Wal-Mart And The 'Brave New World Of Business'

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Wal-Mart And The 'Brave New World Of Business'

DAVE DAVIES, host:

This is FRESH AIR. I’m Dave Davies, senior writer for the Philadelphia Daily
News, filling in for Terry Gross.

Wal-Mart is the world’s largest private employer, with more than two million
employees worldwide and 1.4 million in the United States. It just reported
second-quarter earnings of $3.44 billion, slightly ahead of projections.

To its critics, Wal-Mart is emblematic of what’s wrong with corporate America.
It’s made a science of cutting costs by building massive distribution centers,
squeezing suppliers and pinching the wages and benefits of its employees.

Wal-Mart executives have long argued that the result of its efforts is lower
prices for everybody, effectively giving us all a raise, And as the company has
come under attack from unions and other activists in recent years, it’s focused
more on environmental protection and sustainability in its operations,
purchasing and corporate giving.

Our guest Nelson Lichtenstein, has written a history of Wal-Mart, beginning
with its founding by the late Sam Walton and tracing its phenomenal growth,
which Lichtenstein says was linked to the cultural values of Bible-belt
America. He says Wal-Mart has transformed retailing, but created a business
model that is ultimately unsustainable.

Nelson Lichtenstein is a history professor at the University of California
Santa Barbara. His book is called “The Retail Revolution: How Wal-Mart Created
a Brave New World of Business.”

Nelson Lichtenstein, welcome to FRESH AIR. Tell us about Wal-Mart’s
headquarters in Bentonville, Arkansas. It’s in a fairly rural part of the
state, right?

Professor NELSON LICHTENSTEIN (History, University of California Santa Barbara;
Author): Yes. It’s in the extreme northwest Arkansas. It’s a kind of bustling,
booming - well, now middle-sized town with all sorts of new construction going
on. And there are some 750 of the – at least – of these vendors who’ve
established sort of offices there, including Procter & Gamble in nearby
Fayetteville, which is the university town.

And then I was struck - for example, Walt Disney, which, you know, sells lots
of cuddly, you know, little dolls and things, you’d assume that Walt Disney
would have its retail headquarters in Los Angeles, but no. It’s right there
next to Wal-Mart in northwest Arkansas.

DAVIES: And, of course, Wal-Mart has enormous power with respect to its
vendors, those who supply all the goods on its shelves. And I guess this grew
out of the patriarch of the firm, Sam Walton. And in the book, you give a
fascinating description of how he made his career in retail. How did he change
the relationship between his retail stores and these manufacturers who made the
goods?

Prof. LICHTENSTEIN: Well, right. Well, Sam Walton was there in northwest
Arkansas, where he had his first set of stores. And he was always irritated and
vexed by the fact that getting the goods to his stores was a difficult,
complicated thing. There were intermediaries. There were jobbers. There were
suppliers. They didn’t even want to go to northwest Arkansas. It was out of the
way. And therefore, you know, it was expensive to get, you know, goods to his
stores.

He wanted to have a discount operation. He wanted to sell stuff cheap. So he
said, well, I’ll establish my own distribution centers, my own warehouses and
thereby, you know, cut out the middleman. And he really couldn’t stand
salesmen, but his key thing was first setting up his own distribution centers
in Arkansas and then in the states around there, and he owned them. The firm
owned them.

This was a big innovation that Wal-Mart made - really, the same magnitude as
the first assembly line that Henry Ford created in the early 20th century to
eliminate as many of these middlemen as possible. And the fact that all the
vendors end up in Bentonville, you know, with offices, is a kind of visible
indication that he’s gotten rid of a lot of those middlemen, middlewomen.

DAVIES: So instead of buying products from some marketing guy who dealt with
the manufacturer, he ended up buying a big fleet of trucks and building these
huge warehouses and buying direct from manufacturers and just having all that
stuff right there to deliver to his stores when they needed them.

Prof. LICHTENSTEIN: Yeah, that’s correct. And here’s a word we should consider,
the word warehouses. They really - they aren’t warehouses. They’re distribution
centers. And here’s the difference.

There had been warehouses. Warehouses were places you stored stuff, you know,
got off the ship from Europe, stored it for several months or, you know, got
off the train from, you know - and you stuck it in a place. And you - when you
needed it, you took it out of there. Walton – that’s a waste of money. That’s a
waste of time. That’s a waste of space.

Walton built distribution centers so that the truck came in one end of the
distribution center, and 12 hours later, the stuff left the other side of the
distribution center, repackaged and going to every individual store.

And so when you - if you go to one of the 120 giant distribution centers that
Wal-Mart has right now, the goods never stand still. What they’re composed of
are hundreds of miles of conveyer belts, which take the goods from trucks
coming from the supplier, from the factory, and then moving it around and
resorting it and then going off to the stores.

DAVIES: To move all this stuff efficiently, you’d need a really sophisticated
information system which balances the needs of the stores and what the
manufacturers can deliver. And you point out that Walton was among the first to
use the barcodes to develop that kind of information, and that that was
critical in transforming his relationship with these suppliers. How did it
work?

Prof. LICHTENSTEIN: Yes. The barcode was actually invented, came out of the
grocery industry in the very early ‘70s, ‘60s and ‘70s. There was a – they
thought that they would, you know, eliminate a lot of clerks and checkout
people and speed it up by having - you know, everyone knows what these barcodes
are, this electronic system of registering the price. And it did do that to
some extent, although it turned out it wasn’t quite as much labor-saving as
they thought.

But they didn’t understand - the grocery people didn’t understand, but Walton
did - that the real advantage of the bar code was the question of the
information it contained about where and when sales were made and how much the
cost of the item was.

And so Walton began to install these barcode scanners in his discount stores,
which were selling not necessarily groceries, but selling other things. That
was considered a great innovation. And then he captured the information about,
you know, how many tubes of toothpaste were sold in the morning versus the
afternoon, versus at this price or that price.

For years, for decades, it had been the manufacturer, Procter & Gamble,
Colgate, etcetera, which jealously guarded that kind of information. And then
they, you know, they took surveys. Procter & Gamble invented the soap opera as
a way of, you know, of selling this stuff.

They were the ones who would go the merchant and say, look. Here’s – you know,
we know exactly how much you’re going to sell. We want you to take these five
boxes of toothpaste because we’ve made the surveys.

Well, Walton upended that relationship entirely. After he put all the barcode
scanners in and built a gigantic data warehouse in Bentonville – it looks like
something out of the Pentagon. There are no windows. It’s a huge building.
There are guards all around it. Anyway, this was a mechanism for him to gain
the knowledge, to assemble it, to slice it, to dice it, and as we know,
knowledge is power.

DAVIES: Give us an example of how the leverage that all this information gave
Wal-Mart allowed them to dictate to suppliers.

Prof. LICHTENSTEIN: Well, for example, with - Procter & Gamble is a good
example. It’s a huge company. It has an office in - near Bentonville with 250
people in it. It sells billions and billions to Wal-Mart each year. But when it
comes to, you know, the sales of its various products, Tide or the toothpaste
or soap, Walton - I mean, and Wal-Mart today - can tell Procter & Gamble
precisely the kind of products that sell better in Florida versus Minnesota
versus some other place, and can direct, literally direct, the factories that
Procter & Gamble has, either in the U.S. or abroad, where to send this
material. And they don’t have to - it’s such a big supplier, it doesn’t even go
through the warehouses anymore. It goes directly from the factories, directly
to the various stores because they put that entirely computerized.

In fact, they don’t even order material from Procter & Gamble anymore. The
computers are interlaced, are interconnected, so that when a sale takes place,
you know, in California for a tube of toothpaste, the electronic impulse goes
directly to Procter & Gamble, and then they produce more toothpaste.

So it’s a much more efficient system. And, of course, they’ve wrung out a lot
of the overhead. And Procter & Gamble’s making money, and Wal-Mart’s definitely
making money.

DAVIES: Tell us about the internal culture of Wal-Mart.

Prof. LICHTENSTEIN: Well, Wal-Mart was founded in the rural South in the 1950s
and ‘60s. It was one of the last places in the country that the agricultural
revolution really hit - that is, the depopulation of the rural areas, the
elimination of the family farm.

The Ozarks were an area of small farming and subsistence farming, really. So
you had a terrific surplus population of ex-farmers. Some of them went to
California and the north and Chicago. But many of them wanted to stay in the
Ozarks, and they also wanted to stay in a kind of small-town environment in
which they, you know, their friends and neighbors were right there.

So the rise of the discount stores that Walton was now creating in this area
sort of took the place of the farmstead. And often, you would have people who’d
lost their farm would now move into the role of a manager - this would be for
the men - the manager of a store. And then the clerks were the women, who had
been, you know, the helpers on the farm, you know. And so you sort of
replicated that rural, patriarchal kind of culture in the store.

Sam Walton – I mean, I don’t know how self-conscious he was about that, but
clearly he embodied that himself. He was proud and advertised the fact that he
was sort of a good old boy - although he’d gone to college - but he loved to
hunt and shoot and he had a very stable marriage and his kids went into the
business. And he was, you know, sort of the pater familias. He was Mr. Sam. And
there was, I think, a genuine loyalty to him and veneration of Sam Walton in
the early years of the firm.

DAVIES: And so there was a sense of family, right? I mean, you don’t call your
workers employees. You call them associates, right?

Prof. LICHTENSTEIN: That’s right, associates. I mean, this was – right, the
associates. They created a whole variety of names, of different names for
traditional things in, you know, in industrial relations. They weren’t workers.
They were associates. The managers were not managers. They were coaches. The,
you know, meetings they had, their annual stockholder meeting was not a staid
affair with people with suits. There was country music and canoe trips and
barbecues and all sorts of stuff like that.

So they tried, successfully, to create this sense of family. And there was a
kind of – in the early years - it’s changed since them, of course – in the
early years, a sense of identification between the - Sam Walton living in
northwest Arkansas himself and the many, many associates that he hired, many of
whom came right off the farm.

DAVIES: Our guest is Nelson Lichtenstein. His book is called “The Retail
Revolution: How Wal-Mart Created a Brave New World of Business.” We’ll talk
more after a break. This is FRESH AIR.

(Soundbite of music)

DAVIES: If you’re just joining us, our guest is Nelson Lichtenstein. He’s
written a new book about Wal-Mart called “The Retail Revolution.”

So what are some of the ways that Wal-Mart today holds down its labor costs?

Prof. LICHTENSTEIN: Well, one is no overtime, certainly for those who are on
hourly. But at the same time, when it comes to people who are on salary,
assistant managers who don’t make – who make maybe $45,000 a year, there they
work 50, 60, 70 hours a week regularly.

Furthermore, Wal-Mart is a company which has sort of abolished the weekend, or
done a lot - they have Saturday morning meetings for many executives and lower-
level folk in and around Bentonville, and also out in the field to some extent.
And so the weekend, which we thought was completely established, has now been
sort of shaved back. And so Saturday morning for many Wal-Mart workers is a
regular day of work. Now that really returns us to the situation in the 1920s.

Because of the bonus that these managers receive, based in part on keeping
labor costs low, for many years - and to some extent still today - they were
under great pressure to shave those costs. And sometimes that meant doing
illegal things in the stores, like literally going into the computer program
and cutting out hours that people had actually worked.

DAVIES: And they tend to keep - leaves a lot of part-timers, right? They run
stores, a lot of these stores, around the clock, so people are on odd schedules
and often don’t get the 34 hours a week that make them full-time, right?

Prof. LICHTENSTEIN: Well, that’s right. When Wal-Mart - especially after it
went to selling groceries, which meant that it went 24/7 - it had a – it hired
a lot of part-timers. About a third of the workforce is part time, but full
time is defined as 34 hours a week. So that’s less than a 40-hour week.

What that means is that everyone who works at Wal-Mart is desperate to get more
hours, and that gives terrific sort of power to the manager, who can then play
one worker off against the other or give rewards, you know, or penalties by
cutting back hours.

DAVIES: Wal-Mart prides itself on offering health insurance to its employees.
What kind of health insurance does it offer?

Prof. LICHTENSTEIN: Well, it solves this problem in two ways. Health insurance
is very expensive, and it’s been very assiduous in trying to keep this cost
down. One is they hire a lot of people who get their health insurance from
somewhere else: older people, young people, people who’s spouse works somewhere
else.

So Wal-Mart claims that 90 percent of all its workers have health insurance,
and they do, but only about 51 percent now have their health insurance from
Wal-Mart itself.

Now with the Wal-Mart insurance, they’ve really adopted the Republican,
conservative solution to the health care crisis in America, and it’s this: You
offer health insurance policies with very low premiums and very high
deductibles, as much as $3,000 or more. And then you give a health security
account to each individual, which they can put money in themselves, or the
company can put some money in, which they can use for regular office visits.

Now the problem with this system is that when you have any serious illness, you
have to pay out of pocket up to $3,000, plus your premiums plus co-pays,
before, you know, the insurance kicks in. And for, say, a mother, a single
mother with two kids earning $22,000 a year at Wal-Mart, it means that 25 or
even 30 percent of their income can easily go to health insurance if their kids
just have ear infections and the normal kind of things that lots of kids get,
which is one reason that lots of Wal-Mart employees don’t even sign up for the
Wal-Mart health insurance.

DAVIES: You know, Wal-Mart obviously is aware that its labor policies have
created an image issue, and it’s made an effort in recent years to reach out to
some liberal constituencies. I mean, it’s promoted the Al Gore film, “An
Inconvenient Truth.” It’s undertaken some important sustainability efforts in
its own buildings and practices, and I think even made some efforts to kind of
get organic foods on its shelves. Some have been impressed by these. How do you
regard these initiatives?

Prof. LICHTENSTEIN: Well, many of these efforts in the environmental fields,
sustainability, are - they’re kind of a win-win. You know, Wal-Mart does want
to run its trucks with - using less fuel. That saves money, and it’s good for
the environment. And, you know, in the entire supply chain – that’s the phrase
they use for how to get the suppliers’ goods to the store – there’s, you know,
many, many places where you can save money, and you can also do good things for
the environment.

So I think there’s a lot of genuine activity here that’s good for everyone. And

you know, if it’s good for Wal-Mart’s public relations, that’s fine, as well. I
think the big box itself is a problem. A lot of people find that a kind of
environmental and urban-planning problem, and Wal-Mart has not been as
successful at putting smaller stores in urban areas, for example.

Another side of this, though, which I think is more significant, is that Wal-
Mart was very aware that it was subject to many, many lawsuits, lots of bad
public relations for its - not just its low wages, but its illegal payment of
low wages, its failure to adhere to the standard variety law governing wages,
hours, etcetera. And so after the election of Barack Obama in November, Wal-
Mart clearly made a decision that they wanted to solve that problem.

So on December 23rd, while everyone else was thinking about Christmas, Wal-Mart
announced that it would settle 63 wage and hour class-action lawsuits against
it at a price of, you know, upwards of $600 million.

Now, Wal-Mart had a terrific reputation, a fearsome reputation for never
settling class-action lawsuits. I mean, they just said, you know, these are
just people trying to come after us and get some of our money. But they agreed
to settle them.

It’s because Obama was elected. Hilda Solis was the new secretary of labor, who
would a little later say there’s a new sheriff in town. We’re going to enforce
these laws. And I think this is as significant as the environmental activities.
And if Wal-Mart does continue to settle these kind of suits and agree to obey
the law, that will be significant.

DAVIES: Nelson Lichtenstein will be back in the second half of the show. He’s a
history professor at the University of California Santa Barbara. His new book
is “The Retail Revolution: How Wal-Mart Created a Brave New World of Business.”
I’m Dave Davies, and this is FRESH AIR.

(Soundbite of laughter)

DAVIES: This is FRESH AIR. I’m Dave Davies, filling in for Terry Gross.

We're speaking with Nelson Lichtenstein, who's written the history of Wal-Mart,
which is the world's largest private employer. Lichtenstein says Wal-Mart
founder Sam Walton made an obsession of cutting costs by building massive
distribution centers, squeezing suppliers, and scrimping on employee's wages
and benefits.

Lichtenstein says Wal-Mart has created a business model others have tried to
replicate, but he says it's a model that's ultimately unsustainable. His book
is called "The Retail Revolution: How Wal-Mart Created a Brave New World of
Business."

You know, in the debate in the past about the Wal-Mart business model, the
company has admitted at times that its wages are lower than some, that some of
its employees aren't raising families on them. But they also have another
argument, which is that their low prices and the pressure that they exert on
their competitors to lower prices amount, in effect, to raising everybody's
standard of living, giving everybody else a raise. What about that argument?

Prof. LICHTENSTEIN: Well, there's truth to it as far, as it goes. That is,
there has been a reduction in the price of groceries, of clothing, the kind of
things that you buy at a Wal-Mart store. And the company's estimated it, you
know, is up to, you know, as much as $2,000 a year will be saved by a typical
family buying at Wal-Mart. And that's true, and I celebrate that. I think
that's terrific. It's good to have stuff that's inexpensive.

The problem is this: The kind of things you buy at Wal-Mart only represent
about 20 percent of the typical family budget, and it's actually been declining
in recent years. The things you can't buy at Wal-Mart, which really are eating
up and are pressuring families: health care, housing, transportation,
education, you can't buy those at Wal-Mart yet. You can buy them with higher
wages.

So to the extent that Wal-Mart lowers the wage level for its own employees and
everyone else, it's making it much more difficult for people to buy the 80
percent of the things they need to sustain the family budget which you can't
buy at Wal-Mart. And that's the problem.

DAVIES: You know, there are a lot of retailers that have seen Wal-Mart's
success and are copying some of its methods, Target and others. And you say at
the end of this book Wal-Mart and its clones face a day of reckoning. Their
relentless growth and Darwinian competitiveness have created a world that is
increasingly inhospitable to their own success. What do you mean?

Prof. LICHTENSTEIN: Well, by that I mean is - to the extent that wages remain
stagnant and there's a political backlash against the benefit levels, it means
that the day of reckoning is coming, that they can't continue with that model.
And I think that was shown both with the recent recession. Although Wal-Mart
did pretty well, lots and lots of retailers went bankrupt in that recession.

And it's also true politically. Wal-Mart has been stymied in its effort to
expand throughout the rest of the United States. In fact, it cut the number of
stores that it would open by one third two years ago. So it faces that sort of
political and even cultural resistance. And I think it's trying now to get out
from under that burden, and we'll see whether that takes place. But I think
there is a kind of recognition in the firm that the model set up by Sam Walton
40 years ago can't continue today.

DAVIES: Give us a sense of what it was like to deal with Wal-Mart as a
researcher and writer. I mean, would their executives talk to you? Did you get
access to information you needed?

Prof. LICHTENSTEIN: Well, I mean, I did talk to some of them, you know. But I
could read what they said on their very elaborate Web page. And then I could,
you know, they would much rather talk to The New York Times than to some
obscure historian - at least as far as they were concerned - on the West Coast.

However, I found it far better and more rewarding not to talk to current Wal-
Mart managers, but to talk to retired Wal-Mart managers and workers, of which
there are a lot because there's a kind burnout at the firm and lots of people
retire in their 50s if they can.

Also, there've been all these lawsuits against Wal-Mart. Well, these lawyers
became kind of my research assistants. That is, they would be deposing Wal-Mart
executives. They would be ferreting out various documents and things. And many
- much of this became in the part of the public record, so I was able to use
that.

Furthermore, there was an amazing archive of videos that turned up in Kansas.
There’d been a firm in Kansas - Flagler Productions, for 25 years, had been
doing videos of all of Wal-Mart's meetings, many of them not open to the
public, and they had a huge archive there. Well, then Wal-Mart fired the firm
about two or three years ago. And, you know, the firm, thinking well, we got to
make money. You know, we got to - you know let's open this to the public. And
so I went down there and I saw many of these videos and I, and the transcripts,
and that was terrific.

DAVIES: Can you share a moment from one of those videos that you found
particularly revealing?

Prof. LICHTENSTEIN: Yes. Well, one of the most remarkable was a fellow by the
name of John Tate. John Tate was Sam Walton's age, same generation. And Sam
Walton hired him in the early 70s to handle the company's labor relations. John
Tate had got his start in North Carolina. He'd been a right-wing activist in
Nebraska. He was a lawyer, and he pioneered many, many of the techniques that
today are standard in stopping unions, some legal - many legal but some a
little not legal - the kind of demonization of unionism which takes place in
the retail industry.

Well, Tate, this amazing speech he gave in the year 2004, kind of a valedictory
in which he told you know 500 cheering Wal-Mart managers that, you know, I've
been fighting unions all my life. Unions are bloodsucking institutions. Your
job is to go out there and, you know, help me complete my life's work. This was
genuine. It was emotional. He got a cheer. And it completely contradicted the
official Wal-Mart line.

DAVIES: Do you shop at Wal-Mart?

Prof. LICHTENSTEIN: Yes, when I can. I have no objection to shopping at a big
firm like that. I buy cars through some assembly of the lines, and I buy
products sold at the most efficient form of retailing. And I’d like the change
the company, but I see no problem with, you know, shopping there.

DAVIES: Well, Nelson Lichtenstein, it’s been really interesting. Thanks so much
for spending some time with us.

Prof. LICHTENSTEIN: Delighted to do so.

DAVIES: Nelson Lichtenstein's book is called "The Retail Revolution: How Wal-
Mart Created a Brave New World of Business."

Coming up, Dr. Lisa Sanders explains why doctors are misdiagnosing illnesses
more than you think.

This is FRESH AIR.
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Meet Lisa Sanders, The Doctor Behind 'House'

DAVE DAVIES, host:

Dr. Lisa Sanders is fascinated with medical mysteries. A practicing internist
on the faculty of the Yale Medical School, she writes the "Diagnosis" column
for The New York Times Magazine, in which she describes and analyses unusual
cases. And she's a technical advisor for the Fox TV series “House,” in which a
condescending, pill-popping doctor solves a tough medical puzzle every week.

But Sanders’ new book is more than just a collection of fascinating yarns from
the examining room. She argues that despite remarkable advances in medical
technology, doctors are misdiagnosing their patient's ailment at a surprising
rate - between 10 and 15 percent of the time, according to studies.

She offers some interesting reasons for why physicians sometimes miss the boat
and some ideas for sharpening their skills. Her book is called "Every Patient
Tells a Story: Medical Mysteries and the Art of Diagnosis."

Well Lisa Sanders, welcome to FRESH AIR.

You make the point in the book that it's really important to take a thorough
history from the patient. Find out, you know, why they're there and what their
medical and history has been - what they’ve experienced. Do doctors listen as
well as they should?

(Soundbite of laughter)

Dr. LISA SANDERS (Internist, Yale Medical School; Consultant, Author): I think
we all know the answer to that.

DAVIES: Right.

Dr. SANDERS: No. We don't. And shame on us. Because it's been known for a
really long time that the patient is the source of the information that most of
the time, sometimes up to 90 percent of the time, will give us the answer to
the question: What's going on? What does this patient have? But we don’t listen
to patients, and it's hard to listen to patients.

As a news interviewer, or as an interviewer, you know that when you talk to
somebody, you have two conversations that are going on. You have the
conversation that you’re having with the person you're talking to, and you have
the other conversation: Am I getting what I need?

A doctor, what a doctor does is very similar. They're having a conversation,
just a regular conversation. Tell me what's going on. When did you start
feeling bad? But they're also having this other conversation inside their heads
of am I getting what I need? Is this enough information? What does this all
mean?

And so I think that we're not trained to do that. You just have to pick it up.
You have to learn it on the fly. And some doctors are better at it than others.
But it hasn’t really been valued in the way we train doctors. And so if we
don’t listen, maybe it's because we didn't really teach doctors how to listen.

DAVIES: Wasn't there a study which actually recorded interviews by physicians
and gave us a sense of what the interaction was like?

Dr. SANDERS: Absolutely. There's actually been two that were a few years apart,
and they showed the same thing, which is basically doctors let patients talk
for an average of 20 seconds before they interrupt - sometimes even less. In
the most recent study, some doctors let a patient talk for only three seconds
before they interrupted. And they interrupted with a very specific question,
usually. But the chance that the patient would go back and finish that story is
almost zero. I mean, it almost never happens.

They get distracted. New information prompts new questions, and people go on
to, you know, describe other symptoms. But having the patient tell the story is
thought to be the most efficient way of getting all this data out, and yet we
don't do it.

DAVIES: And do the studies also indicate that when doctors do interrupt, that
they get an inaccurate picture of what’s going on with the patient?

Dr. SANDERS: They can. Sometimes you can be right and you take it in the
direction where it absolutely needs to go. But that's not always the case. And
up to 50 percent of the time, when a patient leaves the doctor's office and
they’ve been asked about it, they have symptoms that they didn't get to talk
about. Half the time, a doctor and a patient will not agree on what the purpose
of the visit was about.

DAVIES: That's after the visit?

Dr. SANDERS: After the visit. If they're questioned separately, what the doctor
thinks that the appointment was about and what the patient thought that the
appointment was about are going to be two different things half the time. So
that's crazy, and that's a bad way of collecting the most important data that
we have.

I mean, I think that there was a sense that we all know how to ask questions.
We all know how to hear the answers, that this was not something that needed to
be taught. But I think that studies like these suggest that we're wrong on
that. And actually, one of the other difficult things about it is there's a
certain anxiety when you’re confronted with something that somebody who's sick
or facts that you haven't - you’re not able to add up. And that uncertainty,
that provokes a certain anxiety that makes you want to find an answer. And so…

DAVIES: You mean that the doctor - the physician may be uncomfortable with sort
of the emotional atmosphere of the encounter?

Dr. SANDERS: I think the doctor himself will have emotions about seeing a
patient where you don’t know what's going on. And those feelings - I mean we're
- none of us are wildly comfortable with uncertainty, I think. You have to be a
very special kind of person to be comfortable in the face of real uncertainty.
So when a doctor is faced with this kind of uncertainty, the first thought that
passes his mind is often grabbed on with both hands.

The right thing to do, of course, and what I teach my residents and medical
students is to make note of what you’re thinking, but listen, listen and wait
because you - because the average patient's story last less than two minutes.
So you only have to wait two minutes before you ask your question. And yet,
sometimes it can be very hard.

DAVIES: You write in the book that the physical exam, once our most reliable
tool in understanding and diagnosing a sick patient, is dead. What do you mean?

Dr. SANDERS: I think it’s gone. We're all taught the physical exam in medical
school, but it doesn’t take long for you to realize as a student, as a
resident, as a young doctor that no one cares what you find on physical exam,
that it's really what the tests show. It's what the, you know, it's what the
tests show. And yet it's clear that the physical exam has important things to
tell us. It can direct where we look. It can tell us - show us in a very real
way what’s going on.

DAVIES: Can you think of an example of a case where reliance upon tests and
technology and neglect of a physical exam led to a misdiagnosis?

Dr. SANDERS: Oh, many. There was one case - a young woman she was a resident, a
doctor in training. She came - she was brought to the emergency room by her
fiance. Her heart was beating quickly, too fast to be normal. Her eyes were
incredibly insens - sensitive to the light. And she was speaking incoherently.
She was delirious. When she opened her mouth, a flood of words came out but
they didn’t make any sense. She was taken to the emergency room, put in a nice
quiet room. When the doctor came in and turned on the light, she called out
because the light hurt her eyes. And so he shut down the lights so that it was
very low and she was comfortable. You know, he was her friend, he didn’t want
her to be uncomfortable. He was worried about her.

And so, because of that he didn’t notice a couple of really important things.
He didn’t notice that her skin, which was normally a fair-light colored, was
bright red. He didn’t notice that her mouth was very dry. He didn’t notice that
her eyes were incredibly dilated. All these things would have been important
clues to what was wrong with her. She had been poisoned by a plant in her yard
that she had thought was lettuce and so had eaten. This set of symptoms is so
common, we have a mnemonic for it, you know, when somebody is mad as a hatter,
red as a beet, hot as a hare, blind as a bat. So these are all clues that we’re
all taught about this kind of poisoning.

But because he didn’t want to make her uncomfortable and didn’t really value
what he could see by doing this exam. He didn’t turn on the lights and yet if
she had said, I’d really rather not have a CAT scan, oh that would never stand.
Everybody would be in there trying to talk her into it. But without of peep, he
lowered the lights, cutting himself off from the data that could have led him
to a diagnosis.

DAVIES: Our guest is Dr. Lisa Sanders. Her new book is “Every Patient Tells a
Story.” We’ll hear more after a break. This is FRESH AIR.

(Soundbite of music)

DAVIES: If you’re just joining us, our guest is Dr. Lisa Sanders. She has a new
book about errors in diagnosis called “Every Patient Tells a Story.” I was
interested in a case that you describe in the book, a woman you called
Carlotta(ph), your own patient I believe as a first year resident who had a lot
of difficulty and a lot of pain. And you were struggling, despite tests, to
figure out what was going on. And a third year resident listened to them and
noted that she seemed to be having pain out of proportion to the physical exam.
And she said now that, when I put it together with the other things, are the
classic symptoms of ischemic colitis - which is an infection of the colon,
caused by a shortage of blood supply.

The point you made was that, that wasn’t a collection of symptoms and diagnosis
that you would have found it any book. She just knew that excessive pain
combined with the other things tended to be classic symptoms of ischemic
colitis. Do you find it there is this oral tradition in which doctors share
things with one another that may be aren’t there in books.

Dr. SANDERS: This is one of the ancient parts of medicine, that it really does
have to be learned at the bedside from the patient with the guidance of
somebody older, more experienced, wiser. We all hope to get to be that older,
more experienced and wiser doctor. But, this is the route to getting there, is
to being at the bedside with the patient and somebody smarter than you. It’s
how medicine is learned, and has been always, even when there was not much to
know.

(Soundbite of laughter)

Dr. SANDERS: It was - it’s always been the way medicine is done. There’s always
aphorisms that, one of the teaching tools in medicine, ways to remember all the
millions of pieces of data. My favorite aphorism, when I was taking care of a
guy who is found down in the snow on the side of the road. So, he had
hypothermia, very, very low body temperature. The emergency room doctor - I
mean, that he had no pulse, nobody could hear a heartbeat, EKG couldn’t pick up
anything. But the ER doctor said you’re never dead until you’re warm and dead.
And, so they slowly warmed him up.

And as his body warmed up we started to feel a quite pulse and then his
respiration became obvious. And then we could pick up his heartbeat. And he was
fine. He walked out of the hospital. But, I’ll never forget that – you’re never
dead, until you’re warm and dead. This is the way medicine is passed on. It’s
part of this old tradition that we’ve - that has been part of medicine from the
beginning. Hippocrates, the father of medicine, wrote three volumes that he
called aphorisms. And they’re just these one-liners about with an associated

story about things to observe and things to know in medicine.

DAVIES: For years, you’ve written this column for the New York Times magazine
about diagnosis in which fascinating medical mysteries are explored. And you’re
a technical advisor for “House”, the very successful FOX TV series about the
acerbic, pill-popping doctor who is so brilliant at cracking a medical mystery
every week. So, what’s thought you wrote? Do you provide, you know, obscure
illnesses and mysterious diagnosis to the show and then they build a series, an
episode around them.

Dr. SANDERS: Yeah, I mean usually the writers have an idea of what kinds of
things they want to have happen. And they call me up and say, so do you know of
any diseases that can do this that and the other thing. Okay. And what is some
of the complications of that disease? And where is some of the complications of
treating what we thought it might have been but isn’t? And what if some of the
complications, what are some of the problems you can run into if you’re doing
this strange test for this other disease?

So, they call me up and I’m a resource and it’s great. I love coming up with
weird diseases. When I read the literature, the medical literature, I’m always
on the outlook for some odd thing to pass on to “House.” And then in the
hospitals that I work in, people come to me with odd things. And I pass them
on. Last season or the season before last, House was doing surgery on a patient
and cut him open and his bowel gas caught on fire. There was a huge fire in the
operating room…

(Soundbite of laughter)

Dr. SANDERS: …it was fantastic. But, that was based on something that happened
in the hospital were I’m an attending physician. So, I passed - as soon as I
heard it, I knew it was “House” material. In fact, I heard it because the
resident it happened to ran to tell me as soon as she – as soon as her hand
healed.

DAVIES: You’re telling me that in your hospital someone’s bowel gas caught on

fire.

Dr. SANDERS: Uh huh. It happens, you know, there are only two cases written of
this in the medical literature. I’m sure it happens a lot more frequently than
that. But it’s – I guess people don’t really want to talk about it that much
but it’s fantastic. And it totally makes sense if you understand the physics of
it.

DAVIES: Well, at the risk of being crude how does it get ignited?

Dr. SANDERS: When you make a cut, you sew up large vessels that bleed, but
little tiny vessels that bleed are usually cauterized. And to do that - we use
basically an arc welder on a very tiny scale. So it puts out a little spark and
that cauterizes the little vessel. So, you take methane and a little spark in
the tiny hole. And you’ve high pressured gas going by a flame. And you have an
explosion. So, you know, the resident who was operating said that the flame
shot up 10 or 12 feet and said that the lights at the top of the ceiling were,
you know, covered in smoke and melted. The covers were melted. So, it was – let
me just say, the patient did fine.

The attending physician - the attending surgeon took the scalpel out of the
surgeon’s hand and opened the incision wider, so that the gas just diffused out
quietly and that put out the fire. And the patient – they went ahead and did
what they needed to do for the patient and sewed him up, told him about it, and
he was completely fine.

DAVIES: You know, as you’ve looked at the art of diagnosis - I mean you’ve made

the point that some studies suggest as many as – as much as 15 percent of
diagnosis are inaccurate. And that there are a number of ways in which, kind of
the training and structure of medicine don’t give physicians the kind of habits
that they really should have to, you know, to do careful physical exams and
listen to patient histories and think, you know, in an open-minded way, about
problems. And the nation’s now beginning to think about how it’s going to
restructure. At least, how it pays for medical care. And to some extent how
medical care may be structured. Do you have an opinion about how health care
reform should proceed?

Dr. SANDERS: Absolutely. And I think that it would be hard to find doctors,
especially internists, who don’t have very strong opinions on this. We don’t
have the time that we need. We don’t have the tools that we need, because what
we do is not valued. Thinking, which is really what a doctor does - thinking,
examining, questioning, is not valued by the system. It wasn’t designed that
way. It was just an accident but doing is what really counts, thinking not so
much. For example, not long ago I had – I guess nine or 10 patients in a half
day. My first nine patients were with the usual diabetes, high blood pressure,
hyperlipidemia, cold, cough, bronchitis.

The last patient I’d scheduled at the end of the day needed his ingrown toenail
removed. So, I see everybody, every patient gets 20 minutes for the most part.
This last patient also gets 20 minutes. I cut out his toenail and gave him a
band-aid and sent him on his way. But for that procedure I got paid more than I
did for all the patients I had seen prior to him because we value doing rather
than thinking. So, I would certainly encourage reform to allow for people to
think. Because it’s thinking fundamentally, it’s going to save us money.

DAVIES: Well, Lisa Sanders, it’s been really interesting. Thank so much for
speaking with us.

Dr. SANDERS: Thank you so much Dave.

DAVIES: Dr. Lisa Sanders’ new book is called, “Every Patient Tells a Story:
Medical Mysteries and the Art of Diagnosis.”

Les Paul, the guitarist and inventor who made 36 gold records and developed new
instrumental and recording techniques, died today. He was 94. In the 50s, he
recorded many hits with his wife Mary. We’ll close with one of them. This is,
“How High the Moon.”

(Soundbite of song, “How High The Moon”)

Mr. LES PAUL and Ms. MARY FORD: (Singing) …if you will. How high, how high, the
moon.

For Terry Gross, I’m Dave Davies.
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