The Myth of Universally Desired Efficiency
Not everyone wants to make things more efficient. Some people and organizations have a vested interest in keeping things inefficient. What’s financially good for Person A is often financially bad for Person B, and Person A will fight to keep it. These people will often claim other reasons why things need to stay the way they are, and they may even believe them. In other cases, they’ll know that a better market does not involve them, but they have to cling to the inefficiency for survival.
Examples
“Eliminating waste” is a common cry when it comes to health care, and this is popular because “waste” is something we view as universally bad…except for the people who consider it revenue. A “wasted” medical procedure is still making money for someone. Thus, attempts to improve the health care system are met with resistance by medical providers who might rely on a certain level of needless procedures for their income.
The intersection of I-70 and the Pennsylvania Turnpike is not a simple interchange. Instead, drivers are routed two miles through city traffic to get from one interstate to the other. Fixing this would be a straightforward road project, and would save hundreds of thousands of hours of drivers’ time and frustration. However, the truck stops in the Breezewood, PA business district make a lot of money from the traffic forced through this choke point. They have no interest in saving driving time – in fact, many business are completely dependent on this forced inefficiency to survive.
A common type of art fraud is when someone “finds” a previously unknown painting by a famous artist. In these cases, most everyone wants the fraud to be maintained. The person who “found” the painting certainly wants people to believe it’s by a famous painter, the art community might be excited at a new and interesting work, the auction house or broker making the sale earns a commission, and the person buying the painting clearly wants to believe it’s genuine (so long as the fraud can be maintained over the long term). We assume someone would want to know the truth, but these frauds often perpetuate because very few people have a vested interest in revealing the deception. (Also called “A Conspiracy of Goodwill.”)
It’s said that pharmaceutical companies don’t want to invent “cures,” rather they want to invent “treatments.” While curing something seems to be a universally good thing, the cured person then no longer needs to pay for a drug. It’s much more profitable to invent a drug that someone is required to take forever to treat a chronic condition (e.g. – antidepressants, Viagra, cholesterol medication).
Goldman Sachs asks in biotech research report: ‘Is curing patients a sustainable business model?’
The potential to deliver “one shot cures” is one of the most attractive aspects of gene therapy, genetically-engineered cell therapy and gene editing. However, such treatments offer a very different outlook with regard to recurring revenue versus chronic therapies. It could represent a challenge for genome medicine developers looking for sustained cash flow.