The Problem with Profits; Katie Meacham's story

[Tom Rinaldo]

A small story appeared in the New York Times that few nationally are likely to have noted. It was published on page MB1 of the New York edition, not exactly high profile placement for a national newspaper, but what it covers should be central to the national debate going on today about health care in America:

A Lifesaver Out of Reach, for Want of a Profit
By JIM DWYER
Published: October 16, 2009

"Even though she is just 26, her days and time are at a premium. Ms. Meacham lives on the Upper East Side of Manhattan, but she is also a citizen of another country: cancer land. She has a kind of aggressive lymphoma, a disease that ruins the blood."

..."There is no easy way to make money from the cures to these diseases. Millions of people are willing to donate cells from their bone marrow, but commercial blood banks are not interested in bearing the cost of figuring out who wants to do it or in tracking them down when they are needed.

“It’s not a business,” said Robert Baitty, the director of the blood stem cell transplantation program at the Health Resources and Services Administration."

Similarly, more than four million babies are born every year in the United States, each one with an umbilical cord containing blood that is highly prized because it is less likely to be rejected when cells are transplanted.

“Most of the cord blood is just thrown in the garbage,” Ms. Meacham said.

The reason for this squander is simple. No one has figured out a way to make money by salvaging the blood and making it available for therapeutic use. It is expensive to collect the names and tissue types of millions of people, or tens of thousands of units of umbilical cord blood. For these lifesaving therapies, there is no business model."
http://www.nytimes.com/2009/10/18/nyregion/18about.html?_r=1&em

There is of course much more to be said in the full story which I urge all to read. It even discusses a promising but woefully underfunded Federal program that was begun to step into this health care breech which an insufficiently dependable profit stream left in our health care system. The relevance of this matter now is obvious, as Congressional Democrats jockey over the worthiness of providing a government run health insurance option for our citizens that can compete with private insurers; the very same insurers who invented the technical but often life or death determining concept of "pre-existing conditions" in order to insure their own profits.

We live in a mixed economy, and bully for that. I for one, as a progressive in relatively good standing, would not seek nor desire total government control of "the market place". Historically the profit motive has demonstrably been tied to multiple creative and socially beneficial innovations, as well as the reduction or even elimination of many parasitic inefficiencies that added costs to essential or desirable goods and services without in any way improving them. There is a potential danger in overly aggressive government regulation, just as there is in insufficiently aggressive government regulation, as the Great Recession we now experience bears witness to. That is a dance that perpetually must be practiced, because balance in a moving world is never static.

But stories like the above and many others that too often slip by without notice point to a larger question than the proper role of government in regulating private enterprise in the free market. It points to something both simpler and larger; the role of government and the reason for it. Even in capitalist economies, when comprehensive solutions to systematic social problems do not readily lend themselves to profitable business models, government provides alternatives. When the social consequences of allowing some to freely prosper and profit while others are left out to suffer became greater than the fabric of our society is capable of bearing, or at least bearing in good conscience, there is government as an alternative. And when the long term needs that embody the common good run counter to the merit of allowing some, who by hook or crook position themselves in a free enterprise system to reap vast short term profits, traditionally, in Democracies at least, government steps in.

It can be said that both public education and medicare were socialist experiments. If so they were highly successful socialist experiments. Yes private alternatives to both did and still continue to exist, and I have no quarrel with that. They serve a purpose for some, but the motto of America is "E. Pluribus Unum", ONE out of many. The one that our motto speaks of represents the common good, and that common good is ill served by allowing those who insist that we find "a way to make money" for everything worth doing, or by definition it is not worth doing, tightly control our nations policies. Just ask Katie Meacham.

[Tom Rinaldo]

1. One kick for the work week crowd n/t