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Memo to Political Leaders: When You Think Job Creation, Think Natural Health (If You Don’t, Other Countries Will)

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iStock_000003066815XSmallNatural health is a tremendous growth industry. Over the next few decades, it will generate millions of jobs. Europe will get few. Asia many. What about the US?

Europe will get very few of the these new jobs because the regulatory climate is so bad. As you know, supplements are gradually being shut down, much to the delight of drug companies. The few supplements available already cost as much as four times what they cost in the US. European doctors cannot even tell you about an “unapproved” supplement in the privacy of their offices without risking jail. It’s too bad on so many levels. Europe is mindlessly kicking out what seems likely to be one of the greatest growth industries of this new century.
Asia is an entirely different case. There, regulators are friendly, mindful of thriving, thousand-year-old herbal medicine traditions, and eager to capture new natural health markets. US specialists in natural medicine are invited to Asia as speakers; some are invited to become visiting professors at leading Chinese and other universities. Even some of the most profitable conventional medicine is migrating to Asia. “Medical tourism,” in which US citizens fly to Asia for operations, is booming, and offers recuperation at leading spas and five-star hotels.
In the past, it has been taken for granted that the best medicine—and lots of job opportunities—would be found in the US. But this is no longer clear. As Death by Medicine by Gary Null et al. documents, conventional medicine is now the leading cause of death in the US. Conventional medicine does create more and more new medical jobs each year. But these are not durable jobs. They are part of a conventional medical industry bubble, not a real growth industry.
What is the difference between an industry bubble and a real growth industry, the kind that produces millions of real and enduring jobs? Here is how you can tell: In an industry bubble, both prices and employment rise, until finally the prices become so high that everything collapses. This is what recently happened in US housing and is still happening in conventional US healthcare.
In a real growth industry, by contrast, productivity booms and prices steadily decline as sales increase. Price declines mean that more and more people can afford the product, and in the process, millions of real, not phony, jobs are created. Conventional medicine in the US defines a classic industry bubble, while natural health defines a classic growth industry.
Of course the American Medical Association (AMA), the medical equipment manufacturers, the hospitals, the insurance companies, the drug companies—all the “medical players” whom President Obama recently invited to the White House—don’t like the threat of natural health. They are pulling out all the stops to quash it by influencing and controlling Washington. If they succeed, the US, like Europe, will become a medical backwater, and miss out completely on all the millions of real jobs to be created in natural health.
Conventional medicine has good reason to worry. Consider the drug industry. It is not replenishing its supply of newly patented drugs. Its huge monopolistic profits could collapse.
And consider this math: US drug sales today are about $300 billion. Supplement sales are only about $25 billion, less than a tenth. But if drug sales stagnate, and supplements only grow at a little over 7% a year, supplements sales could pass drug sales in only 30 years.
Supplement sales could easily grow at a much faster rate, say 15%, in which case supplements would overtake drugs in only 20 years. If sales increased at 25% (entirely possible if FDA supplement information censorship ended), supplements could overtake drugs in 12 years.
Imagine if this happened. Drug companies could no longer control medicine through the millions spent on lobbying, the flow of campaign contributions, the consulting fees for medical experts, and the lavish contributions to universities and medical societies in return for support and access to patents.
Drug companies are smart. In addition to trying to quash supplements, they also buy supplement companies. They try to launch new supplement blockbusters (look at Proctor and Gamble’s probiotic Align®, designed to tap the irritable bowel syndrome market). But what really scares the drug companies is that no supplement product will ever generate huge monopoly profits like a drug. Even if drug companies completely captured the burgeoning supplement market, their profits would still collapse.
Of course, it is not just supplements that compete with drugs. So do so-called “functional foods”—foods such as cherries that we may eat for a specific health benefit, and health foods that we eat to stay healthy in general. We all need to remember that studies show diet alone can reduce heart disease and cancer by 90%. No drugs will do that.
Sales of functional foods in the US supposedly reached $29 billion in the US in 2007, but this includes dubious items such as “lite” beer and low-salt soups. Whatever the figures for genuine functional foods are, it is clear that sales are booming. It is also clear that the FDA’s mindless banning of even valid health claims hurts the industry and hurts consumers even more.
Sales of organic food, a category related to functional foods, increased by 5% in 2009 over the prior year, even in a recession, and now represent just under 4% of all food and beverage sales according to the Organic Trade Association. Other sources indicate that over two-thirds of Americans buy organic occasionally, and core buyers are about 18% as of 2007.
If you look beyond drugs and supplements, the numbers are equally interesting. The National Center for Complementary and Alternative Medicine, part of the US government’s Institute of Medicine, says that 38% of US consumers bought natural health services in 2007, the latest year for which data is available. Consumers paid $34 billion out of their own pockets for these services.
But when you look within this figure, only $12 billion was spent for natural health practitioner visits, and $3 billion for homeopathy, much of the rest being spent for things that most of us would class as supplements. Since total medical costs in the US run at $2.2 trillion for 2007, $12 billion for natural health practitioner visits seems really a pittance.
This is not, however, the whole story. Here’s a shocker: Newsweek reported in December 2002 that “Americans make more visits to holistic health care providers (some 600 million a year) than to MDs, and spend more money out-of-pocket to do so….” These figures are old and highly debatable—it all depends what you put in and leave out. But they make a clear point. If natural health services were reimbursed like conventional services, the latter might well collapse.
We also know that visits to conventional doctors have declined further since 2002, especially during the recent recession. Does the decline of conventional doctor visits and the increase in alternative practitioner visits worry the AMA? It seems to, since the AMA works so hard to control state medical licensing boards—which constantly threaten to pull the licenses of even the most distinguished natural health MDs and DOs.
Sometimes it seems that conventional medicine is just blind. Consider hyperbaric oxygen (HBOT) treatments. This is pressurized oxygen delivered to the patient in special tanks. Many hospitals have such tanks, and the FDA has approved their use for carbon monoxide poisoning and even flesh-eating infections, but they are rarely used even for the latter.
HBOT should also be used for stroke, Lyme Disease, major viral infections, MS, heart disease, sinusitis, head injuries, and many other problems, but isn’t. Even wounded Iraq and Afghanistan war veterans with their numerous head trauma injuries are rarely given this treatment. What treatment is emphasized instead? Drugs—most ineffective, most highly toxic, and all approved by the FDA. Meanwhile, which countries have taken the lead on the manufacture and use of HBOT tanks? Russia and China. Certainly not the US.
Do Americans really want to cede medical leadership and the related employment opportunities to Asia? If not, we need to make an urgent course correction.

Also Featured in the August 17, 2010 Newsletter:
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