McKinsey to pay $573M to settle claims over opioid crisis role: source • Hacker News Board

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#461

Post by leafmeal » Thu, Feb 04, 2021, 11:42 PM UTC

crumbshot wrote: post #326

This is far too low. A fine large enough to destroy the company (as was effectively done to Purdue) would have been the only palatable outcome. And even more importantly, legal repercussions for all their employees who were personally responsible for this. All this settlement achieves is 'a cost of doing business', as they say. It's not punishment or deterrence. McKinsey and other companies like them will do similar…

From the New York Times article, "The amount McKinsey is paying is substantially more than it earned from opioid-related work with Purdue or Johnson & Johnson, Endo International and Mallinckrodt Pharmaceuticals, its other opioid-maker clients, a person involved in the settlement negotiations said"

To me, "a cost of doing business" implies that they're making more money than it costs them. Here at least, that doesn't seem to be the case. So while this may not have been sufficient for retribution, I think it's easy to make the case that this will be a pretty good deterrent.

Consulting companies will start to realize that they can be liable for the advice the give.

https://www.nytimes.com/2021/02/03/business/mckinsey-opioids...

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#462

Post by minikites » Thu, Feb 04, 2021, 11:43 PM UTC

nitrogen wrote: post #440

minikites wrote: post #382

Earlier quoted context omitted.

>If big companies face no consequences, then our society will fall apart. It currently is and I don't see any sign of it stopping. The foundation was laid in the 80s, the roof fell in on January 6th, and the Democrats don't have enough of a spine to actually fix the problem because Republicans keep calling them mean names.

The fault in our society is not that one party is bad and the other party it's good, it's that both parties think that about each other and believe a whole bunch of distortions based on the extremes of either party. Rs think Ds are destroying our society just as much as Ds think Rs are doing the same. Both sides are vilifying Is for not taking enough of a stand on The Issues That Will End The World TM. The only way o…

Do you really think both sides are the same? Do you really think if Biden loses in 2024 he would call upon his supporters to attack the government? Do you really think that even if Biden did do this, that he would find dozens of supporters in Congress? Sometimes one side really is worse and acting enlightened by saying "both sides are the same" is becoming increasingly comical as empirical evidence continues to mount showing that they are not. Trump is the first American president to not peacefully transfer power and he continues to have significant Republican support today.

>The only way out is to fix that mutual misunderstanding, and to stop destroying the neutral space where that misunderstanding can be mended.

Who do you think destroyed this neutral space? Do you genuinely think both sides are equally at fault for destroying it?

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#463

Post by ergocoder » Thu, Feb 04, 2021, 11:43 PM UTC

gnulinux wrote: post #401

minikites wrote: post #360

Earlier quoted context omitted.

If big companies started facing consequences for their actions our economy would fall apart.

So let's allow all big companies to do whatever the fuck they want, because otherwise "our economy would fall apart"? This is the darkest comment I read on HN.

I don't think we should fine the company. It should be the execs who signed off serving time in prison instead.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#464

Post by leafmeal » Thu, Feb 04, 2021, 11:44 PM UTC

humaniania wrote: post #460

crumbshot wrote: post #326

This is far too low. A fine large enough to destroy the company (as was effectively done to Purdue) would have been the only palatable outcome. And even more importantly, legal repercussions for all their employees who were personally responsible for this. All this settlement achieves is 'a cost of doing business', as they say. It's not punishment or deterrence. McKinsey and other companies like them will do similar…

Justice was not done in the case of Purdue. The Sackler family absconded with billions. They still need to be held to account.

Here's a fascinating article about the Sackler family and how deluded they are about the whole thing https://www.newyorker.com/news/our-columnists/the-sackler-fa...

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#465

Post by londons_explore » Thu, Feb 04, 2021, 11:46 PM UTC

humaniania wrote: post #460

crumbshot wrote: post #326

This is far too low. A fine large enough to destroy the company (as was effectively done to Purdue) would have been the only palatable outcome. And even more importantly, legal repercussions for all their employees who were personally responsible for this. All this settlement achieves is 'a cost of doing business', as they say. It's not punishment or deterrence. McKinsey and other companies like them will do similar…

Justice was not done in the case of Purdue. The Sackler family absconded with billions. They still need to be held to account.

It does seem a rather gaping hole in our legal/finance system that it's possible for a company to do a risky thing where the upside will occur soon, yet the downside will be delayed many years. Then the shareholders of the company can take out all the profits of the upside, walk away with all the cash and declare the company bankrupt when the downside happens.

I think the only proper fix would be to disallow companies from going bankrupt - ie. if a company has unpaid debts, the shareholders must pay them, and the share price can become negative. That forces everyone to build such risks into their models from the start, and company directors will be discouraged from taking such risky bets.

Other similar financial instruments exist - like stock shorts, futures contracts, lloyds names, etc.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#466

Post by ClumsyPilot » Thu, Feb 04, 2021, 11:46 PM UTC

minikites wrote: post #445

bcrosby95 wrote: post #392

Earlier quoted context omitted.

I agree, but I'm not really sure what that has to do with this: > If big companies started facing consequences for their actions our economy would fall apart.

There are enough large companies who have committed misdeeds worthy of major consequences that if we actually punished all of them in a meaningful way, the economy would fall apart, because there would not be many companies left.

on the contrary, it would create opportunity for actually well-run businesses that benefits the customer to take their place

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#467

Post by bumby » Thu, Feb 04, 2021, 11:47 PM UTC

lostcolony wrote: post #442

bumby wrote: post #434

Earlier quoted context omitted.

> what's the concern? I think the concern is there may not be enough “ambitious” people to maintain productivity to sustain the non-ambitious folks. Thinking back to a previous job that most people would probably assume employees incredibly driven people, I can honestly say many were not. Hours wasted on long lunches/breakfasts/breaks, surfing the Internet for auctions, bouncing from office to office for hours to gos…

Your example kind of makes my point? Those people you mention...how much were they really adding to the org? If a company is happily paying white collar worker wages to people who are that big a waste of space, why not pay them $20k in UBI and let them go, $20k to someone who needs it, and not waste everyone's time? Let those people have the safety net necessary to find themselves, so to speak. Worst case is they sta…

If they were fired, their net utility can go to zero. I may not think they are worth their wage, but they are still providing some marginal value. Not having a slow morphine drip of money is all that seems to keep them providing any value whatsoever.

>Worst case is they stay on and we're in the same situation we're in now

I think I disagree with this. Similar to point above, they can go from providing a marginal amount of value to justify being a net negative on the balance sheet by staying home and collecting UBI. Ideally, they will find a way to contribute to society but I’m not convinced many or most would, given anecdotal observations. I’m not taking some Randian stance here, but I can at least imagine a scenario where there are more takers than providers because it’s the easier path and we seem wired to prefer to minimize personal costs. I don’t think it’s a situation where there’s next to no downside as you suggest.

Most game theory seems to devolve when freeloading is not kept in check. With all the talk about the benefits of UBI, I hear very little about checks and balances if it doesn’t work. I’m currently in favor of it but would like to see a bit more due diligence in terms of guardrails

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#468

Post by nitrogen » Thu, Feb 04, 2021, 11:54 PM UTC

eggsmediumrare wrote: post #455

nitrogen wrote: post #440

Earlier quoted context omitted.

The fault in our society is not that one party is bad and the other party it's good, it's that both parties think that about each other and believe a whole bunch of distortions based on the extremes of either party. Rs think Ds are destroying our society just as much as Ds think Rs are doing the same. Both sides are vilifying Is for not taking enough of a stand on The Issues That Will End The World TM. The only way o…

I agree with the sentiment, but it's also not helpful to lay blame equally. It's pretty obvious that the Republican party and their peripherals (fox news, et al) have caused way more damage than the Democrats. (Not to say that the problems in our society can be distributed fully between those two groups).

It's pretty obvious that the Republican party and their peripherals (fox news, et al) have caused way more damage than the Democrats.

Obvious to whom, and damage to whom? Even those are things we need to work to restore a common view on. Even if you're right (and w.r.t. Fox News it'd be hard to be wrong), based on those I know who vary from middle left to far right, apportioning partisan blame, and blame in general, is just not going to be a productive way to frame the path forward. Maybe we need to take a breather, ignore who said what and why, and just look at where we really are, where we think we're going, and what we (as people, not as groups or parties or labels) can mutually agree to do to improve where we're going, and to find more common ground where we disagree on the fundamentals.

There are far too many things for just a few of us in a single HN thread to solve, of course, and I suppose proposing that we "elites" "solve" them is one of the things that contributes to the coastal/inland left/right rift. But every time I feel compelled to comment on a political discussion on HN, I'm still going to try (and occasionally fail) to keep searching for a way out, rather than just adding to the volume of what already exists, and encourage everyone who reads this to do the same. We know there is pain, we know there are voices to be heard. Now we need to use that pain to come together instead of to break apart. If we can find ways to do this on HN, maybe we can spread that to all the other communities we are part of.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#469

Post by jessaustin » Thu, Feb 04, 2021, 11:55 PM UTC

nitrogen wrote: post #440

minikites wrote: post #382

Earlier quoted context omitted.

>If big companies face no consequences, then our society will fall apart. It currently is and I don't see any sign of it stopping. The foundation was laid in the 80s, the roof fell in on January 6th, and the Democrats don't have enough of a spine to actually fix the problem because Republicans keep calling them mean names.

The fault in our society is not that one party is bad and the other party it's good, it's that both parties think that about each other and believe a whole bunch of distortions based on the extremes of either party. Rs think Ds are destroying our society just as much as Ds think Rs are doing the same. Both sides are vilifying Is for not taking enough of a stand on The Issues That Will End The World TM. The only way o…

Both parties are bad because only bad parties can succeed in our bad system. Also because they're basically identical. They are ants contending over a postage stamp, on a continent of political possibility. The only thing we can expect them to do is what they've already been paid by lobbyists to do before. That's why CARES Act is more of the same, except worse, that we already saw in the 2008-9 "bailouts". The next time most Americans suffer some easily foreseeable disaster, we can be sure that billionaires will feast even more and regular people will be helped even less.

There's no logical reason to be fighting seven wars, having 5% of the world's population but 25% of its prisoners and 20% of its covid deaths... and 800 billionaires. Our polity is shit. We're not in a local maxima. Literally any possible change would be for the better. The system we have cannot be changed via the methods it allows, however. Juvenile pleas for understanding only prolong our misery.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#470

Post by yowlingcat » Thu, Feb 04, 2021, 11:57 PM UTC

Terretta wrote: post #28

tharne wrote: post #4

Too bad they can't be sued for ruining countless businesses with mindless self-serving "advice" meant to do nothing more than get their contracts re-upped. The whole business is a scam built around sending in some 26 year-old with an Ivy League degree and $100 haircut to regurgitate snippets from articles in HBR.

Once you realize the game is “management” in collusion on both (a) outsourcing the reading of the HBR articles so they don’t have to, and (b) what I call “decision insurance” (“but our consultants confirmed this made sense!”) so decision accountability is laundered, everything makes much more sense. In mega enterprises the CEO matters a lot, but the next 3 or 4 layers often exist primarily to filter and spin bad news…

> In mega enterprises the CEO matters a lot, but the next 3 or 4 layers often exist primarily to ... diffuse accountability

It took me a while before I understand the political side of how this works. For a while, the biggest question in my head was what the CEO gets out of the whole transaction -- the manager intuitively gets power vis-a-vis proximity, but what does /their/ manager get out of it?

I think this confusion wears off the first time you see a sacrifice in management made. That's when you start being able to see how the value chain which is attached to that confidence default occur. Then it becomes completely rational that decision insurance is priced into both the manager's internal calculus and that of the corporation.

The problem with running a company this way is that "your margin" eventually becomes "my opportunity" and that transition gets especially jerky in a frothy market like the one we have now. Do you really need the layers of middle management there, at all? If someone raised a boatload of cheap capital and rebuilt the high margin bigmoat stuff from scratch, would they out-execute you?