Life Is Scarce

Matt Yglesias:

Simon (i.e., plenty) for capital and Malthus (i.e., subsistence) for labor. That, of course, is Karl Marx’s vision of long-term economic development. And while I don’t have a strong opinion as to whether or not this is accurate over the long term, it’s certainly a plausible story about the future, and Marx’s solution—socialism—unquestionably seems to me to be the correct one. … If the “robots” are really mere machines, then it should be easy to peacefully divide up the surplus more-or-less equitably, we’ll transition to socialism and everyone will be happy—it’ll be like Star Trek. If the robots are sentient beings, then we’d presumably be looking at an eventual slave revolt and Communist revolution.

Karl Smith:

Is it possible that Health Care is 160% of GDP? What this is telling us, is one way or another health care costs will not continue to rise faster than the overall economy. … The question before you is, do you want the world where health care is limited only by our collective ability to pay for it. What many elites don’t face up to is that if you asked this question to the person on the street he or she might very well say yes. I am constantly aware of this because a persistent source of tension between myself and my family is their feeling that it is not just ok but morally imperative that personal budget constraints be hit in the purchase of medicine. … Making the case for less health care spending is making the case for abandoning the sick and the needy. If you want a world that does not proceed on autopilot you need to be gearing up to make that case. Slight of hand about cost-savings or market efficiencies is not going to do the trick.

When I describe a Malthusian future where most (robot) people wouldn’t live much longer than they were near the best in a very competitive labor market, many readers react like Yglesias, and talk of revolution. Surely, they suggest, no moral person would accept a society where how long folks lived depended greatly on how much they could pay.

Like Karl Smith above, a month ago I tried to make the point that even without robots we are heading toward such a world:

A fountain of youth pill whose required dosage doubled every decade would either have to be banned, or given to everyone over thirty with insurance. … Eventually we’d run out of money to pay for these pills; we’d have to say no to some people, and then they’d quickly die. … Good thing we don’t have a fountain of youth pill, right? Actually, our real situation is worse. Per capita medical spending in the US doubles about every fifteen years, which is still much higher than our economic growth rate. Yet we struggle to see any substantial correlation between health and medical spending – our medicine is mostly useless on the margin. Its nothing like a fountain of youth pill. Our refusal to say no to any medical treatment that seems to our wishful-thinking eyes like it might help will also bankrupt us. And we won’t even get a fountain of youth in the bargain.

One way or another we will find a way to exclude seen-to-be useful medicine from people in our society. The only question will be: what will be acceptable criteria for such exclusion? I’ve argued that the ability to produce enough wealth to pay for your added life is a decent criteria for such a choice, and it can be implemented in an admirably flexible and decentralized way. If you reject that criteria, what other criteria will you substitute, and what price are you willing to pay in centralized regulation and lessened innovation and competitiveness with the rest of the world?

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  • Dave

    Many of your ideas are based on open ended extrapolations. But actually the bubble provides a better model.Since each resource has alternate uses,according to some economists like Sowell, there will be a limit to how much can be allocated to one area.

    In health,the main determinants are not medical spending but culture,genes and life choices.

    The market will eventually intervene and change things. It looks like we can afford all the excesses we have because the growth wealth has kept up with it. However the bubble will burst.

    The same problem of extrapolation, effects ideas about robots. After all they are just tools. One time I visited a cigarette factory and they had a machine the made a cigarette a thousand feet long. Are you saying if you developed it to an infinite capacity,it would end up demanding smoke break?

  • http://pecancorner.blogspot.com/ Tina

    Agree with Dave: the main determinants of longevity are not “health care”. While it may contribute somewhat to statistical life expectancy, nothing we have to offer has ever added a single second to the statistical life span. It is inaccurate to conflate the terms.

    Cleanliness and nutrition are immediately responsible for the vast improvements in life expectancy seen in Western societies over the past 150 years. Communication enhancements will be responsible for further improvements for various reasons.

    What modern health care provides to adults at great expense is a certain quality of life: the knee replacement vs 20 years of wearing a brace, cataract surgery vs 20 years of blindness, a prosthesis vs crutches, a happy day vs the torment of mental illness.

    These interventions include surgical responses made possible by miniaturization, which provide more jobs per surgery than previously, and for which costs had been dropping historically (and would plummet if legal/liability expenses were tamed). As well, the costs of medications had also been falling when pharmaceutical companies must operate in a truly competitive environment. Mechanical & technological interventions that are only incidentally part of the medical world also provide much enhanced quality of life.

    The anecdotal evidence shows the record-setting life spans belong to people who do not credit “health care” as one of their secrets to survival. The science shows that nothing other than caloric limitation can be affirmed as a pseudo-lengthener of life (but still not past the 120 years given in Genesis 6:3)

    So your title and question, and the question of many in these debates, operates from a faulty premise – and a very dangerous one. It assumes an effect that is simply not there, and could lead to worse conclusions such as “He lived to be 90 because of his medical treatments”.

    The real, and human, question is not “can we pay/amass wealth?” but “can we provide for ourselves?” And that question has been answered every day in every society since the dawn of time.

    • Jamie_NYC

      What are you and Dave talking about? Robin points out that medical spending is rising faster than GDP, and that cannot continue forever. So, choices need to be made.

      “The science shows that nothing other than caloric limitation can be affirmed as a pseudo-lengthener of life” – not true. Rapamycin has been shown to increase average lifespan of mice.

      My opinion is that the health care will undergo a productivity (r)evolution, just like other sectors of the economy, but it will take a couple of decades. Healthcare as % of US GDP in 2030: 25%, in 2060: 5%.

      • Poelmo

        Healthcare costs will rise until doctors and insurance/pharmaceutical executives cannot afford healthcare anymore themselves, then suddenly, and of course entirely coincidentally, it will become possible to provide healthcare and produce medicine much cheaper than before. Mark my words…

  • Lord

    The ability to produce enough social wealth to pay for the median added life is a decent criteria for such a choice, and it can be implemented in an admirably flexible and centralized way. Those able and willing to pay more can, as long as it is heavily taxed.

  • Graduate

    > One way or another we will find a way to exclude seen-to-be useful medicine from people in our society … the ability to produce enough wealth to pay for your added life is a decent criteria

    Drawing paralells with your vile offspring malthusian upload scenario seems unhelpful from a mathematical modelling point of view. In a human society with approximately constant population – like the UK – there is no fundamental reason to have different allocation of resources based upon ability to pay or to contribute to society. This is true even if we have immortality treatments and the population grows linearly (pop = A+Bt)

    In the malthusian upload scenario, there are simply too many uploads trying to reproduce quickly to give all of them resources.

    Really, these are very different scenarios.

  • Ernie Bornhemer

    One way or another we will find a way to exclude seen-to-be useful medicine from people in our society.

    Does “seen-to-be useful” mean some portion of medicine has value much lower than what it’s perceived to be? If so, why not change the perception?

    As to rationing health care (which seems to be what the post is about), why not follow the principle “from each according to his ability, to each according to his need”? If need is hard to measure, and we have to draw lines about what we’ll spend on and what we won’t, why not draw those lines democratically? So, to answer the question: the criteria I would use are: need and democracy.

    …what price are you willing to pay in centralized regulation and lessened innovation and competitiveness with the rest of the world?

    That question contains assumptions that I, for one, don’t accept. It’s not obvious to me that a society where people treat each other decently would have to be imposed from without, or would need to be centralized. And it’s not obvious to me that the only possible incentive for innovation is differential societal rewards. To recognize that these things happen to be true here and now is to point out room for improvement. It’s not a comment on human nature.

    • mike

      “a society where people treat each other decently”

      Please define.

  • Poelmo

    It should be very simple: does society have access to enough labor and natural resources to produce enough fountain of youth pills for everyone then they should be available to everyone, rich and poor, it would be insanely immoral to do otherwise. Do note that I’m not talking about money: yes, the illusion that money equals wealth is useful in daily life, but we should really put that illusion aside in the case of a fountain of youth pill and if necessary have state owned companies do the necessary resource extraction and production at below market value*. If resources are insufficient then the only moral options are rationing or a complete ban.

    *let’s assume the pill needs gold, and lots of it, say half the world’s supply (which we assume will be continually recycled). Now there are two choices: pay trillions to buy half the world’s gold, or have the state take control of half the world’s gold and pay only real production costs (wages of the workers, cost of equipment), which would be much, much cheaper than the trillions it would cost to buy the gold at market value where the price of gold is far, far inflated above real production costs because of speculation and the huge demand for jewelry.

    I would dare those (already rich, let’s be honest) people who feel that this would be an unacceptable government infringement on economic liberty to put there money where their mouth is and explain to a guillotine-equipped public, why the majority of the population would have to go without the pill even though technically society has the capacity to provide the pill to everyone.