Friday, March 12, 2004

Structural causes of healthcare inflation


The cost of healthcare is rising much faster than general inflation. In the US a chunk of that is the collapse of managed care. There are fundamental structural causes however; aging population, new technology, etc.

Today I ran into a structural example I'd not thought of for a while. My son needed an antibiotic for a strep throat and co-occurring ear infection. Ten years ago that would have cost about $10. Instead today it's $120. A tenfold cost increase, because of antimicrobial resistance.

We expect antimicrobial resistance to worsen. Eventually many old favorites, such as augmentin, will bite the dust. Their replacements will cost even more.

Will a strep infection eventually cost $1000 to treat with antibiotics? Talk about health care inflation ...

Productivity and Demographics: Was the boom from the boomers?


In the past decade we've had nice year on year productivity increases. Productivity increases grow the pie -- they're generally a good thing. I'm hoping much of it comes from the application of IT, globalization, etc.

I wonder about demographics though. Over past 10 years the number of workers between the ages of 32 and 47 must have peaked, following the boomer's age path. Now the oldest boomers are almost 60. For knowledge workers productivity probably peaks, for most people, between the ages of 36 and 50. As we boomers move out of that range, will productivity decline?

Unintended consequences: DVRs & the death of broadcast tv, HDTV and massive hard drives

Mercury News | 03/10/2004 | Hitachi unveils massive drive for digital media
Digital media hogs can celebrate.

A new, whopping 400-gigabyte hard drive from Hitachi Global Storage Technologies can store up to 400 hours of standard television programming, 45 hours of high-definition programming or more than 6,500 hours of digital music...

San Jose-based Hitachi said it designed the monster drive, the Deskstar 7K400, for audio/video products such as digital video recorders.

So many fascinating aspects it's hard to figure where to start. Quickly:

1. The storage industry has moved to Hitachi and Toshiba. Quite a shift from a few years ago. I think the movement of mass storage from dedicated computers to consumer devices has transformed that industry. The iPod and the DVR are the leading edge. Massive hard drives in cellphones, video cameras and still cameras are obvious additions, but where else will they appear. Ten years ago we thought ubiquitious networking would make hard drives less important -- but we were way wrong. Weird. I remember when CDs first came out, and Bill Gates had his name an a MASSIVE tome about the glorious age of cheaply replicated mass read-only devices. I wrote a letter to a Canadian aid agency waxing enthusiastic about the potential of cheaply distributing educational and reference materials via CD. Then came Gopher came along and that "fork in history" was forgotten with some embarrassment. (Yes, Gopher came before the web -- and it alone demoted the CD as a reference source.)

Now storage is back, as limits to network traffic have become apparent. The world now seems to be converging on a combination of local storage, network traffic, and the critical new world of local caching of massive amounts of data.

Very neat.

2. We thought HDTV would drive the creation of cheap hi resolution display technology. It will, but the conjunction of HDTV and DVRs is driving the creation of massive storage. Unexpected.

3. DVRs, even though they are used by relatively few people, have destroyed broadcast tv. We watched the Simpsons the other day, for the first time in 10 years (we don't watch much tv). The density of commercials was stunning for one unaccustomed to commercial tv. It was unwatchable without a DVR to zip past the commercials. DVRs make standard commercials less effective, also mortal. The natural reaction of a dying industry is to redouble their efforts. But that makes tv less watchable, so it accelerates the move to DVRs (and cable). End result -- an accelerated technology transition. This feedback phenomenon also hit with pay phones and mobile phones. As mobile phone use grew pay phones became worth less and were less reliable and less available. That meant one could not rely on a pay phone, so one needed a cell phone. Feedback is interesting.

Tuesday, March 09, 2004

The Endocannabanoids - medicine does move on

Entrez-PubMed
After the discovery, in the early 1990s, of specific G-protein-coupled receptors for marijuana's psychoactive principle Delta(9)-tetrahydrocannabinol, the cannabinoid receptors, and of their endogenous agonists, the endocannabinoids, a decade of investigations has greatly enlarged our understanding of this altogether new signalling system.

I finished medical school in 1986, so my core medical sciences ended in 1983, about 21 years ago. The endocannabanoids, endogenous (natural) agents that act on the same neuro receptors as cannabis, feel like the most dramatic new discovery since that time. Researchers long suspected that, just as we have endogneous opioids, we must have endogenous cannabinoids. It just took a while to find them.

True, we did sequence the genome -- and that's been amazing. But, oddly enough, it felt like a continuation of what we new or guessed in the early 80s. New physiology feels more "real" and proximal to a physician. For example, I went to this research article because of hype about an endocannabinoid derived medication that allegedly helps with weight loss and smoking cessation. Talk about near term impact.

This feels new, and exceptionally interesting. I know nothing at all of the basic science, but I'll be looking for a "popular" (eg. physician oriented review) in JAMA or NEJM.

This probably also provides some insight as to why cannabis sativa manufactures its namesake product in the first place.

MSNBC - Avoiding attacking suspected terrorist mastermind

MSNBC - Avoiding attacking suspected terrorist mastermind
In June 2002, U.S. officials say intelligence had revealed that Zarqawi and members of al-Qaida had set up a weapons lab at Kirma, in northern Iraq, producing deadly ricin and cyanide.

The Pentagon quickly drafted plans to attack the camp with cruise missiles and airstrikes and sent it to the White House, where, according to U.S. government sources, the plan was debated to death in the National Security Council...

Four months later, intelligence showed Zarqawi was planning to use ricin in terrorist attacks in Europe.

The Pentagon drew up a second strike plan, and the White House again killed it.  By then the administration had set its course for war with Iraq...

In January 2003, the threat turned real. Police in London arrested six terror suspects and discovered a ricin lab connected to the camp in Iraq.

The Pentagon drew up still another attack plan, and for the third time, the National Security Council killed it.

Military officials insist their case for attacking Zarqawi’s operation was airtight, but the administration feared destroying the terrorist camp in Iraq could undercut its case for war against Saddam.

If Bush loses the next election the truth may come out; this will be one of the cases to investigate.

Monday, March 08, 2004

Wahhabism and the Saudi Front (NYT Magazine)

Intruders in the House of Saud, Part I: The Jihadi Who Kept Asking Why
Long NYT Magazine article -- Saudi Arabia and Pakistan are the next "front" in the Forever War.

Betting against Bush's America ... Buffet's move.

NYT: Weak Dollar Gains Notice of Buffett
Warren E. Buffett, the billionaire investor, has a $12 billion bet against the United States. Mr. Buffett said over the weekend in an annual letter to shareholders of Berkshire Hathaway Inc., his holding company, that he began investing in foreign currency for the first time in 2002 and expanded his positions in 2003.

By the end of 2003, Berkshire Hathaway held foreign-exchange contracts valued at $12 billion that were spread among five unspecified currencies, he said in the letter, which was released on his company's Web site.

He said Berkshire also owned $1 billion of euro-denominated junk bonds. Mr. Buffett, who still has the bulk of his assets in the United States, bought into the foreign currency as the United States trade deficit swelled and enjoyed large investment gains as the dollar continued to weaken. 'As an American, I hope there is a benign ending to this problem,' Mr. Buffett wrote, referring to the trade deficit and the weaker dollar. He said, however, that the impact could reach 'well beyond currency markets.'

One Berkshire shareholder said the move was an about-face for Mr. Buffett.

'I've attended the annual meeting for well over the past 15 years, and every year until this year when asked about the dollar or foreign currency, Berkshire's basically said, 'You don't make money betting against the United States of America,' said Tom Russo, a partner at Gardner, Russo & Gardner, which owns about 1,000 Berkshire shares. 'Something must have really scared him.'

And so it begins. Seriously, about 1-2 years ago, looking at the Bush budgets, I looked for an easy way for a small investor to bet against the Bush budget. I didn't have the time or expertise to devise a strategy. Buffett is less constrained.

Sunday, March 07, 2004

Evolution in action: why Theocons need to teach natural selection in the schools

Wapo: Dueling Viruses Are Latest Computer Pest (TechNews.com)
The programmers behind the ongoing wave of computer worms and viruses hitting the Internet are starting to take aim at each other, and consumers and businesses around the world are getting caught in the crossfire, security experts said yesterday.

In the space of about three hours early Wednesday morning, five new variants of widespread bugs MyDoom, Bagle and Netsky were spotted roaming the Web...

... Ken Dunham, director of malicious code at Reston-based iDefense, said the authors of Bagle and MyDoom appear, in essence, to be wrestling for remote control over compromised computers, while the Netsky worm attempts to deactivate the other two.

... "We are seeing just variation after variation after variation," said Steven Sundermeier, vice president of products and services at Central Command Inc., a Medina, Ohio-based antivirus company.

If the theocons are able to remove natural selection from our science curriculum, how will students understand the evolution of their spam?

Viruses and worms have one of four agendas:

1. economic and military disruption (allegedly used by US forces prior to GW I and possibley GW II).
2. terrorism (no clear examples known)
3. an unusually ineffective form of display competition between teenage boys
4. seizing control of computing resources (increasingly important).

Natural selection has only a limited role in understanding #1 and #2. In #3, and especially #4, it has a strong role. Theory predicts that computer worm/viruses should increasingly protect the host computer by limiting harm to it while simultaneously fighting off rival code. In time worm/viruses should emerge that are effective antiviral agents while simultaneously causing minimal harm to the host, indeed in time they should theoretically improve performance of the host. (example: more efficient code for particular functions inserted by the virus).

On wonders if this is partly how early multicellular immune systems developed. Were the first immune systems in bacteria constructed by competing viruses?

Saturday, March 06, 2004

Kristof: The market failure of CEO Compensation

Op-Ed Columnist: Millions for Moochers
...The problem with "the great C.E.O. pay heist," as Fortune magazine once called it, is that the free market is not at work here. The average C.E.O. of a major corporation now gets $10.8 million a year, almost 20 times as much as in 1981, as the result of a classic market failure.

"The salary of the chief executive of the large corporation is not a market award for achievement," John Kenneth Galbraith noted back in 1980. "It is frequently in the nature of a warm personal gesture by the individual to himself." ...

... These pay packages are negotiated, reflecting what a good C.E.O. brings on the free market. How's that? There is a huge supply of would-be C.E.O.'s and negligible demand from companies for new ones, so their price should be cheap — if boards would use their leverage. When Jack Welch retired, General Electric held a contest among three underlings to succeed him. Each was desperate to get the job. If G.E. had done its usual tough bargaining, it could have signed Jeffrey Immelt on a 15-year contract for a mere $750,000 a year in salary, plus reasonable incentives for long-term success.

If you don't pay a chief executive an obscene sum, you'll lose him. Nope, it doesn't happen. Except for turnaround experts, C.E.O.'s have few transferable skills and are in little demand elsewhere. The average 63-year-old head of a plastics company has almost zero chance of finding a better job elsewhere. One study found that of 77 cases when a major company had to find a new boss, only twice was this because the C.E.O. had left for another corporate job.

Kristof does a very nice job of summarizing and dismissing the usual vapid explanations of multimillion dollar CEO packages. Yes, it's often brutally hard work -- but it doesn't need to be. I suspect many CEOs would make better decisions if they slept more, exercised better, and traveled a bit less. CEOs work like crazed loons not because they have to, but because it's their nature. It's the same reason many of the tenured professors I know work 60 hours a week. It's just the way they are.

On the other hand Kristof is wrong when he suggests the CEO has to accept a lower wage because they've nowhere to go. Kristof should know better. A highly compensated CEO will almost always have a net liquid asset value of over $10 million. That's known in the industry as f___-you money, because anyone with that asset value can leave work at any time without undue suffering. The alternative to lower pay for these CEOs is to retire, start another company, etc.

CEO compensation is indeed a classic example of market failure. The last 20 years have been very hard on the religion of the invisible hand. Markets are still the best method we have to allocate resources, but they do fail. When they fail we need to find ways to resuscitate the market.

When you have eight strong candidates fighting to be CEO, let's try dropping the compensation package until only three remain.

Thursday, March 04, 2004

How Will the Universe End? - A cosmic detective story about the demise of the world, in three parts. By Jim Holt

How Will the Universe End? - A cosmic detective story about the demise of the world, in three parts. By Jim Holt
Before I was going to start worrying about the extinction of absolutely everything in some inconceivably distant epoch, I thought it would be a good idea to talk to a few leading cosmologists. Just how certain were they that the cosmos was undergoing a disastrous runaway expansion? Was intelligent life really doomed to perish as a result? How could they, as scientists, talk about the ultimate future of "civilization" and "consciousness" with a straight face?

This guy is good. He covers a lot of fun cosmology in a very short essay, and he manates to talk with some great physicists. I really enjoyed this, and his prior essays are fun to. I was particularly struck by a phrase in his Christmas essay:
...You can believe, as I do, that the universe is presided over by a being that is 100 percent malevolent but only 80 percent effective (which explains pretty much everything)
He's got a good point there. I'd tended to assume a disinterested deity, or trillions of short-lived deities with very odd interestes, but malevolence and ineffectiveness has a certain symmetry with human affairs.

Republican party: anti-gay yes, but also anti-adoption?

NYT: Senate Hears Testimony on a Gay Marriage Amendment
Lawmakers and other supporters of the proposed amendment disputed the notion that it amounted to discrimination and said that accusation was offensive. They said their goal was to place in the Constitution a recognition of the traditional view of marriage and family.

"Children are raised expecting to have a biological mother and father," said the Rev. Richard Richardson, president of a child welfare agency in Boston and a leader of the Black Ministerial Alliance of Greater Boston. "It is not just society — it is biology, it is basic human instinct."

When John McCain ran for the 2000 republican presidential nomination in South Carolina, his daughter appeared beside him. She was born in Bangladesh and was adopted by McCains. The usual story is that he lost that race in part because of a Rove-inspired push poll that alleged his daughter was an illegitimate offspring of a liaison with a black woman. (Since it was widely understood in South Carolina that this was true of Strom Thurmond it may have had some superficial credibility.) I wonder, however, if the voters were really that uninformed. I wonder if they knew his daughter was adopted -- and perhaps that was the real problem for them.

Now, in the context of the anti-gay amendment, some of these sentiments are leaking out. Reverend Richardson, I suspect, is only speaking plainly what many socially conservative Republicans believe. Like tribalists everwhere they may find the concept of adoption profoundly unsettling -- particularly intraethnic adoption.

Child bearing and raising is undoubtedly the true tender issue in discussions of gay marriage. It's arguably a winning issue for Republicans ... but it has risk for them too. It will be hard to keep the message from straying into an attack on adoption by heterosexual couples. Many of those couples might vote Republican, but not if their family comes under attack.

Rove may not like how this goes.

Salon.com | Theocons vs. neocons: The contradictions within the republican party

Salon.com | Theocons vs. neocons
Theocons vs. neocons
With Mad Mel scaring the Jewish vote and Bush pandering to his theocratic base, the Republicans are quickly losing their secular swing voters.

I like the term "theocons". It's definitely catchier than "religious right" and more specific than Evangelicals. This is a scary group. At their core they believe Bush is the "Anointed President", an agent of God's will who will lead the forces of righteousness against the armies of the Antichrist. He is the end time president.

The Republican party may, at last, be coming apart at the seams. The ultra wealthy think the Bush economic policy emperils their children, their society, and their fortune. Large corporations like the service they get as corporations, but their executives don't enjoy paying bribes, and don't like anti-Gay policies. Economic conservatives are in shock. Foreign policy conservatives feel Bush/Cheney blew it in Iraq, and vaporized American credibility around the world. Libertarians worry about loss of privacy and the reincarnation of "Total Information Awareness". Intelligent conservatives and historians look at Mel Gibson and think neo-Fascism.

For all the talk about Karl Rove's genius, Bush may be blowing his reelection. Since he's evidently a very stubborn ideologue, I can only hope he'll persist.

Wednesday, March 03, 2004

Building a better memory

Wired News: The Masters of Memory Lane
Hagwood said he wasn't born with an outstanding ability to memorize, and claims anyone can learn the skill. There are specific techniques that mnemonic masters use -- such as associating images with each number and suit when memorizing card positions -- but in general it all comes down to keeping your brain synapses in good working order.

To do that, Hagwood, who gives seminars on how to improve memory skills, advises people to use their non-dominant hand in daily chores, do crosswords and puzzles, play chess, take a different route on your daily commute, learn to tango, play an instrument and speak another language.

No matter how challenging your job is, it isn't demanding enough. Brains thrive on constant challenge, so presenting them with the same activities that they already excel at doesn't keep the gray matter in top shape. You can, however, substitute the waltz for tango lessons -- just ensure that you have a good balance of fresh thinking and activities built into your life.

I have wondered, is my deteriorating memory merely middle aged senescence, or has heavy use of PIMs, PDAs, and other data management systems accelerated the atrophy? Hmmmm.

Tuesday, March 02, 2004

The power of the internet combined with social networks ... it still stuns me

MacInTouch Home Page
John Faughnan emailed us about a QuickTime 6.5 EXIF problem he has been tracking down with Thorsten Lemke, author of Graphic Converter:

When you import an image using Image Capture or iPhoto, both of which use Quicktime 6.5, the EXIF header for image orientation is duplicated and one version is incorrect. You can see the two tags using EXIF Viewer.

A portrait image taken with a camera oriented vertically that supports the EXIF orientation tag, after importing via Image Capture, has these duplicate tags (comments mine):

Image Orientation: Top, Left-Hand [I think this is the misleading tag]
Image Orientation: Right-Hand, Top [I think this tag reflects the state of the image]

This image will display the following ways...

The above was featured prominently on Ric Ford's Macintouch this morning. It was read by perhaps 10,000-100,000 Macintosh geeks, who in turn probably act as a knowledge resource for 50,000 - 500,000 Macintosh users. That's amazing enough, but the full story shows the power of the internet, of authentication and reputation, and of social networks. Here's a quick outline:

0. I've never met Ric Ford (Macintouch) or Thorsten Lemke (Graphic Converter). However, both men know me by correspondence over the past several years. I have a recognizable name, and I always make my identity clear. They have a certain degree of trust in what I write. Ric Ford and his co-editors at Macintouch know and respect Thorstent Lemke's reputation -- but they've probably never seen him.

1. I notice that my digital images are not being rotated or handled correctly during image import. After a month of dealing with this hassle, it really starts to annoy me. I correspond with Thorsten, but we don't yet understand the problem.

2. Google searches provide no explanation. I puzzle a bit and correspond some more. It occurs to me that the only possible explanation is that there are two orientation messages with different values. Thorsten confirms this is true (I don't know if he already knew the problem -- his english is far better than my German but it is not his first language). He sends me a version of his software to test -- it doesn't quite do the trick and I suggest an alternative approach. Twelve hours later he sends me a version of Graphic Converter with a good workaround for the bug in the Apple software -- not quite what I suggested, but very workable.

So in the space of several hours, across the world, 3 people who've never met one another identify an annoying bug in one of Apple's core software applications, educate most of the Macintosh users, put pressure on Apple to fix it, and adapt a well regarded image management application to fix the problem. It's not the internet alone, it's the internet plus social networks and reputations.

I'm old enough to remember when email was available only to researchers. This is such a different world.

And now, unleash the dogs of democracy ...

Big Margins in Key States Assure Kerry the Nomination
Senator John Kerry blazed to victories in Democratic primaries from New York to California today, according to early returns and surveys of voters leaving the polls, effectively capturing his party's presidential nomination and setting up an eight-month general election battle between President Bush and Mr. Kerry, the senator from Massachusetts.
and from the local paper
... [Caucus] Turnout was heavy, estimated at well over twice the 12,000 who turned out in 2000. DFL Party Chairman Mike Erlandson said it was the best caucus showing since the Vietnam era. At his own caucus, attendance was 177, compared to seven people four years ago.

The war starts Thursday with a deluge of Bush attack ads. It will be one hell of a campaign. Most of us have been keeping our powder dry, waiting for the nominee.

I attended my first ever caucus (DFL) in Minnesota. The traffic was backed up for about a mile and most of us parked 1/4 to 1/2 mile away from the school. Inside the school rooms were packed. Kerry won handily in our precinct. There was little sign of surprise, nor of either celebration or disappointment. It was merely the start of a vast struggle.

I did get to see the Minnesota DFL caucus in action. I now understand why the state party has such a bizarre collection of resolutions and "planks". By the time I left, fairly early in the evening, the residual group would have passed a resolution mandating lifetime employment and shutting down all trade with the rest of the world. I can see why democrats elected in Minnesota almost always win without the party's endorsement.