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Prasad's Law: there's always enough health spending to concentrate wealth, never enough to diffuse it

In a recent installment of his Plenary Session podcast, hematologist-oncologist Vinay Prasad observed that "There are interventions that disperse wealth, … and they give people jobs, and they send them out in the community; and there are implantable drugs, implantable devices, there are drugs, there are cancer screening tests, and we will always prioritize interventions that consolidate money in the hands of the few, over interventions that disperse money to the hands of many, with the same levels of evidence."

The "unaffordable" interventions are things like more nurses, home visitors, and other policies that give small amounts of money to a large number of people to deliver health care.

Dr Ray Poses, Clinical Associate Professor of Medicine at Brown University, has consolidated this into "Prasad's Law": "Medical goods and services that concentrate wealth can be paid for; medical goods and services that disperse wealth are 'unaffordable.'"

I would state it more generally as "Spending that involves procurements will have vendors who will use excess revenues to lobby to increase that spending. Spending that merely pays employees to do the work of the institution has no such excess capital and will therefore be squeezed out over the long term."

I first started thinking about this at an Orgcon some years ago, where I saw a rep from Reprieve present their research on civilian casualties from US drone strikes outside of theaters of war. These drone strikes are coordinated by the CIA (which is not a military organization, thus their activities are not an "act of war"), and the Agency knows next to nothing about who they kill.

As the Reprieve rep explained it, the CIA used signals intelligence (intercepted communications) to decide who was a terrorist, targeted them using their cellphone identifiers and killed them. But because the CIA was using signals intelligence (AKA "sigint") to operate, it only found out who was killed if they later intercepted communications from inside the country with the details.

This is very weird, because the CIA is historically a "human intelligence" (humint) agency, not a sigint agency. Signals have been the purview of the NSA (which sits under the Pentagon and thus can't direct drone operations without risking an act of war). The CIA's historical role was to dress up spooks in Lawrence of Arabia drag and send them into hostile territory to cozy up to sources and say things like, "Hey, did you hear about that big drone strike? Wild! Do you happen to know who got scragged?"

How did the CIA lose so much of its humint capacity even as it expanded its sigint capacity? I think the answer is that sigint produces procurements (computers, analysts, etc) while cosplaying Lawrence of Arabia is basically free (there's just not a lot of money in marking up putty noses). That means the people who sell sigint to intelligence agencies can make continuous, long-term investments in lobbying the CIA to expand its sigint activities, while the pressure to improve humint is diffused and ineffective. Over time, the budget tilts from humint to sigint ("We kill people based on metadata" -Keith Alexander), and eventually humint withers.

I think that this is generally true of institutional spending (think of schools increasing budgets for terrible core-curriculum-oriented online resources while fighting tooth and nail against reducing class sizes or paying teachers more), and that it's especially true where the procurements are made from concentrated industries (most industries, these days), that can lobby effectively together.

It is not, in reality, a particularly surprising result, because the true purpose of the U.S. healthcare system is by no means to supply medical care (although that is indeed the goal of many who work within it), but instead to serve one overarching purpose – to make money for capitalists. Adequate nurse staffing does not make money for capitalists (even if it makes money for nurses); and crazy expensive, marginally effective, cancer drugs do make money for capitalists. It’s that simple.

And to change it – ever – will, in my mind, require a lot of change, not tinkering at the edges. As long as those who control our system now (now including private equity investors) continue to control our system, it cannot change. Wresting control from their hands will undoubtedly be a hell of a fight, but it is a fight essential to alleviate the serious issues that cause so much suffering.

Why Hospitals Never Have Enough Nurses: The Explanatory Power of “Prasad’s Law” of Wealth Concentration [Roy Poses/Naked Capitalism]