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The Public Shouldn’t Pay for Drugs Twice

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Re: The Public Shouldn’t Pay for Drugs Twice

#41

Post by hakfoo »

rayiner wrote: post #15
jacknews wrote: post #5

Isn't this a deliberate model, and not only for pharma? Govt funds the risky research, and then hands the baton to competitive industry, which is good at 'finding markets', making it a product, and optimizing costs. Eg, google, amazon, etc, would not exist without the govt early (and continuing) funding of the tech their business is based on. What is then supposed to happen is that profits are taxed sufficiently, fee…

Economists broadly agree that taxing corporate profits is inefficient. From an NPR show surveying five economists across the political spectrum about what are consensus ideas in the field: https://www.npr.org/sections/money/2012/07/19/157047211/six-... (“Eliminate the corporate income tax. Completely. If companies reinvest the money into their businesses, that's good. Don't tax companies in an effort to tax rich peop…

But will that be effective too?

I guess I look at the CEOs who take a symbolic $1 salary-- they're reliant on either selling their plumped securities and other assets (at a low capital-gains tax rate) or borrowing against them (at zero tax rate) to actually cash out living expenses.

The right answer is to just nationalize profitable industries and use them as direct revenue streams. This eliminates much of the need for a formal tax-assessment (return processing, auditing, etc.) system, creating an immediate user-experience improvement and streamlining, and cuts out a lot of the opportunities to cheat. It's not like you can use creative accounting to boost your gas mileage (and reduce your spend at a state-run oil company). Not to mention the huge opportunities to manage for social/political aims (i. e. a state-run telecom will probably honour build-out commitments better than Verizon, because their jobs are all directly accountable to angry legislators)

Re: The Public Shouldn’t Pay for Drugs Twice

#42

Post by elktown »

rayiner wrote: post #35
elktown wrote: post #32

Earlier quoted context omitted.

So "heavy investment in state-owned industries just doesn't work" is actually just you drawing far-reaching conclusions over shifting economic policies and/or voting patterns. That line of reasoning doesn't even pass the most basic correlation is not causation test.

When many different societies with different political systems all try something around the same time, and all retreat from that approach a few decades later, that’s really significant real-world data. The country I’m from has socialism written into its constitution, but now is strongly neoliberal. Maybe that’s just correlation, but otherwise it has little in common with Sweden, reducing the possibility that some com…

I mean, discussions about this free-market/neoliberal political shift have been going on for a long time. To just assume state-owned industry "just doesn't work" because of that post-Soviet shift is confirmation bias on an already weak correlation.

In Sweden it's glaringly obvious that the privatizations have provided worse outcomes than before - even the free-market think-tanks are smart to avoid that subject. Unfortunately for us, they instead tend to focus on supporting voices that blame immigration for the consequences of sky-rocketing inequality. I guess they'll have to wait another decade or so before the myth building of the inherently incompetent state is on more fertile ground.

Re: The Public Shouldn’t Pay for Drugs Twice

#43

Post by jacknews »

rayiner wrote: post #15
jacknews wrote: post #5

Isn't this a deliberate model, and not only for pharma? Govt funds the risky research, and then hands the baton to competitive industry, which is good at 'finding markets', making it a product, and optimizing costs. Eg, google, amazon, etc, would not exist without the govt early (and continuing) funding of the tech their business is based on. What is then supposed to happen is that profits are taxed sufficiently, fee…

Economists broadly agree that taxing corporate profits is inefficient. From an NPR show surveying five economists across the political spectrum about what are consensus ideas in the field: https://www.npr.org/sections/money/2012/07/19/157047211/six-... (“Eliminate the corporate income tax. Completely. If companies reinvest the money into their businesses, that's good. Don't tax companies in an effort to tax rich peop…

The problem is not payroll, but shareholder dividends, capital gains and share buy-backs, and the corporate debt to pay for all of these.

Re: The Public Shouldn’t Pay for Drugs Twice

#44

Post by Arnt »

pessimizer wrote: post #19
Arnt wrote: post #18

Earlier quoted context omitted.

If that's right, shouldn't there be a flood of new companies looking to get the dollars? Is there such a flood, or at least a stream? I haven't noticed one, but I don't really try…

It's not a program to support small businesses, it's a structure to support massive companies who lobby and hire politicians and their friends and family.

In that case, shouldn't there be a flood, or at least a stream, of existing big companies setting up new subsidiaries to take advantage of this? There are many big companies with existing lobbyist divisions, deep pockets and experience in broadly similar areas. Food, cosmetics, chemicals spring to mind.

Re: The Public Shouldn’t Pay for Drugs Twice

#45

Post by rayiner »

jacknews wrote: post #43
rayiner wrote: post #15

Earlier quoted context omitted.

Economists broadly agree that taxing corporate profits is inefficient. From an NPR show surveying five economists across the political spectrum about what are consensus ideas in the field: https://www.npr.org/sections/money/2012/07/19/157047211/six-... (“Eliminate the corporate income tax. Completely. If companies reinvest the money into their businesses, that's good. Don't tax companies in an effort to tax rich peop…

The problem is not payroll, but shareholder dividends, capital gains and share buy-backs, and the corporate debt to pay for all of these.

Dividends and capital gains are taxed. Why would corporate debt be taxed?

Yes the problem is the payroll. Silicon Valley people engineers making $500k/year are the most under-taxed people in the country compared to European nations. Our corporate or capital gains taxes are unexceptional. It’s our taxes on the upper middle class—which haven’t been raised since Reagan-that are unusual. These people are the backbone of the tax base funding the welfare state in other countries.

Re: The Public Shouldn’t Pay for Drugs Twice

#46

Post by rayiner »

elktown wrote: post #42
rayiner wrote: post #35

Earlier quoted context omitted.

When many different societies with different political systems all try something around the same time, and all retreat from that approach a few decades later, that’s really significant real-world data. The country I’m from has socialism written into its constitution, but now is strongly neoliberal. Maybe that’s just correlation, but otherwise it has little in common with Sweden, reducing the possibility that some com…

I mean, discussions about this free-market/neoliberal political shift have been going on for a long time. To just assume state-owned industry "just doesn't work" because of that post-Soviet shift is confirmation bias on an already weak correlation. In Sweden it's glaringly obvious that the privatizations have provided worse outcomes than before - even the free-market think-tanks are smart to avoid that subject. Unfor…

The shift towards SOEs and back away is close to the largest scale economic experiment we have ever done on the planet. Many of these countries, particularly India and China, invested heavily in terms of political and reputational capital into the approach of a government-run economy. They had tremendous incentives to stick with a system they had assured the public was the way of the future. When the same approach is tried in everything from Scandinavian social democracies to Islamic socialist societies to Asian communist regimes, and then all of them change course after a few decades, that’s not just “confirmation bias. That’s data.

Maybe voters in Sweden and voters in India and party functionaries in China all just got some “right wing”virus at the same time. Or maybe they were reaction to the unworkability of an economic system they had tried. You know what they say: those who don’t understand history are doomed to repeat it.

Re: The Public Shouldn’t Pay for Drugs Twice

#47

Post by elktown »

rayiner wrote: post #46
elktown wrote: post #42

Earlier quoted context omitted.

I mean, discussions about this free-market/neoliberal political shift have been going on for a long time. To just assume state-owned industry "just doesn't work" because of that post-Soviet shift is confirmation bias on an already weak correlation. In Sweden it's glaringly obvious that the privatizations have provided worse outcomes than before - even the free-market think-tanks are smart to avoid that subject. Unfor…

The shift towards SOEs and back away is close to the largest scale economic experiment we have ever done on the planet. Many of these countries, particularly India and China, invested heavily in terms of political and reputational capital into the approach of a government-run economy. They had tremendous incentives to stick with a system they had assured the public was the way of the future. When the same approach is…

It's hard for me to take doubling down on "correlation is causation" seriously, especially on such an obviously multi-faceted subject, it's simply too unnuanced. Just the assertion in passing that China has supposedly moved away from SOEs could be a debate on its own.

You talk about incentives? The amount of money that has been concentrated to the wealthiest portions of society is simply staggering, even in superficially equal countries like Sweden. The privatization of state-owned industry, properties, and the welfare system has been an unprecedented goldmine for private interests. Essentially a smaller Scandinavian version of a post-USSR wealth transfer. The incentives for people in power in less democratic and/or corrupt countries is even more obvious.

The virus was the global shock-wave due to the collapse of soviet-Union? Come on. It was not like the shift to third-way social-democracy was a grassroots movement. Party politics is more fluid than voting patterns. A sentiment of "It's new times now, we need to go along with the flow" (not that dissimilar to today's politicians accepting the gig-economy, but that's another topic), rather than "we can clearly see that state-owned industry just isn't working, we have no choice but to try something new". If it actually was the latter, it would've be repeated by right-wing representatives on every political debate since the 1990, but that hasn't happened.

I'll leave it there, I think I've gotten my point across.

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