Recently, I was quite interested in the REED paper about the innovation ecosystem and healthcare (healthcare often lacks a healthy one.) I had one blog about REED and another where I applied the REED model to four healthcare innovation problems.
Primary blog about REED
https://www.discoveriesinhealthpolicy.com/2025/12/are-we-dumping-good-innovations-into.html
Reed & 4 topics
https://bqwebpage.blogspot.com/2026/01/medical-innovation-case-studies-via.html
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WSJ 2025 - Galston - America's 25 Years of Decline (polarized, paralyzed).
WSJ 2025 - FREY book review on How Progress Ends
WSJ 2026 - REES MOGG by Raskin. Stability supports progress; conservatives; ecosystem
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Below is a structured synthesis of the three WSJ pieces, followed by an innovation-focused interpretation, framed explicitly for someone who works in healthcare and policy-constrained innovation ecosystems.
I. Concise summaries of the three WSJ pieces
1. Jacob Rees-Mogg: “Progress Depends on Conservatism” (WSJ Weekend Interview, Jan 2026)
Rees-Mogg argues that durable innovation depends on stable institutions, not constant disruption. He frames British common law, freedom of speech, property rights, and moral restraint as innovation-enabling infrastructure, not obstacles. Drawing on Chesterton’s Fence [*] and Schumpeter, he emphasizes that creative destruction should be purposeful, not reflexive: institutions should be dismantled only when they demonstrably fail. He is skeptical of centralized bureaucratic overreach (including EU legal structures), but not anti-technology—embracing AI, digital tools, and even crypto within a moral and institutional framework. His core claim is that societies that forget why their institutions exist tend to undermine the very conditions that produced progress in the first place.
[*] In his 1929 book, The Thing [about Catholicism], one chapter created the parable of a fence in the road, and a discussion, don't tear it down at first glance, not until you know why it was there and whether it is no onger needed. Hence, for the literati, reduced to the abbreviation "Chesterton's Fence" (a la Schrodinger's Cat.]
2026 WSJ 0102 Rees_Mogg on Inno…
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2. Carl Benedikt Frey, “How Progress Ends” (Book Review, Sept 2025)
Frey offers a historical theory of innovation cycles: progress depends on an adaptive balance between decentralization (for discovery) and centralization (for scaling and exploitation). Early-stage innovation thrives when multiple actors can experiment, evade veto points, and challenge incumbents. But once technologies mature, central coordination can accelerate diffusion and productivity.
The danger arises when institutions optimized for scaling become sticky, blocking the next wave of discovery. Frey warns that both the U.S. and China risk stagnation—China through authoritarian over-centralization, and the U.S. through protectionism, immigration barriers, and institutional sclerosis. The key threat is institutional inertia, not lack of technology
[See also decentralization in genetic testing, CAP Today 2025, here.]
2025 WSJ 0928 How Progress Ends…
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3. William Galston: “America’s 25 Years of Decline” (Dec 2025)
Galston presents a narrative of governance failure, not technological failure. Since 2000, the U.S. has experienced bipartisan mismanagement: trade shocks without adjustment policy, prolonged wars that diverted strategic attention, fiscal irresponsibility, financial deregulation failures, and escalating polarization. The result has been policy paralysis [*], executive overreach, and declining public trust in institutions—exacerbated by Covid-era missteps. Galston’s underlying argument is that even strong economies and innovation engines cannot function well under chronic political dysfunction, especially when long-term challenges (healthcare, demographics, entitlements) are left unresolved
[*] Esp. when the Presidential party is a mismatch to at least one, House or Senate = nothing happens.
2025 WSJ 1230 25 Years of Decli…
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II. Interpreting all three through an innovation lens (especially healthcare)
1. Innovation requires an ecosystem, not just technology
All three pieces converge on a point that resonates strongly in healthcare: innovation is ecosystem-dependent.
Rees-Mogg emphasizes legal and moral continuity; Frey emphasizes institutional adaptability; Galston emphasizes functional governance. None argue that innovation fails because ideas dry up. Instead, innovation fails when the surrounding system cannot absorb, evaluate, scale, or pay for new ideas.
In healthcare terms, this mirrors the reality that:
Breakthrough diagnostics, drugs, and AI tools routinely outpace reimbursement systems, regulatory clarity, and delivery models.
The problem is not invention, but translation and institutional fit.
2. The decentralization–centralization cycle maps cleanly onto healthcare
Frey’s framework is especially powerful when applied to healthcare innovation:
Decentralized phase: early discovery (academic labs, startups, LDTs, exploratory AI, off-label use).
Centralized phase: standardization, guideline inclusion, FDA approval, CMS coverage, scaling through payers and health systems.
Healthcare today is stuck in a mismatch:
Regulatory and payment institutions are behaving as if technologies are mature (demanding standardization and certainty),
while the technologies themselves (AI diagnostics, MRD testing, multi-omic profiling) are still in rapid exploratory phases.
This creates exactly the stagnation Frey warns about: institutions optimized for exploitation prematurely suppress exploration.
3. Rees-Mogg’s “conservatism” aligns with innovation realism
Although framed politically, Rees-Mogg’s argument is strikingly relevant to healthcare innovation policy. His emphasis on:
common law–style evolution,
skepticism of abrupt top-down redesign,
respect for accumulated institutional wisdom,
maps closely to the idea that healthcare systems cannot be “disrupted” the way consumer tech can. FDA pathways, CPT coding, and CMS coverage are not arbitrary barriers—they are load-bearing structures. Remove them without understanding their function, and innovation collapses under its own weight.
This echoes what many innovators learn the hard way:
You don’t remove the fence until you know why it was built.
4. Galston diagnoses the real bottleneck: governance, not science
Galston’s essay explains why even a country with world-leading biomedical science struggles to convert innovation into outcomes. Chronic polarization leads to:
regulatory whiplash,
payment uncertainty,
executive rulemaking substituting for durable legislation,
erosion of trust in expertise.
For healthcare innovators, this translates into unpredictable policy signals, delayed coverage decisions, and fragile business models. The danger is not that innovation stops—but that it becomes financially unviable, misaligned with care delivery, or politically radioactive.
III. A unifying takeaway for healthcare innovation
Taken together, the three pieces argue—implicitly but powerfully—that:
Innovation is not primarily a problem of ideas; it is a problem of institutional alignment over time.
In healthcare, this suggests:
Innovation policy must distinguish exploration from scaling, and design different rules for each.
Stability matters as much as speed; constant reinvention of regulatory frameworks is itself anti-innovative.
Trust—in institutions, expertise, and process—is a prerequisite for adoption, not a nice-to-have.
For someone working in healthcare innovation, the warning is clear:
If we focus only on what is new (AI, genomics, precision medicine) and neglect how institutions adapt, we risk repeating exactly the stagnation these authors describe—despite unprecedented scientific capability.
If you’d like, I can next:
map these ideas directly onto FDA / CMS / MolDx dynamics, or
apply the framework to a specific technology class (AI diagnostics, MRD, digital pathology).
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IV. Re-reading the WSJ pieces through the REED ecosystem framework
1. Fragmentation—not ideology or technology—is the common failure mode
Reed et al. argue that innovation stalls not because technologies are weak, but because innovation ecosystems fragment: developers, researchers, clinicians, regulators, payers, and institutions each optimize locally while the system fails globally
[See links to my other blogs at top]
2025 J Internet Res REED Innova…
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This diagnosis aligns strikingly with all three WSJ essays:
Rees-Mogg describes institutional decay when traditions are dismantled without understanding their coordinating role.
Frey describes systems stuck in the wrong phase—centralized when they should be exploratory, or vice versa.
Galston describes political and administrative silos that prevent coordinated long-term action.
REED provides the missing synthesis: each author is describing a different manifestation of ecosystem fragmentation.
2. Rees-Mogg as an ecosystem thinker (unexpectedly)
Although framed as conservatism, Rees-Mogg’s argument maps closely onto Reed’s “don’t look only at the focal innovation” warning.
His use of Chesterton’s Fence is almost a lay version of REED’s critique of the linear innovation pipeline—the idea that innovation can be handed off downstream without shared responsibility
2025 J Internet Res REED Innova…
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In REED terms:
Common law, free speech, and property rights function as coordination infrastructure.
Destroying them prematurely fractures adoption chains and co-innovation pathways.
His skepticism toward radical redesign mirrors REED’s insistence that ecosystem cohesion matters more than technical novelty.
This is particularly resonant in healthcare, where regulatory and payment “fences” often look obstructive—but frequently exist to stabilize trust, accountability, and scale.
3. Frey’s decentralization–centralization cycle ≈ ecosystem phase mismatch
Frey’s core insight—that innovation requires shifting between decentralized exploration and centralized exploitation—maps directly onto REED’s ecosystem stages.
REED shows that failure occurs when:
innovators behave as if they are still in exploration,
while institutions behave as if exploitation and scale are already appropriate.
In healthcare, this is endemic:
AI diagnostics, MRD assays, and digital pathology tools are still co-innovation-heavy, requiring workflow redesign, clinician behavior change, and payer adaptation.
Yet regulators and payers demand late-stage certainty, reimbursement evidence, and standardization prematurely.
REED gives operational language to Frey’s historical insight: the system is not anti-innovation—it is misaligned across ecosystem roles.
4. Galston’s “misgovernment” as ecosystem leadership failure
Galston focuses on political decline, but REED helps specify how governance failure undermines innovation.
REED identifies the absence of:
ecosystem leadership,
incentives for boundary-spanning work, and
protected spaces for coordination and learning
2025 J Internet Res REED Innova…
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Galston’s narrative of polarization, executive overreach, and policy paralysis describes a system where:
no actor is empowered to align incentives across silos,
each group fulfills its formal role,
yet collective outcomes deteriorate.
This precisely matches REED’s Minneapolis bridge analogy: everyone does their job; the bridge still collapses.
5. Why healthcare innovation is especially vulnerable
REED emphasizes that healthcare is uniquely fragile because:
knowledge is tacit and distributed,
workflows are complex and overloaded,
incentives reward local success, not system success.
This explains why healthcare innovation feels “harder” than other sectors:
Developers optimize models and accuracy.
Researchers publish frameworks.
Clinicians cope with overload.
Regulators enforce safety.
Payers enforce cost control.
All are rational. The ecosystem fails anyway.
The WSJ essays describe the symptoms; REED explains the mechanism.
V. A unified interpretation
Read together, the four frameworks converge on a single conclusion:
Innovation fails when ecosystems lose the capacity to coordinate across difference—across time horizons, incentives, and institutional roles.
Rees-Mogg warns against tearing down coordination structures blindly.
Frey warns against locking institutions into the wrong innovation phase.
Galston warns that governance paralysis erodes trust and capacity.
REED shows how fragmentation occurs and what must be rebuilt: shared value, leadership, and cohesion.
For healthcare innovation specifically, the implication is sobering but clarifying:
The bottleneck is not AI, genomics, or precision medicine.
The bottleneck is ecosystem design.
If you’d like, next steps could include:
mapping FDA–CMS–MolDx through the REED ecosystem stages,
applying REED directly to AI pathology or MRD testing, or
turning this synthesis into a short essay or slide deck suitable for policy or investor audiences.
Here is a single, integrated essay, written in paragraph form, synthesizing the three WSJ essays through the analytic frame provided by Reed et al.’s ecosystem theory. I have treated Reed not as a fourth “opinion,” but as the explanatory system that makes sense of the other three.
Across the three Wall Street Journal essays—by Rees-Mogg, Frey, and Galston—there is a shared anxiety that innovation has slowed or become strangely brittle, despite extraordinary technical capability.
Each author approaches the problem from a different angle: Rees-Mogg from institutional tradition, Frey from economic history, and Galston from governance failure.
What Reed et al.’s ecosystem framework adds is a way to see these not as separate diagnoses but as different symptoms of the same underlying condition: ecosystem fragmentation. Innovation, in this view, fails not because ideas are exhausted or talent has declined, but because the systems that must coordinate discovery, adoption, scaling, and legitimacy no longer function coherently .
Rees-Mogg’s argument, stripped of its political clothing, is fundamentally about institutional memory. He insists that durable innovation depends on inherited legal and social structures—common law, speech norms, limits on arbitrary power—not because they are old, but because they quietly coordinate behavior across time. Reed’s framework clarifies why this matters: institutions are not merely constraints on innovators; they are adoption-chain infrastructure. When reformers dismantle institutions without understanding the roles they play in aligning incentives and expectations, they fragment the ecosystem. Innovation may still occur locally, but it becomes harder to translate into stable, trusted practice. In Reed’s language, the system loses cohesion even as individual actors continue to perform well within their silos.
Frey’s historical analysis deepens this diagnosis by showing that innovation requires phase-appropriate institutional behavior. Periods of discovery benefit from decentralization, experimentation, and pluralism; periods of diffusion and scaling benefit from coordination and authority. Reed’s ecosystem lens explains what happens when these phases are mismatched: developers behave as though exploration is still dominant, while regulators, funders, and institutions behave as though the technology is already mature. The result is not balance but friction. In healthcare, this appears as premature demands for standardization, reimbursement certainty, and evidentiary closure applied to technologies—AI diagnostics, genomic testing, digital tools—that still require extensive co-innovation with clinicians, workflows, and payment models. The ecosystem fails not because any one actor is irrational, but because each is optimizing for a different, unacknowledged phase of innovation.
Galston’s essay on America’s 25 years of decline supplies the political dimension of the same problem. His account of polarization, executive overreach, and policy paralysis describes a system in which no actor has the authority or legitimacy to perform ecosystem leadership, a role Reed explicitly identifies as essential. When governance structures cannot align incentives, create protected spaces for collaboration, or sustain long-term learning, responsibility fragments. Each institution fulfills its narrow mandate—Congress deadlocks, agencies regulate defensively, innovators route around policy, clinicians cope—but collective performance deteriorates. Reed’s Minneapolis bridge analogy is apt here: everyone does their job; the system still collapses.
What unifies all four perspectives is the recognition that innovation is relational, not merely technical. Reed makes this explicit: innovation succeeds only when developers, researchers, practitioners, regulators, and funders share a common value proposition and accept joint responsibility for outcomes. Rees-Mogg worries that we forget why coordinating institutions exist; Frey warns that institutions become trapped in outdated modes; Galston shows what happens when political systems lose the capacity to coordinate at all. Reed provides the operational diagnosis: the ecosystem lacks incentives, leadership, and shared sense-making mechanisms to adapt as innovation evolves.
The synthesis leads to a sobering but clarifying conclusion, especially for healthcare. The constraint on innovation is not the absence of breakthroughs, nor excessive caution per se, but the erosion of ecosystem coherence. Without shared understanding of roles, phases, and responsibilities, innovation oscillates between reckless disruption and paralyzing control. Reed’s prescription—wide-lens thinking, shared value propositions, ecosystem leadership, and deliberate investment in coordination—does not promise speed or spectacle. It promises something more important: the capacity for innovation to become routine, trusted, and durable. In that sense, all three WSJ essays are not lamentations about decline so much as warnings about what happens when systems forget how to hold innovation together.
