Capitalisn’t: The Capitalisn’t of Vaccines

Bethany: I’m Bethany McLean.

Speaker 2: Did you ever have a moment of doubt about capitalism and whether greed’s a good idea?

Luigi: And I’m Luigi Zingales.

Bernie Sanders: We have socialism for the very rich, rugged individualism for the poor.

Bethany: And this is Capitalisn’t, a podcast about what is working in capitalism.

Speaker 5: First of all, tell me, is there some society you know that doesn’t run on greed?

Luigi: And, most importantly, what isn’t.

Speaker 6: We ought to do better by the people that get left behind. I don’t think we should have killed the capitalist system in the process.

Speaker 7: In the global race for a coronavirus vaccine, Russia said today it’s already won, even though it hasn’t completed phase 3 trials.

Luigi: Bethany, did you hear that Putin not only has a vaccine, but also has sold it to all the major oligarchs in Russia?

Bethany: What a shock that one of the most corrupt countries on planet Earth would be the one to come up with a vaccine first and that, on top of that, the billionaires would be the one to get it. But it does raise a really interesting question about the race for a vaccine, which is, in a case like this, who gets it first? In a case where there is going to be a shortage, and there are going to be pricing and safety differentials, who gets what vaccine, and who gets what vaccine first? How do we determine that?

Luigi: I find you so anti-Russia. Do you think that our president would do better than Putin?

Bethany: OK, fine. I’m not going to make that argument. But seriously, the Russian news really does point to some of the key issues surrounding a vaccine, right? Is capitalism the best way to determine who gets the vaccine and who gets which vaccine? Is the market the right mechanism, or is there a different mechanism in a situation like this? Is this a moral question rather than a market question?

Luigi: I think it’s both, but to help us in resolving the moral issue, because I certainly claim no expertise in that area—I don’t know whether you, Bethany, have some, but I don’t have any expertise in that area—and that’s the reason why we reached out to a bioethicist, Professor Arthur Caplan. But first we’re going to discuss the economic side of this issue.

There is an issue of allocation and there’s an issue of reallocation. You might think that it’s fair to give everybody the right to a vaccine, based maybe on a random lottery or maybe on a priority basis, according to our decision of who needs it the most.

Then, the second question is, do we allow people to reallocate their right? Suppose that I am a poor guy and I receive the right to get the vaccine first, and then Bill Gates comes along and says, “I’ll pay you $10,000 to take your place.”

Bethany: Good God.

Luigi: Can I do it?

Bethany: No, no. I find this completely and totally horrifying.

Luigi: Why is it totally and completely horrifying?

Bethany: Because it’s a bit like allowing people to sell their organs in exchange for money. It’s a bit like saying, you’re poor, so you can sell your kidney and get $10,000. It’s horrifying.

Luigi: But we let people work in a mine and take the risk of dying. We let them work in essential jobs where they risk their lives, and also, think about how people have different preferences for risk and for money. It’s a bit patronizing to say, we’ll give you the vaccine, but you’re left to die of starvation. You might discuss that we want to avoid both, but we’re not doing both in the same way.

It’s a little bit like, in the current healthcare system, if you have psychiatric problems, we are ready to give you drugs that are worth $10,000 a dose, but we’re not willing to give you $10,000. Many people with psychiatric problems would feel so much better with $10,000 rather than with a drug, but we don’t give them the money, we give them the drug.

So, I think that giving an allocation based on priority, on some form of need, is absolutely right, but why not let them trade?

Bethany: Well, perhaps this is condescending as well, because the argument about the drugs is that government knows best, right, that we know better than the person with psychiatric problems does about how their money should be spent. But that actually might be true with the vaccine, in the sense that there are certain populations that we all, as a country, would agree are a common good to be vaccinated. Perhaps urban areas ahead of more rural areas where the coronavirus isn’t going to spread as quickly. There are places where it’s the common good for all of us to see people become vaccinated first, and if you give people the right to sell their vaccine, you’re ignoring any element of the common good.

Luigi: You’re absolutely right. Where there is an externality component, where this externality is very strong, you don’t want to allow this trade. There is this very important component, and this is where, to be honest, the market system is good—with all its limitations, but it’s good—is in the fact that we let people sort out and at least see their preferences, rather than coming from above and saying, you want this but I won’t give you this other thing. This is what a centrally planned economy would do, and in general, it doesn’t work so well.

Bethany: Putting aside the question of whether people should be allowed to trade their rights, should people get the vaccine based on a random lottery, or should they get it based on the risk that their job or their situation presents them with? Should there be just a random lottery across the US, or should healthcare workers get it first? Should there be a random lottery, or should people of color, who have been shown to suffer much worse effects from the disease than white people, should they get it first? How should that work?

Luigi: I think that, actually, the decision should be based on some principles, and these principles should be decided by a political institution. I don’t think that this is the role of an economist to decide how they should be allocated. I can tell you how the market would allocate it and what the relative costs and benefits of a market allocation are versus some other allocation, but this is ultimately a political decision.

I was entertaining myself by provoking . . . My stepdaughters were spending some of their COVID period with their boyfriends at my house, and I actually asked, how would you allocate a vaccine when the vaccine is going to be ready? Everybody agrees that healthcare workers are first. When it came to second, the temptation of most of them was to say, you should give it to students. And why? They had a very compelling reason, which is because we are in the phase of learning, and the opportunity cost of not learning now is very high, etcetera. They were making a very convincing case that they should be first.

That, to me, is the risk. And, in a sense, that’s the beauty of the market allocation, that you have some objective parameter and you are not so arbitrary, and so there is not what we call a lot of rent-seeking. The moment you start to determine that this would be decided based on some parameters, everybody’s going to start lobbying that their parameters are more important, that their category is more important, and a lot of resources would be spent in that way. And a lot of resources, I’m sorry to say, would be spent by corrupting people to go one way or another.

You are horrified by the idea of retrading, but how much money would you want to bet that the billionaires are going to get the vaccine first, no matter what? I think that they are going to get the vaccine first. The question is, are they going to pay for it, or are they going to receive it almost for free? I think, at some level, maybe it’s a nice way of redistributing resources to auction off a few vaccines to the richest people at outrageous prices.

Bethany: What’s interesting is that I think you seem to be arguing that, in this case, democracy and capitalism actually go together perfectly, that democracy should set forward the laws and capitalism should then, the market economy should then, make sure that those laws work in the best way possible. Whereas I would have said, approaching this from the outside, this is a situation where capitalism doesn’t work, where this is the antithesis of capitalism, and we want something other than the market making determinations.

Luigi: I don’t think we want unbridled capitalism. I agree with you that if you have only the market system, it’s going to be a disaster. And I think that one of the big lessons of COVID, in my view, is to show how much we need a functioning government in some situations. The reality is, I don’t want an overly powerful government, but I do want a government that does well what it’s supposed to do. Public health is one of the primary functions, and we have seen that in places like Germany and Denmark, this has worked relatively well, and in places like the United States, it’s been a disaster.

Bethany: How do you stop? Even assuming our government were to be capable of putting in place, let’s just call it the right rules, around vaccine accessibility and distribution and allocation. How do you then prevent corruption from setting in? Even if the rules are to be set up in a way that makes sense, how do you make sure that those rules function and don’t get distorted and corrupted by lobbying?

Luigi: I think that that’s the challenge of the market system these days, is that rules tend to be very easily corrupted by pressure. Adding a lot of transparency in the decision of these criteria and making it very accountable to people is the first step to avoid distortion. In one of my books, I said that simplicity of rules is the best way to make sure they are not manipulated, because they are much easier to enforce and to recognize when they are manipulated. It’s easier to be monitored by the public at large.

Bethany: That’s actually very interesting. I wonder, in the wake of the financial crisis, we put in place, obviously, Dodd-Frank and it is many, many times longer, I don’t remember the exact number, but many, many times longer than Sarbanes-Oxley, which was put into place in the wake of the Enron scandal in the early 2000s. Perhaps the added levels of complexity were to provide additional room for manipulation.

Luigi: Yeah, not to mention that Glass-Steagall was only a few pages and worked pretty well. And, in fact, I use exactly that example to say, at the end of the day, we economists are responsible, because we like more sophisticated rules, because it shows how brilliant we are in making all those complicated models. But we don’t understand that a side effect of that is that they are much more difficult to be monitored by the public at large. And so, it’s costly as an economist to admit that, but we should give up some cleverness for some broad principles. That’s what my suggestion would be, is to try to find some principles that are easier for people to understand. Like, for example, how exposed you are to people at risk, that’s a fairly easy criterion, and how old you are and whether you have some preexisting conditions.

Those are things that, of course, they can be manipulated. I’m sure that some people will try to do it, and actually, I had a colleague who said, “I have a preexisting condition.” I said, “What is it?” “Oh, I’m obese, and if it takes a little bit of effort to become one, I will.”

Bethany: In effect, the way to judge whatever protocols there are around the distribution and accessibility of the vaccine, the longer they are, the more we should worry.

Luigi: Absolutely, absolutely. We have to realize that not only will the rich and powerful try to manipulate, we all will try to manipulate in some way or another, like the colleague who’s trying to get fatter so that he qualifies under the obesity rule. I think it’s part of the game, and so a good system is a system that tries to minimize this cost, because the guy gaining weight and risking his life for other reasons in order to get the vaccine sooner is, if you want, a dead-weight cost, as we say in economics. It is an inefficiency of the allocation system that should be factored in. Because imagine that, in order to get the vaccine earlier, a lot of people gain weight, and then they later die of a heart attack. It’s not that easy to lose the weight you gain. Later, you die of a heart attack. That’s not particularly smart as a strategy.

Bethany: On the other hand, if you saw a lot of people rushing to become healthcare workers, then that might be a good effect.

Luigi: Absolutely. Yes. If that’s literally the ticket to get the ticket, that’s a fantastic mechanism. Yes.

I think that we have not touched . . . There are two issues that are important from an economic point of view. One is how to allocate the vaccine once it’s produced, but the second one we have not touched at all, which is how to create the right incentives to produce the vaccine, and how to remunerate or not remunerate, and who is going to pay for it.

Speaking about the capitalist system, why might the market not work in producing the vaccine at the fastest possible speed? And the answer is because we know that once we have the vaccine, a lot of people will demand the vaccine to be given at a low price, and rightly so. And so, at the end of the day, the producer does not get many of the returns. That’s the reason why we have seen massive government intervention.

Now, the reason why we cannot in good conscience let only the market work here is because I think, ex post, we do want to give the vaccine to everybody, and we want to have it at a reasonably low cost. This is in contradiction to creating incentives to make the investments, and so we need to subsidize part of the investments.

Bethany: That’s interesting. I would worry that the very title of the US government’s efforts to get a speedy vaccine, Operation Warp Speed, says it all. In other words, that what we’re paying for is to incentivize the speed of production, not the fairness of the distribution once we’ve gotten it, and so I think there are two issues here. Are we actually being set up from a naming point of view, such that then the distribution becomes, look at these amazing American companies, they’ve competed to do Operation Warp Speed, let them charge whatever they want because the government money was to induce them to do it quickly?

Then the second set of worries is that, at this point in late-stage capitalism, even if we do succeed in getting a vaccine and pricing it appropriately, does corruption screw up who gets it and how it’s distributed and priced? Can that be done fairly in a system that is so susceptible to lobbying and corporate interests and monied interests?

Luigi: I think now is a great time to go to our interview with Arthur Caplan.

Bethany: Yes, Dr. Caplan is someone I’ve known for a while. He’s helped me with various stories I’ve done over the years. He is the founding head of the Division of Medical Ethics at NYU School of Medicine in New York City and has written over 35 books and over 725 papers in peer-reviewed journals. Luigi, that probably means more to you than it does to me, but he is actively involved in thinking about these very questions on the vaccine. In fact, this is like catnip to him.

Art, as we’re in this period where everyone all over the world is rushing to develop a vaccine, what’s the trade-off between Operation Warp Speed and safety? Is there a trade-off?

Arthur L. Caplan: There absolutely is a trade-off, and it ought to concern all of us, because people are leery of new vaccines, and they should be. There’s always a concern that either the vaccine will reveal adverse events if you go too fast, or there will be a glitch in manufacturing, which has happened before with respect to swine-flu vaccine, way back in the Gerald Ford administration almost 40 years ago, the quality slipped.

You’re basically trading trust for speed, and I’ll say this. Look, we hear people saying, I think something’s going to be here in January, but what’s going to be here in January if we’re really, really, really lucky is an FDA-approved vaccine. Then, most of them are two-dose vaccines. That’s 600 million doses that have to be shipped around the country, that have to be put in vials, and I guess I’ll let the listener decide, when’s the last time we made 600 million of anything perfectly?

Bethany: I actually can’t remember an example of that. That’s frightening.

How do we not have this be an issue with the vaccine for COVID? How do we get transparency so we understand what we’re paying for and what we’re taking, if that’s not the way our system generally works? How do we make it different?

Arthur L. Caplan: Here’s the second shortest answer you’re going to get from me. Not going to happen. I mean, it’s not happening. We are not insisting on transparency. People are running around saying, I have a patent protection, this is proprietary information, I’m not saying anything of X, Y, Z. The FDA has not said, hey, we’ll approve these drugs with an open hearing, so you can see how much evidence there was and the nature of it and critique it, and I don’t think we’re going to get there unless we get a change, not only in the administration but also in Congress. They are not inclined to, if you will, stop industry friends from being able to exploit the market. I wish they were, but I don’t think so.

Bethany: If you were an ardent capitalist, you would say, here we are in a time of great need around the world. Let the market work its magic and produce a vaccine. Why do we need government money in order to produce a vaccine?

Arthur L. Caplan: We need government money because the odds of coming up with a successful vaccine are so long. The companies want some assurance that if they invest here and they keep coming up with failures that they’re not going to go broke. The other reason they want government partnership is, if there are adverse events, they want the government to step in and protect them against lawsuits. It’s also likely that it’s only going to work, what the FDA says it wants is 50 percent of us are going to respond to it. That would be approved and considered a success. Well, if that’s all we’re aiming at, there are going to be a lot of people running around that are still going to have to wear a mask, socially distanced, can’t go back to confined workplaces, still going to be outbreaks. It would be nice to have something that tamped it down, but I think we’re spending too much money on vaccines that are just not first class.

Luigi: What about paying people to do voluntary trials? Are you in favor or against and why?

Arthur L. Caplan: Yeah, well, that’s a great question. We have been kicking that one around in the bioethics classroom long before COVID, I can tell you.

Luigi: I’m sure.

Arthur L. Caplan: There’s two versions of payment. One is, I have an experimental vaccine and I want you to try it, and, by the way, I’m going to need to probably recruit, for each experimental vaccine, about 30,000 people, so this is not easy. If you want to speed that process up, you may say, you know what, I’m giving you the experimental vaccine, and here’s something else, I’m going to infect you with the COVID virus deliberately. I’m going to put you in a building, I’m going to give you the experimental vaccine, and then I’m going to give you the virus so I can tell, is this vaccine doing any good faster?

When you do it with the 30,000 people, you’re waiting for them to get infected by nature. When you do it as what’s called a challenge study, you’re deliberately doing it to speed it up.

Both raise payment issues. For the challenge study, I don’t think you can pay, because it’s dangerous, and I think people have to go in eyes open, altruistically knowing they’re going to get exposed to a dangerous virus like COVID. In a general, broad experimental vaccine study, I’m giving you the vaccine and then you go home, and we’ll see what happens over the next six months, I think you can pay people and recruit them. The issue or the test is, if you can’t tell me what the risks are in the study, I’m probably paying you too much, but in principle I’m not opposed. If it distorts your ability to hear the risks, I get nervous.

Well, the good news in the challenge study, which I favor, is that you probably only need 400 people, and we already know there’s a web signup now called “One Day Soon,” and it’s already got about 35,000 people saying, I’d volunteer.

Luigi: Sorry, I’m a little bit puzzled by the fact that you are against the idea that if we want to speed up the vaccine, we cannot pay a person in their 20s, where they have, what, one in 10,000 chances or one in 20,000 chances of dying if infected. We’re not willing to pay to speed up if they agree to the deal?

Arthur L. Caplan: Yeah. I’m not, because it’s not just a one in 20,000 I’m going to go to the hospital. What we don’t know is, is it going to damage your heart? Are there long-term follow-ups? There’s way too many unknown risks. The only way, however, I’m going to shut up the critics of challenge studies, the deliberate infection thing, is to make them believe that people choose to do this, otherwise they won’t permit it. So, the payment issue actually turns out to be a bigger obstacle, not so much from recruiting young people, who still might say, I’ll take the risk, I need some money, it actually is on the regulatory side, where they won’t let it happen if you pay.

Luigi: I find this strange, because in many situations in the world, we’re actually subjecting people to risk for the greater good. Think about the fireman going to a fire, not to mention the people in war, so why are we not willing to do it now?

Arthur L. Caplan: Let me jump in and I’ll give you an even better example. Remember, we had a lot of healthcare workers, nurses, doctors, a couple of months ago in the Northeast, now in the South and Southwest of the United States, who didn’t have adequate protective gear. They died in way disproportionate numbers. Nobody said, you can’t go in there and treat. We, in fact, said, you’re heroes, we’re going to bang pots for you, the fire department’s going to come by. I suggested, how come we don’t pay them more? Why aren’t we giving them some combat pay? Well, the bosses didn’t like that, they didn’t want to do that, they like banging pots and showing up with lunch.

I hear your objection. I’m just telling you, in the practical world, critics of deliberate infection are so strong that they think it violates do-no-harm principles, that if you bring payment forward, they start to say, a-ha, now you just don’t care about these people at all.

Luigi: Let’s take a step back and ask the question, how would you allocate the vaccine, given the fact that it’s not going to be ready in a quantity sufficient to fulfill everybody? And let’s just limit ourselves to the United States. Of course, there is a world problem, which is not a minor one, but let’s limit ourselves to the United States. Now, 300 million people need a vaccine, and there are only, let’s say initially, 30, 40 million doses. How do you allocate them?

Arthur L. Caplan: Well, that scenario is going to happen, and I will tell you what will happen, and then I’ll add something about what I think ought to happen.

We will see a black market. There will be rich people out there trying to obtain product, and historically they have. So, a Goldman Sachs or a super-wealthy investment bank, you will see them start to use their monetary power to gain privileged access, I will predict. I was actually consulted during the swine-flu outbreak back in the early 2000s. Goldman Sachs, I think it was, but it was one of the big companies, called me up and said, “Look, what we want to know is, is it ethical if we buy the entire vaccine product and just give it to all our employees. Would that be unethical?” It was like, what are you talking about? They said, “Well, we could.” I said to them, “Well, do you think you’re the most important people that we should try to save first?” They said, “Oh yes.”

Bethany: It’s the logical extension of the belief that if you make money then you must be better than others, right?

Arthur L. Caplan: Secondly, we’re going to see some people saying, “I don’t want this. It’s too dangerous. I’m out. You take it and let me know how it turns out. It makes me nervous.” Some people are just going to walk away and not in small numbers, probably 30 percent, maybe 35 percent. That’s what polls are indicating, and there’s reason to worry about that.

All that happening, I think what we’ll see is, people seem to agree on healthcare workers, first responders. The moral principle is, prevent death. I would add prisoners, because prisoners have been ravaged by this disease with many deaths. Native Americans on reservations who are poor, not ones who run casinos, but they’ve been hit hard on the poor reservations. There are a bunch of neighborhoods where minority folks have been clobbered in death rates by this, and so I would be including them, and probably nursing-home residents, they’ve been beaten up by this. Morally, preventing deaths, I think, is the first use of a vaccine.

Politically, are Americans going to say, yeah, next in line, prisoners? I don’t know. It will be interesting to see.

Bethany: Who should make that determination of who gets the vaccine first? Should it be governments, given how much money the governments are investing in creating the vaccine, or should it be the FDA, I guess as an arm of the government? Should it be doctors in individual hospitals? Who should make that determination?

Arthur L. Caplan: Well, it won’t be the FDA. The FDA mandate is to approve drugs as safe and effective based on research data. They never control distribution, and they’re not going to start here. There are a bunch of committees that have been formed to think about this. One is, the National Academy of Medicine has a new committee to think about allocation. There’s also the Corona Task Force that Trump appointed that Dr. Birx is the head of, and they’re thinking about this.

But again, not to amaze listeners and interviewers, but no one has the authority right now to enforce distribution, and I think that should change, and I’ll give you what I think should happen. We should have a national commission. It should have the authority to determine vaccine policy, and the commission should have representation from a broad spectrum of stakeholders. If you let the National Academy of Medicine decide where vaccines are going, you’re asking a 20-person committee of scientists, dare I say it, nerdy scientists, to decide for everybody else where the vaccine supply is going, and I don’t think that’s a representative body. I mean, I’m interested in what they say, but I wouldn’t give them final say.

Luigi: Can I ask a provocative economist question? Imagine that your commission goes through and allocates the right. It’s a bit of a ticket or priority, so there is the first wave, the second wave, the third wave, OK? Do you let people trade their positions? Imagine that I receive the second wave, and I receive an offer from somebody of $10,000 to trade my second wave for the tenth wave. Do you allow that?

Arthur L. Caplan: Well, I might. The difficulty with your market is only enforcement, and can you really show up with a chit and say, “Art sold this to me, so I want it”? Because the doctor may say, “I don’t care what Art sold you. We only are giving it now to this class of people.” Regulating a market in the middle of the first wave of the pandemic will be tough.

Can you do it in the second and the third stage? Maybe. Maybe you could, and we didn’t get to it, but there’s another factor. Pretty soon you start thinking, how do I control the spread? You sometimes may want to vaccinate, say, Phoenix or Miami, because they’re hotspots, or Lombardi in Italy, because it’s got a big outbreak. So, it’s not that they’re going to save lives, it’s just a way to tamp down a hotspot so you get more control. I’m not sure you want sales in that kind of a strategy.

Bethany: What do you do if we have, just to keep it simple, let’s say we end up with just two vaccines, and one is far more expensive than the other and it works way better? How do we determine then who gets which one?

Arthur L. Caplan: Far more likely that the better one is in America and the West and Europe, and the not-so-good one is off in Mali and Niger and Cambodia, because those price differences are going to really hinder distribution.

Bethany: Is that the way it should be? Is there a way to make it work in a more equitable fashion than that?

Arthur L. Caplan: I’m going to say one morally controversial thing in response to that. I do think it makes some sense, if you’re going to use need, to do your own country first, because it’s sort of like, I have to pay attention to my family, I have to pay attention to my community, my neighborhood. I do think morally it’s OK to say, I’m going to give some precedent to needy people in the US if we have the vaccine. But then, when you start to say, I’m going to just vaccinate all the rest of us rather than needy people in other places, that does challenge fairness, equity, in terms of obligations to do life-saving as opposed to minimizing low-risk people through vaccination.

Prioritizing, to some extent, country by country first, it’s almost what people expect their government to do. They didn’t expect them to get an initial supply of vaccine and donate it to Burundi or something. But the price angle or the economic angle, that just is going to drive vaccines to where the money is. We either do something about that, institute groups that have the authority to enforce a different pattern, or, you know, we’ve seen a lot of AIDS treatment, high-end AIDS treatment in Europe and the US. We’ve seen poorer types of drugs and more generic things operating in Africa. We have a precedent.

Bethany: It’s hard to find the hard line within that of when your own country should stop coming first, in other words.

Arthur L. Caplan: I’d love to get into that debate. I don’t know myself where I’d draw that point, but I think that’s where the debate is. I don’t buy the rhetoric that just says, say from WHO, the Gates Foundation, every life is equal, as soon as we get a vaccine, let’s flip a coin and distribute it randomly to people who might benefit around the world. I don’t think that actually is the right moral position. I get the idea that lives are valuable, but I think the whole idea of friendship, family, neighbor, country, privileges some lives over others, at least initially. If I’m wrong, we’re going to have a lot of explaining to do about why we take vacations and spend money on tennis lessons while there are starving people in Somalia.

Bethany: That is a very fair point. Is there any kind of historical analogy to where we are today? Has the world ever faced a situation that is comparable to this?

Arthur L. Caplan: The closest is polio. We didn’t have a vaccine, people didn’t know what to do. There were no therapies. They were shutting down public pools, people weren’t sure how you got the disease, people were keeping their kids home from school. It was international, and ultimately, as we know, we got two different vaccines, a shot and then an oral version, but there’s a little sad ending to that story. We’re just about done eliminating, eradicating polio from the world, and it’s only taken about 35 years.

Luigi: Can I tell a little story, that my elder brother died in 1955, probably of polio? The vaccine was already available in the United States, but not yet in Italy.

Bethany: Wow.

Arthur L. Caplan: Yeah. By the way, a little story from me, I got polio. I had it. I was one of the last Americans to get it just ahead of the shot. If people are wondering, why is this guy so interested in vaccines as an ethics guy? That’s why.

Bethany: That’s fascinating from both of you. Thank you so much, Art, for making the time. This was really, really interesting.

Arthur L. Caplan: You didn’t tell me you were going to stick me on with Luigi. My God. That’s so grim and bitter, everything tradable on a market. Geez.

Luigi: There were a lot of interesting ideas to discuss from this conversation. I was particularly surprised by how vehemently people in the bioethics world are against paying people to be part of the challenge study. And I understand that if you pay a disproportionate amount of money, people don’t understand the risk involved, but I have to say, we unfortunately do that all the time. When we send people to work in a mine or when we send people to work in a chemical plant, do we really know all the side effects that the chemical plants can have on their health and the health of their family? No, and we should know more, but there is a disproportionate attention to prevention in this case, where the benefit is enormous, and not equal attention to preventing other cases where the benefit is not that large. Because if we stop producing nonstick pans, we can still have nice eggs over easy anyway, and I don’t think that the world ends, but if we don’t have the vaccine sooner, it’s not that the world ends, but a lot of people will die in the in-between.

Now, if there are heroes who want to do it for free, for the good of the country, that’s even better, but I don’t know how many people there are like that.

Bethany: I don’t know how many there are either, and I think paying people seems like a fair way to do this.

I was most surprised by how much of a nationalist he was and understands or believes that countries should take care of their own first, and that surprised me.

Luigi: I think that a lot of people, and I’m one of those, are rethinking some of the internationalism that was behind our thinking, and part of it is because it’s very difficult to have an international democracy. So, if you want to have some form of balance to capitalism, you have to have a democracy, and so far we have been able to implement a democracy only on some limited geographical basis, not vis-à-vis everybody. If you really start to ignore the wishes and the boundaries of that community, you end up giving no power to the democracy itself. In a sense, you can interpret a little bit of what happened in the last 20 years in which an international spirit prevailed. As a result, corporations have become more important than countries.

Part of the rules in the latest international trade agreements were that you could challenge any country that was putting up a rule against a corporation. As a country, you should have the right to choose what you want and be respected. I think we are in a world in which, in name or international principle, we’re basically eliminating every right of individuals to defend themselves, protect themselves.

Bethany: What’s interesting is how the pandemic is rewriting some of those rules or are changing the very ground on which we used to walk underneath us, in the sense that I think, even though there were questions about globalization and internationalism before COVID hit and a growing rebellion to it, it wasn’t really a practical one. And now it’s starting to be very practical in terms of the growing tensions that we have with China, people’s questions about how much they ever want to travel again, questions about hospital supply chains and how much sense it makes to have things outsourced, and the vaccine, whether countries that develop a vaccine think about taking care of their own population first rather than taking care of the world and operating internationally.

Luigi: Yeah, I think it will be interesting to see what happens in the European Union, because I imagine that in the United States, there will be a preference for Americans versus foreigners, but there will not be a preference for one state over the other. That is, even if the vaccine is produced in Connecticut, I don’t think that they will let people from Connecticut get it first before people from Mississippi. But in the European Union, I could see that the vaccine is produced in Germany and Germans would get it first and Greeks last. I think that that’s unfortunately the nature of the European Union. I think that brings another challenge to this international dimension. What do you consider your population of reference?

Bethany: That’s actually really fascinating, because we have obviously heard a lot of comparisons between the American union and the European Union, and this is a key way in which it’s likely to be very, very different. And people have talked a lot about how the European Union has pulled together over COVID, and yet when it comes to the vaccine, it may splinter whatever togetherness was starting to happen.

Luigi: Yeah, I think it will be very interesting to see what happens. First of all, who is going to produce the vaccine first? And my bet is that probably the vaccine is going to be produced either by Germany or by the UK, which is not part of the European Union anymore. So, we’ll see what happens there, and then see how it’s going to be distributed and who’s going to be given priority.

Bethany: What I was also very surprised by from Art Caplan, it has always seemed to me that one of the key areas of importance for a properly functioning market is transparency, access to information. And I had not realized beforehand that the FDA’s deliberations on vaccines are not going to be public, so people won’t even have the information to know which vaccine, or may not have . . . There’s obviously a cry now to make the FDA be public about its deliberations, but that seems to me like a way, and it’s a broader conversation about the ways in which capitalism has gotten messed up by that very lack of transparency. And how can a market mechanism work if people can’t even choose to pay more for the vaccine that works better, because we don’t even know which one works better?

Luigi: Yeah, but there’s also an important issue of public policy that Arthur was mentioning, which is super important, which is, imagine we rush to get a vaccine through and then there is a problem, and several people or thousands of people die because of the vaccine. Not only there is the tragedy of the people who are dead, but there is also an enormous backlash to the possibility of widespread adoption of the vaccine, and as a result, we don’t reach early immunity as a result of the resistance of people to get vaccinated. As Arthur was saying, it’s not unlikely that we’re going to have a snafu. If you try to produce 600 million doses in a short period of time, you’d be surprised if you don’t have any glitch in the process.

The other part is, we don’t know where those production chains are going to be, because where is most of the production of drugs done these days? Not in the United States, but in India or places like this, and so, is it more likely that a snafu will be there if we try to push things through, number one? Number two is, aren’t they going to try to blackmail us by saying, you are producing it here, you have to give us at least X amount of doses if you want to get your doses back? I think that that’s going to be a big, big issue in the supply chain.

Bethany: That’s a really interesting question, and you’re right, it is. There are two separate issues here. It’s creating a vaccine that works and making sure that people understand how it works and what the data is around that, but then there’s the manufacturing issue, and that’s an entirely separate issue. I don’t know if you read my friend Katherine Eban’s book about the generic drug industry and the terrible manufacturing policies and the FDA’s inability to police that, but the very dangerous manufacturing policies in India and China, and so, if we have our vaccine being made there, we’ve ceded control and a certain degree of care for American lives.

Luigi: This is a beautiful example of how good regulation can increase competition and bad regulation can actually favor monopolies, because this book, and I’m not saying this is her goal, but this book is the best thing that could happen to the pharmaceutical industry in the United States. Why? Because it starts to plant a seed of doubt about generics, and so people will pay the huge premium to get the official drugs because they don’t trust the generic.

In order to have real competition, you need to have a regulatory authority that guarantees the minimum quality, and if they fail at their job, then you rely only on reputation, and that allows you to create a very large or to enjoy a very large margin, because the brand name will be able to carry, and it does carry, a huge premium over the generic. And now even I will be tempted not to get the generic at Walgreen, because you told me that they are not as effective.