Twit Tweets Twaddle

Numbers 14: (18) The LORD is long-suffering, and of great mercy, forgiving iniquity and transgression, and by no means clearing the guilty, visiting the iniquity of the fathers upon the children unto the third and fourth generation.

When your grandmother is a notorious dirty-tricks operative who slept her way through Washington, D.C and your father is brainless political operative whose claim to fame is calling people Nazis, you know you're not going to get out of childhood without frequent and severe humiliation. And so it begins: Jonah Goldberg twitters:

Stuff my daughter says: "Mommy! Daddy! Did you know I can touch my uvula without throwing up?"
10:54 AM Sep 6th from web

hat tip to TBogg.

Oh sweet Jesus.

Smoking cigar on my patio. Working on proposal for next book. Can't believe I'm going through that hell again.

Let me guess: Liberal Cannibalism: The Secret History of the Missionary-Eating Left, from the Donner Party to Obama's Mama.

I'd feel sorry for Jonah's daughter but she'll probably grow up reading Ayn Rand and fancying herself a boot-strapping intellectual who rose to fame through sheer brain-power.

The Libertarian Dodge

Speaking of Obama's televised speech to the nation's schoolchildren, Megan McArdle tries to draw an equivalence between the actions of the left and right. She links to Byron York, the author of The Vast Left Wing Conspiracy: The Untold Story of How Democratic Operatives, Eccentric Billionaires, Liberal Activists, and Assorted Celebrities Tried to Bring Down a President--and Why They'll Try Even Harder Next Time, who points out that liberal congressmen complained when Bush addressed the nation's schoolchildren after cutting school lunch funds. That makes liberals hypocrites, McArdle declares.

McArdle is very fond of declaring that liberals are just as bad as conservatives, a statement that both sides can find offensive. McArdle does not point out liberals becoming hysterical at the thought of the president addressing schoolchildren out of fear of his voodoo mind control, however. Liberals also did not scream and sob at their Congressmen and women in town halls, demanding to take America back from the Marxists and socialist Nazis.

The libertarian dodge is a very handy one, in which a person can hold herself apart from the heaving masses, criticizing and sneering at both sides without having to do or say anything helpful or constructive. As McArdle says, "You seem to be under the mistaken impression that I have a workable political program. I'm a libertarian. My political ideas are always unpopular."

And unworkable.

They're Laughing At You

partygrl: o hai whuts up

deansgrl: no skool lol

partygrl: me too rents sure are stupid

deansgrl: hahahaha i said obama was scary

partygrl: so they let u stay home?

deansgrl: suckers!

partygrl: me too i cried even it was easy oooh scary black man

deansgrl: ur so bad! my dad said obamas a socialite

partygrl: omg i hate glenn beck the rents make me watch him

deansgrl: random much?

partygrl: sorry they made me miss supernatural im so pissed

deansgrl: oooh dean is so hot he wants me

partygrl: u wish freak lets go to movie tomorrow

deansgrl: school????

partygrl: forget it! tell ur dad obama wants you to be indoctored

deansgrl: huh?

partygrl: doctored like brainwashed

deansgrl: and tortured!

partygrl: yeah god there so dumb they believe anything i say

deansgrl: mommy mommy fox news said that obama closed all the schools!

partygrl: rotflmao!

Bowing To Mammon

As long as libertarians will not personally suffer from the occasional tip of the scales they are content to believe free market forces will cure all ills, because markets are never controlled, manipulated, or regulated. This is the fantasy in the center of the Libertarian Fantasyland, the Sleeping Beauty's Castle of our libertarian princess, Megan McArdle.

Which brings us to her post on Pfizer.

Derek Lowe on the Pfizer settlement:

The six whistleblowers in the case are getting anywhere from $2.3 million to $51 million now that the settlement has been announced (that upper figure is Kopchinski, who seems to have provided the most serious evidence). As I mentioned the other day, I think this is a good thing. It takes a lot of nerve to step up when your employer is doing something outside the limits of the law (and asking you to do it as well). A chance to make up for the certain loss of your job (and the near-certain loss of any future prospects in the field) goes a long way.

And there's an interesting perspective on why a settlement was reached:

. . .Pfizer is the pharmaceutical equivalent of insurance giant American International Group Inc., which was too interwoven into the global economy to be allowed to fail. Likewise, if Pfizer were convicted of a crime, it would face debarment from federal programs. And that would mean that Medicaid and Medicare patients would have to either somehow pay pocket for vital medicines the company produces or go without.

Hadn't thought of that one. I wonder if any company will have the nerve to use this as a negotiating tactic? Perhaps Pfizer already did, come to think of it. . .

Pfizer's behavior has tipped the scales of free market out of balance, and some counteractive force must come to bear to force them back into line. The public, in the form of a government fine, is doing its free market job of acting as a counteragent to the other side of the market. McArdle must be delighted.

This implies that the larger the share of government spending in health care, the more license pharma will have to misbehave . . .

But--but---the invisible hand of the marketplace! And market equilibrium! Why does Megan McArdle hate free market capitalism? Whatever countermeasure are taken by the public and government are not only good they are absolutely necessary and must not be stopped by any means. If they go too far then corporations will withhold their drugs and the government or citizens will be forced by free market forces to ease up, the way God and Milton Friedman intended.

It is just as wrong to block the free activities of one side of the equilibrium as the other! The fans of the free market have been horribly remiss in not reminding the public to hold up their end of the free market bargain. They should exhort everyone to follow corporations with an eagle eye and help keep down wild, destructive swings in equilibrium, which often end up harming the public no matter which side is out of balance.And Pfizer has not only swung the poor, abused free market out of equilibrium, it has knocked it for a loop-de-loop.

The Obama administration intensified its public campaign against health-care fraud Wednesday, putting drugmakers on notice that they will be forced to atone for improper marketing practices as prosecutors unveiled a record $2.3 billion settlement with Pfizer.

Officials at the departments of Justice and Health and Human Services called the agreement with Pfizer and one of its subsidiaries a cautionary example of their strategy to team up with states to police errant health-care businesses.

The Pfizer unit Pharmacia & Upjohn pleaded guilty to a single felony charge that accused the company of marketing its anti-inflammatory drug Bextra for broader uses and higher dosages than those approved by the Food and Drug Administration.

The company allegedly enticed doctors to prescribe the drug for pain relief by taking them on lavish trips, created sham requests for medical information as an excuse to send unsolicited advertising materials to physicians, and drafted articles promoting the pills without disclosing its role in preparing the stories.

In connection with the settlement, Pharmacia & Upjohn consented to pay $1.3 billion in fines and forfeiture, the biggest criminal penalty ever imposed in the United States, prosecutors said. Pfizer paid an additional $1 billion to state and federal authorities to resolve civil allegations of improper marketing over Bextra and three more drugs: Geodon, an antipsychotic medicine; Zyvox, an antibiotic; and Lyrica, an epilepsy medicine. In the bulk of the civil allegations, the company did not admit wrongdoing.

The settlement comes as federal agencies pursue a wider strategy to target wrongdoing in the deep-pocketed health-care industry.

McArdle should be thrilled to see market forces at work, yet instead she warns that the bigger and wealthier Pfizer becomes, the more dangerous it becomes. What could keep Pfizer from withholding drugs right now if it wanted to? In a sense they already do, since they only produce the drugs they think will be profitable. We know McArdle approves of this approach because the more money the drug companies have, the more research and development they can do, saving hundreds of millions of lives. Unprofitable drugs would kill millions, therefore drug companies cannot and should not make them. It's the millions of lives saved in the future (when McArdle will be old and therefore sick) that counts, not the scant un-and-under-insured millions now, who are not Megan McArdle. We must bow to the demands of Pfizer or they will deny us access to drug we must have, and there is nothing we can do about it.

To me, that sounds like craven submission to corporate blackmail, to a corporatist economic ideology. That sounds like fascism.

More Lies

Megan McArdle has made a stunning discovery! A reader emailed her with new information regarding her health care statistics, which forces her to question everything she's ever known.

A reader sends in this note:

I am a former tax lawyer who worked for years on pharmaceutical international transfer pricing cases. The basis for such cases revolves around what share of profits is attributable to a given country. Let me tell you, you will never get an accurate figure, because no such figure exists - all the numbers are purely notional.

[snip]

For this reason, any number as to the percentage of pharma profits made in the U.S. should be treated as arbitrary and bogus. It will entirely depend on how the costs were allocated, which will differ from company to company, and may even differ from one company's financial statements to its tax returns.

Like Iraq and the destruction of the economy, it turns out that pharmaceutical profits are too complicated to understand. Why didn't McArdle know this, when she is a self-avowed economics expert? Alas, she was led astray by others, who lied to her!

So it looks like I got taken, at least in the sense that there's probably no way to come up with an estimate that I would find acceptable. I wouldn't have put that number in a blog post, because I would have looked for better corroboration, and I'm sorry that I used it when responding on the fly, which I did several times.

What kind of immoral, self-seeking hack would lie about the health care statistics that formed the basis for McArdle's entire argument against any public option in health care? It's hard to tell because McArdle links to a post that just reiterates her earlier claims that have been documented so extensively--health care innovation will be destroyed because 80% of European profits come from the US's drug prices. It's possible she meant to link to this, however:

I may be in error on that--I've heard 80-90% from people in healthcare consulting, and I've seen that sales and profits in the US are usually larger when they're broken out on financial statements, which they aren't all that often. But they were not speaking on the record, and financial statements are not necessarily a very good guide to allocating the net profitability of a drug, because of various tedious pricing strategies involving market timing that you can read about in an exhaustive volume from the OECD that I have on my desk, if you want to come to my office, or spend $100 to buy it yourself. There are also issues of the way that companies allocate profits across international borders, which vary for all sorts of reasons, including the location of the company.

It was people in "health care consulting" who lied to our poor, gullible lass, who interviewed them with an open, trusting heart and was betrayed, just like she was betrayed by the bankers who assured her that risk was so yesterday and free markets self-regulate.

McArdle must also clear up another matter as well. It seems that anything McArdle says in the body of a blog post is utterly trustworthy but anything she says in the comments is "on the fly" and might or might not be accurate, even if she insists it is, offers proofs, and uses that information as the basis for her entire argument. This might make asking McArdle questions in the comments a futile and frustrating experience, but that's blogging for you. McArdle has now determined that the real number is oh, 60%. Maybe.

80% may not be right, and I can't back it up with any hard numbers, because there are no hard numbers available. But multiple corresponding sources suggest that the number is well over 50%. 60% is probably the floor of likely.

She can't back up her number but unnamed sources tell her, based on unknown numbers, that the floor is probably likely to be 60%, more or less. We can just trust her that her numbers are right (kind of) and her sources are telling her the truth. This time.

I'm now adding this to my long list of "dark numbers", with the best available proxy being the global sales of New Chemical Entities. Two thirds of those, not more than three quarters, occur in the United States, versus about a quarter in Europe. You can argue about what the fixed costs are in various places, but as my correspondent implies, given how much cross border activity there is, the problem seems to be indeterminate, so I'll stick with a number we know. This doesn't really change my assessment of the problem, since 2/3 is still pretty overwhelming, but statistics matter.

Yes, they do.

By the way, speaking of statistics, I bet you thought McArdle admitted she made up the earlier 80% number, didn't you?

Anonymous: You said that medical innovation will be wiped out if we have a type of national health care, because European drug companies get 80% of their revenue from Americans. Where did you get this statistic?

Megan McArdle: It wasn't a statistic--it was a hypothetical.

However, whenever I have been able to find pharma financial statements that break down their profits by region, the lion's share always comes from the US.

You could not be more wrong.

On a side note, the reason I said 80% was a hypothetical in the Washington Post chat is that . . . well, I didn't. I forgot that conversation, and thought the commenter was referring to this post. These are the perils of typing thousands of words a week, and also, of getting old.

In that post (Health Care: A Lesson In Practical Philosophy) McArdle says the same thing she says in all her other posts:

You can assume that slashing pharma profits 80% will have no impact on their behavior, or at least, only change the behavior you want to change.

Or you can bite the bullet and say, we should save lives now at the expense of lives later.

It's the same argument, the same number, the same justifications, the same threats of disaster. There's no mix-up, just more lies. It's insulting and utterly ridiculous.

UPDATE: McArdle responds to a commenter who can't believe a University of Chicago MBA doesn't know about cost allocation. Criticism of McArdle's authority is about the only way to get a response from her:

I'm glad that you have never, ever made a basic cognitive error, NDM, but there you are, I do from time to time. We live in a world of imperfection and travail.

And lies and deceit.

K-Lo Goes To Confession

K-Lo: Bless me, Father for I have sinned. It's been two days since my last confession. Oh my God, I am heartily sorry for the horrible meanies who say all those horrible things about Mrs. Ex-Governor Palin. They make me sick. Levi Johnson probably isn't even Catholic. Just look at his name! Is Levi a Catholic name? No, it is not. Levi Johnson is making baby Jesus cry, I just know it. And not a little whimper, either, a big fat crying, like lots of angry babies--.

Father: Kathryn Jean, please, calm yourself. You know how much People upsets you, maybe you should---.

K-Lo: It was Vanity Fair and it was for work, Father, I promise. Our future First Lady President is under attack and I had to defend her. She was nursing a viper at her breast, Father, feeding him the milk of human kindness ,and he threw up the barf of disloyalty all over her.

Father: Kathryn Jean, please---.

K-Lo: Sorry, Father, I didn't mean to be vulgar. Hey, it's kind of convenient to sin in the confessional. You don't have to wait to unburden yourself and risk eternal damnation by getting hit by a bus before you go to Church.

Father: Speaking of sinning, Kathryn Jean, do you have anything else to confess?

K-Lo: I thought about taking a life, but just for a second, Father. Fortunately I carry Jesus in my heart at all times and He turned me away from hatred just in time. Although I don't think I'll get my deposit back at the gun shop, a punishment I gratefully accept for opening my heart to sin.

Father: Kathryn Jean, you may not have a gun.

K-Lo: But the socialists want to take away my freedoms!

Father: No.

K-Lo: I need a gun to defend my right to protect myself from liberals, Father. They eat people, just like that zombie movie I saw on tv when Mama and Daddy left me with a baby-sitter. Sure, it's just a finger today, but tomorrow it'll be brains and Jonah says I can't spare any.

Father: No.

K-Lo: But---.

Father: Kathryn Jean, no. No guns. God watches over us all, and He'll protect us from any zombie attacks, I promise.

K-Lo: True, it won't be His first zombie attack. Thanks, Father, I feel better. And I promise not to shoot Levi Johnson, even after he said that Sarah doesn't care about Baby Trigg. Of course she loves him, Father; she didn't have an abortion even though Obama told her to.

Father: Kathryn Jean, Obama did not tell her to---.

K-Lo:: I read it on the internet, Father, it has to be true.

Father: Try to look for the good, Kathryn Jean. And the truth, that would be good as well.

K-Lo: I am, Father. If it's true that Mrs. Palin doesn't really love Todd, maybe she'll move to Washington, District of Perversion, and we can be roomies. I'll bring her coffee and cokes and breakfast in bed every day if she wants. She likes people who are helpful and giving of their time.

Father: Kathryn Jean, say ten Hail Marys and ten Our Fathers. And for Heaven's sake, stay away from chainsaws.

Cause and Effect

You know what happens when you incite violence?

Violence.

(via)

Shorters

Bi-Polar Megan: The free market is self-correcting, except when it isn't. And how could you mess with success? Or failure.

Utterly Oblivious Megan: Don't you hate it when people just make up facts and you have to waste your time refuting them? Oh well, at least we can mock them.

Accountability

What do you do when you are caught out in error? Do you admit you were wrong, or do you insist you were right and hope that if you talk fast enough and for long enough everyone will forget what you have done? When you are Megan McArdle, paid to be wrong, to disseminate bad information out of ideology and conformity, there is absolutely no question what you will do: Pull out the shovel and keep digging until you hit China.

The first thing you do is try to reframe the issue. The people who pointed out your deliberate errors did so out of fear and malice, not out of a desire to determine the facts of the matter.

There's quite a lot of question about whether Obama can turn health insurance reform around when he comes back from vacation next week. My guess is that he has to do it pretty quickly--within a few weeks--or any idea of really substantial reform is fairly hopeless. But I certainly don't think it's impossible. The man can talk.

But I gather that liberals are getting more and more worried. Why? Because the gratuitous nastiness from across the aisle.

So ultimately I'm saying, I think this is the way that our government works, and this is the way that markets work, and for all the screaming, these are not crazy positions.

So why talk any more? I can't believe how nasty this debate has gotten. I can't believe that people who claim to value a classically liberal market society, on the one hand, and people who say that all they want to do is help people, turn into such screaming, hate-filled lunatics when the subject comes up. A debate over health care should not remind me so much of a debate over the Iraq War. I write thousands of words on innovation, and John Holbo boils my concerns about lost years of life down to "indifference to the poor"--as if, first, the poor will not be helped by new treatments, and second, we should do anything at all, no matter how horrific the results, as long as it helps the poor. Well, and third, as if the poor weren't on Medicaid, but that's another rant. This is about as useful as my saying that John Holbo's basic philosophical premise is a desire for my grandchildren to die young. I devoutly hope that if any of his freshmen said anything remotely this silly in a paper, Mr. Holbo would flunk them.

[yap]

But I'm sad about what's happened along the way. I'm sad that people are carrying guns to protests, even though I think they have a right, and I'm sad that so many liberals have caricatured the opposition to the health care agenda as legions of astroturfed militiamen who accuse Nancy Pelosi of appointing Hitler to a death panel, or something. I'm sad that libertarians and conservatives are casting this as some sort of massive conspiracy of power-mad idiots, when there's obviously a very large left-wing policy apparatus built up around health care that knows a thing or two, and virtually all of the progressives advocating this are for it because they are worried about people who can't get basic health care. I'm sad that liberals are casting their opposition as being mostly about racism and hatred of the poor. I'm sad that the debate has taken place 95% at the level of the gut revulsion Red and Blue Americas are actively nurturing for each other.

It seems almost impossible to get anyone to engage in this kind of discussion. As I replied to him, you have to try to enter an imaginary thought world where not all discussions are instrumental in some larger argument about the level of government intervention in the economy. Where it is possible that I am not simply attempting to subtly maneuver my opponent into accidentally embracing my position so that I can jump out from behind a tree and scream gotcha! Where one might simply hear Julian Sanchez ask whether we really want to guarantee access to an expensive cancer drug that buys a modest increase in lifespan, and want to explore the reasons that you might answer, "Yeah, maybe."

But I wasn't concern trolling, or trying to set up a gotcha. I'd be genuinely interested to know how Ezra thinks those questions should be addressed, and not because I think that his answers will be stupid, or provide some launching platform from which I can attack the left. I simply think Ezra's answer is likely to be smart, nuanced, and interesting.

McArdle is the poor victim here, of the screaming and nastiness of the left when all she is trying to do is have a reasonable discussion about her imaginary guess-work facts and false anecdotes. And she grieves, oh how she grieves, over the bipartisan discord when all she is trying to do is have a philosophical debate about how our health care system is the best in the world and should not change, or else millions will die. She's saving lives here, people.

The second thing you do is lie. (Again.)

The [American Prospect] reference is to my off-the-cuff remark about slashing pharmaceutical profits by 80%.

It was not an off-the cuff remark. McArdle stated the number as if it were a fact and repeated it several times.

Megan McArdle (Replying to: cmm) August 13, 2009 4:05 PM
The United States currently provides something like 80-90% of the profits on new drugs and medical devices. Perhaps you think you can slash profits 80% with no effect on the behavior of the companies that make these products. I don't.

She repeated her claims in the comments and ignored several requests for a cite for her information.

Reply
FOARP (Replying to: Steve C) August 15, 2009 3:56 AM
I would also like to know where this 80% figure comes from. The big pharma companies which publish break-downs of turnover by region show roughly comparable turnover in the EU and the US, the difference nowhere being greater than about 25%. Does anyone actually have statistics which support this claim?
Reply
Megan McArdle (Replying to: FOARP) August 15, 2009 7:27 AM
You're comparing revenue with net profit. Net profit is higher in US than in Europe, even though Europe has more people. When you take out generics, the difference is even more pronounced.


Reply
Megan McArdle (Replying to: Xavier Cunha) August 14, 2009 9:49 AM
But those biotechs get funding largely because there's an exit strategy through an acquisition or IPO. If you slash the future profits on drugs 80%, the capital will dry up.

I'm not defending Big Pharma--I could care less if Pfizer stays in business. I'm defending market pricing for drugs.

I suspect that Holbo, and many of my interlocutors, are made intensely uncomfortable by the idea that their root assumption--that they are on the side of reducing human suffering and lengthening lifespans--might be wrong. There are a bunch of ways you can deal with this disturbing possibility. You can scream at me. You can posit a highly speculative world in which government and academia suddenly, and for no apparent reason, get a lot better a inventing devices and mass-market drugs than they have so far proven. You can claim, falsely, that government and academia already do all the work producing useful drugs. You can assume that slashing pharma profits 80% will have no impact on their behavior, or at least, only change the behavior you want to change.

After you lie you move the goalposts, building in enough wiggle room to move them again if you are caught lying again.

I should note, to be fair, that there were two portions of the comment: one in which I repeated an estimate I had heard from several people, that the US accounted for something in the range of 85% of pharma net profits after you accounted for various issues, which I then turned into 80-90% when typing--a fairly common way to give a range on an uncertain verbal statistic. And then I said, "So if you slashed pharma profits 80% . . . " When asked about it on the Washington Post live chat, I forgot the first, and thought the commenter was referring to the postulated hypothetical destruction of all US profits. It's not clear which part of the comment they are referring to.

But this "error" that I didn't check was not, contra Waldman, in a blog post, but in a comment, followed by a live chat on the Washington Post's site. Waldman doesn't seem to know that, which implies that he didn't look. I mean, I'm not saying that Waldmann should be fired. But maybe his bosses should sit down and have a talk with him about primary sources.

I may be in error on that--I've heard 80-90% from people in healthcare consulting, and I've seen that sales and profits in the US are usually larger when they're broken out on financial statements, which they aren't all that often. But they were not speaking on the record, and financial statements are not necessarily a very good guide to allocating the net profitability of a drug, because of various tedious pricing strategies involving market timing that you can read about in an exhaustive volume from the OECD that I have on my desk, if you want to come to my office, or spend $100 to buy it yourself. There are also issues of the way that companies allocate profits across international borders, which vary for all sorts of reasons, including the location of the company.

McArdle goes on and on, but you get the gist. Tucked into the goalpost moving is an admission of error, in a way.

I don't want my off-the-cuff comment, based on conversations with people who were not speaking on the record, to become the source of a fake statistic for the right. 80% may not be right, and I can't back it up with any hard numbers, because there are no hard numbers available. But multiple corresponding sources suggest that the number is well over 50%. 60% is probably the floor of likely.

That is not what McArdle said previously.

Megan McArdle (Replying to: drbel) August 13, 2009 4:08 PM
Actually, the bulk of the profits are from the US. Look at the financial statements of any company that breaks out its international operations. The bulk of the sales often comes abroad. But all the margin is here.

Megan McArdle (Replying to: Xavier Cunha) August 14, 2009 9:49 AM
But those biotechs get funding largely because there's an exit strategy through an acquisition or IPO. If you slash the future profits on drugs 80%, the capital will dry up.

Megan McArdle (Replying to: FOARP) August 14, 2009 7:06 AM
Look at the financial statements of any company that breaks out its numbers by region.

After obfuscating the issue, McArdle introduces a new topic into the discussion, abandoning her failed tactic for a brand new one to push.

[...W]e could go to the academic literature. Not the literature from advocacy groups which too often fills the pages of political magazines on the left and right, but something from someplace like Rand. And fortuitously, Rand happens to have published a paper on this very topic! Their analysis of the effect of a 20% price decrease--about what they estimate we could get:

Exhibit 1 illustrates the impact of introducing U.S. price controls on the longevity of cohorts ages 55-59, using our baseline parameter values. It shows that the introduction of price controls would reduce life expectancy by two-tenths of a year for Americans ages 55-59 alive in 2010 and by one-tenth for Europeans ages 55-59 alive in the same year. In percentage terms, these correspond to 0.8 percent and 0.7 percent declines from the status quo.

The longevity effects are larger for the older cohorts, because the effects of price controls take time to set in. The early cohorts are not exposed to innovation reductions for a number of years. This dampens the impact on their life expectancy. By 2060, Americans and Europeans in this age group lose almost 0.7 years of life expectancy as a result of U.S. price-control implementation.

McArdle has actually found a cite for her work, something she usually find completely unnecessary, but did she check the cite? After the Black Panthers incident and so many others it would be very foolish to take her word for anything. Several commenters question the Rand paper and one point out an extremely important fact.

September 3, 2009 12:23 AM
The RAND paper contains the following disclaimer:

This research was funded by a grant from Pfizer Inc. to the RAND Corporation, with additional support from the National Institute on Aging through a grant to the RAND Roybal Center for Health Policy Simulation (1P30AG24968-01), and from the Bing Center for Health Economics.

Of course, one of the things not mentioned in the RAND paper was that if Pfizer reduced its dividend payout to the rate of, say, Cisco Systems it could double spending on R&D. But, hey, why ruin a good party.

Reply

Megan McArdle (Replying to: ndm) September 3, 2009 1:25 AM
The question is, what would happen the next time Pfizer needed to raise money?

The Rand paper [pdf] make the same assumptions as McArdle.

Pharmaceutical pricing and access involve a trade-off between current and future generations. The prospect of higher future profits creates stronger incentives to innovate, which benefit the future generations who will use tomorrow’s inventions.

Conversely, policies that ensure high profits typically impose greater spending burdens on patients using today’s innovations. As a result, policies that promote higher revenues benefit future generations, but possibly at the expense of today’s patients. Some critics have questioned the empirical validity of the link between profits and pharmaceutical innovation; however, a great deal of evidence suggests an underlying relationship between the two.2

The second important trade-off in pharmaceutical pricing is global in nature, because new treatments are of value to the entire globe. Thus, spending by Americans encourages innovations that benefit both Europe and the United States. As a result, U.S. spending cuts may harm Europeans.

We have seen evidence that McArdle's theories on innovation are flawed and based on guesswork and conservative conventional wisdom. It will take more than one flawed paper to support McArdle's claim. Giving her the benefit of the doubt and assuming good faith is not an option. But--McArdle does have a new talking point to flog; national health care will cut about eight months off of your life. And flog it she does.

I think probably most people would agree that if Rand is right, and price controls shave, say, almost a year off of average lifespans, this is not necessarily a good deal for even the squishiest bleeding heart liberal--for the same reasons that socialism turned out not to be a good idea.

[yap yap]

You may disagree. You think government works better than I do. You think we'll be able to draw a line in the sand and keep the government from crossing over it to take over more of the market. You think government spending can substitute for R&D, because you don't find the socialist calculation debate compelling. Or maybe you say, hey, yeah, well, 0.7 years off the average lifespan isn't a bad tradeoff for covering the uninsured.

I can't talk you out of it. You can't talk me out of thinking that 0.7 years of life is a whole lot of life when you apply it to 400 million people. Numbers like that seem kind of meaningless-it's just eight months!--but this is composition fallacy. Some people won't live longer. Some people will die sooner, because treatment is iatrogenic in at least some cases. And some people will get extra decades of healthy life to hug their children or compose symphonies.

It's a judgement call. Not all values are commensurable. There are multiple theories of politics. And justice.

She cares, so very deeply, you see. She's keeping an eye out for the little people, not the drug company or companies that shovel money into The Atlantic. Everyone has her all wrong; she really has a heart of gold.

Finally McArdle wraps up her contribution to the health care debate by declaring the thorny problem of fake statistics settled and done.

So we've arrived at an impasse. I think fiat will screw up the health care system even worse than fiat has already screwed up the health care system, and that this will be bad for everyone in the long run.

McArdle reserves the right to continue discussing anything that strikes her fancy, but she has moved on past the old, uncomfortable past into a shiny new future, where nobody remembers a word she said and everyone ignores the killing blows to her reputation and legitimacy.

Brilliant Response

Shorter John Holbo: Megan McArdle, you just don't want to help anyone else.

Shorter Megan McArdle's Response: Commie.

McFact-Checking

Many thanks to Ken Houghton, who pointed out a Health Affairs press release titled "Europe Has Expanded Its Lead Over The United States In Pharmaceutical Research Productivity." The press release states that Europe has more drug innovation than the United States, which "never overtook Europe."

Bethesda, MD -- It is widely believed that the United States has eclipsed Europe in pharmaceutical research productivity. However, a comprehensive data set of all new chemical entities approved between 1982 and 2003 shows that the U.S. never overtook Europe in research productivity, and in fact Europe is pulling further ahead, according to a study published today on the Health Affairs Web site. http://content.healthaffairs.org/cgi/content/abstract/hlthaff.28.5.948

The study is one of three released by Health Affairs dealing with prescription drugs and intellectual property. http://content.healthaffairs.org/cgi/content/abstract/hlthaff.28.5.948/DC2

The U.S. share of approved new drugs did increase in the decade from 1993 to 2003, as compared to the previous decade from 1982 to 1992, but that simply reflected the fact that the pharmaceutical industry poured more of its research dollars into American labs, says study author Donald Light, a professor of psychiatry at the University of Medicine and Dentistry of New Jersey and the Lokey visiting professor at Stanford. Over both decades, the U.S. share of approved new drugs lagged behind its share of research funding.

On a dollar-for-dollar basis, Europe was more productive in discovering new drugs than the U.S. was, and the European productivity advantage was greater in the period from 1993 to 2003 than it had been in the period from 1982 to 1992. Japan outstripped both Europe and the United States in pharmaceutical research productivity over these twenty years.

“Congressional leaders and others concerned about high prices of new patented drugs will be heartened by this analysis, because lower European prices seem to be no deterrent to strong research productivity,” writes Light. He cites previous research showing that pharmaceutical companies are able to recover research costs and make a “good profit” at European prices, and he rejects the notion that Europeans are “free-riding” on American pharmaceutical research investments.

To nobody's surprise, Megan McArdle did not cite her claims regarding drug innovation because she could not. She bases her "philosophy" on ideology and emotion, not facts and analysis. It is easy to dismiss McArdle because she is a woman and so very inept, but she is not the only one who trades in fake incidents and "hypothetical" statistics. Every journalist and politician should be subjected to the same scrutiny, and thanks to the internet and the overall compulsiveness of human behavior we can. It is also human behavior to mock pretentiousness and arrogance. If the Village doesn't like it they can stop being pretentious and arrogant, a solution that never seems to occur to them. Our wanna-be Villagers suffer from the same syndrome. They have the vapors or lash out when criticized, instead of actually trying to improve their work. They will not question, and a journalist who won't ask questions is an utterly useless creature.

Cows With Guns

Many thanks to Jerry Kirschner, who passed on this email from Megan McArdle explaining her gun posts. McArdle, as always, simply repeats her earlier responses, as if enough repetition will convince people she is correct.

"You are conflating two different questions.

1. Should people openly carry guns to political protests, other than perhaps ones organized by the NRA? No they should not. It is freaking people out, and it is not advancing the cause they say they are interested in: second amendment rights.

2. Are people who openly carry guns to protest likely to prove dangerous? No they are not. All of these people contacted law enforcement ahead of time to notify them of their intention, and in the case of Obama visits, undoubtedly had Secret Service was watching them the whole time—which I am sure they knew. This is not the behavior of a would-be assassin. A would-be assassin picks a distant hiding place, or conceals his weapon until he plans to use it.

Not all people who do things you don’t approve of with guns are dangerous criminals.

Not all liberals disapprove of guns. Many, however, want sane laws to control them. McArdle has created a straw man liberal that hates guns, thinks everyone that owns a gun is a criminal and is hysterically afraid of guns, so she can dismiss any legitimate concerns about safety.

They’re just behaving boorishly. I’m not defending the behavior. I’m saying that the more hysterical claims about the behavior—that it makes it just a matter of time until someone is shot, that the only reason they could possibly be doing this is to imply that they will shoot anyone who tries to oppose their political opinions—are not based on any factual evidence, only a fervent belief in the bad character of anyone who likes guns too much. Or I should say, anyone on the other side of the political fence who likes guns too much, since at least one of the gun toter was a Democrat who carried a sign supportin healthcare reform, and a pistol strapped to his hip. He says that he was there to support both healthcare and the second amendment. And I have so far found no one making quite strong claims about the intentions of the right-wing heat packers who is willing to say that this chap, too, must have been trying to intimidate people who disagreed with him by implying that he was willing to shoot people if national healthcare failed to pass.

The fact that someone is behaving inappropriately does not mean that it is therefore okay to say any horrible thing about them that you please, nor that anyone who points out that these horrible things are very likely untrue, is therefore savaging the memory of assassinated presidents, or trying to fill our nation’s political rallies with guns.

Assassination is not the only reason to keep guns out of volatile political events. That fact is perfectly obvious. The presence of guns will attract more people with deep, personal interests in guns. Accidents could happen. Guns could be stolen, from the person wearing it or from the cars in the parking lots. A lot of entirely unnecessary and unfortunate events could occur that would not even be an issue if people could just manage to leave the weapons at home the next time they want to attend a health care town hall McArdle simply ignores any arguments she might lose, which must be very nice for the ego but not so good for actually winning the argument, instead of just declaring it won.

When George Bush was running for the presidency, the Black Panthers showed up at an anti-Bush rally carrying AK-47s, a phenomenon that does happen from time to time, but is apparently not always as interesting as we now find it, which is why virtually all the people getting angry at me seem unaware that left wing groups occasionally do the same thing. Bush ignored them, which is the proper response to such behavior. And, like virtually everyone else who legally carries guns, even to political rallies, they wandered around with their guns for a while and then went home without harming anyone. I think what they did was fine in the sense that it wasn’t particularly dangerous, and they had a right to do it. I also think they were behaving like jerks. But people have a right to behave like jerks. I don’t think that hysterically slandering people necessarily discourages them from the behavior. It may just convince them that there’s no reason to listen to you."

Here we have a repeat of the bad information McArdle attempted to pass on without even a cursory glance to check it out. Her Black Panther incident is wrong, a misinterpretation of incomplete information. What's really interesting, however, is that now McArdle is adding information she couldn't possibly have, embellishing her little story to make it more emphatic. Now the Black Panthers show up waving AK-47s "from time to time" and "left wing groups occasionally do the same thing." One incident has become several, to prove that liberals are just as bad as conservatives. It has now been proven beyond doubt that McArdle is just making up whatever she thinks will help her cause, doing her job of lying to serve her corporate bosses.

McArdle is trying to rescue the reputation of the tea-baggers and tea-bagging events, so that fear of armed men doesn't hurt the careers of her smart set of friends. It's too late; Republican party leaders have already run in fright from town halls and any pretense of grass-roots support has been abandoned for the safety of corporate insiders. The only true thing she says is that she won't listen to any counter-arguments, since the liberal meanies won't accept her authority and automatically believe her stenography.

Wankers Aweigh

Shorter Ross Douthat: GIVE ME YOUR WOMB. RIGHT...........NOW. Okay, right......now. Now, dammit! Come back here! With your womb! Immediately!

More Stressed Megan

Shorter Megan McArdle: I remember the good old days, when the mention of my blog made publicity departments quiver in fear. And the magic moments spent with Peter on the gritty streets of New York City, camped out like Iraqi refugees, with only our complimentary beverage service and inflatable mattresses to stave off the cold, cruel world. Now everybody criticizes me. Life sucks.

(Okay, not-so-shorter.)

Lies, Damned Lies and Megan McArdle

It is a truth universally acknowledged that every word Megan McArdle utters or writes must be fact checked. It would take a team of scientists, logicians, historians and economists to check every single "fact" that McArdle plinks out on her keyboard so we'll just look at one, McArdle's claim that Black Panthers wore guns and "marched on Bush" at a political rally.

typetype August 27, 2009 6:39 PM
Guns at political rallies.

I guess it's legal. I guess it's not really dangerous, if you buy Megan's argument and I'll grant her her argument.

But it's never happened before in my lifetime.

So Megan and cohorts, go ahead and be an apologist for it all you want. You can compare it to the opposition to the war in 2003, but those folks did not carry guns.

Something is very wrong.

Reply

Megan McArdle (Replying to: typetype) August 27, 2009 6:44 PM
Yeah, that's not true either:

http://newsbusters.org/blogs/ken-shepherd/2009/08/18/media-barely-noticed-legal-gun-brandishing-leftist-black-panthers-2000

McArdle also says:

The Black Panthers carried guns at an anti-Bush rally when he was running for president. I think they had a perfect right to do so, and also, that they were jerks. But harmless jerks, as witnessed by the fact that no one got killed.

McArdle's source is a grossly biased site created by Matthew Sheffield for L. Brent Bozzell III's Media Research Center, and is financed by all the usual right-wing foundations. A quick google reveals an problem; Newsbusters is virtually the only place to find the information. This immediately sets off alarm bells, of course. The Newsbusters article was written by Ken Shepherd, who reported:

According to the mainstream media, carrying a gun to a protest is just plain crazy, even if perfectly legal. What’s more, it’s indicative of the toxic, hate-filled atmosphere filling conservative protests of President Obama and his plans for health care reform.

“Hardball” host Chris Matthews and his daytime colleagues at MSNBC, for example, have their used air time to marvel at what would possess an average American citizen to go to a rally near where President Obama is speaking with a gun.

But the media reaction was markedly different nine years ago when a group of Black Panthers marched on the Texas Republican Party’s state convention on June 2000 brandishing AK-47s. Indeed, that incident itself was chalked up as then-Gov. Bush’s fault by none other than then-MSNBC "Equal Time" co-host Paul Begala.

A search of Nexis and the Media Research Center’s News Tracking System found no stories on that evening’s broadcast network newscasts about the Black Panthers brandishing “assault weapons” to protest then-presumptive GOP presidential nominee – and Secret Service protectee – Gov. George W. Bush’s refusal to intervene in the pending execution of convicted murderer Gary Graham.

The June 16, 2000 “Fox Report” noted the incident, featuring an on-scene report from reporter Mike Rosen of Fox News Austin, Texas, affiliate KTBC.

We can see by the date that McArdle was wrong; the "Black Panthers" event happened in 2000, as a commenter immediately pointed out. They were protesting the execution of a man who had converted to Islam, outside of the Texas Republican Party's state convention, with all the other protesters. McArdle evidently did not read the article carefully (if at all) and was quite wrong about the protest. It's very difficult to find any other information about the event (as the article notes), but a search does turn up an article from the "Ashville Global Report." It quotes a Reuters article, reporting from Houston.

Now, this is where it comes in handy to be from Houston. Any mention of Black Panthers and Houston means a mention of Quanelle X, a former drug dealer and pimp who embraced Islam and started to change his ways, declaring himself a New Black Panther and a voice of the oppressed. He is easy to find; just look for a controversy and news cameras, and he and his bodyguards and limo will be there. He is not taken seriously, to put it mildly. The Nation of Islam kicked him out for inciting violence and gross anti-Semitism, and his New Black Panthers party (not the Black Panthers) was denounced by the real Black Panthers party. Sure enough, Quanelle X was involved.

Houston, Texas, June 16— The debate over the pending execution of Shaka Sankofa (Gary Graham), a black man who many believe was wrongly convicted, heated up on Friday when a dozen gun-toting black militants staged a protest outside the Texas Republican Party’s state convention. The protest turned into a brief confrontation when one of the members of the New Black Panther Party, who arrived at the protest in an open-top Hummer stretch limousine, shoved a convention delegate who shouted that the protesters were “evil persons.”

The militants, most of them wearing black military style uniforms and carrying rifles or shotguns, demanded that Graham receive a new trial and that Texas Gov. George W. Bush, the presumptive Republican presidential candidate, declare a moratorium on capital punishment. Displaying guns in public is not illegal in Texas except in certain instances.

“We demand an immediate moratorium on the white supremacist, racist and classist death penalty in the state of Texas and across the country,” said Quanell X, the group’s leader.

Graham, 38, is scheduled to die by lethal injection on Thursday at the Texas death chamber in Huntsville, Texas. He was condemned for fatally shooting a man while robbing him outside a Houston supermarket in 1981....

Quanelle X and his organization did not "march on Bush" because they were not at a march or rally. It wasn't the Black Panthers, it was the New Black Panthers, run by the militant equivalent of Brittany Spears. And it took place in 2000, not at a 2004 or 2008 presidential political rally. (Or health care town hall, the last place one should find guns.)

Not that the facts matter. Our glamor girl of glibertarianism habitually pulls information from her rear end, knowing her peers will refrain from criticizing her egregious and constant stream of errors, lies and manipulations.

Gardening

Why look, there's Megan McArdle in her back yard, with a shovel. I wonder what she's going to do with it?

typetype August 27, 2009 6:39 PM
Guns at political rallies.I guess it's legal. I guess it's not really dangerous, if you buy Megan's argument and I'll grant her her argument. But it's never happened before in my lifetime. So Megan and cohorts, go ahead and be an apologist for it all you want. You can compare it to the opposition to the war in 2003, but those folks did not carry guns. Something is very wrong.
Reply
Megan McArdle (Replying to: typetype) August 27, 2009 6:44 PM
Yeah, that's not true either:
http://newsbusters.org/blogs/ken-shepherd/2009/08/18/media-barely-noticed-legal-gun-brandishing-leftist-black-panthers-2000
Reply
Jim Kakalios (Replying to: Megan McArdle) August 27, 2009 6:57 PM
The Black Panthers were protesting the war in Iraq in 2000? That's certainly an example of not waiting till the last minute! You were comparing the protesters of Health Insurance Reform to those opposed to a war. I think what typetype wrote is in fact true - or at least your link does not counter the argument.
Reply
Megan McArdle (Replying to: Jim Kakalios) August 27, 2009 7:17 PM
I meant to point out that it is not true that guns have not been pulled out at a protest in TypeType's lifetime. Or else TypeType is a very precocious child.

I do believe she appears to be digging in the dirt. I think she might be digging a hole.

Reply
TallDave (Replying to: Mike D.) August 28, 2009 12:06 AM
The real issue is weaponization of discourse by people with an extreme version of her basic perspective.
And those Black Panthers were just hanging out, right? Well, I guess since Obama's AG dropped the case "weaponization of discourse" is a nonissue these days.
Reply
NRB (Replying to: TallDave) August 28, 2009 12:10 AM
TallDave, you should be defending the Black Panthers if you want to have any sort of consistency. They weren't breaking any laws, right? Or do only crazy white people get to carry guns at political rallies?
I am at least consistent: no guns at political rallies! Not for right wing loonies and not for the Black Panthers.
Reply
Keltin (Replying to: NRB) August 28, 2009 9:00 AM
The Black Panthers weren't carrying guns. They were carrying clubs. A holstered revolver on the hip of a couple of conservatives going towards them to vote, would've caused said Intimidators to back away from their hate-speech they directed at whites who wanted to vote there.
Of course, Philadelphia police would've probably absolved the Intimidators and arrested the citizens because they were 'obviously racists' /s
Megan McArdle (Replying to: NRB) August 28, 2009 9:12 AM
I'm absolutely defending the black panthers, provided the weapons were legal. And I note that again, nothing happened. They were still jerks, of course. But harmless jerks.

It is a hole. And she keeps digging it deeper.

August 28, 2009 7:00 AM
Can anyone care to guess how the Bush administration would have reacted to a gun carrying man in an "Out of Iraq NOW" t-shirt at a Bush speech? If I recall correctly Secret Service or hired goons were throwing people out of Bush public appearances just for having the t-shirt.
Perhaps some blacks, Hispanics, and feminists should exercise their 2nd amendment rights at a Sarah Palin public appearance.
Reply
Megan McArdle (Replying to: Stuhlmann) August 28, 2009 9:25 AM
As you'll see upthread, Black Panthers marched on Bush with AK-47s when he was governor of Texas and running for president. He ignored them.
Reply
DB Cooper (Replying to: Megan McArdle) August 28, 2009 9:54 AM
As did the current President in Phoenix. Not sure why the last sentence is relevant. The alleged hysteria does not reside in the White House.

And deeper.

Reply
Megan McArdle (Replying to: km) August 28, 2009 9:40 AM
The Black Panthers carried guns at an anti-Bush rally when he was running for president. I think they had a perfect right to do so, and also, that they were jerks. But harmless jerks, as witnessed by the fact that no one got killed.
Preventing people from carrying guns into buildings is a perfectly legitimate limitation, given the problems of guns in an enclosed space. But how many people does this restriction, or even the metal detectors, protect? How many people were shot in Federal buildings, elementary schools, etc. before we had the ban?

McArdle forgets Ta-Nehisi Coates is the son of a former member of the Black Panthers. Although maybe she didn't forget, and simply assumed Coates would keep quiet.

Please, Make Me Stop Reading This

I think Megan McArdle broke something in her brain.

Megan McArdle (Replying to: John Aislabie) August 28, 2009 9:21 AM
The Nation of Islam, et al., are black nationalists, which is a left-wing movement, not a right wing one. Al Sharpton, who is certainly on the left, helped incite the anti-semitic riot that killed Yankel Rosenbaum: http://en.wikipedia.org/wiki/Crown_Heights_riot.

There are fringe antisemitic strains on both sides. Both have been waning for decades. Neither is representative of any significant number of members any longer.

A left-wing movement. Really. A movement of the left. Something that moves, from the left. The Nation of Islam, a religion. Is of the left. A anti-Semitic organization, of the left. An authoritarian religion, a separatist movement, a sect that believes in UFOs and prophesies and says that white people are potential humans who haven't evolved yet--that's liberal. That's progressive. That's the left.

Jesus.

Adolescents With Guns

Caption: Megan McArdle spots a liberal national health care advocate.

Let's go back in time and examine the philosophical basis for Megan McArdle's insane desire to see armed men roam political rallies.

So if Heller, as libertarians devoutly hope, legalizes gun ownership in DC, the question immediately arises for those of us who live here: buy one, or not? On the one hand, they are expensive, and shooting ranges far away. On the other hand, I live alone in an apartment that is something less than amply fortified. On the third hand, I'm pretty sure I shouldn't handle a gun when I'm sleepy.

However, I probably will anyway, just because I can.

Scratch a libertarian and you'll find a teenager, who wants to get drunk and have sex and smoke dope and shoot guns, just because he can. Not because it's wise or right or appropriate. No, because she can. Never mind the possible consequences, of course, because in Libertarian Fantasyland they don't exist. Having a gun would be cute and fun and make her look cool in front of the boys.

There is a distressing lack of attention to the female market in gun companies. I want something with accuracy and stopping power, but also, an attractive exterior casing that easily integrates with my other accessories. This doesn't seem unreasonable.

The funny part of all this gun worship is that despite the libertarian mind-set and childish desire to have something that is dangerous and goes boom!, McArdle didn't even really want a gun.

I wasn't going to buy a gun, because, hey, what would I do with it? But the chicken guano rules that DC is imposing make me want to buy a handgun just to annoy the twopenny tyrants who thought them up:

[snipped quote]

May I really carry it inside my home without a license, just as if I were a free citizen in a country that respects individual liberty? I am overcome with gratitude, really overwhelmed with the state's generosity . . . permission to cry, sir?

My goodness, that takes me back, to when I was substituting at a wealthy high school. The cheap, petty sarcasm that exposes the speaker as immature and nasty, vapid and foolish and pinched in spirit. But they were children. McArdle's a middle-aged woman. McArdle became a bit testy when commenters and others pointed out that waving around guns could be dangerous.

Now the gun controllers pour out of the woodwork to claim that you're more likely to kill yourself or a family member with a gun than a criminal.

Some of the people deploying this statistic really ought to know better. Composition fallacy, anyone?

These are not double blind experiments. Guns may be the weapon of choice for all sorts of crimes; that does not mean that they cause the crimes.

Yes, guns don't fire themselves, so adding a gun to a volatile situation will do nothing to change the power dynamic for the worse. Although McArdle said she wanted a gun to even up the power dynamic.

I'm hardly the first person to make this observation, but I don't know why it isn't noted more often: guns are the only weapon that equalizes strength between attacker and attacked. It's the only time when men's greater speed, strength, and longer reach make no difference; if you pull the trigger first, you win.

This is an enormous social advance. I am all for strengthening the social contract (and law enforcement) so that fewer men commit rape, assault, or robbery. But until human nature has improved so radically that grievous bodily harm has passed from living memory, I don't understand why more feminists don't push for widespread gun ownership.

Women need guns because bad men might try to hurt them. It's a solution that creates more problems, but one I can understand. But why do men attending political rallies need guns? It's certainly not for protection, and anyone who takes a gun to a rally dramatically increases the level of fear and panic. Guns, crowds, politics. They do not mix, and pretending they do is utterly moronic. Or just incredibly immature.

Sickening

I was already feeling unwell today and reading this didn't help. Megan McArdle says that criminals are sub-normal creatures easily identified by sight. Perhaps they have beady, furtive eyes, or are wearing striped pajamas with an iron ball and chair around their ankles. Who knows? The point is that they are not us, and since McArdle wouldn't kill anyone with a gun, neither would anyone else. This was the same reasoning she used with Iraq. She said that if she were Hussein she would have had WMD, therefore despite any and all evidence to the contrary, Hussein had nuclear weapons and was going to use them. McArdle promised to reexamine her thought processes and identify the cognitive bias that created this unhappy mistake, but she must have been too busy, or maybe just forgot.

I was going to quote some stupid at random, but the whole post is so monumentally stupid, so rancidly centered around the isolated bubble that is McArdle's life, that I really can't single out one thing. Nothing exists for McArdle outside of her own head, her own experiences. It's like going to a dog for advice. They might be able to give you a very good perspective on flea-scratching and butt-sniffing, but it isn't very useful for a human being.

McArdle Admits Her Anti-Health Care Argument Is Based On "Hypothetical" Number

In today's Washington Post live question and answer, Megan McArdle admitted that her entire argument against health care is based on a "hypothetical" statistic.

Anonymous: You said that medical innovation will be wiped out if we have a type of national health care, because European drug companies get 80% of their revenue from Americans. Where did you get this statistic?

Megan McArdle: It wasn't a statistic--it was a hypothetical.

However, whenever I have been able to find pharma financial statements that break down their profits by region, the lion's share always comes from the US.

A hypothetical is not a statistic. A statistic is a fact that can be verified, not a guess, and McArdle just admitted she made a guess. That guess was the entire basis for her argument against health care reform.

I don't think Matt understands what worries me about national health care, or else he doesn't actually understand how the system in the Netherlands works underneath his interaction with an insurance company. It isn't the cost. It isn't the taxes. It isn't the redistribution. It isn't even the mandate, which is borderline plausible to me in the way that mandatory auto insurance is, and forced retirement savings might be: the moral hazard is huge, because your neighbors won't let you die.

My objection is primarily, as I've said numerous times, that the government will destroy innovation. It will do this by deciding what constitutes an acceptable standard of care, and refusing to fund treatment above that. It will also start controlling prices.

McArdle made up a number based on a balance sheet she might or might not have seen at some time. Like so much of her evidence, it is part guess and part wishful thinking. As a pundit McArdle is inept. As a journalist she is hopelessly out of her league, a simple fact that doesn't seem to bother The Atlantic at all.