The Hacking of the American Mind

by Robert H. Lustig

  “Like”-wise, the Liker can get into trouble. A recent study created a fictitious social media group, in which all the participants were actually the research subjects, and the scientists were in charge of what each subject viewed on Facebook.19 Each subject underwent MRI scanning while being shown a fake item for a thumbs-up or thumbs-down. The nucleus accumbens (NA) lit up only when the subjects Liked something that they thought that others Liked as well—in other words, they exhibited the herd mentality. If they Liked something that wasn’t popular, no dopamine rush was noted. This could easily be a trap for both participants on the end of a social network. Maybe we should call it antisocial media. And Facebook, Snapchat, etc., are for-profit entities. They are there to make money through ad sales. They need to be relevant to do so.

  Irrational Exuberance

  If you think your smartphone provides a pretty good rush, try the floor of the New York Stock Exchange. John Coates is a Wall Street trader turned University of Cambridge neuroscientist who studies traders on the floor of the stock exchange to determine when, how, and why they engage in risk-taking behavior.20 He chronicles both the testosterone and the dopamine surges of the traders in the midst of a bull market versus the cortisol rises during the bare-knuckled fall to the bottom of a bear market. The result of this double hit is an overworked and overtired reward system, unable to muster up a taste of victory. Perhaps then we should not be too surprised to hear that David Nutt, the UK drug czar, opined in 2013 that many of the traders who precipitated the Great Recession were so morally bankrupt, so depleted of dopamine and their receptors, that they had to resort to cocaine to feel anything.21

  No doubt, conflating happiness with the maximization of pleasure and reduction of pain (see Chapter 1) has influenced the inherent structure and function of our financial markets. In part due to the Great Depression, the Keynesian economic school of thought ruled the markets from 1936 until 1970. Keynesian economics states that the private sector makes the decisions, but always under the watchful eye of government, which alters policy as necessary (i.e., establishes regulations). Such an oversight posture invariably limits growth and therefore the production of money. Rather, Milton Friedman22 and his University of Chicago economic colleagues conflated money with happiness, and his legacy is that more happiness, i.e., more money, is always better than less. After all, consumers want more bang for less buck, and more buck for less bang. Indeed, the genius of the Chicago school was to apply this psychology known as “price theory” to all walks of life—that the only method of rational behavior was that which created the most happiness . . . er, money.

  Enter Lewis Powell. By 1980 the sands had shifted to favor corporations over people. The Chicago school began to dominate in 1980 under Reagan. Banks started borrowing at low rates to buy other companies to liquidate them, known as risk arbitrage. The Chicago school achieved its sentinel victory with the repeal of the Glass-Steagall Act in 1999, which completely deregulated the banks and markets—and we all know what came next.

  What the Market Will Bear

  Yet for all their unpredictability and volatility, markets still do work, and we usually let them. Except when it comes to addictive substances. Witness the phenomenon of price elasticity for foods.23 This is an index, applied to products, that indicates how badly the consumer wants the product using the metric of how much they would be willing to pay, and it is driven by dopamine and its receptor.24 The price elasticity index is measured as: if the price were to increase 1 percent, how much continued sales would remain? A low index means that people stop buying the product, and the product is “price elastic.” A high index means that people will continue to buy the product even though the price has increased, thus the product is “price inelastic.” The most price elastic food item is eggs, at 0.32. This means if the price of eggs goes up 1 percent, consumption goes down 0.68 percent. Eggs are the highest-quality protein there is. Eggs have all the nutrients you need. They are literally the world’s most perfect food. And people won’t buy them if the price increases. Why? Because there’s nothing in an egg that has hedonic properties. Tryptophan (the precursor of serotonin) sure, but can it drive dopamine? Conversely, the most price inelastic consumable is fast food, at 0.81. This means if the price of fast food goes up 1 percent, consumption only goes down 0.19 percent. And the second most? Soft drinks, at 0.79. These two food items exert the most hedonic effects (due to sugar and caffeine) and happen to be the ones that people will consume no matter what. And of course they are the most addictive. So how can society turn an addicted, depressed, drug-addled, corpulent, and metabolically ill populace around?

  Each of these hedonic stimuli (substances or behaviors) generates money for its purveyors or they wouldn’t be purveying it. But what does it do for the individual and for society? In 2007 the U.S. gaming industry generated $92 billion of which about 15 percent was profit. Although 86 percent of Americans gamble once a year, only 16 percent are frequent gamblers, scratching the lottery ticket at least once a week. An estimated 36 percent of the revenue comes from “problem” (i.e., addicted) gamblers, which is 1.1 percent of the population (2.2 million people). So when you do the math, the addicted gamblers lost $33 billion compared with a $14 billion profit to the gaming industry. More money lost out of the system than gained. But no one cares about this, because it’s “pay to play”; if you lose, it’s your fault. And 2.2 million is not that many people.

  Data on the alcohol industry is harder to come by, but one report says that alcohol revenues in 2013 were $308 billion. Twenty billion dollars was profit due to the high taxes on alcohol. But only 61 percent of the population imbibe alcohol, and 20 percent of America are problem drinkers (9.6 million) who spend $3,200 per person annually. So $30 billion of the revenue is spent by alcoholics. And the rehab industry can gross $50,000 per month per suffering addict. Again, more money lost out of the system than gained. Similarly, although 10 million people are alcoholics, most people don’t think this is a big problem, because (1) unless you have an alcoholic in the family, it’s not your problem; (2) if you drink, it’s your fault; and (3) alcohol is already regulated.

  Now let’s look at the food industry. The food industry grosses $1.46 trillion a year, of which 45 percent is gross profit (which makes gambling and tobacco and alcohol look like chump change). Yet the U.S. health care system in 2015 spent $3.2 trillion per year,25 of which 75 percent are diet-related chronic metabolic diseases, and of those, 75 percent could be prevented. That means $1.8 trillion a year being wasted on preventable health care—triple the money than the industry profits. And now, since we’re talking about more than 50 percent of the U.S. population afflicted with some form of chronic metabolic disease (driven by the sugar in processed food), this is an enormous problem. And it’s not their fault, because they didn’t pay to play; the sugar was put there by the industry for its own purposes. And since the amount of money per family wasted on health care (18 percent of GDP) is way above their food budget (7 percent of GDP), this constitutes a policy crisis as well.

  This is tantamount to what has happened to the health insurance industry. For decades, health insurance followed the casino model: (1) pay to play, and (2) set your own rates. In this model, the insurance industry wanted people to be sick, and they couldn’t lose. And as long as there was enough money in the till, they pulled down big profits. Obamacare put 32 million sick people onto the rolls, and they were capped at 15 percent profit. We’ll see what Trumpcare looks like, but the proposed rollback of regulations is unlikely to improve health or health care or insurers. The one thing we know for sure is that insurance companies now want their subscribers to be healthy, because they can’t make as much money off sick people. But the populace is sicker than ever, in part due to chronic metabolic disease and in part due to mental health conditions, neither of which will improve until the food supply changes. Once losses exceed profits, people take notice.

  The Cheapest of Thrills

  It�
�s now time for an economics lesson. Which addictive substance is the cheapest to procure, yet the most expensive burden to society? Nicotine used to be the cheapest. At its worst, lung cancer claimed 443,000 people a year, and cost health care $14 billion annually. But it also made society money, because the average smoker died at age sixty-four, before they started collecting from Social Security and Medicare. And through the 1970s, even with the removal from television airwaves, Big Tobacco still cornered the marketing market. The Marlboro Man, gorgeous ladies with their Virginia Slims, even doctors extolling the medical benefits of smoking. Cigarette taxes netted $25 billion for the government. How about alcohol? Each year, alcohol causes ten thousand deaths from drunk driving, twenty-five thousand deaths from cirrhosis and other diseases, and costs the medical system $100 billion annually. But it makes $5.6 billion per year for state and local governments in taxes.

  Far and away, the most expensive burden is sugar. Because it wastes $1.8 trillion in health care spending, and kills slowly, thus reducing economic productivity. And of course it’s the one that is subsidized by the federal government. Witness the tripling of global consumption in the last fifty years, and the doubling per capita in the United States. Amsterdam is the drug capital of the world. In 2013, Paul van der Velpen, chief health officer of the Netherlands, famously declared sugar to be “addictive and the most dangerous drug of the times.”26 Sugar is indisputably the easiest hedonic substance to procure, and despite its ubiquity, one that continues to fetch a higher price. And we pay for it twice. First we pay in federal subsidies (the price on anything that’s not subsidized must therefore be raised to pay for the subsidy). Then we pay for the ER visits. We will see how all of society pays in Chapter 15.

  But the public is catching on. In 2014 an NBC News/Wall Street Journal poll asked, which substance is the most dangerous to society? Forty-nine percent said cigarettes, 27 percent said alcohol, 8 percent said marijuana—all understandable responses. The surprise was that 15 percent said sugar was the most concerning substance. The word is getting out. Witness the spate of soda taxes being enacted all over the world, in an attempt to override the market and its marketing mayhem.

  And just in time. The loose confederacy of Washington, Wall Street, Las Vegas, Silicon Valley, and Madison Avenue has brought us to this precipice. One step more, and the downward force will drag us all into an inescapable vortex, the proverbial death spiral.

  15.

  The Death Spiral

  The “death spiral” is a doubles figure skating maneuver in which the larger skater (read: the man) pivots on one toe while holding the hand of the smaller skater (read: the woman), who whirls around him in a supine position as her head reaches closer and closer to the ice. Centripetal force pulls her back up. That’s where America finds itself now, in a death spiral—a virtual health care vortex, flirting with oblivion, from which it seems impossible to escape. But there’s no force trying to pull us back up; in fact, the centrifugal forces just push us closer to the brink. Obesity, diabetes, heart disease, stroke, cancer, and dementia are among a set of diseases known collectively as metabolic syndrome, and they threaten to bring our entire health care system to its knees. They are certainly devastating to the people suffering from them. Over 88 percent of Americans surveyed said they would rather be healthy than rich, yet only 37 percent believe that they will enjoy good health ten years from now.1 Furthermore, 80 percent of all respondents over fifty already have at least one disease of metabolic syndrome. If they would rather be healthy than rich, they’re doing a pretty lousy job. But they aren’t the only ones suffering. Treating each of these conditions is expensive and all of society pays the price in taxes and higher insurance premiums. Ultimately metabolic syndrome will be the straw that breaks Medicare’s back. Currently 9.3 percent of the adult American population is diabetic, and another 40 percent is prediabetic. But this is not just our problem. The same struggle is being fought around the world. Great Britain, Australia, Japan, Mexico, and South Korea are all experiencing the same bankrupting of health care, due to the same diseases. And Saudi Arabia, Kuwait, Qatar, UAE, and Malaysia are now at 80 percent obesity and 18 percent diabetes. Even with all their oil money, they can’t support and underwrite this level of illness.

  A Legal Ponzi Scheme

  Where could these diseases be coming from? Everyone assumes this is the result of the obesity epidemic: too many calories in, too few out. Children and adults are getting fat, so they’re getting sick. But here’s the rub: while 80 percent of the obese population is metabolically ill, that means 20 percent are not. They are what we call “metabolically healthy obese,” or MHO.2 They will live a completely normal life, die at a normal age, and not cost the taxpayer a dime. They are not contributing to the death spiral. Conversely, 40 percent of the normal-weight population harbors these same diseases, but they’re not obese.3, 4 If normal-weight people get them as well, how is this related to obesity? Rather, we now know that obesity is a marker rather than a cause of metabolic syndrome.

  There’s no question that more people, especially the poor, are getting the diseases of metabolic syndrome.5 This is in part due to population growth: when there are more people, there are also more sick people. But 2015 saw an increase in age-adjusted mortality rates for all the diseases of metabolic syndrome;6 heart disease, stroke, Alzheimer’s disease, diabetes, and kidney disease. And it isn’t just that more people are getting these diseases (incidence); technological and medical advances mean that people are able to live longer than ever before, meaning there are more people who have the disease at any given time (prevalence). Yes, we can keep these sick people alive longer, but a longer life isn’t necessarily a better one, and certainly not a cheaper one.7 The increasing incidence, prevalence, and severity of all these chronic metabolic diseases; the price of their treatments; and the fact that patients can simmer along debilitated for years is why health care is going broke. Stanford economist Raj Chetty demonstrated that personal income directly correlates with life span: the less money you have, the quicker you die.8 Yet neither poverty nor minority status underlies the reason for the changes in U.S. mortality statistics over the 2005–2015 decade. We keep old sick people alive longer, which costs a lot of money. This expense should be offset by healthy young people paying in, yet we’re losing them to drug overdoses,9 addiction, and complications from metabolic syndrome (see Chapter 9).10

  This is felt in all branches of government, but nowhere more than in social security. Social security is a legal Ponzi or pyramid scheme. Lots of young people at the bottom of the pyramid pay in, with the expectation that the money will be there once they make it to the top. The only difference between social security and Bernie Madoff is that the U.S. Treasury holds the money and, if you’re lucky, pays it out. But social security is in crisis in every country. In order for social security to be healthy, you need lots of healthy young people at the bottom paying in, with the fewest old sick people taking it out at the top.

  Social security in the U.S. started to falter in the late 1990s. Before that, our government had the ideal paradigm. We had a nation of smokers; even though we knew that U.S. surgeon general Luther Terry’s 1964 report categorically demonstrated that smoking kills,11 the U.S. government did little to curtail smoking for the next thirty years. Why? Because the actuaries determined that smoking killed you at a mean age of sixty-four—one year before you started to collect social security. And the insurers were delighted, because you could only spend so much money on lung cancer, which would kill you in an average of six months. So you had healthy young people paying in and then dropping dead just before they started to take out. The ultimate Ponzi scheme.

  But, instead, what if the young people are sick? What if the young people are on disability due to chronic disease? Now we’re talking about diseases that don’t kill you quick, like lung cancer. We’re talking diabetes, fatty liver disease, heart failure, kidney failure—diseases that take twenty years of misery an
d money before you succumb. Worse yet, what if social security is paying out to all these debilitated young people in benefits? When the base of the pyramid crumbles, the whole structure collapses. And that is what is happening right now, all over the world. My good friend Juan Lozano Tovar, currently head of social security for the government of Mexico, convened a symposium on the future of international social security at MIT in May 2015. At this symposium we discussed economics, pensions, aging, and genetics.12 The elephant in the room was the epidemic of chronic disease in young people. I see ten-year-olds with type 2 diabetes every day; they’ll likely be on long-term disability and never hold a job. When the money goes out instead of coming in, everything else is rearranging the deck chairs on the Titanic.

  Eating Away at the Base of the Pyramid

  One big portion of the problem is that we have focused all of our efforts on health care rather than health, on treatment instead of prevention. We plow billions of dollars into drugs and surgeries and nutraceuticals, some of which have in fact reduced death rates, but none of which has reduced the actual rates of disease. In the good old days, we got sick and we died. (Is that good? It is if you want to keep a health care system afloat.) Today, fewer people are dying from heart disease or diabetes, because we have treatments to keep them alive.13 Now they hang around, with compromised worker productivity, detracting from the positive side of the economic ledger. Yet they rack up higher medical costs, increasing the negative side of the financial ledger as well. In fact, all of our medical technologies have allowed us to tread water, but they haven’t rescued us from the pool. We’ve just delayed the drowning. We are literally in the throes of the death spiral, with a vortex so strong, we can’t escape the forces dragging us downward.