Ideas to Action:

Independent research for global prosperity


This is a joint post with Tejaswi Velayudhan.

Two messages reigned supreme at last month’s International AIDS Conference (IAC) in Washington DC:  1) that there should be universal coverage of HIV/AIDS treatment and 2) that international funding for HIV/AIDS has been flat-lining recently and may even shrink. The most optimistic scenario to reach universal coverage will cost $22 billion dollars annually, which means raising an additional $6 billion per year. Clearly, the goal to provide treatment to the 34 million people currently living with AIDS, and the approximately 2.5 million newly infected each year, conflicts with the reality of shrinking aid budgets.

Indeed, an IAC session titled Show Me the Money: Political Commitment, Resources and Pricing made it clear that there was no question of abandoning the agenda for universal coverage of HIV/AIDS treatment – rather the challenge moving forward would be to secure financing. To this end, there were several creative solutions put forth in sessions at the conference and at satellite sessions throughout DC.

Denis Broun of UNITAID suggested using financial securities transaction taxes to address the funding gap in HIV/AIDS. A tax of 0.0005% levied on products of globalization such as international trade, transportation, finance, internet and telecommunications could raise $300 billion a year. A similar tax that has already been implemented on air tickets has raised $9 billion in the last five years.  Seems like a quick and painless way to raise more than enough to cover the gap, and the success of the air ticket levy suggests that this is a politically feasible solution. But most of the revenues would come from transactions in the developed world, whose governments may wish to allocate money to their own pressing issues (Medicare and Social Security in the US?).  Perhaps a tax to prevent about 2 million deaths each year would be much more popular than taxes to increase defense budgets. Either way, financing universal treatment of HIV/AIDS through a transaction tax will prolong the dependence of AIDS budgets on donors.

Another intriguing option from Gorik Ooms from Georgetown Law School is to capitalize on the fundraising potential of the Millennium Development Goals by proposing universal health coverage as a new goal to rally around when the current goals expire in 2015. It would mean a shift from the primarily vertical approach that the AIDS community has taken to combat the epidemic, to a more holistic approach where HIV/AIDS prevention and treatment is synonymous with health systems. Ooms rightly pointed out that the AIDS response stands to gain by working for Universal Health Coverage, and making it their own from the very beginning to ensure that AIDS treatment does not get left behind.  The right to health as a development goal, ratified by the majority of countries would create a truly shared, global responsibility and a means to hold world leaders accountable for sustaining health programs. In this scenario, the financial securities transaction tax and allocation of the resulting revenues to global health and HIV/AIDS would be more of a political reality.

At a slightly hyperbolic debate at the World Bank, Jeffery Sachs of The Earth Institute argued that there are more than enough funds in-hand to treat everyone in need if we are able to achieve a more equitable taxation system, a budget focused on building a healthier, more productive, global population (instead of arms driven), and continued investment by the wealthy – as seen by the likes of Bill Gates, Warren Buffet, and Raymond Chambers. But accessing these funds in the current market, where people are afraid of market failure and savings are at an all-time high, is a herculean task. Perhaps this option would be more feasible in the future, but unfortunately now is the time when people need treatment.

All of these ideas are worth considering given the challenge of closing the funding gap for HIV/AIDS in the coming years.  But allocative efficiency of both domestic and international health funding must also be considered in a resource constrained environment if donors and countries want to continue to save the lives of people in need – not just people with HIV. As Mead Over, senior fellow at CGD, questioned during the World Bank debate: why should we focus constrained resources on HIV when we could instead save the lives of millions of additional children with more cost-effective treatments for diarrheal diseases or one of the other diseases on the long list of child killers. This balancing of program funds and priority setting are at the crux of more than just AIDS funding, it is at the heart of international health in the coming years. The path we choose to take will determine not only the focus of the next International AIDS Conference in 2014 in Melbourne, but how the global community will help shape donor and domestic budgets and more importantly the lives of millions of people around the world.