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July 10, 2006


"It's the same basic logic as patents". No, it's a problem related to the problem patents are trying to solve. However, this works without giving anyone a monopoly on an idea, so it's far better. Used in conjunction with an assurance contract scheme, it could replace patents for first-world medicines, too.

I know you read Marginal Revolution now and then :-) Tabarrok is a proponent, and inventor of a special kind of assurance contract which might be more popular in practice. even has a working implementation, although people don't seem to get it quite, yet. They use it as any other fundraiser, and more for begging than buying.

Here's the thing - why do anything when you don't pay a price for nonaction? The American voter has lost all interest in the possible.

Tony Blair referred to the International Finance Facility for Immunisation in a recent speech at Kings College in London - but in the next paragraph he refers to

Solidarity contributions on airline tickets are another innovative way to help deliver more aid - the UK already has an Air Passenger Duty. And with France in particular, we are developing an International Drug Purchase Facility designed to lower the cost and improve the availability of drugs for HIV and AIDS and malaria.
While I hesitate to impugn your blogging skills, Hilzoy, I cannot see how two different forms of funding for the same project should clash with each other at all: and as the only news reference I've found to their being a "spat" is in the WSJ, I wonder if it is not an invented spat by the WSJ?

(I say this with hesitation, because I began by assuming that there was a spat: France and the UK traditionally oppose each other on all kinds of measures. But then I wondered - why would there need to be a spat, if France is supporting one kind of funding and the UK is supporting another? If we decide to raise money for the same charity, and you decide to sell cakes and I decide to sell raffle tickets, we are not competing: some people will buy one, some another, some both.)

I'm not sure I understand the logic of using an airline ticket tax to fund this, but that's quibbling with an otherwise excellent idea. Hell, $6 billion is a rounding error in the U.S. budget, and I can think of plenty of ways to balance out a $60 billion committment in order to fund something like this. Combine this with some good training programs on using the vaccines and this could be one of the most effective uses of foreign aid dollars in our history.

The IFFim has been about to issue bonds "in a few months" for nearly a year now. I wrote a story with a quote to that effect last August for a finance magazine, so I'd be skeptical about any statements on timing. Nobody has been able to tell me definitively what the hold up is, beyond trying to get more countries involved. Given that the whole idea is to frontload aid to save lives immediately, it seems a bit perverse to hold out for scraps - Spain just agreed to contribute Eu190m over 20 years, which is hardly a huge amount. That would buy one medium sized hospital.

I don't have much to add about the "spat", but frankly any good excuse to raise tax on air travel is a bonus at the moment. It's the fastest growing source of greenhouse emissions, airplane fuel is untaxed, and airlines aren't part of the EU emissions trading regime (yet).

Jes: the 'spat' isn't a result of a necessary conflict between different funding mechanisms; it's a result (as I understand it) of the fact that we are unwilling to raise taxes, even little taxes on airline tickets dedicated to this purpose, and France retaliated by blocking this other idea. I don't see why they have to conflict either.

The whole thing is puzzling. The US seems to be opposed to both the UK and the French plans, but has not offered an alternative funding plan.

And what difference does it make? Why not let each country make a commitment and fund it how it will?

Could it be that the dispute over funding is just an excuse to back out of the whole deal?

"Could it be that the dispute over funding is just an excuse to back out of the whole deal?"

This is my suspicion. Any of the three countries mentioned could fund a large portion of the program on their own. They could unilaterally choose a couple of diseases and fund a vaccine for them. This is much like the long collapsing Doha round--a world-wide good thwarted by silly games all around.

If the French want to back out, we should call their bluff. If we want to back out, shame on us.

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