Supply or Demand?

(This is part 2 of a series on pharmaceutical drug shortages, which began with Not what the doctor ordered. A brief recap: over the past decade we've experienced more numerous and more severe shortages of prescription drugs. Currently over 240 drugs are unavailable, and another 400+ are back-ordered. Roughly half of the unavailable drugs are "sterile injectibles" used for chemotherapy and sedation. Consequences to patients and practitioners abound.)

The web sites of the FDA and the ASHP (American Society of Health-System Pharmacists) list drugs that are in short supply and the reasons for their scarcity. The three general reasons are: “manufacturing difficulties,” “increased demand,” and “no explanation given.” I assume the last arises when a company decides to stop making a low-profit-margin drug but doesn’t want to take the public relations hit that would come from stating the case so baldly.

How shortages develop: the perspective of managed care organizations

The Premier Healthcare Alliance (PHA) report I mentioned in the first post of this series offers the following reasons for the shortages (the categorization is my own, for the sake of clarity):

Interruptions in supply: “lack of active pharmaceutical ingredients”

Quality control: “Roughly half of the shortages of injectable drugs in 2010 were due to product quality situations such as presence of particulates, microbial contamination, newly identified impurities, and stability changes.”

Consolidation of drug manufacturers (i.e., takeovers and mergers): "Where we used to have two and three [companies] providing drugs in some cases, we now have one.” 

Financial motives, i.e., companies make less profit from generics so they stop making them: "Manufacturers are delaying or discontinuing investments, thereby impacting product availability."

Fear-based financial motives: “Pressures are mounting to offset profit reductions resulting from patent expirations, healthcare reform, and investments related to FDA regulatory compliance for older products." 

The FDA: “The agency requires manufacturers to abide by what are known as good manufacturing processes (GMPs) or else face regulatory action.”

Hm. These last two reasons bear closer examination. It is true that several hugely profitable patents are set to expire in rapid succession, and without new blockbusters in the pipeline the companies are justifiably nervous. But the situation feels dire only because the industry has enjoyed such fat profit margins (at least several times that of the oil industry) for so many decades; the guy with a billion dollars in the bank blanches at the thought of losing a hundred million, but it won't actually make him poor. We should bear this in mind.

Moreover, healthcare reform was actually a boon to the pharmaceutical industry, since it ensured an increase in the number of insured and thus an increase in drug consumption—long-term stability they gladly traded for short-term discounts to insurance—and, astonishingly, guaranteed twelve years of exclusivity rights to branded biologics, far longer than the usual five years given to small molecule drugs. The industry thus maintains its "islands of monopoly" (see discussion in part 4: Old treatments, new patents, big money).

Finally, let's consider the complaint about FDA insisting on Good Manufacturing Practices. How, exactly, are quality controls supposed to contribute to the shortages? Recall that half of the shortages were caused by contamination of one sort or another. I suppose the industry would have preferred to be able to sell the contaminated drugs—at a discount, of course. After all, one aspect of Premier Healthcare Alliance’s mission is to “operate at costs in the lowest quarter of the healthcare system while providing quality in the highest quarter.” Given the subsidized monopolies that healthcare and drug companies enjoy, I assume that ‘quality’ refers to return on investor shares and ‘highest quarter’ means the penthouse suite.

The PHA report elsewhere concedes that safety is a good thing, but then they hedge:

"While the FDA's vigilance of [GMPs] and actions against unapproved drugs help keep medications safe and effective for the public, new regulations may have a downstream impact on the entire marketplace," the report authors said.

I’d say that if the regulations requiring manufacturers to adhere to quality standards didn’t have a “downstream impact on the entire marketplace” there would be no use for them. But you have to give the PHA credit for their subliminal messaging about "new" regulations that "may...impact"; there are no new regulations affecting production that I could unearth, but the phrase conjures an ominous sense of Government Interference looming just around the corner. 

The pharmaceutical industry’s response

Here is the statement issued by the Pharmaceutical Research and Manufacturers of America (PhRMA) in response to PHA’s survey:

"According to the Food and Drug Administration (FDA) and other experts, drug shortages can occur for any number of reasons, including natural disasters; shifts in clinical practices; wholesaler and pharmacy inventory practices; raw material shortages; changes in hospital and pharmacy contractual relationships with suppliers and wholesalers that can cause fluctuations in the availability of certain products; adherence to FDA-mandated distribution protocols, which can impact patients' timely access to medicines; individual company decisions to discontinue specific medicines; and manufacturing challenges," said PhRMA Senior Assistant General Counsel Maya J. Bermingham.

PhRMA has not taken a position on Klobuchar's drug shortage legislation.

The tone of this statement is instructional, as if PhRMA is patiently teaching a class on drug shortages. "Experts say that there are eight reasons for..." It's also slick: you’ve got to admire the way PhRMA doffs its hat to the FDA at the beginning to set up a more convincing accusation later. Unsurprisingly, Big Pharma wants to spread the blame around. First there are the “acts of God”: natural disasters and raw material shortages. Then there are faults with healthcare providers themselves: “shifts in clinical practice,” “inventory practices,” “changes in hospital and pharmacy contractual relationships with suppliers” (a.k.a. drug companies; anyone see any circularity here?). Then, of course, there is the the FDA, which wields the stick of “mandated distribution protocols” (so that hospitals get, say, flu vaccines before retail pharmacies).

To their credit, PhRMA does not complain about having to adhere to the FDA's Good Manufacturing Processes. But notice that they assiduously avoid mentioning their own significant contribution to the problem, industry consolidation. They also fail to cite manufacturing difficulties, which I find curious.

What's missing

The one explanation that is missing from both the PHA report and the PhRMA response is increased demand. It's the elephant in the room no one wants to acknowledge, because it calls into question everything we've been taught to believe about health, technology, the "free market," and progress. I'll take up these implications one by one in the next few posts.

Not what the doctor ordered

After decades of gleeful consumption, we seem to be finally coming up against the reality of limits. We may not know the details [1], which in any case are impossible to pin down with certainty, but the gist is familiar: the pie is shrinking, there are more of us trying to get a piece of it, and the two trajectories are on a collision course. Oil and water supplies, rainforests, and animal species have been decimated by our wasteful, anthropocentric ways, and the most we seem to be able to manage in global response is a collective shrug.

To top it all off, we are now facing a serious shortage of . . . prescription drugs.

I had my own brush with a drug shortage two years ago, when I could no longer procure the thyroid medication that works best for me, but I had no idea of the scope of the problem. Leave aside for a moment the first question that pops into any reasonable person’s mind, namely, how on earth we have become so sick that the mighty pharmaceutical industry can’t keep up. What's actually happening?

In the late 90's . . .

Drug shortages apparently started attracting attention in medical publications in the late 90’s. The British Medical Journal reported in their January 20, 2000 issue that a “few years ago a hospital might run short of one or two critical drugs a year, whereas in the past year the number has run to as many as two dozen drugs.” The report gave three examples, one of which was the following:

      . . . Brigham and Women's Hospital in Boston found itself unable to buy sufficient supplies of oxytocin, which is used in almost every one of its 10,000 annual deliveries. Doctors therefore had to cut back on their use of the drug. Fortunately no patient suffered, said Dr David Acker, the hospital's chief of obstetrics.

The BMJ article offered three explanations for the shortages: manufacturing difficulties, “just in time” inventories (keeping minimal supplies on hand to save outlays and storage space), and “price inflation in the ‘grey’ market for drugs, under which small drug wholesale distributors obtain drugs and resell them at large markups to hospitals unable to obtain them from regular suppliers.” According to the BMJ, the grey market accounted for about 1% of total sales of prescriptions drugs in 1999 (~ $1 Billion). Although only the manufacturing difficulties would account for an actual reduction in supply, distribution practices presented a significant problem. In 1999, the American Society of Health System Pharmacists protested to then-secretary of Health and Human Services, Donna Shalala, that hospitals weren't receiving their orders for flu vaccine yet the vaccine was shipping regularly to supermarkets and other retail outlets. In response, the US Food and Drug Administration set up a website to serve as a central repository of information on scarce drugs: www.fda.gov/cder/drug/shortages/.

. . . and now.

As of May 2011 there are over 240 drugs in such scarce supply that no one knows when they’ll become available; another 400+ are on backorder (you can see the list of drugs here). Most of these drugs are used in the hospital setting for sedation, emergency care and chemotherapy, but antibiotics and other meds are also affected. 

Over the past few months, dozens of journalists have been riffing on a survey performed last year by a “performance improvement alliance” of 2,500 U.S. hospitals, the Premier Healthcare Alliance (PHA), which asked 311 “pharmacy experts” at hospitals, surgery centers, and long-term care facilities about their experience with shortages during a six-month period in 2010.[2]  Among the survey respondents:

53% said treatment-plan-changing shortages had occurred more than six times during the six-month period 

80% experienced shortages that caused delay or cancellation of patient care (surgeries and oncology treatments in particular); 34% reported such a shortage occurred more than 6 times in the six-month period

89% experienced shortages that “may have caused” a medication safety issue or error in patient care. Eight out of 10 times a shortage occurred, the patient’s care was delayed or the medication intervention was canceled.

98% experienced shortages that led to increased costs. Drug shortages are estimated to cost U.S. hospitals “$200 million a year, in part because providers pay an average of 11% more for shortage products.” 

What is the fallout from a drug shortage?

The unavailability of a favored drug can disrupt healthcare—providing or receiving it—at multiple levels. Most obviously, there are the logistical imperatives of scarcity: because pharmacists and physicians often don’t find out until the day the drug is needed that it is not going to be available, scrambling about for a substitute requires time and tactical adjustments that can only add tension to a system already stretched thin.

In some cases, there isn’t a good substitute. A related drug might be less effective for a particular use, in a particular patient, or less well tolerated. It might also be much more costly. A brand-name cancer drug called Fusilev (levofolinate) contains similar active ingredients as the now-scarce $7.41/dose leucovorin, but at $177 per dose it costs nearly 24 times as much. (It’s noteworthy that most of the supply problems affect inexpensive generics and off-patent drugs.) The two drugs also have different treatment profiles, and no one knows how Fusilev interacts with other compounds in the chemotherapy cocktails that used to contain leucovorin. Even if an effective substitute is available, greater demand for that substitute is likely to create a secondary shortage. Sudden interruptions in supply also create headaches for clinical trials.

Most problematically, scarcity sets the stage for dangerous mistakes. Drugs in the same family can differ greatly in dosing requirements: two patients died after receiving hydromorphone at the same dose as its chemical kin, morphine. A September survey by the nonprofit Institute for Safe Medication Practices documented more than a thousand errors, near-misses, and adverse patient outcomes directly attributable to drug shortages.

Senators Amy Klobuchar (D-MN) and Bob Casey (D-PA) recently sponsored a bill that would require pharmaceutical companies to notify the FDA when they expect a shortage of a particular drug or plan to discontinue it. Even though the proposal is merely an early-warning system, and a toothless one at that, the pharmaceutical industry has not yet decided whether it supports the legislation, which just might be able to grow teeth in the future. (Currently, drug companies are not required by law to alert the FDA when they expect a shortage, even though in about a dozen cases when the FDA received early word of a supply problem they were able to avert a crisis.) 

In the meanwhile, physicians, nurses and pharmacists are devising heroic workarounds, sharing resources, forming networks with other providers, strategizing for the near future. Perhaps their effectiveness, all the more remarkable considering the other pressures they labor under, is why more of the public is not aware of the problem.

In the next post, I'll analyze the way the shortages are being understood by the industry itself.

Notes:

1.  Some of these statistics are estimates, but they're unlikely to be too pessimistic:

Non-Opec nations passed peak oil production in 2010

Potable water has already caused bloodier conflicts than petroleum, including the Rwandan genocide

Rainforests once covered 14% of the earth’s surface, now cover less than 6%, and the rest could be consumed in the next forty years

About 137 species disappear every day because of deforestation

Half of all ocean species have vanished in the past fifty years

2. The AHP mission and vision statements deserve an analysis on their own (and will receive one in due course).

The Iliad, bin Laden, and a Mother's Day Proclamation

I've been quiet about the assassination/murder/execution of bin Laden, in part because the blogosphere has been full of opinions, but mostly because of feeling there are many other Important Matters to ponder. But I have finally decided that there is one important thing to articulate about the headlines of this week besides the question of whether anyone really believes the death of this one individual is going to diminish terrorist activities around the globe. (Which, after all, was the ostensible motive for killing him.)

It is this: that conservative estimates of the number of people killed in the wars in Iraq and Afghanistan since the U.S. coalition attacks began is nearly 1 million. That's more than 300 times the number of people killed on September 11, 2001. According to U.S. State Department data, that's also 130 times more people than were killed in all terrorist attacks around the world from 1993-2004. (Numbers after 2004 remain classified, since they suggested that the U.S. wars were actually fomenting terrorist attacks, rather than striking terror into the terrorists' hearts.) The cost of these wars has plunged us into an economic whirlpool of debt, with ever-widening currents sucking jobs and public services into the deep. Talk about Pyrrhic victories.

The most recent issue of Harper's Magazine contains a lengthy essay by Nicholson Baker, "Why I'm a Pacifist: The Dangerous Myth of the Good War." He examines the circumstances surrounding the US entry into World War II and the result, concluding, along with a number of historians, that this act actually fueled Hitler's rush to exterminate the Jews. I am not a WWII historian, but it's a provocative argument.

I've also been reminded of Simone Weil's beautiful, exceptionally moving essay, "The Iliad, or the Poem of Force," published initially in 1940 after the fall of France. It opens thus:

The true hero, the true subject, the center of the Iliad is force. Force employed by man, force that enslaves man, force before which man's flesh shrinks away. In this work, at all times, the human spirit is shown as modified by its relations with force, as swept away, blinded by the very force it imagined it could handle, as deformed by the weight of the force it submits to. For those dreamers who considered that force, thanks to progress, would soon be a thing of the past, the Iliad could appear as an historical document; for others, whose powers of recognition are more acute and who perceive force, today as yesterday, at the very center of human history, the Iliad is the purest and the loveliest of mirrors.

To define force—it is that x that turns anybody who is subjected to it into a thing. Exercised to the limit, it turns man into a thing in the most literal sense: it makes a corpse out of him. Somebody was here, and the next minute there is nobody here at all; this is a spectacle the Iliad never wearies of showing us....

The rest of the essay's 24 pages are equally potent; I recommend reading it as a perspective-altering, almost transcendental experience. And it is very much relevant to us today, when our society is riven by internecine strife between people who cannot communicate because they have forgotten the extent to which circumstance and necessity impinge upon the human soul. Again, Weil's words:

... nothing is so rare as to see misfortune fairly portrayed; the tendency is either to treat the unfortunate person as though catastrophe were his natural vocation, or to ignore the effects of misfortune on the soul, to assume, that is, that the soul can suffer and remain unmarked by it, can fail, in fact, to be recast in misfortune's image. [...]

Both the Romans and the Hebrews believed themselves to be exempt from the misery that is the common human lot. The Romans saw their country as the nation chosen by destiny to be mistress of the world; with the Hebrews, it was their God who exalted them and they retained their superior position just as long as they obeyed Him. Strangers, enemies, conquered peoples, subjects, slaves, were objects of contempt to the Romans; and the Romans had no epics, no tragedies. In Rome gladiatorial fights took the place of tragedy. With the Hebrews, misfortune was a sure indication of sin and hence a legitimate object of contempt; to them a vanquished enemy was abhorrent to God himself and condemned to expiate all sorts of crimes—this is a view that makes cruelty permissible and indeed indispensable....Throughout twenty centuries of Christianity, the Romans and the Hebrews have been admired, read, imitated, both in deed and word; their masterpieces have yielded an appropriate quotation every time anybody had a crime he wanted to justify.

Americans, too, lack a tradition of tragedy—treacle doesn't count—and American exceptionalism is everywhere in evidence, from political speeches to economic debates to the unwillingness of many to face our environmental crisis. Is it any wonder that we spawned Abu Ghraib and Guantanamo? Are they our gladiatorial rings?

In honor of Mother's Day, let me also share a portion of Julia Ward Howe's Mother's Day Proclamation, written in 1870 in reaction to the carnage of the Civil War and the Franco-Prussian War:

We will not have great questions decided by irrelevant agencies,
Our husbands will not come to us, reeking with carnage, for caresses and applause.
Our sons shall not be taken from us to unlearn
All that we have been able to teach them of charity, mercy, and patience.
We, the women of one country, will be too tender of those of another country
To allow our sons to be trained to injure theirs.

Their vision, of an international council of women, was simplistic, but the sentiment, I think, was right.

Observations on the 19th c. Japanese response to natural disasters

One of the themes of this still-new blog is the revelatory potential of perspectives brought by history, other cultures, and other disciplines. Julian Sands' beautiful essay in this week's London Review of Books explores Japan's present-day reaction to March's triple disaster (earthquake-tsunami-nuclear reactor meltdown) through a 19th century Japanese lens. I was so struck by the inversion of our present-day values that I wanted to share it with you; excerpts are below but the whole can be found through the link above. 

On 11 November 1855, a massive earthquake and tsunami destroyed most of Japan's capital city, Edo, the precursor of modern Tokyo. Roughly 7000 people were reported dead or injured, and the numbers rose in the days that followed. There were no newspapers published in the city—the shogun's government forbade public comment on anything directly concerning the regime—but by the end of the year hundreds of woodblock broadsheets had appeared with stories and interpretations of the disaster. Among the surviving broadsheets one type stands out: colour woodblock prints depicting the earthquake as a catfish.

 

Since the 17th century, folklore had associated catfish with earthquakes. It was said that a giant catfish lay under a stone at the Kashima shrine... The god of the shrine had the duty of holding the catfish down. When he neglected his job, the catfish would wake up and shake, causing earthquakes. The god of Kashima seems to have been peculiarly negligent around this time: an earthquake destroyed the castle in the city of Odawara in 1853, another struck near the imperial shrine of Ise in the summer of 1854, and two tsunamis caused thousands of deaths along the Pacific coast that autumn. These events occurred soon after the arrival of American gunships under Commodore Perry forced the shogunate to open its ports to trade, rocking a dynastic system that had maintained stability in Japan for 250 years. It is not surprising that many in Edo believed the gods had chosen this time to overturn the existing world and start things anew....

I have been showing these pictures to students for years, interested in what they tell us about the period, but until the earthquake and tsunami that struck Japan on 11 March it had never occurred to me just how remarkable and strange to modern sensibilities this outburst of satirical humour in the face of disaster was.

The example reproduced here, ‘Mr Moneybags Launches Forth His Ship of Treasure’, employs a common motif: the suffering of elite merchants and the delight of working men. The man at the top is a wealthy miser: with the encouragement of a catfish, he is vomiting gold coins. Three men wearing the blue leggings, jackets and cloth headbands of craftsmen and builders scramble for the fallen money. The catfish lectures the miser: ‘Sir, you suffer now because you oppressed those beneath you in ordinary times. It would be well for you to change your ways and practise charity and virtue.’ Meanwhile, one of the labourers tells his mates: ‘Don’t be greedy. If you save too much and an earthquake comes you’ll regret it: better to go and spend it at the temporary brothels and keep it circulating.’ Destruction of property naturally hurt the haves more than the have-nots, and construction workers in particular stood to profit from the city’s rebuilding. Indeed, just as many occupations seem to have profited as suffered in the aftermath of the earthquake.

Another print depicted two groups of people standing on either side of a catfish, one labelled ‘those who laugh’ (a carpenter, a plasterer, a lumber merchant, a roofer, a blacksmith, a prostitute, a physician and a street-food vendor) and the other ‘those who weep’ (a teahouse proprietor, a seller of eels, a seller of luxury goods, a diamond dealer, an import merchant, musicians and entertainers). A city made entirely of wood, paper and clay could be rebuilt in a matter of weeks, and reconstruction provided work at good wages to a large segment of the urban population...

Although Japan’s disaster-prone capital lies on a major faultline and tremors are frequent, fire was by far the more common source of destruction in the 19th century. A conflagration that turned several blocks to ashes occurred in Edo on average every five or six years... Since there was a seasonal rhythm to these events and the gap between them was short, Edo’s citizens learned to flee, then return and rebuild. They kept their belongings light and portable and lived in houses that were easily dismantled. In 1880, a fire swept through Kanda’s city centre, destroying 16 blocks of dense tenements and displacing 5986 people. The mayor reported that, fortunately, it had occurred during the day, so there were no deaths or injuries. With a population well prepared for disaster, destruction of property even on this scale was accommodated within the management of the city.

This accommodation was possible because the city’s light physical infrastructure was matched by a strong and enduring social infrastructure. The people of Edo policed themselves and fielded their own fire brigades. The wealthy property owners who had the most to lose from lawlessness and property damage paid directly for these services, which were provided by their tenants and employees, and established town residents provided alms to the poor until houses were rebuilt. Although this charity was in theory voluntary, the need to maintain neighbours’ respect (and keep their custom) made it effectively obligatory. After major disasters such as the earthquake of 1855, registers were compiled in each neighbourhood listing the names of donors and amounts given, making the contributions a matter of public record. Kitahara Itoko, Japan’s leading historian of disasters and the author of a social history of the 1855 quake, has found that the donations corresponded closely to the wealth of each household, with the city’s wealthiest merchant houses, like the Mitsui dry goods business, contributing more than a thousand gold pieces, while smaller shops contributed as little as a few coppers. The shogun’s government made a practice of rewarding almsgivers after disasters, but the same fixed amount was doled out to everyone on the register, so that the compensation was little more than a token to the wealthy but could be double the amount of the original donation in the case of a poor household.

The working man gathering Mr Moneybags’s treasure implicitly referred to a physiological theory of cycles in nature, of destruction followed by renewal. Like typhoon-season floods and dry-season fires, earthquakes and tsunamis were understood as corrections of temporary imbalances in the vital force perpetually flowing through the world (known in Japanese as ki and in Chinese as qi). Periodic eruptions of natural violence released pent-up force and kept both nature and human society healthy by renewing them. In a study of the catfish prints, Gregory Smits has shown that Confucian philosophers as well as ordinary people believed that the economy followed the same principles. Just as ki flowed continuously in nature, money should be kept moving in the economy too, not allowed to stagnate and foster greed. For this reason, many people viewed capital accumulation distrustfully. Nature, they believed, censured it. 

It would be a mistake to presume that these Japanese fatalistically accepted natural destruction. Other contemporary accounts reveal that Edoites mourned the loss of family and friends, that they commemorated their deaths solemnly and sought solace in religion. But the relief of having survived, the outpouring of private and public charity, the break from everyday life and its duties, the levelling effect of the shared crisis, and the economic activity and opportunities in the reconstruction that followed, gave a positive tone to many of the catfish prints, prompting Kitahara to coin the term ‘disaster utopia’ to describe the world they depict. Of course, the condition was temporary, and neither alms nor higher wages were sufficient to cause a fundamental change in the poverty of the masses in the city’s tenements. Nevertheless, since everyone suffered together, and practically everyone contributed alms to relieve that suffering, common folk could believe that nature – in the form of the trickster catfish – had indeed instigated a healthy social renewal, and that these were bright times. Many of the prints plainly celebrate the present: using a formulaic phrase containing equal measures of irony and genuine hope, they call it ‘this blessed age’.

[VL comment: this is quite a contrast to the world of "disaster capitalism," in which wealthy developers swoop in to buy up, rebuild, and profit from areas that have been decimated by disasters, leaving the original residents permanently displaced.  It is also noteworthy that private charity, strongly local, was enforced by a system of complete transparency that itself depended on a strong social fabric. Our atomized American culture is comparatively ill-equipped to care for the dispossessed.]

Why aren’t the Japanese celebrating today? If the Fukushima nuclear plant can be brought under control, post-disaster reconstruction, at least in the long term, holds out the possibility of social and economic renewal. Assistance is flowing into the tsunami-affected region, voluntarism is flourishing and there is talk of this being an opportunity to revitalise the country, evoking notions of economic stagnation and flow that Japanese would have readily understood 150 years ago. Yet a wide gulf separates the Japan of the mid-19th century from the Japan of the present. In its slow unfolding and the inequality of its social effects, March’s triple disaster may bear more resemblance to a premodern famine than to the earthquake-tsunami that destroyed the capital in 1855. No one ever welcomed a famine because of its potential for enabling renewal. The drawn-out disaster gradually exposed and exacerbated class and regional disparities. The tsunami also brought to the surface deep structural problems: the depopulation of rural areas and the advanced age of their inhabitants (the median age of tsunami victims was reportedly around 70); the economic fragility of Japanese farming, which depends on government subsidies and tight import restrictions; and the fragility of the food system, vulnerable as it is to the invisible threat of contamination.

...In Tokyo one of my former neighbours, a woman in her sixties, writes of ‘trains running on reduced schedules, blackouts and calls to save energy, shops half dark, heat off in the house – why, we lived this way just a little while ago. I can only hope this will be the turning point away from mass production and mass consumption, towards a sustainable society.’ For people like her, who remember the days before Japan’s economic take-off, the hope is that this disaster will lead to a reduced dependence on heavy technological infrastructure.

It is remarkable that a country so seismically active and vulnerable, and which had developed the art of light infrastructure, should have embraced nuclear power. Japan began building heavy in the 1870s, soon after the modern state that replaced the shogunate chose to join the international economic and military competition led by the Western imperial powers. The country’s first model factory, a silk filature built under French guidance, and its first planned commercial district, the main avenue of Ginza in central Tokyo, were both constructed from brick in 1872. A massive earthquake in central Honshu in 1891 damaged iron bridges and toppled brick buildings, sparking debate over the appropriateness of Western technology to Japan, and the possible superiority of the lightweight, flexible structures that carpenters had built there for centuries (Gregory Clancey’s brilliant book Earthquake Nation explores the cultural politics of this debate). The debate would continue into the era of nuclear power. Today, Tokyo’s skyscrapers are built with flexible frames, designed to sway in earthquakes. Yet nowhere have architects been able to match the light and quickly constructed urban fabric that Japanese artisans had perfected before modernisation.

Sands goes on to discuss changes wrought by nuclear power technology, the quintessential heavy infrastructure, in 20th century Japan, and he makes the case that the traditionally robust social network is inseparable from the light physical infrastructure that characterized 19th century city life. As various "slow" movements spring up here in the West—slow food, slow gardening, slow art, slow fashion, slow blogging (my neologism for my lengthy posts, perhaps not inappropriately close to "slogging")—I keep thinking that as human beings we long for the kinds of connections that really need to be forged face-to-face, slowly building trust and interdependence over time... in other words, locally. I am grateful for the internet, for the phone, for being able to communicate with dear friends who live far away and 'meet' new friends through comments on this and other blogs. But there is still something irreplaceable about inviting someone over for tea and pastries warm from the oven, about making music together, about having long conversations curled up on a cozy couch, that goes well beyond the advantage of not getting a sore ear from the telephone. Even suffering together through a disaster can be a bonding experience, if all members of a given community share a sense of responsibility.


Given the increasingly inescapable effects of climate change, we need to think about the consequences of our own "heavy infrastructure" for the social fabric of our communities as well as their ability to rebuild.

A little budget fun...

A comment from one of my friends on the previous post prompted me to share two online resources that will educate, enlighten, and entertain.


The first is a "tax receipt" online calculator provided by the White House as part of its commitment to increasing government transparency.  It provides a breakdown of how your income taxes are disbursed across various categories.  National Defense, for example, is the largest chunk, taking up 26.3% of our hard-earned tax dollars (and this doesn't include Veterans Benefits, which is an additional 4.1%). There's no room for doubt about the cost of American military might...


The second excuse for whiling away a gray Saturday afternoon is The New York Times' deficit reduction calculator. Here you can actually try out different budget cuts and see what their effects on the deficit will be in 2015 and 2030. Initially published online November 13, 2010, it's a terrific interactive resource that lays bare the sources of our financial woes. Why, I managed to balance the budget without touching Medicare, Social Security, or federal research programs.

What about all that math and science education we're supposed to be promoting?

Paul Krugman and Hendrik Hertzberg, among others, lauded the president’s budget speech on Tuesday April 11 and the way Obama conveyed dignified exasperation over the notorious Ryan plan. Paul Krugman was fairly sanguine about the direction it pointed in, though he did sound a note of caution that if Obama’s position became the “left pole” from which the Administration would move farther to the right to reach “bipartisan” compromise, it would be better to do nothing at all. 

Unfortunately, it looks like we’ve been had—again—and this time it goes way beyond the Administration ceding ground to the Austerity Brigade.  

In recent weeks we’ve been told:

1. We need to emphasize science and math education so we can “win the future” and “outcompete the world”. 

2. This is the time for austerity, which means cutting the budget for education and federal research support for math and science. 

For the record, I agree with Krugman: whoever came up with the phrase "win the future" should be sent to count yurts in Outer Mongolia. 

More to the point, the problem with this formula is that the NIH and NSF are the primary forces driving research, not to mention our much-vaunted science education. It is federal funding that supports all those wonderful scientists and mathematicians who are going to win the future, etc., etc.  

How much less funding are we talking about? Drawing from recent reports in Science, The Economist, and the House continuing resolution (CR), the upshot is this:

The House CR proposed cutting the NIH budget by $1.6 billion; the administration bargained this down to $260 million.  Since the average NIH grant is $250,000 per year, my back-of-the-envelope calculation is that this means ‘only’ 1040 grants will vanish instead of 6400. There are about 600 research universities in the US; there are roughly 30,000 NIH-funded PI's or "principal investigators", the most successful of whom have an average of 1.2-1.4 NIH grants at a time. By this rough estimate, cutting 6400 grants would have meant over 1 in 5 academic scientists would have lost most of their funding. 

The CR cut the NSF budget by $75 million; the administration bargained this down to $53M.  In FY 2010 there were over 40,000 NSF grants with a median annual award size of about $127,000. The original CR would have cut 590 grants; now only 427 will vanish. (Note that health-related research is generally much more costly than research in the hard sciences.)

The Centers for Disease control budget will be cut by $730 million (instead of $1.4 billion in the CR).

The Department of Energy (DOE) Office of Science will be cut by $35 M (instead of $901M in the CR).

The CR also cut the Office of Biological and Environmental Research (the part of DOE that funds research on climate physics, bioenergy, and initiated the Human Genome Project) by 49%, effectively shutting it down the rest of the year. I can find no information on whether the Obama administration negotiated a less severe cut.

In sum:              

                 House CR cut       Newly negotiated cut           

 NIH            $1.6 B                         $260 M

 NSF            $75 M                           $53 M

 CDC           $1.4 B                         $730 M

 DOEOS     $901 M                          $35 M

Remarkably, these figures represent a miniscule percentage of the multi-trillion dollar budget deficit, and even a relatively small portion of the budgets of these federal offices. What we must realize, however, is that research lab budgets are very streamlined, and every penny must be accounted for on a yearly basis. Young investigators receive support from their university departments, but by their mid-career stage, scientists are expected to cover the costs of their research programs with their own grant dollars. The average biomedical science graduate student is paid $22-25,000 roughly $20-30K (2009-2010), and the grant also covers their health insurance and other overhead, bringing the total cost for a student to about $35-45K. (Note that medical and graduate schools waive tuition for PhD students, which is another sizeable chunk of change that universities swallow for the good of the community.) A post-doc might cost $35-45 40-60K, not including overhead. Faculty salaries vary widely by region, but range from $80K at the low end for young assistant professors to over twice or thrice that amount for the most successful. So one grant might cover the salary of the faculty member, a postdoctoral fellow or a student, some necessary equipment, materials (which easily run thousands of dollars per month), modest travel costs to a conference, and publication costs (the balance depends on the individual lab and other sources of support, and yes, scientists have to pay journals for color figures in their papers and other sundry publication costs). If successful NIH-funded scientists average 1.2-1.4 grants annually (each grant lasts five years, with the possibility for competitive renewal), then to lose 1040 grants means that a thousand scientists, and their postdocs and students, will be out of a job unless they can quickly find another source of support through philanthropy (which is tough to get and doesn’t provide overhead for the university) or industry (which comes with many strings attached, to the benefit of the company rather than the university lab). 

It's also crucial to realize that federally funded research drives the engines of the biotech and pharmaceutical industries, whose main function is to take discoveries made in university and medical school research labs and scale them up into marketable drugs and devices. These industries do not, by and large, conduct fundamental research. (How could they? They exist to turn profits, like all businesses.)

In some ways, scientific labs are like small businesses, which can flourish only when there is robust infrastructural support. Consider our most successful corporations.  They spring up in areas where there's running water, reliable electricity, good roads for transportation, not to mention easy access to educated people. It would be hard to imagine Microsoft, Apple, GE, or Bristol-Myers Squibb achieving greatness from humble beginnings in, say, Afghanistan or Sierra Leone—which is why corporations should be paying taxes instead of getting billions of dollars in rebates.

Every commentator who has lamented these draconian and senseless cuts has thrown up their metaphoric hands and concluded that Republicans must simply hate science.  A few probably do hate the science that provides a rationale for curbing corporate excess—it’s no surprise they wanted to shut down the Office of Biological and Environmental Research, which studies climate physics and bioenergy, among other things—but I don’t think that this is the real motivation.

First, they’re a particularly technophilic bunch when it comes to their own health. 

Second, there is no inherent contradiction between conservatism and science. In fact, among those holding doctorates, scientists and physicians are more likely to be Republican than historians, philosophers, and others in the humanities. In the 112th Congress, for example, there are 20 doctors, only two of whom are Democrats. (Republicans do disdain the humanities, but that's because they see value only in economic terms. Cf. "Ceding the Premise.")

Third, let’s consider what happens to mathematicians and scientists who cannot fund their academic research. Biomedical researchers go to Big Pharma. But what part of the business world most warmly embraces mathematicians and physicists, i.e., those at the top of our scientific hierarchy? 

Why, the financial sector, of course. 

Mathematicians and PhDs of various stripes were the ones who created the algorithms that allow hedge fund managers to shave off a fraction of a penny for each Wall Street transaction and thereby amass untold fortunes while siphoning wealth from the entire economy without anyone noticing.  It's a nifty trick: you can’t teach it in school, you need the combination of unbridled greed and utter contempt for the hoi polloi that comes with constant exposure to the amoral world of economics/finance, in which rationality itself is defined as acting in one's own best economic interest, without any impulse to take into account other systems of value.

Now we know who loses when “we” win the future: us.

Not incidentally, we also know why the Obama administrations seems unable to shake up DC business as usual: it’s all about business in the first place.

If we allow politicians to slash federal education and research programs, our best and brightest (as they define them—scientists and mathematicians) will have no choice but to work for corporate titans to make them even more ridiculously wealthy than they already are, to transform them from the top 1% to the top 0.01%.

This is not an entirely new predicament. The idea that power corrupts, and absolute power corrupts absolutely, has been around since the Romans. (And look what happened to them.) As with so many other contemporary trends, however, the pace of destructive changes is accelerating because of feedback mechanisms within the system. 

Thankfully, there is an alternative.

What an honest, workable budget looks like—and the challenge to getting there

Eighty members of the House Progressive Caucus put together The People’s Budget, which would eliminate the deficit and create a surplus by 2021 in an efficient and fair way, largely by curbing military spending, raising tax rates on giant corporations, and wrestling healthcare costs under control by offering a public option—three mechanisms that a majority of the population have favored.

Check out the People’s Budget and if you like what you read, sign on here.  There is hope for genuine change that allows all of us to flourish, but it will take a little effort to educate ourselves.

This will be an uphill battle, however. To make clear just how difficult it is to wrest money from corporate interests, take the recent prank by US Uncut, a burgeoning movement to pressure corporate tax cheats like GE to pay their fair share.  Earlier this week they posted a fake news release praising GE for returning their legal, if ethically reprehensible, tax refund of $3.2 billion.  Several media outlets ran the story as if it were true, and the result was that GE stocks dropped .6% (far more than the value of the supposed return) until it became clear the press had been duped, at which point the stocks recovered.


As US Uncut rightfully concludes, GE can't be expected to do the right thing voluntarily because its stock would plunge—that's why we have to work to change the laws.  We can argue that a company's priority should not be to keep its shareholders happy, but that's where we are these days.

Further reading:

Joseph Stiglitz, Nobel prize-winning economist, in the current issue of Vanity Fair. 

The Economist's Democracy in America blog has an excellent post for those curious about the effects of cuts to the federal research budgets (see particularly the links).