Putting All Of Your Eggs In The Same Basket: The Story Of The Salmonella Egg Recall

826egg.jpgUnless you’ve been living under a rock, you couldn’t have missed the past week’s nationwide recall of a half-billion eggs feared to be contaminated with salmonella bacteria. How could half a billion eggs – more eggs than there are people in the United States – become unsalable?
Part of the story is that we’ve been putting all of our eggs in the same basket. All of the recalled eggs originate with two producers in Iowa – Wright County Egg and Hillendale Farm. Iowa has come to dominate egg production nationally because the cost of feed grain is so cheap in Iowa, because of Iowa’s abundant corn fields. Although the cost of feed grain in Iowa is probably only marginally cheaper than elsewhere in the country, the huge scale of modern agribusiness means that egg production will be located in a few centralized locations in Iowa.
In short, we put all of our eggs in a few Iowa-based egg baskets. This means when there is a problem in the supply chain, it will have massive implications. These Iowa plants with their Concentrated Animal Feeding Operations (CAFOs) are the ideal breeding grounds for the spread of any disease or contaminants: you have massive, very dense populations whose members, once infected, travel across all fifty states.
Also, with that many egg-laying chickens in such close proximity, prophylactic antibiotics are the order of the day to prevent epidemics that would kill off the chickens laying the golden eggs. But regimens of prophylactic antibiotics of course have side effects: they build up resistance and cause new strains of bacteria to evolve.
What’s the solution? Critics of a pending food safety bill (previously blogged about here), including Walter Olson of the Cato Institute, insist that more regulation is not the answer – that the cost of complying with new regulations will crowd out small-scale producers, such as organic and free range egg producers. You can read Olson’s critique here, in part of a New York Times symposium on the salmonella egg recall.
Of course, as many have rightfully pointed out, the blame for the salmonella outbreak lies not only with the degree of regulatory oversight but with the framework of the oversight. Two different government agencies are responsible for the safety of two intricately connected foodstuffs: the chicken and the egg. The Food and Drug Administration is responsible for egg safety while the Department of Agriculture regulates chickens. (The same bizarre regulatory framework applies to cows and their milk). Having one government agency that oversees both chickens and their eggs might be more efficient. Of course that’s almost too much to hope for.
Critics of new regulation, like Olson, also maintain that big time egg producers like Wright Egg and Hillendale farm already have market incentives to get uncontaminated food to market. Having to destroy half a billion eggs is going to cost them and their shareholders dearly. Yet such a claim would seem to be belied by the checkered safety records of both Wright County Egg and Hillandale Farms. In 2000, the owner of Wright County Egg was cited as a “habitual violater” of Iowa environmental law. A few years before that, the egg supplier paid $2 million dollars in fines for safety violations at a Maine farm. Economies of scale can apply not only to production, but also to avoiding regulation. A small time farmer skips a safety precaution and profits a little by it, but when a large agribusiness cuts the same corner it reaps much larger savings.
Massive Iowa egg producers are probably here to stay. Americans, and people around the world, demand low-cost food. So what should we be doing? Well, the FDA’s new egg safety regulations that went into effect in July will help prevent another salmonella egg recall of this scale. Additionally, a salmonella vaccine that is given to hens in Britain and New Zealand has proved effective there.
But, more than likely, we’re going to see more outbreaks on even bigger scales as agribusinesses try to squeeze more productivity out of every square foot of their operations.

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Link Roundup: From Across The Blawgosphere

  • Over at Torts, law professor Alberto Bernabe covers an ethically troubling phenomenon: the outsourcing of pediatric clinical trials. More and more pediatric clinical trials are being conducted outside the United States. Nearly forty percent of pediatric clinical trials are now being carried out in developing countries. Given a recent Second Circuit decision, the outsourcing of clinical trials might not reduce the pharmaceutical companies’ legal exposure, but patients in the developing world are certainly more likely to have a tougher time getting a lawyer with the skills to successfully sue for them. Also problematic, as Bernabe points out, is the distribution of benefits from these clinical trials. Local populations are the test subjects in these clinical trials but once these expensive pharmaceutical make their way to market will they be available in poor corners of the world? [Torts].

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One-Third Of Doctors Would Not Report Incompetent Or Impaired Colleagues

There are some signs that the medical profession’s code of silence is retreating, but a recent Journal of the American Medical Association survey of 2,000 doctors reveals that only 64 percent of doctors agreed that they had an ethical obligation to report colleagues who were “significantly impaired or otherwise incompetent to practice.”
Seventeen percent of doctors replied that they knew of a doctor so incompetent or impaired that the doctor should not be practicing.

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Should Doctors Admit More Of Their Mistakes?

i_accept_your_apology_sticker-p217466643065825983qjcl_400.jpgA new study published in the Annals of Internal Medicine suggests that when hospitals and doctors admit their mistakes and offer immediate upfront compensation to their patients, they succeed in driving down their medical malpractice liability costs.
The University of Michigan Health System (UMHS) program studied by the researchers is truly remarkable. If UMHS discovers its doctors have committed malpractice, it discloses that fact to the patient, even if the patient is unaware that he has been injured by malpractice.
Why this program works and, if indeed it has been efficacious, is anyone’s guess. Ted Frank gives it his tentative endorsement but cautions that the numbers could be skewed by the absence of one or two large medical malpractice cases. Katherine Hobson notes that the implementation of the program coincides with an overall decline in the number of medical malpractice claims in Michigan and a decrease in the size of those claims.
I can see a few reasons why this program might work. For one thing, delaying compensation in cases of obvious malpractice does nothing but foster animosity toward the hospital and doctors. Injured people’s resolve starts to harden when they can’t pay their bills because they’re out of work and months have gone by without them seeing any money. Secondly, if you get people to sign a full release of their claims before the day-to-day reality of living with their injury has really sunk in, they might be willing to accept a smaller amount of money. Lastly, if patients are entering into these agreements without the benefit of legal counsel or discovery that uncovers all the facts, they might be selling themselves short.
Of course none of these rationales for the program’s success can explain the most remarkable part of the study: that the number of medical errors apparently declined. Maybe knowing that their mistakes will be discovered by the patient, regardless of whether the patient perceives the mistake, makes doctors act more carefully?

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Car Accidents: Changing Times, Changing Causes

_48768640_bridget_driscoll304.jpgToday the BBC commemorated the 114th anniversary of Great Britain’s first fatal car crash with a feature story on the accident that claimed the life of Bridget Driscoll.
The story, retold through the conflicting testimony offered at the inquest into Driscoll’s death, is fascinating. Apparently, the car, driven by Arthur Edsall, had a top speed of four miles an hour, due to a governor that limited the car’s top speed.
How did Bridget Driscoll fail to get out of the way of a car traveling at the snail’s pace of four miles an hour? According to one witness at the inquest, Driscoll, “bewildered” by the strange sight of an automobile, froze in place in the roadway. Other testimony seemed to suggest that Edsall, who had only a few weeks’ experience behind the wheel, did not how to steer and may have inadvertently steered into Driscoll.
Of course, new technologies continue to cause accidents. This week brought news that Dr. Frank Ryan, a famed Hollywood plastic surgeon, drove off a cliff in Malibu while trying to upload a picture of his dog to Twitter. Nowadays it seems we’re not so bewildered by the operation of a car; we’re more likely to get in trouble by thinking we can multitask while doing it.

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Sudden Uncontrolled Acceleration And Stock Trading Algorithms

stock traders.jpgIn January, on the heels of the terrifying tale of a state trooper and his family killed in a crash caused by their out-of-control Lexus, more reports of sudden uncontrolled acceleration problems with Toyotas began pouring in. Of course, skeptics were quick to point out that reports of uncontrolled acceleration problems with Toyotas resembled past claims of acceleration problems with various makes and models that had come to naught, especially the Audi acceleration flap of the early 1980s.
Since no one could point to any mechanism in Toyota’s (computerized) accelerators that would cause uncontrolled acceleration, these skeptics insisted that the problem must be driver error. At the time, I cautioned that we should keep an open mind – that the block box computer programs that regulate Toyotas’ acceleration and braking could conceivably have a bug, the same sort of bug that caused the Great Northeast blackout of 2003.
This week, the acceleration skeptics got welcome news as the National Highway Traffic Safety Administration announced its preliminary findings: in all of the Toyota acceleration cases investigated thus far, driver error has been found to be the cause of the braking failures. Yes, pedal misapplication – hitting the accelerator instead of the brake – is the leading culprit at this point in time.
Meanwhile this week came another story, a story about malfunctioning black boxes. Wall Street traders and government regulators are still probing the May 6 “flash crash” in which the Dow Jones inexplicably plunged nearly 1,000 points within a couple hours. Of course the bulk of stock trading is done by computers running proprietary algorithms that Wall Street banks have invested many more billions in than Toyota has spent engineering the computer systems in its late model cars. Investigators probing these trades are finding the black box computer algorithms used by traders produced bizarre “crop circle” graphs over the course of the flash crash.
It seems one might draw some parallels between the 2010 “flash crash” and an older stock market mystery that occurred around the same time as the 1980s Audi debacle: the Black Monday 1987 stock market crash that some chalk up to computer trading.
My position on the Toyota uncontrolled acceleration phenomenon has always been the same: when people complain that their cars (increasingly controlled by complex computer systems) are going haywire, we should take them seriously and investigate thoroughly because even the best-engineered systems can behave unpredictably. If investigation reveals that root of the problem is not a defectively designed product, but rather human-fueled hysteria, then so much the better for society.
I just wish the same people who are so quick to point to human error in the driver’s seat would be as quick to recognize human error in some of Wall Street’s follies.

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New Study Puts Costs Of Injuries From Medical Errors At $19.5 Billion Annually

medical malpractice 22.jpgThe Wall Street Journal’s Health blog reports today on a new study, carried out by the nonpartisan Society of Actuaries, that estimates the medical costs of medical errors at $19.5 billion annually in the United States.
This blog has long noted how common medical errors are. More than half of pediatricians admit to making at least one treatment error a month. In an intensive care unit, individual doctors and nurses perform, on average, 178 actions per day and commit, on average, two errors. According to the Archives of Internal Medicine, only twenty percent of the time are the correct protocols followed flawlessly in administering patients’ medicines. IV line infections – easily preventable if the proper protocols are followed – affect 80,000 patients annually in the US and kill approximately 5,000.
Of course not every medical error is an instance of medical malpractice. In order to constitute medical malpractice, the breach of the standard of care must cause an injury. If a medical error is caught before it results in injury, it does not rise to the level medical malpractice.
Of course, catching and fixing these medical errors does have costs for our health case system. The new study from the Society of Actuaries pins the direct medical costs of those medical errors at approximately $19.5 billion annually. These are simply the treatment costs of undoing medical errors.
Meanwhile, insurance companies pay out $4 billion a year in medical malpractice claims.
Tort reformers complain that medical malpractice lawsuits drive up the cost of our healthcare by forcing doctors to practice “defensive medicine” – ordering unnecessary tests and procedures simply to protect themselves from liability.
But the costs of defensive medicine ignore an important offset: how much does defensive medicine save us by catching diseases that would otherwise go undetected and untreated? And how much does the threat of medical malpractice litigation save us by causing doctors to remain vigilant in their treatment?
Lastly, would that $19.5 billion dollar a year figure in medical error costs be much higher without medical malpractice lawyers?

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Mounting Evidence About The Defective Design Of CT Scanners

It’s a problem we’ve blogged about many times before – patients receiving mega-doses of radiation from CT scans and other medical imaging.
There are several dimensions to this problem. One, these potentially lethal machines are being operated by under-trained and under-educated technicians who don’t understand all of their dangers. Two (and perhaps most importantly), the manufacturers of these machines, including General Electric and other companies, have defectively designed them, failing to implement any kind of failsafe mechanisms that would prevent technicians from administering radiation doses that would kill an elephant.
Thankfully, The New York Times’ Walt Bogdanich has not let up on this story and last weekend, published another follow-up piece. The piece details just how badly designed some of these CT machines are. As one victim of radiation overdose told Bogdanich, when a truck backs up, “it goes ‘beep, beep, beep.’ If you fill up the washing machine too much, it won’t work. [But on a CT scan] there is no red light that says your irradiating too much.”
Let’s hope these defective machines get re-designed and soon.

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Legal News Round-Up

  • At Concurring Opinions, Dave Hoffman discussed a working paper co-authored with Christina Boyd entitled, “Litigating toward Settlement,” that examines the factors that make a case more likely to reach a settlement. Among the conclusions reached: the more motions filed, the more likely settlement becomes (this is sort of counterintuitive because you might think the opposite is true – the more hard-fought a case, the more likely it is to be resolved by jury verdict); a plaintiff’s success on a motion speeds settlement more than a defendant’s victory; and cases presided over by women judges are nearly twenty-five percent more likely to settle than cases with male judges.

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Insurance That Pays For Your Traffic Tickets?

traffic ticket.JPGIn one of his “Markets in Everything” blog posts, Tyler Cowen introduces us to the (perhaps apocryphal) “Ticket Free” insurance – an insurance policy that drivers can obtain in addition to their primary liability policy that will pay for any tickets they get and the insurance surcharges associated with these tickets.
Ticket Free offers three different policies. The “Mini” exclusively pays for speeding tickets.The “Classic” covers other moving violations, such as illegal u-turns and running red lights and the “Enthusiast” covers everything from excessive window tint to having an excessively loud car stereo.
Although the fact that Ticket Free’s website no longer seems to be operational and it apparently never was registered with the California insurance commissioner suggests that it was pretty fly-by-night, this sort of insurance policy apparently is available in some Scandanavian countries, if blogging commenters are to be believed.
Needless to say, this sort of “ticket insurance” would be a bad idea for American roadways. As the comments to this blog post by law professor David Bernstein (himself recently ticketed) suggest, there are myriad ways that reckless drivers can get out of tickets – even citations issued on the basis of that gold standard of speed detection “lidar.”
The underenforcement of our traffic safety laws causes more numerous and more serious car accidents to occur. Let’s hope that just forcing traffic scofflaws to take time out of their day to show up to traffic court has some deterrent effect on them.

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