Commentary by Stephen Macaulay
Donald Trump sent letters on July 31 to 17 of the leading pharmaceutical companies in which he tells them, in no uncertain terms, that they must lower prescription drug prices in the US, stating that if they “refuse to step up, we will deploy every tool in our arsenal to protect American families from continued abusive drug pricing practices.”
In the text he pointed out there was a May 12 Executive Order, “Delivering Most-Favored-Nation Prescription Drug Pricing to American Patients,” which has the objective of stopping “global freeloading.” Which sounds good, but which is not the case.
While it is true that “brand name drug prices are up to three times higher on average than elsewhere for the identical medicines,” arguably there is a reason why this is the case in many instances in places like the European Union and Canada:
The governments negotiate prices.
Discussion. Bargaining. Compromise.
While the two words rhyme, their meaning is not the same:
Dictate/Negotiate
Throughout his campaign as well as during his time in office, Trump has railed against the “leftist, radical, extremist” etc. people who happen to be in the Democratic Party.
Yet here he is (not unlike his telling corporations that they should absorb the cost of tariffs), taking a page from the Communist Playbook.
In the dictates of communist ideology, there is the abolition of the profit motive, which is a fundamental part of capitalism.
There is centralized — as in “government” — economic planning: the State decides, for example, what prices are.
And there is no free-market competition. The State decides.
There is no discussion, bargaining or compromise. There is a dictate handed down from on high.
Should there be any resistance, then “every tool in our arsenal” will be used to crush the resistance.
I don’t like having to pay higher prices for prescription drugs more than anyone else. But I also understand there are things like market forces that need to be considered.
If the State decides how much drugs should cost — and let’s face it, the State probably doesn’t have the slightest idea of how much the cost associated with the drugs are (from the costs of development and testing through production and distribution, especially now that is evidently thinks that professionals are overrated) — then there is little incentive for pharmaceutical companies to create new drugs. How is that going to work out when the next pandemic arises?
And where does this control stop?
Should Trump be able to dictate the prices of everything, from gasoline to fast food, from toys to candy?
Liberals have always been in favor of the government playing a big role in the economy while conservatives want limited government and free market forces.
So where is the Republican Party, the ostensible conservatives, when it comes to pushing back on what is clearly a case of Statism?
Trump has signed some 180 Executive Orders which, in effect, supersede the authority of Congress to write laws.
Similarly, although Article I, Section 8 of the Constitution says “The Congress shall have Power to lay and collect Taxes, Duties, Imposts and Excises” — which includes tariffs — the President has essentially taken over, claiming in many cases that it is based on “national security,” which makes you wonder how a Kia minivan imported from South Korea poses a military threat.
Again, where are all the congressional free-market people?
Lower drug prices seems a good idea — until the President decides that for whatever whim higher prices (say, by imposing a tariff on places like Switzerland, where several pharmaceuticals are made) are a better idea.
Yes, this is radical, leftist policy coming out of the White House.
Makes AOC and Bernie look like pikers.
Macaulay is pundit-at-large for The Hustings.