Jessica Hyland is correct that if our government starts regulating drug prices, then the development of new drugs will slow down. (Below is the link to her essay in the Des Moines Register.) Our current government policies have given us more new drugs at higher prices than we are willing to pay for. So maybe getting new drugs more slowly would be a good trade-off for significantly lower drug prices.
Good health might be the most important thing in our lives, but it is not the only thing. The pandemic proved that many people are willing to risk their health in order to do those other things they consider to be important in their lives.
Today, drugs approved by the FDA are required to be covered by Medicare regardless of the price, and whether or not the drug is any better than cheaper existing drugs! Government granted patents prohibit competition by generic drug makers for 20 years or more! There is clearly no free market for prescription drugs. As a libertarian, I would love to see our government get out of the healthcare business altogether, but we don’t live in that world. Our government has had its thumb on the scales in favor of drug companies for decades, so it is not unreasonable for it to now start regulating drug prices.
I read the report in The Des Moines Register about the questioning of Tom Vilsack by Joni Ernst during the Senate hearings on Vilsack’s nomination for Secretary of Agriculture. (Vilsack nomination moves to full Senate” 2/3/2021) President Biden has ordered the development of a plan to convert all federal, state, local and tribal vehicles, including Post Office vehicles, to “clean and zero-emission vehicles.” Ernst asked Vilsack if he will direct the USDA to buy Tesla trucks that run on electricity or Ford vehicles that run on 85% ethanol. Vilsack, like a good politician, said it’s not ” an either-or circumstance.” It will be interesting to see how Vilsack balances the interests of farmers and biofuels producers with the interests of the zero-emissions vehicle and power producers. One thing is for sure: lobbyists will be in high demand.
As reported in The Des Moines Register, Iowa has joined 37 other states in an anti-trust suit against Google for discriminating against other search engines. (See link below.)
The purpose of anti-trust action against any company should be the protection of consumers, not the protection of competing businesses. If consumers are not harmed, which is the case here, then anti-trust action should not be taken. I have a strong feeling that the State governments joined this lawsuit in order to share in the billions of dollars of penalties or settlement – a money grab from a deep pocket.
Why should Google be forced to list links to other search engines in the results of their Google searches? Why shouldn’t Google be allowed to pay smart phone makers to make Google the default search engine – which helps to reduce the cost of cell phones? Where is the harm to consumers? In fact, Googles actions arguably help consumers.
Below is the link to an excellent article by Eric Boehm from Reason magazine’s August/September issue. It gives specific evidence that shows how international trade makes us safer in a world-wide pandemic rather than the opposite. There is a knee-jerk reaction when we have shortages to assume that we would be better off if we did not depend on other countries for our various needed products. This essay shows that the facts indicate otherwise.
I agree with John Stanford’s essay in the Wall Street Journal today that controlling drug prices would slow biomedical innovation and and research. (WSJ 7/2/2020 – see link below.) When you spend less money on anything you will get less of it. But that’s okay. Today, we get more drug research and innovation than we want to pay for.
Most drugs approved by the FDA are required by law to be covered and paid for by Medicare and Medicaid regardless of price! Many are required by law to be covered and paid for by private insurance companies regardless of the price! This is true even when the drug provides little or no improvement over other existing approved drugs! Under such a situation we, of course, get maximum research and development.
If we did the same for space exploration, we would probably already have colonies on Mars. If we did the same for climate change, we would probably already have that problem solved. The point is that development of new prescription drugs is not our only priority, and our ability to pay is not unlimited.
We don’t have anything close to free market capitalism in the prescription drug market in the U.S. Government is already very involved, mostly providing subsidies, protection from competition, and other benefits to drug manufacturers. It is not unreasonable to set a drug price ceiling that is 20% higher than what is being paid by Australia, Canada, France, Germany and Japan. We can always make special exceptions for something like a vaccine against the Covid-19 virus.
I don’t doubt the good intentions of our government leaders, including elected officials and public health regulators, as they tighten restrictions on our freedom of movement.. We are “bending the curve” and easing the pressure on our health care system. But unless an effective anti-virus drug is found and administered to everyone very quickly, bending the curve will only delay the time before most of us will become infected, and will lengthen the time that we all suffer emotionally and economically.
Why is our response to this situation so dramatically different than our response to the flu or automobile accidents? Both the flu and auto accidents kill tens of thousands of Americans each year and are preventable. We could dramatically reduce those deaths if we used the same extreme measures that we are using against COVID-19. But what is the point of living if we have to stay away from our family and friends? For a few weeks, fine. For several months or more, not acceptable. Life has risks. We need to balance the costs and the benefits of our efforts. Soon, we need to once again let people decide for themselves how much risk they are willing to take.
I agree with Valerie Stallbaumer in her letter to the editor in The Des Moines Register, (See link below), that the purpose of professional licensing requirements by government is to help protect the public from harm. I disagree with her that it also is to guarantee quality. Safety issues are usually objective: we know pretty well what kind of things can hurt people. Licensing should assure us that the licensed person knows and follows safe procedures. But for many licensed professions, quality is subjective. If acupuncture is not effective for some people, what is the harm as long as they don’t get an infection? The only reason I can think of why government would require a four-year program for acupuncturists is that acupuncturists and their schools lobbied for licensing to protect themselves against competition and to appear more professional. Acupuncturists, physical therapists, tattoo artists, and ear piecers probably can learn proper safety procedures related to “needling” in just a few days. We do need a complete review of licensing requirements and regulations in Iowa to eliminate those that prevent competition rather than protect people.
Sometimes, price gouging can be a good thing. If there is a sudden surge in demand for something, say face masks or hand sanitizer, is it better to keep prices low and encourage hoarding that can result in complete outages, or is it better to let prices go up as the market demand allows to discourage hoarding and encourage rapid increases in production? Why would businesses pay for overtime, or expedited shipping, or other higher costs to quickly increase supplies if they are not allowed to increase prices? There are certainly extreme situations where price gouging would be considered by most people to be immoral. (For example, it would clearly be immoral to charge $1,000 for a glass of water to a person dying of thirst when you have plenty of it.) But there are many other situations where allowing prices to go up significantly and quickly helps to make vital products available for important purposes to more people more quickly. Private efforts to keep prices low and to prevent hoarding in an emergency are to be commended, but be careful before you call for laws or regulations to prevent price gouging.
Laws and regulations should not require a person to join a union in order to work for a unionized employer, including the government. But for privately owned businesses, the owners should be able to work exclusively with a union, and require employees to join the union, if that is what the owners want. Most if not all right-to-work laws do not give owners that right. Those laws should be changed.
Under our current regime of drug prohibition in the U.S., it is true that American drug users support the violent drug cartels in Mexico. If we ended the drug wars, and instead legalized and regulated peaceful drug use, and treated addiction under a medical model, the violence associated with the illicit drug trade would mostly go away. When CVS opens a drug store across the street from Walgreens, they don’t get into a gun battle. When a drug store is robbed, they call the police instead of sending out a gang to get revenge. It is the government policy of prohibition that causes the violence associated with the illicit drug trade. Our drug wars will be endless until prohibition is ended.