Category: reason

Hoping to preempt regulatory efforts to mandate drug price disclosures, the Pharmaceutical Research and Manufacturers of America (PhRMA) announced today new voluntary direct-to-consumer advertising principles.

Specifically, all DTC television advertising by drug companies “that identifies a prescription medicine by name should include direction as to where patients can find information about the cost of the medicine, such as a company-developed website, including the list price and average, estimated or typical patient out-of-pocket costs, or other context about the potential cost of the medicine.” In addition, drug companies will also create a new platform to provide patients, caregivers and health care providers with cost and financial assistance information for brand-name medicines. This won’t be too terribly different than the status quo, since it is actually already relatively easy to find pricing information for most drugs online.

The big announcement is a clear effort to throw a bone to politicians and bureaucrats hoping to demagogue the drug price issue in coming elections. The Trump administration and members of Congress have been calling on pharmaceutical manufacturers to reveal the prices of their drugs in their television advertising. In August, the Senate passed a bill that would have provided $1 million for the U.S. Department of Health and Human Services (HHS) to devise and issue a regulation requiring price disclosure. If implemented, the Food and Drug Administration would consider drug advertisements without prices as labeling violations.

“The pharmaceutical industry hates this bill and this amendment like the devil hates holy water. They don’t want to tell you what it is going to cost,” said Sen. Richard J. Durbin (D–Ill.) in a Senate floor speech in favor of the bill. “We are trying our very best to give the American consumers a break and perhaps to start to slow down the cost of prescription drugs.”

In September, the House of Representatives refused to pass the Senate bill, thus killing this legislative effort to mandate drug price transparency.

HHS Secretary Alex Azar was unimpressed by PhRMA’s announcement. “Our vision for a new, more transparent drug-pricing system does not rely on voluntary action,” declared Azar in a statement. “The drug industry remains resistant to providing real transparency around their prices, including the sky-high list prices that many patients pay. So while the pharmaceutical industry’s action today is a small step in the right direction, we will go further and continue to implement the President’s blueprint to deliver new transparency and put American patients first.” HHS is expected to issue new drug price transparency regulations soon.

PhRMA claims to be worried that disclosing the list prices of drugs in their television advertisements would discourage some patients from using medicines that could benefit them and is misleading since most patients don’t pay list prices. If HHS does issue regulations mandating price disclosures in DTC ads, the drug companies would likely argue in the federal courts that regulations requiring price disclosures would violate their free speech rights.

Every year around Halloween time, Patch, the news website specializing in local coverage around the country, publishes maps that show where sex offenders live. Patch claims this is some kind of public service, even though a thorough study of 67,000 cases of child molestation found zero increase in sex crimes against children on Halloween.

The vast majority of crimes against children are not committed by strangers, but by people close to the kids. Stranger danger is actually pointing worried parents in the wrong direction.

What’s more, sex offenders are not especially likely to go after kids on Halloween. Contrary to popular belief, “across the board the majority of sexual offenders do not go on to reoffend,” says Jill Levenson, a professor of social work who has studied Halloween crimes.

In other words, Patch publishes a list of people who have served their time and are extremely unlikely to offend again, in order to make parents terrified that the people at those addresses are out to hurt their kids.

This year is no exception. Here’s a typical Patch piece, headlined: “Fairfield 2018 Sex Offender Addresses To Be Aware Of On Halloween.” The article continues: “Find out where the registered sex offenders are living in Fairfield before the kids go out trick-or-treating. … You may want to avoid trick-or-treating at these houses and apartments on Halloween, or merely be aware of who’s living in your neighborhood during the rest of the year.”

Why? Why find this out, considering the facts above?

Last year, the National Association for Rational Sex Offense Laws’ had had enough with this approach, and wrote a letter to Patch imploring the company to stop publicizing sex offenders’ addresses. The letter, which Patch ran, suggested printing a map of all the places children have been harmed or abducted on Halloween by someone on the registry over the past 20 years. “Such a map would display no dots because exhaustive research has turned up not so much as a single case,” wrote NARSOL’s board.

That’s right: There is no recorded case of a trick or treater molested by someone on the registry either before or after localities started forbidding registrants from turning on their lights or answering the door on Halloween. The rules and the warnings made no difference, just as forbidding kids from trick or treating at homes where there are pet rabbits, or ficus trees, would make no difference. The kids are perfectly safe.

Patch responded last year with a piece subtitled, “This is why Patch publishes local sex offender maps.” It was by Dennis Robaugh, a top editor of the company.

This was Robaugh’s rationale: A child was raped and murdered by a man named Gerald Turner in Wisconsin on Halloween in 1973. “We publish sex offender maps because people deserve to know whether they live near someone like Turner,” wrote Robaugh.

But the maps do not let people know if they are living near someone like Turner. Not every sex offender is a child-murdering rapist. In fact, very few of them are. (The average age of sex offenders is 14.)

Robaugh adds: “Statistics and research may show children are at no greater risk of falling victim to pedophiles on Halloween than any other time of the year, but that doesn’t mean children are not vulnerable.”

Forget statistics. Patch prefers to stick with hysteria.

The federal government finished the 2018 fiscal year—it ended on September 30—a whopping $779 billion in the red, the largest annual budget deficit since 2012.

The current fiscal year is likely to see an even larger deficit, potentially in excess of $1 trillion.

The Treasury Department’s final data for the 2018 fiscal year, released Monday, shows that the deficit was driven by a combination of higher spending and additional borrowing. The latter was necessary to finance the former, of course, though last year’s tax cuts contributed to the widening gap between how much money the federal government takes in and how much it spends.

Tax revenues were flat during 2018 and corporate tax collections fell by $76 billion, Treasury reported.

On it’s own, the fact that American companies were able to keep $76 billion out of the government’s hands is cause for celebration. Those funds will certainly be put to more productive uses because they won’t be funneled to Washington. Trump’s corporate tax cuts brought the United States in line with the rest of the world, thereby increasing U.S. competitiveness in a global market.

But tax cuts without spending cuts are a recipe for disaster. While the Treasury’s data for fiscal year 2018 looks backwards, the trajectory for the future is the bigger story.

The $779 billion deficit for fiscal year 2018 was up 17 percent from the $666 billion deficit recorded in fiscal year 2017. The data show that the deficit is growing faster than the economy as a whole. In 2017, the federal deficit was equal to 3.5 percent of gross domestic product (GDP), but grew to 3.9 percent of GDP in 2018.

According to the Congressional Budget Office, current policies have the United States on course for a $2 trillion deficit before the end of the next decade.

“It’s an unsustainable fiscal course that will lead us to debt overtaking the size of the entire economy in as soon as a decade, and not long after topping all-time highs as a share of the economy not seen since World War II,” said Maya MacGuineas, president of the Committee for a Responsible Federal Budget, which advocates for balancing the budget, in a statement.

Driven by old-age entitlements and surfing on a wave of retiring boomers, the federal government will continue to pile on more debt unless serious structural reforms are undertaken. A new analysis from longtime congressional budget aide Brian Riedl, now a senior fellow at the Manhattan Institute, a free market think tank, shows that Social Security and Medicare will run a $100 trillion deficit over the next 30 years. With the country already facing a national debt of more than $20 trillion, massive annual deficits in future years are likely to drive-up the cost of borrowing and cause America’s already astronomical debt to grow at a faster pace, he warns.

That this latest increase in the deficit happened during a period when Republicans had full control of the federal government reveals that they were never very serious about balancing the budget. Even now, they refuse to recognize the problem. Democrats, meanwhile, are promising to spend even more on entitlements, if and when they return to power.

Almost nothing about the current state of affairs in Washington suggests that policy makers are prepared to deal with this looming catastrophe. Today’s news is a reminder that the reckoning is coming, regardless of whether our elected officials are ready for it.

Prisons are more likely to give women serious punishments for minor infractions, according to a new collaborative report from NPR, The Social Justice News Nexus, and The Chicago Reporter.

In California, Vermont, and Rhode Island, for example, women were anywhere from two to three times as likely to receive disciplinary action for such infractions as “disrespect,” “disobedience,” and “derogatory comments” against corrections officers and inmates. Depending on the state, such infractions meant longer prison time, restrictions in family visits, loss of shopping privileges at the prison commissary for items such as food and women’s hygiene products, or even solitary confinement.

One former inmate, Celia Colon, told NPR that she received a disciplinary ticket for “reckless eye-balling” after she made a face when an officer gave an order. The led to an unspecified amount of time in solitary confinement.

Maggie Burke, a former warden at Illinois’ Logan Correctional Center, told investigators that corrections officers tend to “discipline based on emotion rather than on safety and security.” Are facilities truly being made safer, she asked, if women who “talked back” are being put in solitary? A November 2016 audit of her old facility found that an overuse of solitary confinement helped exacerbate poor mental health conditions among the prisoners. Suicide attempts at the prison had increased from one a month to 10.

About 61,000 people were kept in solitary confinement in 2017 for up to 22 hours a day. Though the number has declined over the past five years, mental health professionals argue that those unfortunate enough to experience this punishment are essentially victims of torture. Many prison reformers argue that it violates the Eighth Amendment, which prohibits “cruel and unusual punishments.”

Today’s Chapter 11 bankruptcy filing for Sears Holdings has generated a lot of discussion about why the century-old retailer has finally failed.

Edward Lampert took control of Kmart when it emerged from bankruptcy in 2003. When Kmart announced its acquisition of Sears in 2004, press coverage described Sears as “broken” and “mired in a retail slump.” It is now 2018. That’s 14 years (for Sears) or 15 years (for Kmart) of patience and determination and hard work and rigorous analysis trying to rebuild a business that started out with bankrupt Kmart.

What has happened during those 14 or 15 years? Since 2005, Sears Holdings contributed more than $4.5 billion to fund long-established pension plans supporting Sears retirees whose careers at the company predated Lampert’s arrival. That compares favorably to General Motors, which went bankrupt in 2009 after the financial crisis in part because of its obligations to retirees. Sears management also kept open a lot of stores for a long time, hoping they’d turn around along with the economy and the company’s transformation. That kept a lot of Sears and Kmart employees working. That was a long-term bet that didn’t work out. A short-term mindset would have immediately closed more stores.

It wasn’t out of altruism. If Sears Holdings had managed to succeed better, the beneficiaries wouldn’t have only been pensioners and employees, but also shareholders, including Lampert. But interests were basically aligned, contrary to portrayals of Lampert looting the company through “financial engineering.”

Lampert could have quit and cut his losses years ago. Some have seen his failure to do so as hubris.

But what it took was guts, writes Ira Stoll.

View this article.

Sen. Elizabeth Warren (D–Mass.) has released the result of a DNA test proving that she does indeed possess Native American ancestry—way, way, way back.

The results are vague enough that everyone can go on believing their preferred narrative (choose “Fauxcohantas exposed, at last!” or “Take that, Drumpf!” as suits you). According to The Boston Globe, Warren’s family tree probably includes a Native American ancestor six to 10 generations ago. A sixth-generation ancestor would make her 1/32 Native American. A tenth-generation ancestor would mean that Warren is only .097 percent Native American. (The Globe initially miscalculated this, due to a math error.) In this latter case, Warren wouldn’t be any more of a Native American than the average U.S. citizen. But even in the more favorable scenario, 1/32 is generally not good enough to establish tribal membership.

Liberals have been hailing this as a #Resistance victory—Donald Trump has constantly belittled Warren for falsely claiming Native American blood—while conservatives are pouncing on the weakness of The Globe‘s claim. I say this is all a distraction from the real issue: Warren’s actual public policy views, which are quite bad.

We can’t say for sure that Warren is a faux-Indian, but we can say for sure that she is a faux-populist. Despite railing against big business, Warren failed to take a stance against the cronyist Export-Import Bank, a program that essentially provides welfare for Wall Street.

Warren had no interest in killing a government handout to big corporations, but she does enjoy going after the corporations themselves. The senator recently unveiled a truly awful plan that would force businesses to massively reorganize, ostensibly to give the public a stakeholder interest in large firms. The plan could cripple American innovation. The Niskanen Center’s Samuel Hammond calls it “bad economics and worse business ethics.”

I’m not convinced that Warren actually used her alleged Native American ancestry to advance her career at Harvard, though it does look like the administration was keen to tout her as a diversity hire after the fact. In any case, Elizabeth Warren’s most elaborate deception is not her attempt to portray herself as a Native American. It’s her attempt to portray herself as a trustworthy steward of the economy. That is what should disqualify her from the presidency.

In an interview that aired on 60 Minutes Sunday night, President Donald Trump reiterated his belief that America would “win” the trade war—er, battle…or skirmish—that his administration launched earlier this year.

The truth is that trade wars are much more complex than Trump’s simplistic win-or-lose mentality suggests. “Winning” the trade war—whatever that even means—could come with major unintended consequences for the American economy. This should not come as a surprise. All governmental intrusions into the economy have unintended consequences, and these tariffs are a particularly potent intrusion into the free exchange of goods.

Take what’s happening at Kent International Inc., a South Carolina–based bicycle manufacturer. The Wall Street Journal reports that Kent, which currently employs about 167 people, canceled plans to hire another 30 or 40 workers as part of an expansion of the plant. The culprit? Trump’s tariffs, which subject imported steel to a 25 percent tax and have triggered sharp spikes in the price of both foreign and domestic steel.

Instead, the company is now planning to expand operations in southeast Asia, where Chinese-made steel can be imported without the extra taxes.

“We are not bringing jobs back to America with this thing,” Kent CEO Arnold Kamler tells the Journal. “We are bringing jobs to different countries in Southeast Asia.”

Does winning the trade war mean offshoring American jobs? That’s probably not part of the president’s plan.

Trump says the tariffs are a tool to bring China to the negotiating table and get it to stop engaging in unfair trade practices. In practical terms, the tariffs are forcing companies to rework supply chains, and that’s not something the administration can control (nor should it try). As the Journal notes, some American companies are seeing increased revenue as manufacturers seek domestic suppliers to avoid import taxes. But those wins are counterbalanced by a difficult reality: that building things in America is now more costly, thanks to the tariffs.

A speaker assembled in Florida with Chinese-parts will be more expensive because of Trump’s trade barriers, but the same speaker built in China and imported to the U.S. would be tariff-free, as the Journal notes. That’s the rationale for the administration’s continued escalation of the trade war. Last month, the White House targeted another $200 billion of Chinese-made goods, mostly finished products, with a new round of tariffs.

The unintended consequences of tariffs extend out in a variety of directions. Tariff-dodging is now a thing, for example. And the trade war may halt a joint Chinese-American project that was translating ancient Chinese texts into English.

All of which is to say: Trade wars are messy.

Messy like blasting chunks of leftover lasagna into your neighbor’s apartment. That’s the metaphor economist Austan Goolsbee used to describe the current situation during an appearance this weekend on NPR’s Wait, Wait, Don’t Tell Me. You really have to listen to the segment for the full effect, but the story involves a kitchen sink clogged with lasagna and a plunger loaded with explosive charges. Here’s the key bit:

GOOLSBEE: And they lived in a—what in Chicago we would call a converted. It was a house. It had a wall down the middle. There were two identical apartments. And the drains did not just go straight down. They connected in a little Y.

SAGAL: Right.

GOOLSBEE: So every time he blew the bomb into the drain, it didn’t go down the drain to the sewage. It just blew it to the neighbor. And so the next morning, that person comes over (mimicking doorbell), says, Bob, was there some kind of terrible plumbing catastrophe that happened?

And they go— He said, I’d like to show you my apartment. And all over the ceiling, over the kitchen, is my Aunt Trina’s lasagna.

Trump is firing the plunger into the drain, repeatedly. And while he might win a victory over the lasagna that’s stuck in the pipes, the White House’s only plan for dealing with the mess in the neighbor’s house is, apparently, to spend taxpayers’ money to bail out farmers hurt by the trade war. There does not seem to be any plan to deal with the other consequences—like the jobs that could have been created at plants like Kent’s in South Carolina but now will go to workers in Southeast Asia.

That’s what tariffs do, says Goolsbee.

“You can blow the lasagna out of the steel drain. But when you blow it out of the steel drain, right onto the auto industry, Boeing, and all the others, it’s all over the ceiling,” he said. “And that’s what’s wrong with this. It ends up destroying thousands more manufacturing jobs than you’re saving in the one where you’re doing it.”

When Lesley Stahl asked President Donald Trump how he would punish Saudi Arabia if the oil-rich dictatorship was found to have murdered Washington Post columnist Jamal Khashoggi, the president quickly turned the conversation toward the importance of arms sales to American jobs. Was that the right answer?

No it wasn’t, argue editors Katherine Mangu-Ward, Peter Suderman, Nick Gillespie, and Matt Welch on the Monday editor-roundtable version of the Reason Podcast. But maybe, they add, that’s an argument for re-examining whether government should have any role in limiting commerce between U.S. companies and far-flung baddies. The discussion then ranges from the ethics of dictatorship junkets to seasonal Saudi-bashing syndrome to Trump’s ongoing presidency-demystification project, before moving on to the politics of anti–political correctness and the trauma-absorbing qualities of Mr. Rogers.

Subscribe, rate, and review our podcast at iTunes. Listen at SoundCloud below:

Audio production by Ian Keyser.

’18 – Ghosts II’ by Nine Inch Nails is licensed under CC BY NC SA 3.0

Relevant links from the show:

“Did Saudi Arabia Murder This Expat Journalist for Criticizing the Government?,” by Joe Setyon

“Jamal Khashoggi Disappearance Doesn’t Seem to Faze White House,” by Elizabeth Nolan Brown

“With the Saudis, Trump Shows Timidity,” by Steve Chapman

“Rand Paul Says He’ll Try to Block Saudi Arms Sales Over Khashoggi Disappearance,” by Brian Doherty

“The President Shouldn’t Act as an Arms Dealer to the Saudis,” by Veronique de Rugy

“American-Backed Saudi Coalition Kills 40 Children in Airstrike, Injures Dozens More,” by Nikhil Sridhar

“Trump’s 60 Minutes Interview Further Demystifies the Presidency,” by Nick Gillespie

“Study: 80% of Americans Believe Political Correctness Is a Problem,” by Robby Soave

“Don’t Take Too Much Comfort From Surveys Showing Widespread Opposition to ‘Political Correctness’,” by Ilya Somin

Don’t miss a single Reason Podcast! (Archive here.)

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A federal appeals court ruled today that Detroit police didn’t have carte blanche to shoot a woman’s dogs during a drug raid simply because they weren’t licensed.

The Sixth Circuit Court of Appeals reversed and remanded a lower court ruling in the case of Nikita Smith, who filed a federal civil rights lawsuit against the Detroit Police Department after a narcotics raid left three of her dogs dead. A federal judge dismissed Smith’s lawsuit last year, ruling that her dogs, because they were unlicensed, amounted to “contraband” under the Fourth Amendment.

In its ruling, the Sixth Circuit declared that not only was Smith entitled to some process under Michigan law before her dogs were “seized” (read: killed), but that her dogs, even if unlicensed, were still protected from unreasonable seizure under the Fourth Amendment.

“By guaranteeing process to dog owners before their unlicensed dogs are killed, Michigan law makes clear that the owners retain a possessory interest in their dogs,” the appeals court wrote. “This is particularly so in the context of everyday property that is not inherently illegal, such as some drugs, but instead is subject to jurisdiction-specific licensing or registration requirements, such as cars or boats or guns. Just as the police cannot destroy every unlicensed car or gun on the spot, they cannot kill every unlicensed dog on the spot.”

The case is the first time federal courts have considered whether an unlicensed pet—in violation of city or state code—is protected property under the Fourth Amendment. Courts have previously established that pets are protected from unreasonable search and seizure under the Fourth Amendment.

Smith’s lawsuit characterized the police as a “dog death squad” and claimed officers shot one of her pets through a closed bathroom door. Graphic photos from the raid on Smith’s house showed one dog laying dead in the blood-soaked bathroom.

In such cases, police departments typically argue that an officer’s actions were reasonable under the circumstances—and courts give much deference to those arguments. But in Smith’s case, the City of Detroit also adopted a novel legal argument: that since Smith’s dogs were unlicensed, she didn’t have a legitimate property interest in them and therefore could not bring a Fourth Amendment claim against the officers. Lawyers for Detroit compared Smith to a minor holding an alcoholic beverage.

A U.S. District Court judge agreed. “When a person owns a dog that is unlicensed, in the eyes of the law it is no different than owning any other type of illegal property,” U.S. District Judge George Caram Steeh ruled last year.

But in another Fourth Amendment lawsuit—brought by Nicole Motyka and Joel Castro, whose two dogs were shot by Detroit police during a marijuana raid—a different federal judge came to the opposite conclusion, ruling that Detroit’s argument was “misplaced.” Motyka’s lawsuit has been on hold awaiting today’s Sixth Circuit opinion.

Smith and Motyka’s cases are part of a string of lawsuits that have been filed against the Detroit Police Department for dog shootings over the past two years. A Reason investigation last year found the department’s Major Violators Unit, which conducts drug raids in the city, has a track record of leaving dead dogs in its wake.

Earlier this year, Detroit paid $225,000 to settle a lawsuit brought by Kenneth Savage and Ashley Franklin, who claimed Detroit police officers shot their three dogs while the animals were enclosed behind an 8-foot-tall fence—all so the officers could confiscate several potted marijuana plants in the backyard.

Gangs of masked left- and right-wing protestors clashed again in Portland, Oregon, on Saturday night, raising the question of whether political street violence is the new normal in the Rose City.

The weekend’s violence began with an impromptu gathering of the right-wing group Patriot Prayer—a staple of Portland’s street melees over the last couple of years—who rallied in the city’s downtown to call for the ouster of Mayor Ted Wheeler, who they accuse of surrendering the city to far-left protestors.

Pictures and video from the rally show demonstrators waving American flags and sporting MAGA and Proud Boy hats. One man wore a homemade t-shirt with the slogan “I hunt Antifa cowards.”

In attendance were Joey Gibson, leader of Patriot Prayer and unsuccessful candidate for U.S. Senate in Washington state, and Tusitala “Tiny” Toese, another prominent member of the group, who’s been charged with assault for his brawling at past protests.

Following the Patriot Prayer rally, the assembled group marched through the city’s downtown, shouting chants of “USA” as they passed a vigil for Patrick Kimmons, who was killed by Portland police last month.

According to Willamette Week, the first scuffles started shortly after the Kimmons vigil ended. One vigil attendee set fire to an American flag, which was then snatched away by a member of the Patriot Prayer crowd. Insults started to fly between the two groups, followed by squirts of pepper spray.

One video, captured by Portland freelancer Mike Bivins, shows right-wing protestors he identifies as Proud Boys and a black-clad antifa demonstrator approaching each other, fists raised, before another leftist lets loose a string of pepper spray.

The violence only escalated from there, reaching a peak at around 8 P.M. when a full-scale brawl broke out in front of the bar Kelly’s Olympian. Video shows the two sides exchanging more blows and pepper spray. One clip, again captured by Bivins, shows what appears to be a right-wing protestor repeatedly stomping on a left-wing counterdemonstrator, who’s lying prone on the ground.

Portland Police eventually intervened, firing pepper ball rounds and other non-lethal ammunition.

“We are aware that there was a large, violent encounter between opposing groups on Southwest Washington Street,” Portland Police Chief Danielle Outlaw said in a press release. “Officers responded to the scene and used less lethal munitions to break up the fight and prevent further violence. We will continue to investigate this incident and ask that anyone who was the victim of a crime to come forward and file a report.”

No arrests were made Saturday. After being broken up by police, the two sides dissipated, with the Patriot Prayer crowd chanting “Trump, Trump, Trump” as they marched away from the scene.

Violent protests are hardly an unprecedented phenomenon in Portland. The city was affectionately nicknamed “Little Beirut” in the late 1980s for the raucous protests that greeted visits by President George H.W. Bush and Vice President Dan Quayle.

Still the street warfare of the kind we saw this weekend is a relatively new phenomenon, spawned from the hysterical aftermath of Donald Trump’s election. As right and left repeatedly face off, the Portland Police have been criticized for both overpolicing and underpolicing the rallies.

And while the fighters like to present themselves either as dogged defenders of racial equality against the forces of white supremacy or as free speech warriors standing up to an intolerant leftist mob, all I really see in these street scuffles are a bunch of angry people looking for a fight.