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February 14th, 2019 at 5:08 pm
Want to Address Drug Costs? Avoid Price Controls, Eliminate PBMs and Don’t Weaken Patents
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In an excellent piece in today’s Wall Street Journal, Scott Atlas of Stanford University highlights how Americans enjoy far greater access to new lifesaving drugs than patients in Europe and elsewhere, and how the movement to impose government price controls would only restrict access to new drugs and degrade Americans’ health outcomes, as we at CFIF have been emphasizing:

America has superior treatment results for virtually all serious diseases reliant on drug treatment, including cancer, heart disease, stroke, high blood pressure and diabetes.  Price controls would jeopardize that advantage…

Pegging drug prices to those of foreign countries, as both Bernie Sanders and Donald Trump have proposed, would ultimately lead to the same consequences Europeans endure – reduced access to critical drugs and worse outcomes, including more deaths from disease.”

Mr. Atlas also notes how the Trump Administration has taken positive steps toward actually reducing drug prices, by targeting rebates received by pharmacy-benefit managers (PBMs) from drug manufacturers:

The Trump Administration has announced a proposal to do away with rebates paid by drug manufacturers to pharmacy-benefit managers, replacing them with discounts to beneficiaries at the point of sale.  PBMs are middlemen that control ‘formularies,’ the lists of drugs covered by a plan.  Rebates from drug companies to PBMs are payments for influence – either to position a drug on the formulary as ‘exclusive’ or to give it preferred status over competitors.

PBMs act counter to patient interest while aggravating the lack of price transparency.   These complex behind-the-scenes payments – $179 billion in 2016 – reward inflated list prices, on which patient premiums are often based.  This prevents patients from taking account of price…  Go-betweens like PBMs should be eliminated.”

Finally, and just as critically, Mr. Atlas adds that weakening patent and intellectual property (IP) rights would constitute a particularly destructive course:

Drugs are the most significant reason for the past half-century’s unprecedented gains against deadly disease.  But policies that aim to reduce drug prices – price regulation and weaker patent protection – are also associated with delayed availability, less innovation, and limited access.”

Mr. Atlas delves into statistics showing the enormous advantage that Americans enjoy in terms of new drugs and health outcomes, and his piece is well worth the full read.  Hopefully policymakers at all levels of government are listening.

February 12th, 2019 at 7:06 pm
Image of the Day: Bad News, Socialized Medicine Advocates
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Bad news, socialized medicine advocates.  The latest Gallup survey on the issue shows that Americans still overwhelmingly rate their healthcare as positive.

Notably, ratings have improved since Donald Trump replaced Barack Obama, and began chipping away at ObamaCare.

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Bad News, Socialists

Bad News, Socialists

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Socialized medicine advocates thus have their work cut out for them in selling their program to the American electorate.

 

 

February 8th, 2019 at 10:10 am
New York Agrees That a T-Mobile/Sprint Merger Would Serve the Public Interest
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Well, that didn’t take long.

Yesterday, the New York State Public Service Commission approved the proposed T-Mobile/Sprint merger as “in the public interest” after considering all of the relevant facts and competing arguments.

As CFIF and others have emphasized since the proposed merger’s announcement, the transaction would provide an enormous net benefit to the American economy and consumers, and there’s simply no reason for needless delay or misplaced opposition from federal, state or local governments.  In terms of faster 5G transition in the U.S., more jobs, more private telecommunications investment, greater market competition, broader nationwide coverage for consumers, capacity improvements, performance improvements and lower prices (as we highlighted just yesterday), this merger is a no-brainer.

Importantly, among other benefits to the public that we’ve emphasized, the New York Commission yesterday noted how the merger would result in a new entity whose whole would be greater than the sum of its current parts:

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[T]he Petitioners have addressed concerns related to the broader issues raised by others in this case…  In response to claims that T-Mobile and Sprint would have built 5G networks in any case, the Petitioners assert that the new T-Mobile will be able to build a larger, more robust network in a more timely fashion, than either of the two companies on their own.”

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We at CFIF applaud the Commission’s common-sense finding, and hope that other authorities will demonstrate similar rationality.  In particular, next week the House Judiciary and Energy & Commerce Committees will hold a joint hearing on the proposed merger.  As Energy & Commerce Committee Chairman Frank Pallone, Jr. (D – New Jersey), Judiciary Committee Chairman Jerrold Nadler (D – New York), Communications & Technology Subcommittee Chairman Mike Doyle (D – Pennsylvania) and Antitrust, Commercial & Administrative Law Subcommittee Chairman David Cicilline (D – Rhode Island) explicitly stated in their joint announcement, “We look forward to examining this merger from the perspective of what is in the best interest of consumers and hardworking people.”

Well, New York authorities examined that same question yesterday, and the answer was obvious in the affirmative.

 

February 7th, 2019 at 7:20 am
Proposed T-Mobile/Sprint Merger Already Bearing Fruit
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For months since its announcement, CFIF has enthusiastically supported the proposed T-Mobile/Sprint merger, based upon the myriad benefits that it offers the American economy and consumers.

Among those benefits, lower consumer prices stand among the most prominent.  Well, that prospective benefit is already coming to fruition.

Specifically, in a letter this week to the Federal Communications Commission (FCC), T-Mobile Chief Executive Officer John Legere committed to maintaining “the same or better rate plans” for the next three years as the merger occurs:

Critics of our merger … have principally argued that we are going to raise rates right after the merger closes.  I want to reiterate, unequivocally, that New T-Mobile rates are NOT going to go up.  Rather, our merger will ensure that American consumers will pay less and get more…                   

If we broke faith by raising rates and cutting back benefits, we would lose our loyal customers and destroy the future of our brand.  I want to assure you that we would never do this.  My management team and I can make this personal commitment because we believe in delivering on our promises, and we k now if we do not, we will lose credibility and the trust of our customers.  Our business plan and our future success are centered around building a world class 5G network for everyone and delivering more to consumers for less.                     

To remove any remaining doubt or concerns about New T-Mobile’s prices while we are combining our networks over the next three years, T-Mobile today is submitting to the Commission a commitment that I stand behind – a commitment that New T-Mobile will make available the same or better rate plans for our services as those offered today by T-Mobile or Sprint.  We believe this merger makes consumers better off, and we’re willing to put our money where our mouth is.  Period.

Of course, that’s not the only benefit to the American economy and consumer marketplace, as we’ve detailed.

Among other important improvements, the T-Mobile/Sprint merger would add another major competitor to the existing marketplace, and combine their current differing but complimentary assets.  The result will be more jobs, faster wireless, quicker transition to 5G technology in America, more choices for consumers, greater private telecommunications investment and all of the consequent innovation that market competition entails.

Nevertheless, the fact that the benefits to American consumers in terms of pricing are already arriving confirms the soundness of this proposed merger.

It’s certainly something for the House Judiciary and Energy & Commerce Committees must acknowledge at their joint hearing next week.  The alternative to a T-Mobile/Sprint merger is less investment, fewer jobs, less market competition, more harmful government intervention into the economy, slower 5G deployment and one fewer competitive market participant.

That’s simply an unacceptable and indefensible alternative.

February 4th, 2019 at 2:31 pm
This Week’s “Your Turn” Radio Show Lineup
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Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CST to 6:00 p.m. CST (that’s 5:00 p.m. to 7:00 p.m. EST) on Northwest Florida’s 1330 AM/99.1FM WEBY, as she hosts her radio show, “Your Turn: Meeting Nonsense with Commonsense.” Today’s guest lineup includes:

4:00 CST/5:00 pm EST: Dr. Robert McNab, Professor at Old Dominion University – Improving Rural Broadband Access;

4:15 CST/5:15 pm EST: Devin Watkins, Attorney at the Competitive Enterprise Institute – California’s Soda Labeling Ban;

4:30 CST/5:30 pm EST: Nicole Kaeding, Director of Federal Projects at the Tax Foundation – Senator Warren’s Wealth Tax;

4:45 CST/5:45 pm EST: Riley Walters, Policy Analyst, Asia Economy and Technology at The Heritage Foundation – Trade Deal with China;

5:00 CST/6:00 pm EST: Max Eden, Senior Fellow at the Manhattan Institute – School Safety, Leniency Programs, and Governor Ron DeSantis’ Plans for “Guardian” Money;

5:15 CST/6:15 pm EST: Greg Brown, Santa Rosa County Property Tax Appraiser – Latest News and Updates; and

5:30 CST/6:30 pm EST: Timothy Lee, CFIF’s Senior Vice President of Legal and Public Affairs – Free Speech and Economic Freedom.

Listen live on the Internet here.  Call in to share your comments or ask questions of today’s guests at (850) 623-1330.

February 1st, 2019 at 3:21 pm
Proposed T-Mobile/Sprint Merger Would Be a Win for American Consumers
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On February 13, the House Judiciary and Energy & Commerce Committees will hold an important joint hearing on the proposed T-Mobile/Sprint merger that promises greater innovation, more jobs, more private telecommunications investment, increased market competition, faster wireless and greater choice for consumers as America proceeds toward our much-anticipated 5G technological rollout.

Energy & Commerce Committee Chairman Frank Pallone, Jr. (D – New Jersey), Judiciary Committee Chairman Jerrold Nadler (D – New York), Communications & Technology Subcommittee Chairman Mike Doyle (D – Pennsylvania) and Antitrust, Commercial & Administrative Law Subcommittee Chairman David Cicilline (D – Rhode Island) state in their joint announcement that, “We look forward to examining this merger from the perspective of what is in the best interest of consumers and hardworking people.”

Well, the answer to that question is clear.

Compared to the current telecommunications marketplace, the T-Mobile/Sprint merger will mean an enhanced array of consumer services.  Sprint and T-Mobile currently possess differing but symbiotic assets, rather than overlapping ones that might otherwise simply mean a bigger company instead of two smaller (and less competitive) ones.  As a result, the new entity would create a new network with broader nationwide coverage, capacity improvements and improved wireless performance for customers compared to what American consumers currently enjoy.  As has been exhaustively demonstrated by CFIF and others, the proposed merger also promises lower costs for consumers, new jobs and necessary network upgrades.

In particular, the proposed merger offers significant potential benefits through deployment of the first 5G wireless network in the U.S., as CFIF has noted:

With an anticipated $40 billion investment in 5G, consumers will enjoy data delivery at a lower cost, and the incentive for competitors to similarly lower prices to consumers.  That will also prompt market competition to expand spectrum in rural areas in addition to urban centers, as well as capacity improvements for consumers.           

That’s how market competition works.  A T-Mobile/Sprint merger and its 5G deployment would also mean billions in new private infrastructure investment and countless new jobs.  In contrast, the absence of a T-Mobile/Sprint merger would mean slower deployment of a 5G nationwide network, and the absence of a market competitor of greater scale.  Ultimately that means consumers would lose.

There is simply no point in needless delay or contentiousness when the House Judiciary and Energy & Commerce Committees convene on February 13.  The proposed Sprint/T-Mobile merger offers only benefits to American consumers compared to the existing status quo.  The Committees must recognize that reality, lest we pay an unnecessary price in terms of slower 5G, fewer consumer choices, fewer jobs, less investment and less market competition.

 

January 28th, 2019 at 3:06 pm
Image of the Day: New Jobless Claims Plummeting
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Last week, new jobless claims fell below the milestone 200,000 level, and to the lowest point since the 1960s (when the labor force was significantly smaller).   In this chart, note also the steep drop starting in 2017 with the tax-cutting and deregulatory agenda that arrived with the Trump Administration, after the number of new claims had plateaued toward the end of the Obama Administration:

Jobless Claims Plummet

Jobless Claims Plummet

 

 

January 25th, 2019 at 11:48 am
Notable Quote: American Incomes Versus Supposedly Superior European Counterparts
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The myth of superior livelihoods in supposedly more enlightened European nations remains a curiously persistent one, but Mona Charen’s latest commentary today provides a refreshing corrective:

Median household income reached $61,372 in 2017, which is higher than comparable countries like Canada, Germany, France, Britain and Denmark, and exceeded only by a handful of tiny rich nations sitting on oil (Norway) or numbered bank accounts (Switzerland and Lichtenstein).  U.S. median household size, meanwhile, has declined, so individual wealth has increased even more than the income numbers reflect.”

Something to remember the next time Bernie Sanders or latest leftist darling Alexandria Ocasio-Cortez alleges that “democratic socialist” nations of Europe somehow offer a superior alternative, nevermind that Venezuela actually offers a better illustration of socialism in practice…

January 21st, 2019 at 3:08 pm
This Week’s “Your Turn” Radio Lineup
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Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CST to 6:00 p.m. CST (that’s 5:00 p.m. to 7:00 p.m. EST) on Northwest Florida’s 1330 AM/99.1FM WEBY, as she hosts her radio show, “Your Turn: Meeting Nonsense with Commonsense.”  Today’s guest lineup includes:

4:00 CST/5:00 pm EST:  Hans von Spakovsky, Manager, Election Law Reform Initiative and Senior Legal Fellow, Meese Center for Legal and Judicial Studies – William Barr Hearings and Trump’s Former Lawyer Michael Cohen;

4:15 CST/5:15 pm EST:  Clark Neily, Vice President for Criminal Justice at the Cato Institute: SEC and Gag Orders;

4:30 CST/5:30 pm EST:  Michael Bindas, Senior Attorney with the Institute for Justice – Privileges or Immunities Clause of the 14th Amendment;

4:45 CST/5:45 pm EST:  Romina Boccia, Director, Grover M. Hermann Center for the Federal Budget at The Heritage Foundation – Economic Impact of the Government Shutdown;

5:15 CST/6:15 pm EST:  Jennifer Grove, Vice President of External Relations for Baptist Health Care and Development Chair for Leadership Florida – It’s Time to Apply to Leadership Florida; and

5:30 CST/6:30 pm EST:  Sally Pipes, President and CEO, Thomas W. Smith Fellow in Health Care Policy at the Pacific Research Institute – Medicaid Expansion.

Listen live on the Internet here. Call in to share your comments or ask questions of today’s guests at (850) 623-1330.

January 18th, 2019 at 6:52 pm
Image of the Day: Higher Top Income Tax Rates Don’t Mean Increased Revenues
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In our Liberty Update this week, we highlight how history refutes the idea that returning to top income tax rates of 70% or higher, offered by new faces on the political left like Alexandria Ocasio-Cortez, will somehow pay for all of the new entitlement spending they advocate.  Wealthier taxpayers actually carried a smaller share of the nation’s income tax payments before the top marginal rate was cut.  And, as illustrated nicely by Veronique de Rugy and the great folks at the Mercatus Center, it won’t unleash some wellspring of new tax revenues that leftists might hope in any event:

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Sorry, Leftists

 

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January 15th, 2019 at 11:31 am
Drug Price Controls Would Kill Innovation
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We at CFIF have been emphasizing the threat posed by new drug price controls inexplicably contemplated by the Department of Health and Human Services (HHS).  In December, CFIF filed formal Comment opposing that ill-advised proposal, and hopefully wiser minds will prevail before the damage is done.  In similar vein, The Wall Street Journal ran a welcome commentary entitled “The Drug Price-Control Threat” on January 8 of this year, and a followup letter from reader Bruce Zessar of Highland Park, Illinois in today’s edition offers a personal, real-world illustration of what could be lost:

Insulin isn’t the same now as when it was discovered a century ago.  My wife is a Type I diabetic, diagnosed when she was 14 in 1980.  She has been a beneficiary of the tremendous advances in insulin therapy during the last four decades, including Lantus and Humalog.  When we got married in 1990, she had to live on a rigid schedule, eating lunch at, say, noon, and then dinner by 6:30-7:00 every day.  That’s becaue of the way prior insulin therapies worked in managing blood sugar.  With the invention of Lantus and Humalog, she can now live a normal life like everyone else.

Insulin is a shining example of why drugs deserve the utmost patent protection to encourage continual innovation.”

Price controls have never worked in any nation that has tried them, or with any commodity.   Few, if any, products are as important to our lives as America’s world-leading pharmaceutical sector, and we mustn’t let the price control scheme contemplated by the HHS kill the goose that continues to lay golden eggs.

December 13th, 2018 at 10:05 am
Notable Quote: Israel’s Right to Exist
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In a brilliant primer entitled “Refute Palestinian Lies to Promote Mideast Peace” in The Wall Street Journal, Max Singer refutes a persistent myth that the United States must work to refute:

[D]espite widespread use of the term in diplomatic documents and debate, there is no such thing as ‘occupied Palestinian territory’ because there has never been a Palestinian territory to occupy.  As some Palestinians point out, they have never had a state of their own.  This is far more than a game of semantics.  If the land was Palestinian, then Israel could have stolen it.  If the land isn’t Palestinian, then Israel couldn’t have stolen it.  It’s critical that the U.S. actively combat the falsehood that Israel exists on stolen Palestinian land.”

 

November 30th, 2018 at 9:28 am
Image of the Day: So U.S. Manufacturing Wasn’t Dead After All
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People like Barack Obama, rationalizing his unsatisfactory economic stewardship, assured us that manufacturing was a thing of the past, and not coming back.  Well, a funny thing happened following his departure:

 

Barack Was Wrong

Barack Was Wrong

November 26th, 2018 at 5:04 pm
This Week’s “Your Turn” Radio Show Lineup
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Join CFIF Corporate Counsel and Senior Vice President Renee Giachino today from 4:00 p.m. CDT to 6:00 p.m. CDT (that’s 5:00 p.m. to 7:00 p.m. EDT) on Northwest Florida’s 1330 AM WEBY, as she hosts her radio show, “Your Turn: Meeting Nonsense with Commonsense.” Today’s guest lineup includes:

4:00 CDT/5:00 pm EDT: Ilya Shapiro, Senior Fellow in Constitutional Studies the Cato Institute and Editor-in-Chief, Cato Supreme Court Review – SCOTUS Happenings;

4:15 CDT/5:15 pm EDT:  Ana Quintana, Senior Policy Analyst, Latin America and the Western Hemisphere, The Heritage Foundation – The Migrant Caravan;

4:30 CDT/5:30 pm EDT:  Carrie Severino, Chief Counsel and Policy Director of the Judicial Crisis Network – Judicial Nominations in the Senate;

4:45 CDT/5:45 pm EDT:  Phil Kerpen, President of American Commitment – President Trump’s Unfilled Presidentially Appointed Positions;

5:00 CDT/6:00 pm EDT:  Craig Rucker, Executive Director, Co-Founder for a Committee For A Constructive Tomorrow (CFACT) – COP 24, The UN Conference on Climate Change;

5:15 CDT/6:15 pm EDT:  Raheel Raza, Clarion Project Advisory Board Member and Founding Member of the Muslim Reformer Movement – Khashoggi Affair and Saudi Arabia-U.S. Relations; and

5:30 CDT/6:30 pm EDT:  William J. Conti, Partner at Baker & Hostetler: Inside Washington – the Trump/Roberts Exchange and the Judiciary and Pelosi/Democrat Leadership Elections.

Listen live on the Internet here. Call in to share your comments or ask questions of today’s guests at (850) 623-1330.

November 19th, 2018 at 11:14 am
Quote of the Day: John Stossel On the Dangers of Government Drug Price Controls
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In our recent weekly Liberty Update commentary entitled “On Pharmaceuticals, HHS Contemplates Disastrous New Price Controls,” we explain how government price controls undermine intellectual property (IP) rights, stifle American innovation and ultimately punish consumers in the form of fewer new pharmaceuticals.  We therefore encourage the Trump Administration to rethink a toxic new proposal along those lines, and instead pursue a course more in accord with its generally excellent stewardship of our economy and markets to date.

In his latest weekly commentary entitled “Not Healthy to Be Naive,” John Stossel agrees, and in a nice blurb explains the real-world consequences of drug price controls:

[G]overnment-run systems save money by freeloading off American innovation.  American drug companies, funded by American customers, fund most of the world’s research and development of pharmaceuticals.  New drugs and devices are expensive, so sometimes in Britain, says Pope, ‘whenever a new drug comes on the market that can save lives, the government just doesn’t have the funds to pay for it.’

Patients, accustomed to accepting whatever government hands out, don’t even know about the advances available elsewhere.  Single-payer systems also save money by rationing care.  Hence the long waiting times for treatments declared ‘nonessential’ in Canada, Britain and, for that matter, at American veterans hospitals.”

Hopefully, the Trump Administration is listening and corrects course.

November 9th, 2018 at 9:16 am
Image of the Day: Meanwhile, On the Economy…
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While attention can be distracted by shiny objects elsewhere, a nice new illustration of the U.S. economy’s revitalization beginning in 2017, as the procession of deregulation and tax-cuts revitalized an economic cycle previously on weary legs:

An Economic Surge

An Economic Surge

 

October 30th, 2018 at 12:00 pm
Image of the Day: Under Trump, the Poor Get… Richer
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From the U.S. Senate Joint Economic Committee, a stark illustration of the sharp increase in wage and salary growth for full-time employees in the bottom 10% of earners:

The Poor Get Richer

The Poor Get Richer

 

 

October 25th, 2018 at 2:09 pm
HHS Prepares to Commit Unforced Error On Drug Price Disclosure Mandate
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Healthcare costs, including pharmaceutical costs, remain a legitimate concern.  But the Trump Administration Department of Health and Human Services (HHS) is about to commit a needless unforced error.

The issue in question is an effort to force pharmaceutical companies to announce “list price” of drugs that they advertise.

A similar effort was recently introduced as legislation in Congress by Senator Dick Durbin (D – Illinois), which is itself proof of the wrongfulness of the idea.  A coalition of conservative and libertarian voices, including CFIF, stopped Senator Durbin’s effort.  But for some reason the HHS announced intent to impose the mandate via regulation, reminiscent of Barack Obama’s “pen and phone” manner of presiding.

Here’s why this is a terrible idea.

First, a drug’s “list price” is more likely to confuse consumers than enlighten them.  The reason is that what consumers actually pay for a drug is almost always very different, and much lower, than its list price.  Most patients’ drugs are subsidized by co-pays or co-insurance programs, whether via Medicare, Medicaid or insurance companies.  Insurance companies themselves typically don’t even pay the full list price, since they also receive various rebates and discounts from pharmaceutical sellers.  Overall, approximately 9 out of 10 consumers pay below the technical list price.  Consequently, compelling advertisers to state the list price in ads would mislead consumers into assuming that their out-of-pocket cost would be higher than they price they’d actually pay.

That hardly advances the goal of informing consumers.

An even more fundamental problem with the contemplated HHS mandate is that it would violate the First Amendment by compelling speech.

Under First Amendment free speech application, including commercial speech, courts strictly scrutinize any effort by government to force private citizens or entities to what it wants them to say.  Only where the compelled speech is purely factual and non-controversial will allow exceptions to the general prohibition against compulsory words.  As noted above, a drug’s list price doesn’t qualify as purely factual for purposes of informing consumers, because consumers rarely pay that price.  Nor does the HHS proposal qualify as non-controversial, for obvious reasons.

Accordingly, a government attempt to force advertisers to state prices that are higher than what almost all consumers actually pay can’t withstand First Amendment scrutiny, and will be struck down when challenged in court.

Finally, the HHS doesn’t even possess authority to impose this proposed mandate.  That authority under Congressional statute instead lies with the Food and Drug Administration (FDA).  Proponents of the HHS mandate assert that the Social Security Act provides a loophole to force this proposal upon the pharmaceutical market, but that too won’t withstand court scrutiny.

For all of these reasons, the HHS proposal to engage in compulsory speech, speech that isn’t even accurate or informative, is a head-scratcher.  Hopefully it will reconsider this ill-advised effort sooner rather than later, and pursue more effective ways of reducing pharmaceutical and healthcare costs.

October 22nd, 2018 at 10:19 am
Image of the Day: Tax Cuts Bring Dollars Back to the U.S.
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From our friends who do such great work at the Tax Foundation, take a look at how tax cuts have led to companies bringing back more cash to the U.S.:

Tax Cuts Spur Repatriation

Tax Cuts Spur Repatriation

October 15th, 2018 at 10:28 am
Shattering the Decade of “New Normal” Economic Sluggishness
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Consumer spending accounts for approximately two-thirds of the U.S. economy, and this helpful chart from the U.S. Senate’s Joint Economic Committee illustrates why our economy suddenly turbocharged over the past two years from its decade of sluggishness that we were told was the “new normal”:

Turbocharging the U.S. Consumer Economy

Turbocharging the U.S. Consumer Economy