Advice for the corona virus
President Trump wants action on the epidemic. It could easily cause hundreds of thousands of American deaths, maybe even millions. It is likely to cause trillions of dollars of lost output.
Trump wants to cut through red tape, removing regulations, to speed up a solution. What are the considerations?
The main trade-off is safety vs. speed. The culture of the FDA is largely derived from its experience with thalidomide. In 1960, the FDA was asked to approve thalidomide for morning sickness. One of the researchers at the FDA, Frances Oldham Kelsey, refused to approve it. When an epidemic of birth defects happened in other countries but not in America, she was regarded as a heroine. Her legacy still influences the FDA. The lesson they learned is that safety is much more important than speed.
This culture is reinforced by incentives. If the FDA stops a dangerous drug, they are heroes. If they delay a useful drug, they don't get blamed. So they tend to err on the side of delay.
An example is the case of Helen Y. Chu, an infectious-disease specialist. The Atlantic reported that she had an opportunity to test for the presence of the new virus, because she had been collecting nasal swabs for a different study. But she wasn't allowed to test them, because of regulations.
The New Yorker reported that Keith Jerome, the director of the University of Washington Virology Lab, wasn't allowed to do tests for the virus for about a month.
The situation now is almost the exact opposite of what it was in 1960. Now, we are threatened with hundreds of thousands deaths and trillions of dollars in damage. Speed is much more important than safety. The new drugs aren't substitutes for Viagra or Propecia: we need them now.
Drug testing is done in three stages. The first two are primarily concerned with safety, the third with efficacy. The last test should be dropped for anything related to the virus. If the drug is safe, but might not be effective, we may as well use it. If it doesn't work, we have lost some time and money. If it does work, we have saved thousands of lives and trillions of dollars. Even the safety tests should be abbreviated. If preliminary tests indicate the drug is probably safe, then we should use it. The worst case is it would kill a few people, the best case is it would save hundreds of thousands. Those are good odds. There are some drugs which have already been approved for the treatment of other diseases (e.g. malaria) and so could be used off label to treat other diseases (such as this virus). Statnews reported that of drugs that have passed the first stage, only about 1 in 4 are eventually approved. If there is a drug or vaccine that might work, I'll take those odds.
There is a difference between the medical bureaucrats and the physicians. The bureaucrats want to follow procedures. The physicians see their patients get sick and sometimes die: they tend to say: "let's improvise". The bureaucratic inclination to delay reminds me of a short item in the Washington Monthly several years ago. In the Department of Justice building, an employee saw a wall had been opened and wires and equipment lying around. He was concerned the someone was trying to install wiretaps to eavesdrop on criminal investigations. It turned out that it was just ordinary repairs. The employee called security to report the situation and said those responsible could still be in the building. He was told that no one could leave his position to investigate without prior authorization. The Washington Monthly commented: "In case of fire, fill out Fire in Progress form and forward to Department of Fire".
With all the talk about hand washing, we should look at the case of the doctor who established the practice: Dr. Ignaz Semmelweis. He observed that when hand washing was introduced in May 1847, mortality rates for puerperal fever dropped 90%. His ideas were not accepted because they conflicted with established medical knowledge. It wasn't until decades later that Pasteur provided an explanation, which allowed his idea to be adopted. Hughlings Jackson said: "It takes 50 years to get a wrong idea out of medicine, and 100 years to get a right one into medicine." The modern medical establishment is still wedded to existing ways of doing things.
President Trump could go a long way towards fixing this by issuing an executive order. Just state that anyone working on the virus could ignore the FDA and CDC regulations. As a safeguard, the consent of the governor of the state would also be required. So, if you are working on something related to the virus SARS-CoV-2, and the governor of your state approves, you may ignore all the paperwork and anything else slowing you down. The president has the authority to do that under the Constitution, by using his pardoning power. When Jimmy Carter took office, his first official act was an amnesty for draft violations. That is a precedent.
A variation on this idea is to allow governors to make partial exceptions to the regulations. E.g. a governor could allow vaccines that have passed safety tests but not efficacy tests.
In addition, we might as well spend money fixing this. Since the disease may cause trillions of dollars in damage, and since the Congress just passed a trillion dollar package, spending $200 billion would probably be justified. We could have a $100 billion prize for the first effective vaccine. If the vaccine is only 50% effective, the company would get $50 billion. Companies should have limited immunity to anti-trust laws, so they could cooperate on research. The other $100 billion would be a set of prizes ($100 million to $1 billion) for any good idea that helps dealing with the disease. That would include new treatments, improvements to equipment, improvements to distribution systems, improvements for testing for infection, improvements for testing for immunity, improvements for data analysis, fixes for problems developing vaccines, improvements in mass producing vaccines, improvements for social distance in restaurants and theaters, etc. The prizes should be exempt from all taxes, including inheritance and gift taxes. The only restriction would be that the winners would have to put all patents into the public domain. Bernie Sanders, in the last Democratic debate, complained that drug company executives were thinking about how to get rich off the virus crisis. They should be. If there is a problem and no one can get rich from solving it, then that problem won't get solved.
An example of an idea is: we know that copper is toxic to viruses. So maybe impregnating masks with copper could make them more effective.
Establishing prizes would accomplish three things:
1. Most obviously, it would provide everyone with an incentive to solve the relevant problems.
2. It would give publicity to solutions, thereby inspiring others. To maximize this effect, the President should hand out the checks personally. In the news segments, the winner would explain how he heard about the problem and where he got the idea for solving it. People watching would get ideas.
3. It would attract venture capitalists. Jeff Bezos wrote that if you have an opportunity that has only a one in a hundred chance of paying off, but if it does, it pays off at 10,000 to one, you would be a fool not to take it. We need to encourage venture capitalists to fund a lot of long shots.
Companies like Google, Facebook, Apple, Microsoft, Amazon have many creative and smart engineers and scientists, plus they know how to manage them. They could be valuable resources in the fight. We just need to provide the right incentives.
We need to mobilize the brain power of the entire country - better yet, the entire world.
Another step would be to establish a web site to publicize problems related to the virus. Singapore has something similar: REACH (Reaching Everyone for Active Citizenry @ Home) where citizens can make suggestions on various issues. Our web site would focus on issues related to the virus. The site should be curated: only suggestions or questions should be posted. Posts should not be allowed to criticize other posts. There should be subsites (similar to subreddits) for each problem: e.g. equipment, testing. Some of them should be confidential: e.g. suggestions that might qualify for a prize.
We might have sites for venture capitalists. People could post their ideas and the VCs could browse them and fund the ones they like.
What should we do about the economic crisis? We have two problems: the virus and the economic danger. The former is causing the latter. The virus should have the higher priority. For now, we don't know what sort of economic problem we will have. It makes a big difference if the epidemic lasts 2 weeks or 6 months.
What about the Defense Production Act? President Trump just invoked it to force General Motors to make ventilators. Using that law is probably a bad idea. The problem is that it centralizes decision making in one place. That exaggerates the effects of any mistakes. Thomas Sowell, in his book A Conflict of Visions, argued that since everyone makes mistakes, we need to design the system so that we minimize the effects of any one decision. The way to do that is decentralization. We can't rely on experts. They make mistakes too. In Judgment Under Uncertainty, Sarah Lichtenstein, Baruch Fischhoff, and Lawrence D. Phillips found that (with some exceptions, such as weather forecasters) even experts overestimate what they know. Virginia Postrel, in her book The Future and Its Enemies, quoted Bill Clinton's campaign slogan: "A Bridge to the Twenty First Century" and added that it sounded forward looking but really wasn't. A bridge is a way of getting a lot of people from one place to another. The future isn't like that: it is lots of people going off in various directions, each trying different things. Thomas Edison, the greatest inventor in history, used that approach: when he was trying to find the solution to a problem, he would have his employees try everything possible. Jim Manzi, in his book Uncontrolled, pointed out that most ideas fail, so the best approach is to try as many as possible. This is the most important driver of progress. Have everyone doing different things: governors trying different policies, venture capitalists funding different ideas, everyone in the country coming up with different ideas.
I once heard a talk by Roy Childs. His first point was: why participate in politics? To answer that, he quoted Aristotle: because a man's happiness depends not just on what he does himself, but also on what other people do, a rational man will devote part of his time to a consideration of public affairs. To illustrate his point, he said that if you were dying of a disease and the drug that could cure you hadn't been approved by the FDA, then you could pay someone to smuggle the drug into the country for you. But if you were dying of a disease and the drug that could cure you hadn't been invented yet because the FDA regulations discouraged the necessary research, then there would be nothing you could do. The only solution is political. At the time, that was hypothetical. Now it is real.
Bold action by public officials is usually a mistake. When Franklin Roosevelt took office, he asked for the National Industrial Recovery Act (NIRA), which created the National Recovery Administration, which set minimum wages and prices by industry. It aborted the recovery. It was probably the worst piece of economic legislation in our history. The problem was that it prevented people from using their ingenuity to negotiate with other people and solve problems. The situation now is different. What needs to be done is to remove the regulations that are inhibiting people from solving problems. Bold action is called for. Ignoring the experts (the medical bureaucrats) is a good idea.
President Trump, are you listening?