John C. Goodman

I'm going to tell you something that Barack Obama doesn't understand.

And because he doesn't understand it, our country is wasting hundreds of millions of dollars at a time when we cannot afford to waste hundreds of millions of dollars.

Time and again President Obama has told us how he intends to solve our health care problems: spend money on pilot programs and other experiments; find out what works and then go copy it. He's also repeatedly said the same thing about education. The only difference: in education we've already been following this approach with no success for 25 years.

Still, if the president were right about health and education, why wouldn't the same idea apply to every other field? Why couldn't we study the best way to make a computer, or invest in the stock market and do any number of other things — and then copy it?

I want to propose a principle that covers all of this: entrepreneurship cannot be replicated. Put differently, there is no such thing as a cookbook entrepreneur.

Let's suppose for a moment that I am wrong. Suppose we could study the behavior of successful entrepreneurs and write down the keys to their success in a book that everyone could read and copy.

Consider Bill Gates, Warren Buffett and Sam Walton. If we could discover what they did right, and everyone copied their behavior, then we could all become billionaires. Right? Well, not quite.

Here's the problem: In order for each of us to be a billionaire, we have to each be doing something that produces a billion dollars' worth of goods and services. But if all we're doing is copying action items out of a book, then we are not doing anything special. And if we’re not doing anything special, we are definitely not producing a billions dollars of value added.

In mathematics, Gödel's Theorem says that no complex, axiomatic system can be both consistent and complete. What I am proposing is something similar for social science. Although there are some habits of highly successful people that can be identified and copied, there are not enough of them for each of us to become highly successful ourselves through copycat behavior alone.

I think I will call this Goodman's Nonreplicability Theorem.

In health care, it's already been borne out.

Scholars associated with the Brookings Institution identified 10 of the best hospital regions in the country and then tried to identify common characteristics that could be replicated. There were almost none. Some regions had doctors on staff. Others paid fee-for-service. Some had electronic medical records. Others did not.

A separate study of physicians' practices found much the same thing. There were simply not enough objective characteristics that the practices had in common to allow an independent party to set up a successful practice by copycat alone.

By the way, this is not bad news. It is good news. How much fun would life be if we all went around copying what we read in a book?

John C. Goodman

John C. Goodman is Senior Fellow at The Independent Institute and author of the widely acclaimed book, Priceless: Curing the Healthcare Crisis. The Wall Street Journal and National Journal, among other media, have called him the "Father of Health Savings Accounts."