Ezra Klein

Lawrence Lessig reexamines the remix:

Policy wonks, as you might imagine, like to argue about which policies produce the best outcomes. But when you're looking to confirm or debunk policy preferences, you can exaggerate their centrality to outcomes. That's what Matt Yglesias is getting at it in this post, and it's also what you're seeing debunked in Robert Irwin's paper showing that state budget deficits are the result of unemployment rather than differing policy decisions. Policy is important, but it's just one factor.

You see this sort of thing a lot when people are looking at demographic consequences for various welfare states. A pension program that has to deal with a generation in which a larger-than-average number of people retire is considered in crisis, and its crisis is taken as evidence of what a bad idea it was. But before those people retired, they were paying taxes and building up surpluses, so it was a pretty good idea. And if there had been no pension program there to catch the elderly, you'd have enormous problems with elderly poverty, higher-than-optimal savings rates, families that suddenly have to pull someone out of the workforce to care for a parent, etc.

So there's not just the question of the pension program, but the question of what problems would exist in the program's absence. And that's because the underlying issue -- a "bulge" generation retiring -- would exist either way.

You've got questions and Dylan Matthews, improbably but reliably, can find answers.

1) Pew releases an analysis of how the press covered health-care reform.

2) The Breakthrough Institute, the Information Technology and Innovation Foundation, and Brookings have an action plan for energy innovation.

3) The Committee for a Responsible Federal Budget creates an interactive calculator that lets you choose your own deficit adventure.

4) How to tax the financial sector (and how not to do it).

5) Measuring the stock of human capital.

In yesterday's research desk thread, dt4211 asked:

How much of the cost growth in medical care (if any) is driven by increases in costs for the same services, and how much is the costs associated with new treatments and services that didn't used to exist? To put it another way, is there an increase in doctor productivity, such that the same output becomes cheaper over time?

That's an interesting question, and one I didn't know the answer to. So I wrote to David Cutler, a health economist at Harvard, and asked him. Here's his reply:

This is a simple question with a lengthy answer. A few points:

1. Most (>50%) of cost increases historically are driven by new services and expanded use of existing services. Not all of that is bad; most of my research is about the positive benefits of technological change (see my book, Your Money or Your Life). Put another way, productivity is improving.

2. That said, we spend much more than we need to -- my guess is 40 to 50% more than is needed to get the outcomes we get. Some care is wasted, and there are a ton of administrative inefficiencies (not just insurance, but everywhere). That's why when I talk about reform, I talk about spending the next 20-30 years eliminating waste, not cutting back on valuable services. At that point, we'll see how much we spend and what we need to do about it.

3. In very recent years (e.g., the past decade), I think price increases have mattered more. Most big cities have had a huge consolidation of providers, which has led to higher prices for care. This is true for hospitals and MDs. I think this is underappreciated by most of my profession. This is a pure transfer.

4. It's interesting that technology has been so one-sided. E.g., there is no Sam Walton of health care (though perhaps Tommy Frist Jr. counts) -- someone who revolutionizes health care by making it possible to get more for less. I think that's possible and just wrote an NBER paper on "Where Are the Health Care Entrepreneurs?" The key, in my view, is better information and payment reform. I'm quite taken by this question. I hope the next decade is spent producing billionaires able to give us better health for less.

One of the responses I've gotten to my column on the anti-stimulus is that state budget deficits are the direct result of irresponsible state governments and so helping them out would be rewarding fiscal irresponsibility. I don't want to say that there's nothing to that perspective -- I favor tying aid to labor market conditions rather than budget deficits for exactly that reason -- but as this working paper from Wharton economist Robert Inman shows, it's not the underlying story.

The 2007-2010 recession has imposed significant fiscal hardships on state and local governments. The result has been state deficits and the need to increase state taxes, cut spending, and withdraw funds from state rainy day accounts. The primary cause of state budget “gaps” has been the rise in the level of state unemployment. There is no evidence that gaps are related to state political institutions, the state’s prior receipt of federal funding, or possibly favored access to key congressional budget committees.

In the paper, Inman tests factors in states' budgeting practices, politics and economies in order to figure out which correlates most heavily with their economic conditions. The runaway winner is unemployment. "States with a one standard deviation higher rate of unemployment (10.0%) will have a budget gap which is $222/person more than a comparable state with an unemployment rate one standard deviation lower than average (6%)," he concludes. Inman finds this to be a cheering prospect: "The good news from this analysis is that the states’ fiscal crises of 2009 do not appear to be linked to any obvious structural or institutional failures in state finances. It’s the economy."

A few other points from the paper: The states that have survived the recession best are not states with more competent governments. They're states that depend on natural resources – Montana, Nebraska, North Dakota, Texas, West Virginia, and Wyoming – for revenue. Budget cuts, as you might have expected, have hit aid to local education and transfers and services for lower income families hardest. And the stimulus covered, at most, 23 cents of each dollar of state budget gap -- and that's running out this year.

The graph above comes from Pew's study of the media's coverage of health-care reform, and on first blush, it makes the media look, well, not great, but not awful. There really were a lot of stories devoted to the substance of the plans. But as Igor Volsky points out, "as the debate progressed, Americans became more, not less, confused about the policy." In July of 2009, 63 percent said they were having trouble understanding the bill. By December 2009, that had jumped to 69 percent. Six months and thousands of articles and television spots left the American people more, rather than less, uncertain as to the issues under consideration.

There's a problem in the way the media covers substance. At the beginning of the debate, there's a fair amount of attention paid to the basics of the legislation. But the basics of the legislation are not the controversial parts, and so the argument moves on to smaller pieces of the legislation that are controversial. The media cover those points of controversy, and people tune in, but they missed the beginning, and now everyone is talking about the bill's third CBO score, not about how the thing actually works.

It's trite to say it, but the news business is biased toward, well, news. There are plenty of outlets that tell you what happened yesterday, but virtually no organizations that simply tell you what's going on. Keeping up on the news is easy, but getting a handle on an ongoing situation that you've not really been following is hard. In recent years, we've seen the rise of outlets like FactCheck.org, which try and police lies that are relevant to the debate. But there's really no one out there who is trying to give you the background to everything going in the debate. News organizations will write occasional pieces trying to sum up the legislation, but if you miss them, it's hard to find them again, and they're not comprehensive anyway. The fact that I still can't direct people to one really good, really clear, really comprehensive online summary of the bill is an enduring frustration for me, and a real problem given the importance of the legislation and the number of questions there are about it.

If I edited a major publication -- or even a medium-sized one -- I would begin each major legislative battle by detailing a few of my smartest, clearest writers to create a hyperlinked, fairly comprehensive, summary of the basic legislation. That summary would be kept updated throughout the process, and it would be linked in every single story written on the topic. As reader questions came in, and points of confusion arose, it would be expanded, so by the end, you'd have a document that was current, comprehensive, navigable and responsive to the questions people actually had about the legislation. Telling people what just happened is undeniably important, but given that most people aren't following that closely, we in the media need to do a better job of telling people what's been happening.

Budget chief Peter Orszag might become the first member of President Obama's cabinet to resign, which means it's time for Washington to play its favorite game: Guess the replacement! Meanwhile, House and Senate conferees have reached a deal on regulating debit card fees, and for all the talk about how the U.S.'s fiscal policy is too tight, we're the ones begging the rest of the world to loosen up a bit.

It's Tuesday, if you know what I mean. Welcome to Wonkbook.

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OMB director Peter Orszag will likely resign in July and move to a think tank, reports Hans Nichols: "Among the potential replacements under consideration are Laura Tyson, a former director of the National Economic Council under President Bill Clinton, and Rob Nabors, who served as OMB deputy director under Orszag before moving to the White House to work under Chief of Staff Rahm Emanuel, said one of the officials."

Ed O'Keefe names and flash-profiles seven possible successors for Orszag: http://bit.ly/a8bqkU

House conferees have mostly agreed to the Senate's strict limits on debit card fees, reports Binyamin Appelbaum: "The agreement largely preserves the Senate’s language, telling the Federal Reserve to limit the fees that banks collect from merchants when customers swipe debit cards. That is expected to save merchants billions of dollars, some of which could be passed on to customers in the form of lower prices."

U.S. plans to argue against global austerity measures at the G-20, report Bob Davis and Marcus Walker. The U.S. plans to press its economic partners at a summit to move cautiously with plans to tighten their fiscal policies while the global economic recovery remains uncertain, for fear of producing a "Hoover moment."

Cineaste interlude: A Kubrick/Scorsese mashup.

Still to come: Ken Salazar renames the Mineral Management Service; Americans want to move beyond oil but they oppose policies that would get us there; and a Wendell Primus profile. Did you hear that? I said a Wendell Primus profile!

Recap: Liberals have a complicated relationship with President Obama; voters care more about jobs than about the deficit, but they don't necessarily care for Democrats' solutions; and a utilities-only cap-and-trade bill could work out okay.

Elsewhere:

1) Igor Volsky summarizes a Pew study on media coverage of the health-care debate.

2) Some worries about a utility-only cap-and-trade bill.

3) If I lived on the Amazon, I'd probably be glad to see a giant barge filled with candy bars.

4) A lettuce sandwich is getting rave reviews.

Recipe of the day: Phyllo pizza with smoked mozzarella and cherry tomatoes.

"Spend now, while the economy remains depressed; save later, once it has recovered," writes Paul Krugman. "How hard is that to understand?"

I think we can be even more specific than that. The rate on 10-year treasuries is about 3.42 percent right now, which is extremely low. That means two things: First, it's uncommonly cheap for the government to borrow money right now. Second, the market is not that concerned about our deficit right now. We're in this enviable situation because America is considered stable and other economies and investments are considered less stable

The rate on our treasuries will rise at some point. It might even change "on a dime," as people like to say. It'll be that change that forces us to do long-term deficit reduction. In the absence of that external pressure, we're not going to do any serious deficit reduction (at least, not outside what we passed in health-care reform). Let's be honest about that with ourselves.

So what we're left with is a space between now and when interest rates begin to rise. That space is defined by a weak economy with low growth, high unemployment and cheap rates for the government to borrow money. We should use this period before the markets turn on us to borrow money at low rates in order to get our economy back on its feet and make what long-term investments we feel like we want to make (retrofitting schools, for example). When the global economy begins to recover and interest rates rise to, say, a still-low 5 percent, we can pull back on the stimulus and begin deficit reduction.

This is the benefit of being the superpower: America's economic status drives our borrowing costs down when the rest of the world faces an unstable economy. The pity is that we're likely to squander it, and for nothing. If we do too little now to deal with unemployment and anemic growth, we'll have to do more later when borrowing is expensive and when we need to be doing deficit reduction. I'd imagine that lots of businesses would love the chance to borrow at a rate much lower than their competitors at a moment when they really needed to spend, but we seem to prefer to argue about how aggressive we should be in not taking the opportunity.

By Dylan Matthews

Msantow asks:

What percentage of the US economy is taken up with financial services? My sense is that it has gone from single digits in the early 80s, to somewhere between 20% and 25% presently ... but I can't for the life of me remember where I got that from.

The Bureau of Economic Analysis keeps data on the value added to the economy by each sector of the economy. While it provides breakdowns, it initially groups the financial sector along with real estate, which makes sense given the importance of mortgage lending to the financial industry. Here's the growth both in the financial sector alone and in the financial sector along with real estate, since World War II:

While neither line shoots from single digits to 20-25, msantow is correct that 1980 marked a turning point. After the 1970s, in which the combined financial and real estate share hovered around 15 percent, the figure shot up until breaking 20 percent around 2000. It's also worth noting that this change is only in the combined line, while the financial sector measured alone continued growing at roughly the same pace. This is not exactly surprising, given how important mortgages and mortgage derivatives were to the rise of the financial industry in past decades, but it's still striking to see.

[I'd just add that financial-sector profits as a share of total corporate profits reached 45 percent shortly before the bust. -- Ezra]

The big movement on the climate-change bill today is that various power players -- including, most importantly, Rahm Emanuel -- are talking up a "utilities-only cap-and-trade bill." To put this in the simplest terms, it would mean that we price carbon in utilities but not cars. As it happens, this isn't as big a deal as you might think. As this graph from Harvard's Robert Stavins shows that cap-and-trade would, in the first 20 years, primarily affect utilities anyway:

That's because most of our carbon emissions come from generating electricity. The argument over SUVs might dominate the debate, but it doesn't dominate our emissions, as this graph from the U.S. Energy Information Administration shows:

As David Roberts says, "cap-and-trade was always mostly about the utility sector, so if it becomes explicitly about the utility sector, it's not a total loss, if a few conditions are met." Here are the conditions:

To amount to a credible bill, a utility-only cap-and-trade system would need to be accompanied by three things:

* Measures to reduce oil use, along the lines of those Sen. Jeff Merkley (D-Ore.) proposed last week.

* Measures to increase energy efficiency, along the lines of those, um, Sen. Jeff Merkley proposed last week.

* Measures to accelerate research, development and deployment of renewable energy, in particular: a) a renewable energy standard much stronger than those now on the table, and b) substantial investment in energy R&D.;

You also want the bill to be scalable: A utilities-only cap-and-trade program should be designed such that it can eventually become an economy-wide cap-and-trade program.

The graphic above comes from a survey the Kaiser Family Foundation conducted among adults who purchase health coverage on the individual market. What the survey found was a broken market: People with health insurance don't think they can shop around to buy new health insurance because they or someone in their family has a preexisting condition and the market is too complicated. And if people don't feel able to shop around, the market doesn't work.

The good news is that the Affordable Care Act actually solves these problems: Preexisting conditions are no longer relevant and the exchanges make for a much more straightforward shopping experience. The bad news is that it's still a few years away.

With senators beginning to whine that John Kerry is annoying them by talking climate when they want to talk midterms, it's worth thinking seriously about what can be done on climate change in the absence of a bill that prices carbon. Jon Chait makes the argument for the EPA option, and Brad Plumer picks up the ball:

Here's a recent piece I did outlining what, exactly, EPA carbon regulations would entail. A number of experts I talked to suggested that, in the short term, an EPA crackdown on fossil polluters plus an ambitious energy-only bill from Congress that promoted efficiency and other forms of clean power could actually accomplish a lot in the next decade or so (at least so long as Congress or, say, President Palin don't step in and neuter the agency). There are lots of factories and power plants out there that are woefully inefficient, the technology exists to improve them, and a regulatory nudge from the EPA, while not the most nimble way of doing things, would start cleaning up the air. (It'd become virtually impossible to build any new dirty coal-fired plants, for instance.) As studies like this one from McKinsey have found, we could easily cut, say, 20 percent of our emissions this way.

In the long term, though, we'd really need a price on carbon to transform the country's energy sector and give people incentive to develop new clean-energy technologies — having the EPA just flatly tell polluters that they have to adopt this or that specific pollution-cutting gizmo isn't very good for innovation. But hey, maybe a few years from now we'll have a Congress that's ready to address this problem. Odder things have happened.

David Byrne explains how architecture helped music evolve.

I'll admit that until I looked into this last week, I thought that the Gallup poll suggesting that the deficit had become a top concern was a fairly conventional result. But as Ben Somberg notes, that's not the case: Jobs and unemployment are well ahead of the deficit in most polls.

That said, the fact that people are worried about jobs and unemployment doesn't mean that they trust that more stimulus spending will make much of a dent. The way a lot of politicians are experiencing public opinion has left them convinced that voters believe further spending increases the deficit but don't believe that it increases employment and thus they think the safe play is to avoid doing anything at all. Moreover, politicians think a lot more about the press they'll get the day after they vote for a bill than what unemployment will look like the day before America decides whether to vote for them.

Ross Douthat has an interesting column today limning the distance he sees between the dissatisfaction liberals have with Barack Obama and the amount Obama has done for liberalism. There are a couple of things to say here.

First, there are liberals and then there are "liberals." According to Gallup, Obama has a 77 percent approval rating among liberals. That's essentially unchanged from a month ago, when it was 79 percent. Liberals quite like the president. So far as the more elite liberals that Douthat is talking about go, I'm not sure the number would be that much lower: There are plenty of people who want Obama to be more aggressive on a carbon-pricing bill but recognize the difficulty of that project and so approve of Obama overall but are trying to push him on this issue.

Second, problems don't abate simply because they're difficult to solve, or difficult to get the votes to solve. Douthat writes that "technically, [liberals] could be right" that deficit spending would accelerate job growth, but it doesn't matter because the votes don't exist for it. I'm not exactly sure what this is supposed to prove, but I don't think it logically follows that the people who might have the right idea about how to solve the problem should stop pressuring politicians to support that idea. When it comes to something like, say, state and local budget deficits, it really is the case that the federal government could solve this problem, and persuasion and pressure could be the difference.

Third, Douthat identifies a cult of the presidency as part of the problem. And here, of course, we agree: The idea that Obama can simply tell Congress what to do, or tell the public what to think, has been proven false, again and again. But the flip side of the belief that the president can do anything is that everyone should fall into line when the president says he can do nothing. Douthat's column is about the inexplicable tendency of liberals to try to push the president into supporting their policy agenda. But liberals, as Douthat sort of admits, have been well served by this strategy: Health-care reform has moved, and we've seen a number of secondary stimulus bills, and the financial reform bill was strengthened, and there's action on Don't-Ask-Don't-Tell, and so on. There's space between what the president can do and what he wants to do, and that's where advocates come in. Obama is not all-powerful, and he's not always right, either.

And that gets to the final issue here: Douthat's column is sort of an amused look at people who see problems and have identified steps that could possibly ameliorate those problems and are frustrated that progress has ground to a halt. But insofar as liberals focus too much on Obama, the appropriate criticism there is not that they're too interested in the president or too bullish on government's ability to plug state budget gaps, but that they're focusing on the president because it's easy and interesting to do, while the actual problem is a Republican Party that would prefer a grim economy and an undistinguished president going into the 2010 election and a commentariat that's more interested in talking about political problems than policy problems. In fact, the guy who best channeled liberal frustrations on this issue was, well, Barack Obama:

Photo credit: Official White House Photo by Pete Souza

You've got questions, and there's a surprisingly good chance that Dylan Matthews has answers.

There were many moments during the health-care reform process where the participants did not exactly cover themselves in glory, but the one that is going to cause the most ongoing annoyance was the punt on the rates that Medicare pays doctors.

You're all probably as tired of reading this as I am of explaining it, but here, again, is the quick background. In 1997, the Republican Congress created a payment formula meant to govern Medicare called the Sustainable Growth Rate. The formula was supposed to be a little tweak that saved a couple billion dollars. But the formula was wrong, and it quickly proved a wrenching readjustment that would've driven physicians out of the program by sharply slashing their payments. But rather than undo it, Republicans in Congress, and then Democrats when they took over Congress, passed temporary fixes, because no one wanted to come up with the money to fix the thing permanently.

When health-care reform started, Democrats made an admirable effort to end the shell game and just fix the system. But doing so cost almost $300 billion, and Republicans, who caused this mess in the first place, attacked the Democrats' fix as if it was part of their health-care reform plan rather than part of the Balanced Budget Act that Republicans passed in 1997. So Democrats abandoned the effort and left the fix out of health-care reform.

But the SGR isn't something you can just ignore. If you do, it'll slash doctor payments by more than 20 percent, driving them out of Medicare. As with raising the debt ceiling, SGR is one of the unpleasant tasks for whoever happens to be in the majority at any given moment. But in an impressive bit of alchemy, Republicans used health-care reform to pin the doc fix on Democrats and are now much more able to unite their party against protecting seniors from SGR, which has in turn forced Democrats to pass shorter and shorter fixes.

At some point, this has to end and we just have to fix the thing. A permanent fix will cost $300 billion (though that's an imaginary cost, as we were never going to see that $300 billion), and the doctors want it bad enough that you could presumably make some big gains on payment reform as the price for getting it done. It would be nice if the wise men (and women) from both parties were hammering out some private compromise for after the election. All those Republicans who felt that the Affordable Care Act didn't do enough to move toward pay-for-performance could use this as their opportunity. But if the two sides think it's more useful as a cudgel than a bargaining chip, it's hard to imagine anything good coming out of the process.

Story here. Some good analysis of both the economics of the move and what it shows about the US-China relationship here.

Last week, I asked Dylan Matthews to pull together a graph tracking rates of homeownership against policies designed to increase homeownership. The result was surprising: Neither Fannie Mae, Freddie Mac, the Community Reinvestment Act, nor the tax reforms that created the mortgage-interest deduction showed a large, obvious effect. See for yourself:

"This got me wondering what exactly happened around 1995 to cause that jump," Dylan wrote to me. "Correlation isn't causation, but I dug up this document, the National Homeownership Strategy, which HUD Secretary Henry Cisneros and Bill Clinton announced in 1995. The strategy involved lowering standards for homeownership: reducing years of income first-time buyers needed to demonstrate, letting them tap retirement savings, letting mortgage sellers to use their own appraisers, etc. Here are a couple of articles interrogating its role in the subprime crisis. So here's the graph again, with the National Homeownership Strategy added."

There was a lot going on in this period, including the rise of securitization and the global money flows and Fed policies and interest rate drops that created the easy money that led to the easy credit that supercharged the mortgage market. And for all the intentions of the NHS, it's got a lot more rhetoric than policy. Still, it's a bit odd that the CRA and Fannie and Freddie have become so prominent in conservative retellings of the housing boom, but Clinton's NHS, which fits the timing much better, remains little known.

Obviously, he's watching the wrong media outlets. The true test of legitimacy comes from viewer responses to an online poll.

Rahm Emanuel said over the weekend that the White House would "welcome" an energy bill with limited emissions reduction. Unsurprisingly, environmentalists are starting to voice their displeasure with the administration. The Senate has finally passed a "doc fix" restoring Medicare payments to their previous level, though the House insists their approach falls short. The federal stimulus may be struggling against the drag created by state and local cutbacks, and Joe Lieberman wants to give Barack Obama the power to turn off the internet.

Isn't that just so Wonkbook?

Top Stories

Rahm Emanuel is open to an energy bill that only limits emissions from utilities, reports Jonathan Weisman: "'The idea of a ‘utilities only’ [approach] will also be welcomed,' he said, emphasizing that 'a wide range of ideas will be discussed.'…The utilities-only idea is anathema to many environmentalists, who see it as an inconsequential half measure. But to pragmatists, it may be the best the Senate can do on climate change – and even then, it would be a heavy lift."

A growing rift is emerging between environmentalists and the White House, report Peter Wallsten and Eliza Gray: "'I've been disappointed,' said Kyle Ash, a lobbyist for the activist group Greenpeace. 'This really is just a slightly better version of what I would have expected a Republican White House to do if there was a disaster like this in the Gulf.'"

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Meet the anti-stimulus, writes some punk named Ezra Klein: A multiple choice question for you: Did the stimulus a) work; b) fail; c) end up locked in an unexpected battle with the massive anti-stimulus that's ripped through the states? ... Some 46 states are facing budget gaps that will require them to cut spending or raise taxes. The Center on Budget and Policy Priorities estimates that in 2011, the states will have to come up with a total of $180 billion. These budget shortfalls are the equivalent of a massive anti-stimulus, which some experts believe has overwhelmed the $787 billion stimulus passed by the federal government in 2009.

The Senate unanimously passed a "doc fix" on Friday, but Nancy Pelosi is dismissing it as "inadequate": http://politi.co/bB65M8

Obama and the EPA want to resurrect a tax on oil and gas companies to pay for Superfund cleanups, reports Juliet Eilperin: "For 15 years, the government imposed taxes on oil and chemical companies and certain other corporations. The money went into a cleanup trust fund, which reached its peak of $3.8 billion in 1996. But the taxes expired in 1995, and because Congress refused to renew them, the fund ran out of money. Now the Obama administration will push to reinstate the so-called Superfund tax. The Environmental Protection Agency, which rarely urges passage of specific bills, will send a letter to Congress as early as Monday calling for legislation to reimpose the tax."

Folk-hop interlude: Lissie covers Kid Cudi's "Pursuit of Happiness".

Still to come: BP's team of superlobbyists; a labor leader and Fortune 500 executive are teaming up to tackle the deficit; Joe Lieberman wants Barack Obama to have a "kill switch" for the internet; and new limits on overdraft fees could raise bank charges in other areas.

Only one link in reconciliation today, because I'm in awe of the reporting and writing that produced it and I want you all to read it. It's from Sean Flynn in GQ, and it chronicles the days before, and after, the BP oil disaster.

I'll be on Rachel Maddow's show tonight talking about climate-change politics.

From Atul Gawande's commencement speech at Stanford University's School of Medicine:

The truth is that the volume and complexity of the knowledge that we need to master has grown exponentially beyond our capacity as individuals. Worse, the fear is that the knowledge has grown beyond our capacity as a society. When we talk about the uncontrollable explosion in the costs of health care in America, for instance—about the reality that we in medicine are gradually bankrupting the country—we’re not talking about a problem rooted in economics. We’re talking about a problem rooted in scientific complexity.

Half a century ago, medicine was neither costly nor effective. Since then, however, science has combated our ignorance. It has enumerated and identified, according to the international disease-classification system, more than 13,600 diagnoses—13,600 different ways our bodies can fail. And for each one we’ve discovered beneficial remedies—remedies that can reduce suffering, extend lives, and sometimes stop a disease altogether. But those remedies now include more than six thousand drugs and four thousand medical and surgical procedures. Our job in medicine is to make sure that all of this capability is deployed, town by town, in the right way at the right time, without harm or waste of resources, for every person alive. And we’re struggling. There is no industry in the world with 13,600 different service lines to deliver.

It should be no wonder that you have not mastered the understanding of them all. No one ever will. That’s why we as doctors and scientists have become ever more finely specialized. If I can’t handle 13,600 diagnoses, well, maybe there are fifty that I can handle—or just one that I might focus on in my research. The result, however, is that we find ourselves to be specialists, worried almost exclusively about our particular niche, and not the larger question of whether we as a group are making the whole system of care better for people.