It still costs money to run a trial, even when the treatment itself is inexpensive. The people doing the enrolling need to be paid, the biostatisticians need to be paid, the doctors get paid research comp time, etc. It all adds up to a lot of money. A big trial could run into the millions easily. Hospitals operate on margins that are frighteningly low, 1-2% in many cases, if not at a loss. A doctor can't decide to start doing this procedure to patients on their own without a considerable amount of evidence supporting it as a best practice, even if it seems likely that it is better than the current status quo. So here's the dilemma. A hospital or consortium invests millions of dollars in a treatment that can't be patented, costs nothing to startup, and can be easily replicated by others. So they've made the investment with the return being spread out among all their competitors. It's a losing proposition, even in the case of hospitals or universities that could afford it. There is simply no for-profit enterprise that would engage in it. Maybe a foundation (Kidney Foundation, for example) would be interested, but typically the budgets of the national foundations are pretty paltry compared to NIH. That is the main reason why a foundation might look away; I disagree with the author that it's about sexiness (and I say this with some authority, as I'm fairly heavily involved in the American Heart Association). Now, if NIH were to fund a project that can't be directly capitalized on, but whose returns would be spread broadly through the economy, that makes sense, because it's you and I who are putting up the money and reaping the rewards. That's a value proposition. Even if it's ideologically untenable to you that the government fund biomedical research, it's still a pragmatic position to take, given that NIH dollars have a real impact on national health spending--by far our biggest outlay. We can talk about spending all day long, but the conversations will amount to nothing if health and military aren't on the table. Funding NIH is a way to reduce health spending, counterintuitive as it may seem.
Sounds like a possible market failure, though it is far too complex an arena for me to form a clear opinion. I can see how malpractice fear would discourage hospitals and doctors from adopting a new technique without solid research backing it. And no individual hospital expects to gain enough (thanks to a slightly improved reputation) to compensate for the costs of independently doing the research. How about the insurance company, then? It has an interest in patient/customers having fewer complications thanks to a cheap intervention. It probably has deeper pockets than an individual hospital. And it will have the authority to refuse malpractice judgements when doctors use a recommended procedure. (EDIT: But that won't stop people from suing doctors, who will then be even worse off if the insurance company won't cover resulting claims. Sigh.) It's still possible for other insurance companies to eventually copy the leader, but the result is that all the companies benefit instead of just one. It's still good for the leader. Also, it doesn't have to be all strict and scientific; the insurance company can give indemnity to doctors who offer a promising, low-risk treatment to patients on an opt-in basis. If the participating patients get better results, it might not be material for Nature, but it will still be beneficial for all concerned. As mk says, informed patients might request this treatment unilaterally, or even go the DIY route. This is all very theoretical because in the real world everyone knows that NIH does research and DoT builds highways, and those agencies are not interested in competition. This example might be an unusually extreme case of low-tech, low-cost, high-reward technology that we let the rest of the world sort out, like using dent pullers and plastic bags to assist with difficult deliveries. Thanks to you and mk for your thoughts.
The NIH is to public health what NASA is to space science and exploration. When there is no incentive for private investments, but we still have a society-wide need to improve our technologies, the funding must come from a federal entity. If only we could dial back bureaucratic inefficiencies...
"a society-wide need" sounds like as good an incentive for private investment as any business could hope for. Isn't that how we get cars and houses? "The Apollo program indeed produced real-world benefits, but at a tremendous cost." Are you indifferent to the fact that people paid for the Apollo program whether they wanted to or not, whether they benefitted or not? It seems like a lot of people are indifferent. I wish they would pay for my mortgage.
Kinda. Private firms invest in R&D when they believe it will yield a product. "Pure" science is the best example of research that will likely never see private interest, at least in the near future. Things are a little different in b_b's case because of the way the medical marketplace is structured. It's a mess. Let's go to space instead. Example: Oxygen's role in Earth's plasmaspheric currents. As far as I'm concerned, the only justification for delving into such a thing is cuz it's purdy cool. In the next couple centuries we may pull from studies like this one in developing technologies to harvest energy from or navigate around near-Earth space, but good luck convincing a private entity to invest in something that it likely won't survive to utilize. Are you indifferent to the fact that people paid for the Apollo program whether they wanted to or not, whether they benefitted or not? It seems like a lot of people are indifferent. Conspiracy theorists aside, you'd probably be hard-pressed to find many people who feel like the Apollo missions were a waste of money. Not many people benefited monetarily, but just about everyone was pretty damn thrilled that we did it. They're still thrilled. You could say the same concerning any number of vaccines that were developed from federal grants. I'm not sure what that number is, but it probably isn't high enough. I'm pumped that the general public is currently less than satisfied about the state of NASA's budget. That means I'll probably have a job when I finish school. I do wish there was a more general concern about the state of science in the U.S., but yeah. It's also my duty to instill a general excitement for science, so I guess I have work to do there too. More rambling here. Also, Re: 'The Entrepreneurial State' - Nice post, it was before my Hubski infancy. Quantifying risk is pretty difficult (and subjective), but we all know it usually correlates inversely with reward. My scenario of "(pure) science for the sake of science" is something that should be decided by taxpayers, via their representatives. Ah, but that system is almost entirely broken. You and every other citizen. Totally different problem, but I'm with you. Edit: In hindsight, I got way too far off the subject material of the mother post. Sorry guys, I will be striving not to do the same in the future."a society-wide need" sounds like as good an incentive for private investment as any business could hope for. Isn't that how we get cars and houses?
"The Apollo program indeed produced real-world benefits, but at a tremendous cost."
I wish they would pay for my mortgage.
Good idea. When the conversation turns to healthcare, I "prepare for badness." So you have described two benefits. One, we get satisfaction from having a better underderstanding of the universe. That's a real benefit, even if it is not a tangible product. Joy and wonder via books, television, and movies are things people happily pay for. All taxpayers pay to study the plasmasphere. How many enjoy the benefit? I also find space exploration and science fascinating, but I am unaware of this research, and don't even know what the plasmasphere is. Are you confident that a large proportion of taxpayers will enjoy the benefit of a better understanding of the plasmasphere? If not, is it fair to make them pay to provide pleasure to the plasmasphere special interest group? Two, we may one day be able to harvest energy from space thanks to this research. This is clearly a benefit, distant in the future though it may be. Business and government often have to weigh efforts that pay off sooner vs. those that pay off in the long term. Mitigating the effects of climate change is an example: money not spent on malaria eradiaction today can be used instead to reduce the harmful effects of climate change in 100 years. How do we make these choices? With lots of difficult assumptions, of course, and also with a discount rate. Suppose I have the choice of spending $100 on goodies today or investing $100 with a fairly certain expectation of gaining $200 in ten years. If I am indifferent between these options, my discount rate is about 7% per year (the article says "something around seven percent is what the US Office of Management and Budget recommends for a pretax rate of return on private investments"). Let's assume that plasmasphere research today will certainly enable us to harvest energy from space in 200 years. Let's also assume that the value (in today's dollars) of that energy harvest will be one trillion dollars. Using the formula provided, 1/(1+r)^t, we calculate a discount factor of 1/(1.07)^200 or about 0.000001. So the value today of the trillion-dollar benefit we expect in two centuries is about a million dollars. If our assumptions are true about the value and certainty of the energy harvest, we should not spend more than one million dollars in total now for the research (here ignoring the joy dividend). Probably the 7% figure comes from the idea that you can earn at least that much by investing the money in something other than research, then in 200 years you just buy the energy from Elon Musk. Surely not a waste. We got Tang, and better dialysis techniques. And a lot of thrill. Is it wrong to put a price on these benefits? Is it impossible to spend too much on a good thing? The correct way to evaluate an investment is with cost-benefit analysis. Benefit analysis alone is not enough. Lots of people will say they support NASA when they imagine other people are paying for it. If you could calculate how much each person actually contributes, and give them the option of spending that money on something else, how many would still chip in?the medical marketplace is ... a mess. Let's go to space instead.
Oxygen's role in Earth's plasmaspheric currents. As far as I'm concerned, the only justification for delving into such a thing is cuz it's purdy cool. In the next couple centuries we may pull from studies like this one in developing technologies to harvest energy from or navigate around near-Earth space, but good luck convincing a private entity to invest in something that it likely won't survive to utilize.
Conspiracy theorists aside, you'd probably be hard-pressed to find many people who feel like the Apollo missions were a waste of money.
All that I can say to you is "yes". Thank you for your thoughtful posts. This isn't the first time you've laid into an issue reeeeeeal thick like. I know you dig PM's, but if you keep posting in public threads, Hubski will be a better place for it. Hope all's well with you, my friend.
My conclusion is that public funding for NASA should be zero, unless we have good evidence that some kind of market failure will cause us to miss out on an opportunity to achieve widespread benefit, and the resources we use to get that benefit cannot presently be used to achieve any greater benefit. NASA should raise funds through voluntary contributions, from people who enjoy the benefit of NASA's work. If the funds are insufficient to support a space station, the happy result is that people may choose to direct their resources — their money — on outcomes that they prefer to space stations. Are you on board with that? Is private spaceflight so unrealistic? (I expect a lot of those companies are cozy with NASA, but still. If the justification for NASA is that people who pay for it benefit from it, let's cut out these annoying middlemen!) Thanks for your kind words. I enjoy the conversation, and would like to contribute more than I do.All that I can say to you is "yes".
I still don't know how to defeat the "but what about starving kids?" question. Can we just fucking feed them and clothe them and love them? Apparently not. And my lifestyle isn't immune from criticism, by any means. The only silver linings are some feelings of empathy and guilt that suggest I may still have a conscience. We've probably both seen/heard how unsatisfied people in our generation have been with the lack of funding, and in the manned spaceflight sector, particularly. There generally seems to be a waxing interest of space in America. This has not yet translated into more $'s to NASA, but it may in the very near future. So if we threw out federal tax allocations and made it a kickstarter-style money distribution system? I think NASA (or whatever was propped up in its place) would have more money than it does right now, to the detriment of many other scientific endeavors. And if people got to decide what the space program got to do with the money? Oh shit, now I'm in trouble. It would probably all go into manned spaceflight and exploration, which... is great, but I'm still of the thought that Mars is nothing but a death trap for humans at this point in our development. And that's our best candidate, other than the moon. God, we're frail little beings. So no, I guess I'm not on board. A scientifically-illiterate populace has no business solely dictating science policy and funding, despite the fact that we're not much better off with the current rash (HA, SUBTLE) of politicians. The nasty bureaucracy of NASA at least has us targeting the most feasible and practical goals, as decided by actual scientists in the field. There's some "self-service" arguments to be made here, I'll concede, with which you could tear me to shreds. Besides, you can donate money to NASA, and I don't know of anyone that does. I'll tell you straight up, Space-X is the shit. Musk will become a symbol of innovation in the history books. But Musk isn't doing science for anything other than building a product. I'm not demonizing that, because it's a beautiful process with obvious results, thriving in a capitalist economy. My beef is that no-one does science for the sake of science without federally allocated money. Is "pure" science necessary? I think we both agree that it is, but we're not in agreement on the balance and implementation of it in relation to the free market. Big projects with little public benefit don't do well. The JWST deserves criticism, but that's not necessarily NASA's fault exclusively. The entire space industry has a really shitty culture of low-balling cost estimates. Just like everyone else begging for federal grants! There are things about NASA we need to fix, but I think discarding it entirely would be throwing out the baby with the bath. P.S. Your investment math is interesting, but still makes assumptions that I don't necessarily agree with. Great food for thought though, thank you for it, I'll need to revisit it if I plan to address it.NASA should raise funds through voluntary contributions, from people who enjoy the benefit of NASA's work. If the funds are insufficient to support a space station, the happy result is that people may choose to direct their resources — their money — on outcomes that they prefer to space stations.
Is private spaceflight so unrealistic? (I expect a lot of those companies are cozy with NASA, but still. If the justification for NASA is that people who pay for it benefit from it, let's cut out these annoying middlemen!)
That was a cheap shot that probably defeats everybody. If we are honest, we should admit that in practice most of us have priorities other than feeding starving kids. Some feelings of guilt are probably appropriate. But if someone were to come and take most of your money and use it to feed starving kids, wouldn't you object, and fairly? Sure, and I've also heard people complain about slow data service on their cell phones, beach traffic on three-day weekends, and expensive beer at airports. I don't hear many people complaining about gunfire in their neighborhoods, inadequate supplies of canned goods, and unreliable hot water. I don't feel comfortable assuming that people with those complaints don't exist. I am very uncomfortable with the thought of forcing them to pay for research they may never even be aware of, even though my sister has never been bitten by a rat. So, do you say it is justified for others to dictate to the populace how their resources will be used to fund science (1) for their own benefit, or (2) for the benefit of others? In the first case it strikes me as paternalistic and presumptive to say that the illiterates will definitely benefit by having their resources managed by outsiders, and that they would definitely get inferior results by managing their own resources. In the second case it seems uncomfortably akin to simple theft. That's a fair criticism, but the biggest assumption I made was that your speculation of an eventual energy payoff from exotic research would come true. My assumption of the value of this payoff also, I think, favors your side. My joke about waiting to buy the energy from Elon Musk conceals an important point. Allowing people to risk their own resources seeking potentially valuable energy sources means a lot of them will fail (perhaps even coming to ruin) but also that many more possibilities may be explored. Society's "managers" don't have to pick the right one. Maybe Elon Musk will hit a dead end, but someone else will find the secret of cheap, clean energy.what about starving kids?
We've probably both seen/heard how unsatisfied people in our generation have been with the lack of funding, and in the manned spaceflight sector, particularly.
A scientifically-illiterate populace has no business solely dictating science policy and funding
Your investment math is interesting, but still makes assumptions that I don't necessarily agree with.