Why are the Free Traders All Protectionists? Vaccines and Sharing Knowledge (Fun for Thanksgiving)

November 25, 2020

After having Donald Trump in the White House for four years, we have gotten used to being lied to by people in high positions. Trump and his top staff have no qualms about telling us night is day, black is white, and two plus two equals five.

But we expect better from Team Reality: you know, the folks who write newspaper and magazine articles and opinion pieces, teach at major universities, and pass themselves off as great thinkers on the important issues of the day. But when it comes to discussions of the development of vaccines against the coronavirus, Team Reality is not doing much better than the Trumpers.

For the last couple of weeks, we have seen the celebration of reports of successful vaccine trials by Pfizer/BioNTech, Moderna, and Oxford-Astra Zeneca. Their success in such a short time-period is being treated as a remarkable achievement, given that it has often taken more than a decade to develop vaccines in the past. In the case of many diseases, most notably AIDS, we still don’t have an effective vaccine after many decades of trying. In this context, the seeming success of these vaccines is indeed an impressive achievement, as well as being very good news with the pandemic now exploding out of control in the United States.  

But the part of the story the celebrants seem determined to ignore is that the U.S. and European researchers do not appear to be the only ones with success in developing vaccines. China now has five vaccines in Phase 3 testing and Russia has one. Several of China’s vaccines have already been widely distributed in China, and to a lesser extent in other countries, under Emergency Use Authorizations.

It probably is not a good practice to widely distribute a vaccine before it has been properly tested, but you would think that the fact that China is already in a position to make a vaccine widely available would arouse some interest here. After all, we are now looking at close to 200,000 new infections a day and more than 2,000 deaths. If we had begun distributing a vaccine widely a month ago, these numbers would almost certainly look much better today and would presumably be getting lower rather than higher.

Incredibly, in spite of the enormous human and economic cost of the unchecked spread of the pandemic, literally no one in any major news outlet is asking the simple question of whether we could have benefited from access to China’s vaccines. There were a number of articles (here, here, here, and here) that reported on the claims of Sinopharm, one of the Chinese vaccine manufacturers, that it had already given its vaccine to nearly one million people. However, this was treated as an oddity, sort of like a four-legged chicken, not anything that could conceivably be relevant for slowing the spread of the pandemic here.

It might have been reasonable to ask a public health expert about whether the United States could have in the past, or even now, benefit from access to this or other Chinese vaccines. But that question did not get raised in any of these articles.


Can We Cooperate With China?


As my regular readers know, I have harped on this point at length, but I was moved to again push the issue by a piece in the New York Times by Fu Ying, a Chinese academic who has held high positions in its government. There were some items in this piece, which can be assumed to reflect the government’s position, that are troublesome, most importantly its claim that human rights abuses in China are not anyone else’s business. But apart from these items, there is one specific area that certainly deserves attention.  

Near the end of the column, Ms. Fu outlines areas for cooperation between the United States and China:

“Finally, a host of global issues call for close cooperation between China and the United States — the most urgent being the fight against the coronavirus pandemic.

“Scientists from both countries have a solid track record of professional cooperation in responding to past health crises, and they should be encouraged to maximize again the potential for exchange and joint research. Both China and America are resourceful in vaccine development. If they cooperate to make vaccines more affordable and accessible, the whole world will benefit.

“Climate change is another area that needs urgent attention. The world expects China and the United States to play a leading role, and the two countries have a lot to work on together.”


These points are very well-taken and we should hope the Biden administration tries to follow through with the Chinese government.  It was tragic that the United States and the rest of the world took a narrow nationalistic approach to develop treatments and vaccines. If we had continued the path of international collaboration that scientists were following in the early days of the pandemic, it is very possible that we would have had an effective vaccine already.

If we had followed a collaborative path, with no patent monopolies, all results would be fully public as soon as they are available. Anyone would be free to do their own tests and, they could mass produce any vaccine for which they had manufacturing capacity. This would mean, for example, that if the Sinopharm vaccine seemed promising, our researchers would be able to do whatever additional tests were needed to secure FDA approval. We would also be able to manufacture the vaccine as quickly as our factories were able to produce it, without seeking permission from Sinopharm or the Chinese government.

This is a good backdrop for possible paths of cooperation going forward. If we decided to cooperate with China on areas of common concern, such as health care and global warming, we could go this route of shared and open research.

This would mean that both countries would commit to certain levels of expenditure on research in specific areas, with all results being posted on the Internet in a timely manner and any patents being placed in the public domain so that everyone could freely use them. Presumably, we would want to bring other countries into such an agreement, so that they would both contribute to the research and share in the innovations that come from it. (I describe this sort of system in chapter 5 of Rigged [it’s free].)

This sort of system could be an enormous benefit to both China and the United States, and humanity in general. In medicine, the new vaccines and treatments developed could be sold as cheap generics from the day they were approved. Paying for drugs would no longer be a major problem in rich countries, and even in poor countries, securing necessary medicines could be accomplished with modest commitments of aid from rich country governments, international organizations, or private philanthropies.

In terms of dealing with global warming, new innovations in solar energy, wind energy, energy storage, and other areas would be quickly diffused throughout the world. The price would plummet as buyers need only pay the costs associated with manufacturing and installation, there would be no royalties going to companies with patent or copyright monopolies.

Perhaps best of all, we would be removing a large area of potential conflict between the United States and China. One of the items that always appears near the top of our list of complaints against China is the theft of intellectual property. However, if a large portion of our innovation is fully open, there is nothing to steal. We actually want China to install clean energy as quickly as possible, and they want the same from the United States. In this context, the greater and quicker diffusion of technology is truly a win-win.

We can also say the same about advances in health care. Whatever forms our competition with China might take, no reasonable person would want to see their population needlessly getting sick and dying. And, as we can clearly see now, we certainly share an interest in preventing the spread of infectious diseases anywhere in the world.


The End of the Thanksgiving Dream

Okay, this picture of international cooperation might be a very rosy scenario, but I have been around long enough to know it is not a realistic one. A big part of that story is that the industries that might see lower profits in this picture – the pharmaceutical industry, medical equipment manufacturers, wind and solar power companies – are powerful actors who will fight very hard to block any efforts to change the current system.

But the problem goes even deeper. There is an overwhelming consensus among elite types that free trade is the best way to go. We see endless articles and columns that warn us of the stupidity of tariffs on items like steel or cars. While the protection of these and other sectors may have allowed for higher pay for U.S. workers in years past, the story goes that they just have to adjust to a world where these industries will no longer be protected.

We could tell the exact same story about the pharmaceutical industry, medical equipment manufacturers, wind, and solar power companies. But the people who would see their incomes most at risk if we moved towards free trade in these areas (moving away from patent and copyright protection) would be highly educated professionals, largely people with college and advanced degrees in biology, chemistry, and engineering or physicians.  

These people are parents, siblings, or children of the people who write about economic policy and international relations. Policy types are much more likely to have very direct connections with the people who benefit from protections of intellectual property than the less-educated manufacturing workers who might benefit from tariffs on steel or cars.

Whether or not social position explains the differing attitudes towards the protection of manufactured goods and the protection of intellectual property is something I will leave to people to argue about over Thanksgiving dinner. But the fact remains, protection for manufactured goods is universally derided in outlets like the New York Times, Washington Post, and The Atlantic. Protectionism in the form of patent and copyright monopolies, which is hugely more costly, is never even raised as an issue. I’m open to other explanations for this difference in treatment.

Happy Thanksgiving Everyone (hopefully by Zoom).




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