Tuesday, September 04, 2007

Victims of Risk

Jeremy commented on Saturday's post, Creeping "Compassionate Conservatism," wherein I pointed out that the debate about health care has unhappily shifted to how government can best provide it, rather than whether government has any business in it.

I had pointed out that Nanny-state meddling has consistently failed to achieve its high minded objectives. Jeremy does not disagree, but thinks some aspects of the problem were overlooked:
I agree with Mitch's comment about government-mandated expanded coverage of things that most people couldn't care less about. However I think it's a bit unfair to blame rising health care costs primarily on government "meddling" - and not mention the exponential increase in litigation which has in turn raised the cost of liability insurance for doctors. I think that perhaps the biggest factor of rising health-care costs has been a cultural shift and greater sense of entitlement. Fifty years ago people understood that a doctor would do his best but he's not God. Today people expect doctors to be omniscient. Can't say I have hard data to back this up but it seems evident to me.
While these points are accurate, they leave open the questions of why is there an epidemic of litigation, and why do people have this ultra-entitlement attitude? I think cause and effect may be confused in Jeremy's examples. The examples are really just symptoms of the disease.

Serendipitously, Jeremy's comment comes on the heels of an excellent illustration of why his examples represent a cause-effect reversal: John Edwards' comments that health care will be mandatory should he be elected President. Scroll down one post for a note on that. While you're at it, scroll down one more for another example of bureaucratic bungling that continues despite evidence that such policies accomplish exactly the opposite of their purported intent. "Purported," because the actual intent is always "more government."

Jeremy is exactly right about litigation and the enormous increase in Americans' entitlement mentality. I would argue, however, that these examples are synergistic symptoms. A broadly litigious society is made more fragile when potential litigants are very much encouraged to see themselves as offended. This victimhood culture is simply a special case of the entitlement mentality. Neither is sufficient by itself to account for the abject stupidity of public policy. Together, they are nearly all you need to know. Together, they may be sufficient, but they are not necessary.

It is the surge in public acceptance of victimhood that ensures the success of frivolous litigation. Aren't we all treated unfairly, by our own lights, at some point or other? Aspiration to victimhood is an industry. By aspiration I mean both the yearned for status, and the CPR (Consistent Populist Rectitude) that sustains it. Which institution is most responsible for encouraging people to think of themselves as victims and providing the sympathetic infrastructure to satisfy their grievances? Government.

Why do we select such government? Much of it has to do with our anti-market bias. An example on a different front is pollution abatement, mentioned in an October Reason magazine article, The 4 Boneheaded Biases of Stupid Voters. (Check the site in a month or so, the article will be online.) Here's a tiny excerpt:
Anti-market biases lead people to misunderstand and reject policies they should, given their preferences for end results, support. For example, the Princeton economist Alan Blinder blames opposition to tradable pollution permits on anti-market bias. Why let people "pay to pollute," when we can force them to cease and desist?

The textbook answer is that tradable permits get you more pollution abatement for the same cost.
Unfortunately, Adam Smith's message is both counterintuitive and, here, politically incorrect. Those who feel entitled to a zero risk life do not easily tolerate the messiness of a market. Unenlightened self-interest, expressed at the ballot box, helps the command-and-control political elite to provide more and more entitlements. They use everybody's money to buy everybody's vote. The more victims they can succor, the better. Then the lobbyists take over.

An entitlement mentality exists because statist politicians have been pushing it for decades. The evidence of their success is that so-called conservatives now promote it, too. Mitt Romney's example pales in comparison to what George Bush already has done with prescription drugs under Medicare, and these are not "things that most people couldn't care less about."

The problem Romney and Edwards are trying to address is entitlement envy. Other Western democracies have state run health care, why don't we? It's a NATIONAL TRAGEDY to have millions of people without access to high quality health care!

This argument skips right by the definitions of "access" and "high quality," by incorrectly assuming countries like Canada, France, Great Britain - and even Cuba - actually provide such health care. They don't. "We" could, though, because we'd put the "right people" in charge. ... I digress.

The problem being bandied about is that the United States has people who are without health care insurance. Ignore the fact that hospital emergency rooms are required to treat people, and that billions of dollars of legitimate health care charges go unpaid by people making $50K who "couldn't afford" health insurance.

The point is, of the millions of uninsured claimed to exist in the United States, many choose to be uninsured; younger people and the affluent in particular. For example,
...according to the Bureau of Labor Statistics 2001 Consumer Expenditure Survey, households headed by young people between ages 25 and 34 spend more than three times as much of their income on entertainment and dining out as on out-of-pocket health care expenses. For even younger heads of household (18-to-24-year-olds), the annual expenditure on entertainment and dining out is almost five times more than out-of-pocket spending on health care. By contrast, households headed by individuals ages 65 to 74 spend almost 50 percent more on out-of-pocket health care than on entertainment and food away from home. If the young uninsured had unmet health needs, they likely would shift some of this discretionary spending into health care.
For another example:
From 1993 to 2002 the number of uninsured people in households with annual incomes above $75,000 increased by 114 percent.

The number of uninsured in households with annual incomes from $50,000 to $75,000 increased by 57 percent.

By contrast, the number of uninsured people in households with incomes under $25,000 fell by 17 percent.
What we see here is people making decisions about risk. What the socialized medicine proponents want to do is eliminate that choice. Young people should not be frittering their money away on movies and restaurants when they can be paying for someone else's health care. People who don't have insurance are entitled.

This entitlement mentality has been extended so far that the majority of Americans expect they should be exposed to no risk whatsoever. Spill a McDonald's coffee in your lap. Sue McDonald's. Jab yourself in the eye with a screwdriver. Sue the manufacturer, the steel companies and Archimedes. Can't pay your mortgage? Made stupid loans? The Feds will bail you out. There should also be no cost,
because markets are immoral and Government is everyone's alma mater.

Entitlement to a zero-cost, zero-risk life starts with the simple desire to have the government take out the garbage, tuck your kids in at night, or make everyone use low-flush toilets - all services that somebody else has to pay for. It creeps from there into the full munificence of the precautionary principle.

Expanding on the question of victimhood, litigiousness, and who's responsible for making your decisions, I'm recycling an OpEd I wrote for the Lansing State Journal.

I tltled it "Risk Proof," can't remember what they called it:

What do mercury, the Kyoto Treaty, Vioxx, arsenic, genetically enhanced plants, silicone breast implants, and product warning labels such as “DO NOT USE FOR PERSONAL HYGIENE” on toilet-bowl brushes have in common? They exemplify widespread confusion regarding risk, especially the dogma that we should never be exposed to any.

“Risk ignorance” provides fertile ground for
pseudoscientific environmental policy, frivolous lawsuits, inferior health care and all manner of costly appeals to government for regulation and redress - affecting our freedoms and the cost of regulating them.

The poster child for this problem is the “
Precautionary Principle”. It pretends to abolish risk by ignorantly demanding that we assay no progress until and unless we can prove no harm could ever possibly come from the attempt.

Technophobic extremists, aspiring to be the final arbiters of science and ethics, preach precautionary panic to encourage
statist enforcement of their views. It isn’t about risk, it’s about power.

Here are some of the penalties we pay for that conceit.


The World Health Organization, Health Canada, and other similar bodies, have clearly established the safety of mercury exposure levels many times higher than those of the Environmental Protection Agency. Still, we are
subjected to scare stories by our own basic-science-challenged media.

The Kyoto treaty, by estimation of its proponents, might reduce global warming in the year 2100 by two-tenths°C (from 2.1°C to 1.9°C) - at a cost of a trillion dollars. Many think the risk justifies the expense, despite the fact that the prediction relies on computer models which, beyond even their serious methodological deficiencies, cannot even “predict” past climate change.


Overwhelming evidence exists that present standards for arsenic in drinking water are perfectly safe. Still, rampant environmentalism has California about to set standards
below the limit of current technology to detect.

The odds of heart attack or stroke double while on
Vioxx for over 18 months. Another way to present the research is that the chance of a heart attack increases by less than 1 in 100 people. Vioxx controls arthritis pain very effectively, at substantially lower risk for gastrointestinal bleeding than other drugs. Gastrointestinal bleeding causes 16,500 deaths and over 100,000 hospitalizations annually. Some arthritis sufferers would prefer the Vioxx risk. Still, Merck voluntarily withdrew it, hoping to avoid a risk ignorant jury.

Genetically enhanced “Golden” rice
could mitigate the devastating effects of beriberi for millions of third-world poor. Despite the fact that its creators will give it away, EU bureaucrats and technophobic environmentalists oppose it for political reasons they justify via the precautionary principle.

Multiple, rigorous studies
have proven that silicone breast implants do not cause disease. Still, major companies were bankrupted by suits based on this most egregious example of “junk science as policy” in our lifetime.

It’s momentarily unlikely someone will successfully sue because they were damaged while brushing their teeth
with a toilet bowl brush, but we all pay more because of the needed legal opinion and the applied warning label.

There is no excuse for hiding risk. We should be accurately informed and penalties applied if we are not, but the precautionary principle is deliberately misleading. If you need to be warned that a screwdriver is “NOT FOR USE IN THE EYE”, perhaps you
shouldn’t be using a screwdriver.

Had we followed the precautionary principle historically, we would have forgone, for example, fire, penicillin, electricity, the wheel, internal combustion and aspirin. None of these technologies could ever be proven risk-free.


Evaluating risk via the precautionary principle is a retrograde road to, as Thomas Hobbes famously put it, life “nasty, brutish and short.”

1 comment:

Mitch said...

You've made many valid points. I think, elaborate on your tangent on risk, is that people significantly overestimate some risks and significanlty underestimate others. The best example would be people overestimating the risk of dying in a plane crash while underestimating the risk of dying in a car accident.

Government policies tend to play off of these poor risk assessments, as well as other things, such as litigation, etc. Then, we haven't even touched all the lobby groups that make a living over creating hysteria over statistically insignificant risks