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Back in the postwar era of the 1950’s, America dreamed of a not-too-distant future where everyone would have access to civilian aviation. Like the explosion of the automobile just 50 years earlier, civilian aviation was considered to be the ‘next big thing’ that was going to revolutionize how Americans got around. Small airports sprung up on the outskirts of suburban areas. Popular magazines published colorful cover articles proclaiming how the family airplane would be just as common (and indispensable) as the family car in just a few short years. For a country that loved its freedom, civilian aviation would forever change the way that Americans got around.
The 1950’s also gave us a new American icon that promised to play a major role in the civilian aviation revolution – the Cessna 172. Introduced in 1956, the Cessna 172 sold for $8,995 – a large sum, but still in the range of many American families. For the sake of comparison, a new 1956 Chevy cost around $2,200. The 172 was seen as a new Model T with wings – aviation made affordable for almost anyone. In fact, the 172 remains today one of the most successful light airplanes ever manufactured – chances are, that high-winged small plane flying overhead is a Cessna 172.
Today, 54 years down the road, you can still purchase a new Chevy, or, if you were so inclined, a new Cessna 172.
An entry-level 2010 Chevy bears almost no resemblance to the 1956 model.
The Chevrolet automobile has undergone at least 10 major redesigns since 1956, and countless other major and minor improvements. Aside from the bow-tie emblem and 4 wheels, the two cars are nothing alike.
Due to inflation, a nice 2010 Chevy mid-sized sedan would run you around $22,000.00 – around a 10 fold increase from the 1956 model.
Unlike the Chevrolet, the Cessna 172 has changed very little since 1956. The airframe (the exterior, wings, and fuselage) are practically identical to the 1956 model.
There have, of course, been major improvements to the engine and electronics, but the airplane itself has basically the same design today as it had in 1956.
An entry-level 2010 Cessna 172 sells for close to $300,00, or a 33 fold increase over the 1956 model.
This means, of course, over the last 54 years, that the cost of a light airplane increased at over 3 times the rate of an automobile.
Which begs the question WHY?
Actually, there are two major reasons for this discrepancy. First and foremost, when you purchase a new light airplane in 2010, almost ½ of the purchase price (by some estimates) goes towards liability coverage for the manufacturer. So, when you purchase that 2010 Cessna 172, you not only get a new airplane, you also are purchasing a $150,000.00 ticket for the lawsuit lottery.
The second reason why the light plane has gotten so expensive (and why the Cessna 172 still looks the same today) is that government regulations by the FAA make designing an aircraft and getting it approved for sale is a very expensive and time-consuming process. It simply does not pay for a light airplane manufacturer to design a new airframe.
As a result of this runaway inflation, civilian aviation is dying a slow death in this country, and the dreams for civil aviation we had in the 1950’s never came to be.
What does this have to do with health care? Plenty.
As much as I attack the pharmaceutical companies, I do empathize with them on some levels. The cost of getting a new drug through the FDA is as costly and time-consuming as getting a new airframe through the FAA. In addition, they have to factor in the costs of future litigation, especially if a new drug reveals catastrophic side effects several years after it is introduced.
If we follow the saga of the 172, we can extrapolate that the threat of litigation as well as the costs of addressing Federal regulations make our prescription drugs 3 times more expensive then they need to be. My math here might be flawed, and there are other factors affecting prices to be sure, but I am equally sure that these two factors – litigation expense and Federal Regulatory compliance- have a major effect on the cost of our prescription drugs in particular, as well as our other health care costs. I am also certain that if we don’t start addressing these 2 issues, our health care system will suffer the same fate as the light airplane industry.
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