Libertarians and the CDC

I’m talking about the Center for Disease Control and Prevention, of course. It occurred to me that the CDC might prevent a bit of a gray area for libertarians, and I honestly couldn’t figure out where it might stand in this sort of philosophy. As a recovering Libertarian myself, I think I have a pretty solid grasp on the philosophical ideology, but this is something I can’t quite figure out.


I’m not 100% sure what your question is, but I guessing you’re essentially asking what the libertarian perspective is on the CDC? If so, as a libertarian, I don’t think it’s something that needs to be federally funded at all. There’s tons of money in researching diseases, and I’m sure there would also be plenty of non-profit organizations for specific diseases that would have little trouble raising money for research. I imagine some research money for less well known diseases may drop off the plate, but at the same time would probably result in more money for the more popularly recognized diseases, so it’s probably a relatively neutral result.

That’s a good one. Especially for a ‘wishy-washy’ Libertarian like me.

Libertarian principles work well when there are lots of frequent feedback loops to provide data and correct decision-making, transaction costs are manageable, and the severity of a bad decision doesn’t have huge public externalities that are unrecoverable.

Trying Jim’s burger joint instead of McDonalds’ is one example. You try a burger. It costs $3. It sucks. But it’s only you that is affected by the sucky burger. So you don’t go there again. Problem solved.

Choosing not to defend your country’s borders is on the other end of the spectrum. You try it for a while. You save some money on defense expenditures. Then you get over-run and you, your family, and your fellow citizens are enslaved by a dictator. Whoops. It’s not like you can try that one again with a ‘Do Over’.

Contagious diseases that spread rapidly would seem to cross the threshold where public externalities are involved.

So the next question is: How do you dedicate resources to protect against this threat? Do you set up a government agency manned by public employees? Or do you extract resources from the citizenry, but then give independent agencies the money and flexibility to do what they think is best? Or some flavor in between?


There is no money in reasearching diseases. There is a lot of money in selling cures and such for diseases. This is why Pfizer can lay off 800 researchers right before snatching up Wyeth for a cool 68 billion. Pfizer’s quarterly reports show how much they spend on research. Here’s some data from the third quarter of 2007. Out of 11.9 billion in revenue, 1.9 went to research. 16%! Wow. Except that they spent more just setting up sales (5.6). That’s a lot of [del]bribes[/del] advertisement pens for doctors.

There’s nothing to sell if your researchers don’t come up with anything.

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That’s sort of the crux of the issue. The ‘disease = national protection’ metaphor is a good one, and strikes at the heart of my question. So far as disease research is concerned, I see that as pretty easy: privatize it. Not the optimal solution, IMHO, but the ‘obvious’ conclusion from the libertarian perspective.

The CDC, however, is also responsible for tracking disease. Should the need occur, they could call for evacuations, quarantines, etc, that I don’t believe a private organization could muster. They serve a role of a sort of ‘national reserve’ for disease, that clearly serves a public good.

Then again, there are other things that libertarians argue can be privatized, like roads, that I never considered, so I’m going out on a limb here and asking how a private entity could do what it does.

Ah. But you glossed over the most important part of your cite, the one where it says the research doesn’t justify it’s high costs.

Why are the costs so high? Why does it take $1 billion to bring a new drug to market?

Hint, hint…it has to do with the thread of the OP.

What drug companies are doing with their resources is perfectly rational. It costs a fortune to bring a new drug to market, primarily because the costs are driven by <you fill in the blank here…I know you can do it>. So the returns are not there. Therefore, they divert resources to something else.

What if the costs weren’t so high to bring a new drug to market? What might happen then?

As usual, people have no idea what Marketing means. Marketing is a hell of a lot more than advertising. Suffice it to say that a budget like that is neither unusual nor a sign that the company has misplaced priorities. You may be right to say that without research, there is nothing to sell. But it costs grossly more to sell than the do research.

You’re not going out on a limb at all. You’re doing exactly what you should be doing.

That is, defining and clarifying a public externality FIRST, and then figuring out how to solve the problem.

The way it usually happens is that a government agency gets set up as a knee-jerk reaction to ‘do something’ that has nothing to do with public externalities. Or is a reaction to a problem that the government caused by its own intervention.

Then some agency or directorate is set up and funded. As its budget invariably grows each year, an intelligent person dares to question the reason for its existence. It’s then justified by somehow reverse-engineering its charter to include a public externality when in fact none exists, or by tear-jerking anecdotal evidence about how some crippled little girl, senior citizen or other special interest will be negatively affected by taking the funding away. Which is a mathematical certainty. When you rob Peter to pay Paul, you can usually count on the support of Paul.

So don’t apologize. You’re actually doing it the way it should be done.

I apologize for somehow implying this. This is actually typical for a research-heavy corporation. Funding research is actually a very tricky proposition because returns are really unexpected. But the assertion made above me was that research is profitable. It is not. Pfizer’s behavior is indicative of this. It is easier for it to acquire a company that’s already done research than it is to do its own.

Research is like turning on the lights. You’d like to get by with as little electricity as possible. It’s the cost of doing business, and if it can be cut, cut it. It is not profitable to turn on the lights. But you have to see to work.

A fair point, and something I hadn’t considered. From that perspective, I don’t have much of an issue from that sort of responsibility being served by the government; however, I’m not sure that that is necessary or the best solution. So, for the sake of argument, let’s pretend we’re living in Libertaria, and I’ll try to imagine how it could be implemented.

You have some sort of central, but privatized, organization that serves all the purposes of the CDC from drug research and tracking to maintaining databases and organizing responses. Obviously, universities and hospitals have interest in funding research, so they would contribute funds. Local emergency response would want to contribute funds; hell, even with something as well known as the flu can can a locality off-guard if they don’t know when it’s coming and have the appropriate vaccines available. Pharmaceutical companies would be interested in contributing funds from all perspectives because they have interest in research as well as having their drugs used. I don’t think there would be a shortage of funds.

The bigger problem is, of course, getting ubiquity of the name associated with services or products that are related to disease. In the same way that you wouldn’t get a degree from an institution that isn’t accredited by whatever association that accredits your major, or you wouldn’t go to the local cleaners if they’re not a part of the BBB, would you want to go to a hospital or a doctor that wasn’t a member of the privitized CDC? Would you want to buy a drug from a company that isn’t a member of the privitized CDC? If your local emergency response wasn’t a member of the privitized CDC wouldn’t you want them to be?

Some people in this thread seem to be operating under the assumption that the CDC’s major role and mandate is doing research on how to cure diseases - that they do much the same job as a major pharmaceutical company. I believe that in actual fact, a major role of the CDC is to track communicable disease, and to inform the medical community how best to deal with outbreaks. They do not research, for example, new drugs for hypertension or baldness cures.

There is a concrete example that I know of that compares a region with a Centre for Disease Control with another region without (or with a poor one). Anyone remember the SARS epidemic? An person entered Canada from Asia with a serious infectious disease. There were two primary centres of outbreak in Canada - Vancouver and Toronto. In Vancouver, the BC Centre for Disease control was all over it. They sent warnings to every primary care facility promptly. Measures were put in place to protect clinical staff and isolate patients.

In Toronto, no such warnings were put out to primary care facilities, because there was no government entity to do this. Care workers were infected. Patients were not properly isolated, because the information about this disease was not flowing quickly to the medical community from a central government source.

The end result? Vancouver kept SARS outbreaks to a minimum. Toronto had 39 deaths.

I simply don’t see where private companies would have seen a profit motive in informing the public and medical community about this new infectious disease. I don’t see myself setting up a private CDC to catch the next SARS virus and save lives - where would my money come from?

This is a prime case of where the government must provide a service that is for the common good, and one that it is very difficult to see where private industry would fill the niche.

In some cases, I have no problem trading off efficiency for fairness. In some cases, I have no problem trading off fairness for efficiency. But a monopolistic firm like the one you propose, Blaster Master, seems to serve neither cause, and I have a problem with that.

Funny you should say that, because that’s exactly the kind of example that I think supports a private organization better than a government funded one. In this case, a hospital has an incentive to provide funds because that information is crucial to doing their job. And, as a patron, given the option to go to a hospital that has that membership and one that doesn’t, you’d probably choose the first, no? And beyond that, wouldn’t local emergency response want that sort of information and be willing to provide funds for it?

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erislover, my example I think is both fundamentally more efficient and more fair, and I fail to see it as a monopolistic firm. I compared the service to the sort of thing that BBB provides. It’s not a service that precludes competition at all, as any number of organizations can do research on disease and track trends.

I’m also inherently distrustful of these sorts of things when set up by the government. If it’s a private organization, and they fail to live up to expectations, a given doctor or hospital or emergency response can cancel membership and select a similar service provided by another company. If the government fails, you can’t get another service and fixing it involves more beaureacracy, more funds, and dismal, if any, improvements.

So what, exactly, is unfair and inefficient about my proposal. I admit it probably isn’t a perfect proposal, since I put it together on the spot, but painting it as unfair and inefficient without explanation isn’t helpful in the matter.

Actually as pointed out, there isn’t much enthusiasm for private disease research. And what you do get tends to be heavily distorted by the profit motive, such as the wealth of the people prone to that disease, and a preference to lifelong treatments over vaccines.

Mass death and suffering. Because much of the cost is due to the expense of doing so safely.

Yeah, it means in this case repackaging a drug in a different colored pill under a new name. Which is easier than creating an actual new drug, which is why research gets neglected.

And what if none of them have any such membership, or are willing to pay for such a replacement for the CDC ? Look at Euphonious Polemic’s example of Toronto; no such government organization existed, and no one was interested in creating a private version.

And if no one is interested in setting up a private version ?

One of the biggest problems with the whole libertarian philosophy is the assumption that if the government doesn’t do something, that private industry will step in.

Yeah lets go tragedy of the commons all up in the next plague. Yeah!!!

Then it is my fault. Your post read, to me, like the suggestion that the functions the CDC serve are best-represented by a single company.

It is not a question of whether more than one business entity could do it. It is a question of whether more than one would, and whether this would promote efficiency or fairness (or both, to the extent that these are not always mutually exclusive goals). For almost all floors, only one person can really mop the floor, but many, many people would in place of the current janitor. This keeps salaries low. What keeps down the cost of the CDC?

I understand this concern about the quality of a loaf of bread, but not about managing epidemics. If there is a failure in this case, there is simply a failure, and its consequences are massive. There is no fallback position, no insurance policy, no hedge fund, no strategic reserves. I do not understand what subjecting the spread of information–a massive cost–to market forces could do, other than limit consumption of information. Can you explain your idea any further? (Or anyone else.)

Emphatically no. I do not want private, for profit organizations determining what the priorities are for public infectious disease health. I come from a country that has a fairly effective public health system, particularly with regard to infectious diseases. I do not automatically distrust the government, nor do I automatically think the private market must necessarily provide the best solution every time.

We may have to agree to disagree here.

This is a great question, and it does in fact get to the heart of a philosophical split that I see brewing between Libertarians.

There are your ‘fundie’ Libertarians, whose attitude is basically, “Government should only do the absolute minimum possible.” How they define the ‘absolute minimum’ depends. The ‘classic’ response would be, “Defense, police, the courts.” That’s about it. The most extreme wing even wants these functions privatized, which I personally think is nuts.

But I believe there’s a more sophisticated libertarianism brewing - one which recognizes that true market failures do exist, and that really, what government should be doing is ensuring that the markets function correctly so as to maximize their utility and ensure that as many transactions are possible are carried out freely. I’m one of these types, and as such I’ve got no problem with the CDC, given that it’s hard to see the path to profit, and that there are externalities involved and other factors which make it hard to see how a market in ‘disease prevention’ could develop.

Actually, I can imagine one - a consortium of insurance companies might do it if the government wasn’t involved - the same people who would have to pay all the medical bills if the population got sick. I could even see large employers kicking into such a fund as part of a fee to keep their workers healthy and productive.

But that brings up another point - there’s a huge difference between a regulatory agency that constantly coerces people, and one that acts in an information-gathering and advisory role. The latter has a much smaller footprint on liberty, and I’ll tolerate quite a lot of that kind of thing from the government. For example, if th FDA’s mandate was changed to merely provide data and make recommendations, I’d be okay with it.

In the CDC’s case, the only time it compels behavior is when someone presents a clear and present danger to others. So this libertarian is fine with it.

The consortium idea is interesting. But speaking as one who has been a member of few consortium-like entities in the private sector, it’s hard to see how this would ‘spring up’ to the extent required in short order. Competitors are leery of sharing too much information, there needs to be some serious impetus to get going, and people worry about the free-rider problem.

But I like the idea of a government-nudged consortium. Something like a 50-50 funding split, waiving of antitrust laws, etc. and a central facilitator to manage the process. In fact, I like that idea so much, I’m going to salt it away in my small-government toolkit as a permanent fixture.

I suppose it’s possible, but there’s a huge free-rider problem with this approach, so it seems to me you’re likely to get something that will miss large segments of the population. Also, infectious, pathogenic disease treatment is exactly the type of service that is prone to inelastic supply-demand curves. I can’t see this being economically efficient.