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A close legal question-only in 21st century America

Sunday, July 29, 2012

I read Dean Baker’s blog religiously. One can argue that he is repetitive, but I think he rightly feels that he must keep repeating himself, since what he has to say, usually so obviously true when you read it, never seems to sink in. It’s not just him, of course. It’s the same for Krugman and like minded economists-you know, the ones who recognized the coming disaster before it happened.

Not a week goes by that Baker doesn’t lament our broken patent system, or in which he fails to point out that our long term budget woes are almost solely attributable to the far higher costs imposed upon us by our broken health care system.

Here’s a story in which those memes collide:

It would seem a business executive’s dream: legally pay a competitor to keep its product off the market for years.

Congress has failed to stop it, and for more than a decade generic drug makers and big-name pharmaceutical companies have been winning court rulings that allowed it.

Until this month. On July 16, a federal appeals court in Philadelphia issued a decision that the arrangement is anticompetitive on its face. It potentially sets up a confrontation before the United States Supreme Court. If it were to accept the case, the outcome could profoundly affect drug prices and health care costs.

The Philadelphia ruling by the Third Circuit Court of Appeals conflicted with decisions from at least three other federal circuit courts, giving the Supreme Court a strong reason to hear the case within the next few years.

“The Third Circuit has rebalanced the issue and teed it up for the Supreme Court,” said Eleanor M. Fox, an antitrust expert and professor at the New York University Law School. The agreements between generic and branded drug manufacturers “are cases of competitor collaboration, which the Supreme Court has called ’the supreme evil of antitrust.’ ”

The stakes are enormous for brand-name drug makers, which would face lower profits, and for pharmacies, insurance companies and patients, who could benefit from the savings.

In the case of Cipro, a powerful antibiotic with annual sales exceeding $1 billion, Bayer paid $400 million to a generic drug maker, Barr Laboratories, and other companies. In exchange, the generic makers said they would withhold their own lower-priced generic versions of the drug until 2003, when Bayer’s patent on the brand-name drug expired.

(via New York Times)

Now, if the market works as advertised, this must mean that the price of this drug, already at monopoly levels, will be increased by an amount, in the aggregate, greater than the generic manufacturer’s could make if they refused to take these payments. So, rather than forcing prices down, the existence of the generic manufacturers, who are basically now not manufacturing but getting by on bribes, results in an increase in already swollen prices in an amount greater than the savings would be if the generics were truly competing.

Why is it not surprising that the Congress has done nothing to stop this? Why, after years of court packing by Republican presidents, with only nominal pushbacks by the Democrats, is it not surprising that until now every court in the land has ruled in favor of a practice that on its face is monopolistic, price fixing behavior? Is it any surprise that the only surprise is that one court has seen the obvious?

I’ll be shocked if this ruling is upheld. It’s such a quaint throwback to that brief moment in history when this country was not a wholly owned subsidiary of corporate America.

 

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Top 20

Sunday, July 29, 2012







A few days ago the Apple blogs to which I go were abuzz about the fact that Time magazine chose Steve Jobs as one of the 20 most influential Americans of all time. Apparently, the criteria excluded those whose influence was evil (e.g., Rush Limbaugh, who would otherwise be right up there).

Of course, this sort of list is always highly subjective. My first reaction when I scanned it was amazement at the fact that Sacagawea, Lewis and Clark all made the list (separately, not as a group). The definition of influence must be rather strained, as, if memory serves, the broader public never heard of Sacagawea until years after the expedition, when the Journals were finally published. I'm not picking on her necessarily, though the choice is almost glaringly PC, because it's also really hard to make the argument that either Lewis or Clark deserve to be on the list.

The list says more about its compilers than it does about who was or wasn't truly influential. What I found interesting was the fact that there was not a single literary figure among the 20. Neither Thoreau (who influenced both Ghandi and Martin Luther King, the latter of whom justifiably made the top 20), Emerson, Melville, Hawthorne, Whitman, Twain, Fitzgerald, Hemingway, Poe, Dickinson, Stowe (the “little lady who started [that] big war”) nor any other writer made the list, so we are to believe, I must assume, that none of those worthies was as influential as Louis Armstrong, who I admit, played a mean trumpet, but…well, but ..top 20? Really?

Nor, for that matter, did any other artist make the list, other than the aforementioned Armstrong. No painter, no dramatist, filmmaker, or, perhaps more justifiably, journalist. No one, except two scientists (who inhabited a different intellectual realm than the people to whom I refer), whose primary influence was in the world of ideas.

What are we to make of this? Has America really been so untouched by the ideas of its intellectuals and artists that not one has been more influential than a boxer? Is it really the case that their works have been so unimportant that not a one deserves placement on such a list? I think we can safely say that the answer is “no”, and that the self appointed list makers at Time just weren't up to the task.

Addendum: for the record, I'm a big Apple fan, but I don't think Jobs should be on the list either.


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Still worth signing, but where’s their priorities?

Saturday, July 28, 2012

Okay, I signed the Daily Kos open letter to the people of Britain, which you can read and sign here. I mean, why not? Anything that might conceivably hurt Romney is worth doing. But I must take issue with this part of the letter:

Additionally, we do not share the opinion which Romney expressed in his 2010 book, No Apologies, that “England [sic] is just a small island,” and that “with few exceptions, it doesn’t make things that people in the rest of the world want to buy.” Please continue sending us your many wonderful products, especially the upcoming third season of Downton Abbey.

Now, I like Downton Abbey as much as the next guy, but what were they thinking? We can live without Downton Abbey if need be, but Doctor Who is another matter.

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Friday Night Music

Friday, July 27, 2012

I sort of wracked my brain trying to think of a song about someone (think Romney) who keeps putting his foot in his mouth, but couldn’t come up with anything, but I finally found this, which is somewhat apropos. The fact that the first comment on youtube was to the effect that it would be a perfect song for the Romney campaign clinched the deal.

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Hey Paul, over here!

Wednesday, July 25, 2012

Paul Krugman, perceptive as always:

Just a quick note: one thing I don’t think has been sufficiently emphasized as we stare a euro disaster in the face is the amount of damage this will do to the overall European political landscape. Across most of the periphery, both sides of the usual political divide have been roped into the policies of austerity and internal devaluation — sometimes in governments of national unity, sometimes with normal party rule but with both parties following much the same line.

So if the policies fail disastrously, which is getting close to a certainty, the effect is to discredit the entire political center, leaving radicals right and left as the only people who aren’t tainted.

It’s hard to know how this ends. But Europe a few years now may be a very different place from the nice alliance of democratic nations we all know and love.

(via New York Times Blogs)

Well, it hasn’t been sufficiently emphasized, but it was emphasized here.

Update: link fixed, thanks Fred.

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One small part of the Romney Plan

Monday, July 23, 2012

They truly have no shame:

Over a four years period from 2008 to 2011, Corning Inc. was one of 26 companies that managed to avoid paying any American income taxes, even though it earned nearly $3 billion during that time. In fact, according to Citizens For Tax Justice, the company received a $4 million refund from 2008 to 2010. That didn’t stop Susan Ford, a senior executive at the company, from telling the House Ways and Means Committee this week that America’s high corporate tax rate was putting her company at a disadvantage:

American manufacturers are at a distinct disadvantage to competitors headquartered in other countries. Specifically, foreign manufacturers uniformly face a lower corporate tax rate than U.S. manufacturers, and virtually all operate under territorial systems which encourage investment both abroad and at home.

Ford told the committee that Corning paid an effective tax rate of 36 percent in 2011, but as CTJ notes, she is counting taxes on profits earned overseas that haven’t yet been paid and won’t be unless the company decides to bring the money back to the United States. Corning’s actual tax rate in 2011, according to CTJ’s analysis, was actually negative 0.2 percent.

(via Thinkprogress)

I wrote about this newest tax meme being spread by the right a few days ago. Once again, they’ll not stop until they get what they want and once again, it’s a tax plan designed to move money upward . It would bring us into line with a number of other countries, which only tax corporate profits earned within their borders. Except it wouldn't really, because it lacks the safeguards other countries have implemented to prevent tax avoidance. Naturally, it's a centerpiece of Romney’s tax plan. The US does, in fact, have a high nominal corporate tax rate. But, in typical American fashion, it has a low effective corporate tax rate (as the Corning example proves) by dint of the generous loopholes that corporations are able to buy so cheaply from Congress. It’s actually quite convenient for them, as it gives them something about which they can endlessly complain, secure in the knowledge that the corporate media will never bother to call them out about it, giving them cover from within which they can lobby for ever more ways to shift their low remaining real tax burden to the American people.

 

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Friday Night Music-Romney’s Song

Friday, July 20, 2012

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The Future of Education?

Thursday, July 19, 2012

Kevin Carey of the Washington Monthly suggests that it's time to rehabilitate an age old educational scam:

Deep in the recesses of my spam filter, among phishing lures and ads for unregulated “enhancing” pharmaceuticals, vaguely named online universities occasionally promise to transform my valuable personal and professional accomplishments into a convenient and inexpensive college degree. The pitch has been around for decades, quickly migrating from one form of cheap, marginal media—matchbook covers, the back pages of men’s magazines—to another. “Credit for life experience” is well-understood shorthand for “sketchy diploma mill that could get you fired from a real job in twenty years if you’re not careful.”

It may also be a great idea whose time has finally come.

The U.S. economy desperately needs more Americans with college credentials: by 2018, more than 60 percent of U.S. job openings will require some form of post-secondary education, according to the Georgetown University Center on Education and the Workforce. Unfortunately, our existing system of colleges and universities doesn’t appear up to the challenge. …

…

Which is why more people are starting to ask: Is there a way to get students legitimate college credit without the college itself?

Enter “credit for life experience,” or, to use the currently popular phrase, “prior learning assessment.” Legitimate organizations are increasingly offering innovative ways of assessing the skills and knowledge that prospective students, especially working adults, already have between their ears—the human capital they’ve accumulated though past schooling, work experience, or independent study—and building on this preexisting knowledge base with carefully tailored coursework.

(via The Washington Monthly)

What this represents is an abdication of our responsibility to provide an education for our young people. This sort of thinking represents a lot of what is wrong with so-called progressives. The right-wing demands, and when it doesn't get its way, it continues to demand until gradually, and lately inevitably, it gets its way. One of those demands is the destruction of public education, and slowly but surely that is happening. Too many of us, on the other hand, see such changes taking place, and rather than demand, as we should, that the cost of education be borne by all, we seek to accommodate by buying into proposals like this that, no matter how well intentioned, will inevitably further widen the distance between the elite and the masses. One system of education for our masters, one for the rest of us. (The article actually speaks approvingly of degrees conferred by Wal-Mart on its employees: “The process will include granting credit for work experience and on-the-job training earned in various Wal-Mart job categories”.)

Another point: There is a distinction between education and training. That is not to denigrate training, but it does not confer the tools one needs to think critically, and that is the area in which Americans are woefully deficient. Education should be about more than job skills, the process should create thinking citizens. If we thought critically, we’d be voting right, and we wouldn’t need degrees for life experience, because we would not have allowed the conditions to develop that seem to justify them. We would have, as we once did, free or cheap public universities, with a middle class that can afford to pay what should be reasonable education costs. We don’t have that anymore, and this proposal assumes we never will. It’s an abject surrender to the right wing. I’d rather go down fighting.

 

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An alternate theory

Wednesday, July 18, 2012

New London’s own Joshua Green speculates that Romney may have paid no taxes in 2009, thus the argument that he need only disclose back to 2010:

The “zero tax in 2009” theory—again, this is sheer speculation—gains further sustenance when you consider it’s the only year for which nobody knows anything about Romney’s taxes. He’s revealed what’s in his 2010 and 2011 returns, and he reportedly submitted 20-some years’ worth of returns to the McCain campaign when he was being vetted for vice president in 2008. Steve Schmidt, McCain’s chief strategist in that campaign, said on MSNBC last night that while he didn’t examine Romney’s returns himself, nothing that McCain’s vetters found in them disqualified Romney from consideration.

That would indicate that 2009 is singularly important and, if there’s anything to this theory, incredibly vexing for Romney because there’s no way he could release additional returns without including that year. And the chaos that would ensue would be bad enough that it’s probably worth enduring significant damage to avoid.

(via Businessweek)

The theory may be true, but I wouldn’t take Schmidt’s statement to the bank. My guess would be that they never seriously thought about Romney and were just vetting him for appearances sake. After all, everyone who has ever run against him thinks he’s an asshole, and McCain is likely no exception. So, faced with the prospect of reviewing hundreds to thousands of pages of returns they couldn’t understand anyway, for a guy they had no intention of choosing, they probably just punted and went with the obvious choice: Sarah Palin. Which, by the way, proves just how penetrating their vetting process was.

 

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Mitt’s plans

Tuesday, July 17, 2012

I understand that focus groups have refused to believe that anyone running for president would actually take the positions that Romney has taken. That’s one of the reasons, of course, that Republicans (e.g., Linda McMahon) try so hard not to tell anyone what they will do if elected. Better to spout banal talking points. But I digress. I doubt that the group was even told about this, but I’m fairly certain they would not have believed it had they heard it:

The plan Romney has endorsed would change the US tax system to one of territorial taxation. That means that foreign income from US multinationals would be exempt from US taxation. While this seems intuitive, it would turn every country in the world into a foreign tax haven, and encourage US companies to book profits abroad and abandon the US. As Clausing says, this is justified with a bit of legerdemain:

Advocates of a territorial system argue that because many of our trading partners have moved to a territorial system, we need to follow if our multinational corporations are to remain competitive. Yet most countries with territorial systems have hybrid versions of territoriality that are far different from the version being suggested for the United States. Those hybrid systems include tough antiabuse provisions that discourage the shifting of income and employment to low-tax havens; the result is often a higher tax on foreign income than applies in the United States.

In other words, you can move to territorial taxation with these other controls and discouragements; but that’s not the plan on offer. Instead, the plan is to turn loopholes into freeways for Mack trucks. In fact, other countries’ territorial taxation regimes typically tax profits from tax havens which offer drastically lower tax rates.

(via FDL News Desk)

The idea, of course is to create a world where no corporation goes taxed. Now, the Romneybots justify this by arguing, as noted above, that we really must keep up with the rest of the world, except, it need hardly be said and therefore it is not, for those antiabuse provisions which smack of regulation. Among other things, it’s funny how we are often advised to follow foreign examples, except in those cases, such as health care, in which doing so would benefit the common person. Then, the USA is number one by definition, and following the example of the foreigner is unpatriotic.

 

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