We Should All Be Allergic To This Logic

Are life-saving drugs no different than milk or widgets? Should we treat everything on earth as a profit source? That way mechanized madness lies, whereby "your money or your life" is somehow seen as an acceptable business plan.

1. Should we treat drugs that kids need to live just like widgets? Some free-markets fans love that one-size-fits-all  idea, but it hides unattractive ethics, and injects industrial-scale exploitative pressures into our lives.

2. The current Epipen fuss (+500%) joins prior drug price shenanigans (+5000%), and Uber’s “surge pricing” (700%+), which led some free market fans to complain that people just don’t understand “simple economics.”

3.But that’s backwards. Much “simple” economics doesn’t understand people. You can call huge price hikes “logical and fair” or rational and efficient, but they still feel exploitative, which people don’t like.

4. Markets enacts our ethics on a massive scale, their systemic “fairness” dwarfs personal ethics. And something has gone wrong if a “your money or your life” business plan seems acceptable ($64,000 per month medication).

5. The relevant “simple economics” is the misnamed law of supply and demand. Roughly: Price variation ensures markets “clear.” Rising prices = more demand = more supply, and vice versa. “Clearing” means all supply is sold (but not necessarily used efficiently).

6. So let’s compare two allocation schemes, cost-plus vs profit-maximizing: Say an entrepreneur makes 100 widgets for $20 each. Using cost-plus pricing, she sells all for $100 each = $10,000 revenue & $8,000 profit. Using what-the-market-can-bear pricing she sells all at $500 each = $50,000 & $42,000 profit. Way better for her, obviously. But why is it better overall that 100 customers have $400 less? (How they use that $400 might even benefit the economy more.)

7. Unlike the nonnegotiable laws of nature market “mechanisms” empirically vary (e.g. some markets do use cost-plus pricing, an idea once popular in economics).

8. That market rules aren’t facts of, or laws of, nature, means we can choose how to shape incentives to guide markets. Our rules needn’t prioritize supplier profits over other civic goals (like not letting kids die of allergic reactions).

9. Note, approaches like cost-plus don’t limit profit—to make more, satisfy more customers. Free-marketers might prefer price-gouging, but it’s not self-evidently beneficial (and market logic is “cognitively unnatural”).

10. Before heeding the “free-markets-in-everything” crowd and unleashing free-market forces to (mindlessly) coordinate countless transactions, remember how flat-out wrong economists can be (+ they use "rational" and "efficient" differently, sometimes misleadingly).

11. Free markets neither empirically nor logically convert self-interest to social good, nor generate “spontaneously ordered” optimal outcomes. Believing it’s that simple is blind love of unrealistic ideas (= the last unlaughed at utopian ideas).

12. Markets do many great things, but we shouldn’t delegate all our ethics to them. And market-lovers could do more to fix their ills. Nothing compels us to let kids die for lack of Epipens, or to let Californians water lush lawns while the poor’s wells run dry, or make musical toilets while some starve.

13. Widgets and medicines aren’t ethically equivalent, so why auction them as if they were?

14. Those who see competition as the cure, forget that unregulated competition in biology routinely delivers disaster. Profit maximising businesses seek monopoly-like conditions, in a “mutually assured exploitation” game (too bad if you a need a new drug to live).

15. We can guide the massive power of market forces to support our civic goals. Perhaps even America’s declared founding goal of rules “wholesome ... for the public good.”

16. But if you’d prefer a world safe for price gouging, let’s do more “simple economics” training: perhaps  market-gouging drills in kindergarten? Or daily pledges “one Nation under” profit ... dedicated to the idea “that government of the people…” for the profit, shall not perish from the Earth?


Illustration by Julia Suits, author of The Extraordinary Catalog of Peculiar Inventions, and The New Yorker cartoonist.

Plants have awareness and intelligence, argue scientists

Research in plant neurobiology shows that plants have senses, intelligence and emotions.

Getty Images
Surprising Science
  • The field of plant neurobiology studies the complex behavior of plants.
  • Plants were found to have 15-20 senses, including many like humans.
  • Some argue that plants may have awareness and intelligence, while detractors persist.
Keep reading Show less

Human extinction! Don't panic; think about it like a philosopher.

Most people think human extinction would be bad. These people aren't philosophers.

Politics & Current Affairs
  • A new opinion piece in The New York Times argues that humanity is so horrible to other forms of life that our extinction wouldn't be all that bad, morally speaking.
  • The author, Dr. Todd May, is a philosopher who is known for advising the writers of The Good Place.
  • The idea of human extinction is a big one, with lots of disagreement on its moral value.
Keep reading Show less

Space is dead: A challenge to the standard model of quantum mechanics

Since the idea of locality is dead, space itself may not be an aloof vacuum: Something welds things together, even at great distances.

  • Realists believe that there is an exactly understandable way the world is — one that describes processes independent of our intervention. Anti-realists, however, believe realism is too ambitious — too hard. They believe we pragmatically describe our interactions with nature — not truths that are independent of us.
  • In nature, properties of Particle B may depend on what we choose to measure or manipulate with Particle A, even at great distances.
  • In quantum mechanics, there is no explanation for this. "It just comes out that way," says Smolin. Realists struggle with this because it would imply certain things can travel faster than light, which still seems improbable.
Keep reading Show less