23andMe - The Birth of the Crony Capitalist

By -
The FDA has now allowed 23andMe to give their customers some health-related information. This is not everything: it is only the results tat the FDA considers more reliable.

On the face, this might look like a good thing, but it is probably the first step to corrupting one more little industry. Already, 23andMe is running ads saying it is the only genetic testing company offering FDA-approved health results. This is really deceptive because the FDA only approved a small sliver of their tests and because competitors can do the same even if the FDA has not approved them yet.

Consider the people who run 23andMe. Until recently they were fighting against FDA control. Now, how would they view a competitor who wants to offer a non-approved test? They'll probably insist on a "level playing field". Fast forward a year or two and they'll have a relationship with the FDA and may even sue a competitor who tries to offer something new saying it does not need FDA approval. Fast forward a few more years and they would have employed some ex-government folk, and would have initiated joint sessions where they try to get ahead of the FDA, by laying out what they think the rules and standards ought to be. That's when outsiders will scream "regulatory capture".

Two decades ago, Wal*Mart was proud to have a very tiny lobbying office. Microsoft boasted almost no "Washington-man" until the government came after them. Google started that way too. Step-by-step, each of them learnt how to play the game until, finally, they're close enough to government that libertarians can re-write history and say that businessmen are the evil drivers behind "crony capitalism". No, all along it is the idiot citizen buying something at Wal*Mart saying "they should be forced to pay their workers better", or installing Windows and saying "they should be forced to install their competitors' products automatically", or "they should be forced to give me search results for free", or "they should be forced to get approval from government panels before they offer me genetic tests".

Comments

Post a Comment

Popular posts from this blog

Country Shares of World GDP

By -
Image
Here's a chart of world GDP, broken down by country share. ( HT: Carpe Diem ). Careful with the x-axis, it is not at all to scale! The basic idea is that India and China had large shares pre-industrial revolution, after which Europe rose. The U.S. shoots up, to over 40% of world GDP by 1950. Then, Japan begins to grow in the 1960s, and China in the 1980s. Suppose countries end up with GDPs proportionate to their populations. What would that picture look like? I've added a bar to the right, showing the break-down of world-population. Look at the U.S. squished down, with less that 400 million out of a world population of over 7,000 million. The biggest change is in the previously un-noticed 'rest of the world". If Africa, the Middle East and so on moved toward freedom, that could be the story of the century.  What if they do not? Here's a chart with a new assumption. Suppose the "rest-of-world" does not increase its relative s...
Read more

TARP

By -
The Daily Show Get More: Daily Show Full Episodes , Political Humor & Satire Blog , The Daily Show on Facebook ( Link, in case the video above does not play ) In the video above, the Daily Show slams the Fed for giving banks $7.7 trillion in secret. This is a gross misrepresentation that started with a shoddy Bloomberg story and was later echoed elsewhere in the Blogosphere. Simply put, the Fed did not lend anywhere near $7.7 trillion . It was closer to $2 Trillion. Secondly, this total was widely publicized at the time. (What was kept secret was the details about which banks got funds and how much. Everyone knew the details were not being disclosed, and some politicians were quite vocal asking for the details.) The Fed responded to Bloomberg's article, and Bloomberg says they "stand by their reporting", but the details of their clarification show that they were at least guilty of writing in a way that readers might easily be misled. As much as I woul...
Read more

How're we doing on Unemployment? (Feb 2012 Edition)

By -
Image
In October I posted some GDP graphs from the excellent Calculated Risk blog. In summary,  "Real Personal Income"  was still 5% below the pre-recession peak when ignoring "transfer payments".  Additionaly, in four years of recession, the population has grown, and the numbers look worse on a per-capita basis. In this post, I switch my focus to unemployment. Unemployment rate has bottomed:   Here is a graph ( sharper original on Calculated Risk ), comparing the rise of unemployment (downward in the graph) in past recessions, and how soon the rate recovered to its pre-recession level. Post WW-II,  the unemployment rate has never turned so weak nor has it remained weak for so long. Based on historical patterns, it is optimistic to think unemployment will return to its recent pre-recession low (about 5%) any time in the next 2 years. Participation rate falling: One problem with the unemployment rate is that it under-counts dejected workers who have gi...
Read more