Courtesy of the Huffington Post we learn that the structure of health care "reform", as the White House is planning it:

  • Will increase demand for name-brand drugs, therefore giving the industry an artificial (read as: protectionist) leg up on the generic competition.
  • Will generally degrade or attack the government’s ability to use the vast Medicare market share to bargain for lower bulk rates on name-brand drugs.
  • Will provide a net gain to the pharmaceutical industry, assuming renewed economic growth nationally, to the tune of nearly 140 billion dollars.

Take that last bullet point first. The White House this year made great noise as to how Obama had taken on the pharmaceutical industry and gotten 80 billion dollars in concessions from the industry over the next ten years. They used this talking point as a club against progressive critics who accused Obama of coddling big business at the expense of the public. What we learn now is that the drug industry has apparently arranged a profit of billions per year in reality, over that same time span.

Where does that profit come from? Payments for drugs, of course. And who pays for the drugs? Well, either you and I, through our corporate insurance product premiums with corresponding "co-payments", or you and I, through our tax money. In other words, the Obama administration has arranged a net loss to the public of billions of dollars per year going from our pockets to those of insuracrats. The "reform" of pharmaceutical coverage is a wealth transfer scheme that makes the middle and working classes poorer so that wealthy people get richer. From our illnesses and disease.

Now consider the first two bullet points above. Our government regardless of party in power loves to trumpet the virtues of "free markets" and "free trade", at least when it comes to the prerogatives of big business to send American middle-class jobs to Bangalore, or to attack collective bargaining rights.

But the moment that the corporate pharmaceutical industry determines that it is threatened by generic competition in drugs … "free markets" go out the door. In comes protectionism. Between the patent monopolies that people like Jane Hamsher (or even noted economists like Dean Baker) have been raising the alarm on, and policies like these emerging from the US Congress and the White House under Democratic Party control, the US government aggressively protects the wealth of the figures at the top of the pharmaceutical industry.

Of course, if the pharmaceutical industry wants to outsource all its manufacturing jobs to Lower Boliquador, this is fine with the Democrats, the Republicans, the Congress, the White House. Jobs outsourcing is OK. That is the "free market" at work.

What the Democrats, the Republicans, the Congress, and the White House won’t allow is effective outsourcing of corporate and shareholder profits or executive salaries and bonuses.

You get the point, I am sure.

Seymour Friendly

Seymour Friendly

Quasi-leftist Seattle resident, which is kind of like saying "wet rain". There ain't no dry kind of rain ...