Monday, May 28, 2018

Regulation: A Gut Check

How do we get the word out that our underlying conception of how regulations should be designed and enforced needs to change?

The New York Times has an ominous article about the overuse of antibiotics by the livestock industry and its risks for animal health and ours.  Flooding our digestive system with these drugs damages the gut microbiome we depend on for nutrition and waste processing, and it promotes the evolution of resistant strains of bacteria.  The upshot, according to this piece, is that 23,000 Americans die of antibiotic resistance each year, and it adds
A growing body of scientific research also shows that the antibiotics we take as medicine can disrupt our so-called gut microbiome, the bacteria that live happily in our stomach and intestines and that are the key to our ability to properly digest food and process fats. This disruption has been linked to the rise of noncommunicable diseases such as obesity, juvenile diabetes, asthma and allergies. Some researchers also believe that alterations in the gut microbiome have led to an increase in the incidence of autism, Alzheimer’s and Parkinson’s disease.
Ranchers lace their feed with antibiotics to speed up animal growth because it’s profitable.  The risks are difficult for the public to appreciate, and the externality of reducing the effectiveness of legitimate antibiotic treatment is unpriced.  This is a serious problem.

Regulation came to the rescue, sort of, in 2017 with the issuance of a rule by the Food and Drug Administration that requires livestock owners to get veterinary approval for administering antibiotics, with the criterion that the purpose has to be prevention of disease and not growth acceleration.  That sounds like it should have been a solution, right?  You don’t want to ban antibiotics altogether because sometimes there’s a valid reason for using them, so you require professionals to certify that only “good” uses are taking place.

The problem, as the article points out, is that it isn’t clear how much progress, if any, has been made in reducing the routine use of antibiotics in livestock feed.  Ranchers are under pressure to continue pumping up growth, and veterinarians are under pressure to give the ranchers what they demand.  An industry—any industry, including livestock—is an ecosystem, not a machine, with lots of unwritten rules and relationships, incentives, and local exigencies.  You can specify how it’s supposed to work, but it may not work that way.

Fortunately, we have a paradigm for this: adaptive management, which in this case means adaptive regulation.  Every regulation issued by an agency should have three components.  First, it should have a set of rules for people to follow, as all of them do.  But second, it should set up a system of data collection to assess how well the rules are working, and in what way.  And third, it should specify a regular cycle of review and revision to put accumulated knowledge into practice.

The FDA antibiotic regs did #1 but not #2 or #3.  It was a one-off, over-and-out performance, as most of our regulation tends to be.  Regulators did not set up a surveillance or sampling system to see how and where antibiotic use was changing, much less build in an ongoing process of evaluating and improving the regulation itself.  The upshot is that years have to go by, and the political forces for reform have to be assembled all over again to replace a defective rule by a better one.  The NYT article is part of that process, which is good, but it’s a lousy process.

So: how do we get the word out that our underlying conception of how regulations should be designed and enforced needs to change?

(Source for image:


Bruce Wilder said...

I think we should start by jettisoning the notion -- a central dogma of neoclassical economics -- that economic efficiency is entirely or even primarily about allocational efficiency. It just isn't so. Allocational efficiency matters, but in the organization of the economy, the opportunity costs of trade-offs on the putative frontier of production possibilities are normally dominated by the inframarginal problems of controlling production processes by means of social hierarchies using operational models and feedback from error to manage in an administrative sense. Waste and depletion are necessary costs and learning from experience, particularly from a non-local public vantage point (as illustrated in the antibiotic example), poorly conceptualized in the opportunity cost framework and the misplaced faith in the information processing capacity of Hayekian market prices. Do you honestly think "the externality of reducing the effectiveness of legitimate antibiotic treatment" could be "priced"?

I suppose I risk becoming another crank by stating the case baldly. You have been a wonderfully articulate critic of neoclassical economics, but you do not seem to take your own critiques seriously enough to recognize how and how often neoclassical economics, as the source of economic thinking for political society, is a primary obstacle to rational adaptation. I would not say we can do without economics -- that isn't my point. My point is we cannot do with it, as it is, a bundle of lies and misdirection presented as harmless conventions.

I think any number of useful ideas could be pulled out of economics, but not until the theory of the economy as a system of markets processing information and regulating activity by price is discarded as dangerously incomplete and misleading.

Wallfly said...

Although the issue of antibiotic pollution is real the idea that its main effect is manifest in the gut microbiome is sheer speculation (which heavily abounds).

Wallfly said...

Btw, though there is an economic incentive to increase the anti-biotics in cattle feed, the fact is that they need anti-biotics in the first place because grain feeding makes them sick (because they are ruminants). The reason they may be growing faster with increased anti-biotics is because they are less ill. Pasturing cattle may be the only way to substantially reduce anti-biotics in beef production.