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Comment by Ironchefpython | Hacker News Reader

> How about a suggestion that can make both of use happy? We keep the FDA, they do everything the do now, only that other products can still be sold, but they need to have a reasonably BIG label on it, that they are not FDA approved. We put a tiny tax on all products actually approved by the FDA to fund the FDA.

Sure, with two small changes. One, we make the FDA tax progressive. Use whatever argument you like to justify this, like rich people's lives are more valuable, and therefore they can pay more to stay alive, but the key is that everyone will buy into the system in a way that they can both afford, AND be emotionally invested in.

Second, all non-FDA labeled products will have a MASSIVE tax applied, to pay for the externalized costs of bad food, such as emergency room visits, death, sickness, etc.

Of course we need a state to enforce this system, and it won't work any better than the existing one, but hey, it's a market solution!

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A fixed tax is already progressive since rich people consume far more, but I don't really care. Also the tax would be so small that it really would not matter (as long as many produces have this stamp). Only if nobody cares about the FDA it will be expensive.

> Second, all non-FDA labeled products will have a MASSIVE tax applied, to pay for the externalized costs of bad food, such as emergency room visits, death, sickness, etc.

That's another problem with government. Once it does everything, everything has effect on everything else. You can force any health measure on the population with the argument that others have to pay for you if you don't do something. You might as well require that everybody does mandatory sports and eat the state approved diet.

If you as a state want to make a commitment to universal health care then you have to accept people being people and doing unhealthy things. If you as a state don't want to do that, you have two options, don't do it or put a totalitarian policy state in place so people follow your rules.

Even so, there is no way to prove that these MASSIV externalisiere exist. That's simply your assertion. It could also be that these people are exactly the same on avg. It could be that because they abuse products they die faster and thus cost less money to the state.

> Of course we need a state to enforce this system, and it won't work any better than the existing one, but hey, it's a market solution!

You are contradicting yourself. Its not a market solution, its a state run system either way.

What this idea is about is testing if products that are not FDA approve really are worse in the longer term. Because if it turns out that it is the case that they are not, then we can just all agree to drop the FDA.

As long as the FDA has monopoly we have know way of knowing what there actual effects. Seems to me more people should care about stuff like that.

> As long as the FDA has monopoly we have know way of knowing what there actual effects. Seems to me more people should care about stuff like that.

While we may not know exactly the actual effects of the FDA or any other governmental policy, we can have a pretty good idea. We do this via econometric analysis of countries with and without entities like the FDA. Ideally we can get time series data where a country created an FDA. We'd throw in a few control variables as well. Then we see the effects of the stuff like the FDA - and even if this isn't perfect, we'd know in general the likely effects of it.

The evidence shows that having an agency regulating drugs and food increases safety. For example, England had a massive issue with a drug which impacted their newborns. We didn't have the issue because the FDA rejected it for use.

>Even so, there is no way to prove that these MASSIV externalisiere exist Well, actually we can prove externalities exist via various quasi-experiments and math. That's kind of what economists do in order to justify intervening in a market. There are measurable externalities in healthcare - which are at least a certain size and probably larger.

Healthcare in general is interesting because of stuff like the herd effect. If someone takes a bunch of sub-par antibiotics and the bacteria they have evolve around that pill all of society is negatively impacted. The disease is more resistant (kills more people) and society needs to pay for a new antibiotic to be researched and produced. And we don't know what these potential adverse effects are initially - what if we accidentally expose a bacteria to enough weak anti-bacterial agents that it becomes immune and kills millions of people? What if a sub-par untested drug turns all of it's users into homicidal maniacs? Or, like England, we could have years of birth defects.

The companies usually don't know the risks either - because before the FDA medical tests were usually very rushed.

So, as a society we have two options to fix these externalities.

One was listed above: charge producers/consumers of poor drugs a tax equal to the costs they impose on society. The government would then redistribute the tax to injured parties. The problem here is in pricing the externaities properly. Also, how do we know what a poor drug is without testing them? We can't, so we'd have to tax all drugs the same. As a result, if we tax too high we have fewer drugs produced and society suffers. If we tax too low then bad drugs slip in and possibly we didn't guess the cost of compensating people properly. So we don't have enough to pay the widow of a man who took a pill and then died four minutes later.

The second option is to regulate away the possibility of poor drugs as much as is plausible. Here we don't need to guess at how much money the externalities would cost. We also don't need to figure out optimal tax rates to get new drugs produced. In the case of healthcare clearly regulation is the best way to deal with possible negative risks.

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