Dean Baker's Blog, page 460

Robert Samuelson Shows Us How Patents Monopolies Impose Enormous Costs With Medical Technology

Patent monopolies raise the price of drugs from free market prices of $5-$10 per prescription to hundreds or even thousands of dollars per prescription. They have the same effect with medical devices.

The actual cost of using even the most advanced medical equipment is usually very low. After all, the machinery is already there, the only cost is a bit of electricity, the technicians' time and possibly the time of a highly paid medical specialist. Even if we averaged the cost of manufacturing...

The Value of the Yen, the Dollar, and Generational Issues

The NYT had a truly bizarre piece that at least implicitly portrayed Japan unfavorably compared with the United States for having an over-valued currency. The second paragraph tells readers:

"In an echo of a debate that raged in the United States in the 1980s, the government faces growing criticism for doing almost nothing to rein in the yen, despite alarm that the record-high currency is dealing crippling blows to the country’s once all-important export machine. "

The article then goes on to...

Real Newspapers Report That Republican Claims That Generous Welfare States Are Responsible for Euro Crisis Are Wrong

Sorry boys and girls, this is not a debatable issue. It is easy to identify the countries in Europe that have the most generous welfare states. They would be the Nordic countries like Denmark, Sweden, Norway, and Finland. Also high on the list would be the Netherlands, Germany, France and Austria. No one has Greece, Spain, Italy, or even Ireland on the list of countries with the most generous welfare states.

This means that conservatives would be mistaken if they blame the euro crisis on over...

Democrats Are not Proposing to Regulate Not For Profit Colleges, They Want to Put Restrictions on Government Student Loans and Aid

In an interview with Senator Tom Harkin (sorry, no link yet), Morning Edition host Renee Montagne managed to turn reality on its head. She repeatedly referred to restrictions on the type of schools where students could use government loans and Pell grants as interfering with the free market and imposing restrictions on the industry.

This is truly bizarre. Free market purists presumably would not want the government program at all. However, those who support the program would presumably want t...

Charles Lane Finds it Paradoxical that the Government Provides Assistance to Workers Whose Disabilities Keep Them From Working

I'm serious. The Washington Post columnist notes the Americans With Disability Act, which prohibits employers from discriminating against workers because they have a disability, then complains about the paradox that the Social Security disability program gives money to people with disabilities who can't work. I don't realize see the paradox in trying to make it easier for people with disabilities to find jobs while still supporting those whose disabilities don't allow them to work, but maybe...

There Are 25 Million People Unemployed, Underemployed or Out of the Workforce Altogether and NPR's Presidential Debate Moderator Just Wants to Talk About the Budget Deficit

NPR seems to want listeners to ignore the economic downturn, by far the largest cause of the deficit, and to focus on cutting spending programs and raising everyone's taxes. That was certainly the theme of its interview with David Wessel, an economics reporter with the Wall Street Journal, which discussed his new book, Red Ink.

The first sentence of the piece refers to the "ballooning deficit." In fact the deficit is actually shrinking. While NPR can argue that the deficit is larger than it w...

Robert Samuelson Can't Find What Isn't There

Robert Samuelson looks to fear and uncertainty as the reasons that the economy is not doing better. He would be better off looking to national income accounting.

The basic story is that we have a big gap in demand that can only be filled in the short-term by government spending. The reason is simple. The housing bubble was driving around $1.2 trillion in demand that disappeared with the collapse of the bubble.

Roughly half of the falloff in demand was in residential construction. We had a hug...

Bill Keller Wants to Take Away Your Social Security and Is Either Too Ignorant or Dishonest to Acknowledge that He Is Not a Typical Baby Boomer

The effort by the rich to take away Social Security keeps building momentum. Today Bill Keller urges his fellow baby boomers:

"FELLOW boomers, we have done more than our share to make this mess. It’s not our fault that there are a lot of us, but we have resisted any move to fix the system. We should make a sensible reform of entitlements our generation’s cause. We should stiffen the spines of our politicians, and push lobby groups like A.A.R.P. to climb out of the bunker and lead."

"Lead" in...

Doctor Shortage? NYT Has Never Heard of "Immigration"

Apparently NYT reporters never heard of immigration. This is the only way to explain a front page piece that discusses an alleged shortage of doctors in the United States that never once discusses the possibility of bringing more doctors in from other countries.

As a practical matter this should be very easy to do since doctors in the United States earn on average about twice as much as their comparably trained counterparts in Western Europe and Canada.They earn five to ten times as much as d...

Thomas Friedman Flunks Arithmetic Again, Demograhics Is the Cry of the Innumerate

While many of us learned arithmetic in third grade, apparently there are not enough people who retained this knowledge for the NYT to staff its opinion page. Hence they have Thomas Friedman warning us that the retirement of the baby boom cohort is going to devastate the country.

Now, if Friedman could do arithmetic he could turn to the Social Security trustees report and see that they project the ratio of workers to retirees to fall from 2.8 in 2012 to 2.0 in 2035. Is that scary?

Here's where...