, and economies of scale. All this has made it possible to feed a rapidly increasing population with decreasing amounts of land and labor.

(Aside… No doubt Happy Planet Index-type people in 1909 were pointing out the physical impossibility of our one finite planet supporting 7 billion people.)

It's nice to have a garden. But didn't seem nice when I was a kid, when my family had a huge garden plot (a quarter acre, maybe?) on the property of a farmer who went to our church. That much garden in a city would seem like some pretty serious urban farming. Set in the vast scale of cultivated central Iowa, it seemed like what it was: almost nothing. Later, as a teenager, I detasseled corn and walked beans. If a field is big enough, and the curve is right, from the middle you can't see anything else.

If not for the massive subsidies it receives, the percentage of land under cultivation in Iowa would decline even more rapidly than it has. But it would remain one of the best places in the world for growing stuff. An unsubsidized Iowa would grow a different mix of stuff, and would traffic in a different mix of animals. Greater heterogeneity would reduce some economies of scale, but the scale of the actual farming–the kind that keeps humanity fed–will probably remain inconceivable to many rooftop basil growers.

UPDATE: People we're  justly complaining about the junk chart. It's the only one I could quickly find that had the time-scale I wanted. Here's a better one that goes back just 60 years.

Health-Care Reform Discussion Question

Does the fact that the United States does not now have a system of universal health care, despite more than a half-century of strenous legislative efforts by the Democratic Party, imply that a U.S. system of universal health care would produce results significantly different than that of countries that have had such a system for decades?

Pithier: If the U.S. suddenly got the Canadian-style system that majorities of Americans have traditionally resisted, would Americans start acting like Canadians?

Most Unexpected Comparison of the Day

From Arnold Kling:

I worry that today's equivalent of Robert McNamara is Peter Orszag, who I fear is poised to do for our health care system what McNamara did for Vietnam.

I suspect this is a bit overheated, but the fact that Arnold's book, Crisis of Abundance: Rethinking How We Pay for Health Care, is so outstanding makes this tough to simply dismiss.

Anyway, my similar but less dramatically stated worry, which I expressed in my latest column for The Week, is that the reforms currently on offer take the form they do because of Democratic dreams of a single-payer system, but such reforms, once they make contact with political reality, will likely produce a U.S. system that is even more of an convoluted, unsustainable mess. I think Princeton's Paul Starr is spot on about the politics:

Some supporters favor this approach [i.e., a new “insurance exchange” offering a “public plan”] because they see it as a step toward single-payer, which is exactly what the opponents fear. Squeezed by the public plan, providers might raise prices for patients insured by private plans, sending those plans into a death spiral.

But a Congress that is not about to adopt single-payer is unlikely to adopt a Trojan horse for single-payer. Some compromise proposals — such as Sen. Charles Schumer's — offer a second model, calling for a “level playing field” between private insurers and the public plan, including limits on the latter's ability to flex its purchasing muscle. But tight controls on its bargaining power might doom it entirely if it faces severe adverse selection.

Here's the delicate political problem: Depending on the rules, the entire system could tip one way or the other. Unconstrained, the public plan could drive private insurers out of business, setting off a political backlash not just from the industry but from much of the public. Over-constrained, the public plan could go into a death spiral itself as it becomes a dumping ground for high-risk enrollees, its rates rise, and it loses its appeal to the public at large. Creating a fair system of public-private competition — giving the public plan just enough power to offset its likely higher risks — wouldn't be easy even if it were up to neutral experts, which it isn't.

FUBAR, as McNamara's pawns would say.

Why Can't My Team Do Whatever It Wants!?

Ezra Klein is annoyed with the Obama adminstration's pusillanimous pussyfooting. Even that foul-mouthed hard-guy Rahm Emanuel is a squish these days. Why are the Democratic powers-that-be willing even to entertain the lame “trigger” public plan, which kicks in only if private plans fail to hit certain benchmarks for performance. Klein:

What Emanuel is saying here, however, is that in 2009, when Democrats control the White House, the House of Representatives, and the U.S. Senate — and have larger margins than Republicans ever did in the latter two — that they are interested in settling on the same policy compromise [behind Medicare Part D, a product of a Republican president and Congress]: a weak public plan that would be activated if certain conditions aren't met by private industry. That's a bit weird. Weren't elections supposed to have consequences?

Policy follows public opinion, more or less. And the public hasn't really changed much since 2003. This is something partisans have to learn and relearn again and again. If a policy was unpopular before a change in the party controlling government, it will probably remain unpopular after. And politicians like getting reelected. It's pretty simply, really.

Bush couldn't reform Social Security because his plan was unpopular. Obama won't be able to deliver a health-care bill ideological Democrats want, because what they want is unpopular and legislators know it. So Congressional Democrats want something they can cast as “victory” while doing nothing that could hurt their noble struggle for ongoing political self-preservation. Right now, strongly ideological media liberals like Klein have to decide whether they're going to (a) act as enforcers, sending the signal to the powers-that-be that they will vocally and publicly count a “trigger” plan as a pathetic failure, or (b) sigh and prepare to declare whatever legislation passes a profound victory for ordinary Americans that shows just how great Democrats are.

But I imagine this one's a tough call. For lots of ideological Democrats, the point of preserving political capital is to secure real universal health care. So I expect to see a fair amount of (potentially counterproductive) enforcer rhetoric.

The Poor but Unusually Chipper and Long-Lived Index

The Happy Planet Index is an ideologically rigged ranking released each year by the New Economics Foundation as part of their fight against the evils of economic growth. As far as I can tell, the whole thing is based on the false assumption that it is physically impossible for the entire population of Earth to achieve OECD-levels of material wealth. I suspect NEF sort of hopes media outlets will misunderstand what their index is an index of, as they've chosen a rather misleading name for a ranking of countries according to this formula:

Nevertheless, here are some of the headlines:

Australia Not Home to the Good Life — Sydney Morning Herald
Costa Rica: World's happiest place — Xinhua
Happy Costa Ricans top global list for the good life — Financial Times
Costa Rica tops list of 'happiest' nations — CNN

I do like the quotes around CNN's 'happiest'. So, anyway, what is the Happy Planet Index and index of?! Who can say!? Not journalists, who can be counted on to read no further than the press release. If one takes a moment to poke around the website for the Index, they do get around to saying: “The Index doesn’t reveal the ‘happiest’ country in the world,” which is a help. But they should put this up front, or change the name of the damn thing.

Anyway, so what's this “ecological footprint”?

The ecological footprint of an individual is a measure of the amount of land required to provide for all their resource requirements plus the amount of vegetated land required to sequester (absorb) all their CO2 emissions and the CO2 emissions embodied in the products they consume. This figure is expressed in units of ‘global hectares’. The advantage of this approach is that it is possible to estimate the total amount of productive hectares available on the planet. Dividing this by the world’s total population, we can calculate a global per capita figure on the basis that everyone is entitled to the same amount of the planet’s natural resources. Using the latest footprint methodology, resulting in the data in the Global Footprint Network’s Ecological Footprint Atlas, the figure is 2.1 global hectares. This implies that a person using up to 2.1 global hectares is, in these terms at least, using their fair share of the world’s resources – one-planet living.

Don't ask me why they think this makes sense. (Artifical trees!) In short it seems to mean that countries get docked for containing lots of people wealthy enough to buy lots of things.

Let's move on to alpha and beta. What do they mean? NEF doesn't tell you on the website. But if you diligently hunt around the pdf of the report, it is possible to discover Appendix 2, where it is finally revealed what the Happy Planet Index is an index of:

… a constant (α) is added to the ecological footprint to ensure that its coefficient of variance across the entire dataset matches the coefficient of variance for HLY across the dataset. In effect, this serves to dampen variation in the footprint. Once this is done, HLY can be divided by the adjusted footprint to produce an efficiency measure. This is then multiplied by a second constant (β) such that a country achieving a maximum life satisfaction score of 10, and life expectancy of 85, whilst living within its global fair share of resources (one-planet living), would score 100.

They apparently want to dampen the effect of the footprint to avoid the embarrassment of miserably impoverished countries “winning” simply due to the fact that they've got antibiotics but are too poor to buy coal.

It is well known in the happiness biz that Latin American countries tend to do better in terms of self-reported life satisfaction than their economic and political fundamentals would predict–in much the same way East Asian countries do worse. Given that the index strongly penalizes wealth, it's not much of a surprise that the winner would be a poor-but-unusually-chipper Latin American country that also has a suprisingly good average lifespan.

Here is an article on Costa Rican longevity.

Here is my annoyed response to the 2006 index.

What do you make of this claim, just thrown out there in NEF's explanation of its notion of ecological footprint: “[E]veryone is entitled to the same amount of the planet’s natural resources”?