Liberals dare Trump to back their bills lowering drug prices
By RICARDO ALONSO-ZALDIVAR
Thursday, January 10
WASHINGTON (AP) — Challenging President Donald Trump to make good on his pledge to cut prescription drug prices, congressional liberals proposed legislation Thursday to bring U.S. prices in line with the much lower costs in other countries.
The Democratic bills stand little chance of becoming law in a divided government. But the effort could put Republicans on the defensive by echoing Trump’s pledge to force drug makers to cut prices.
Democrats and Trump agree that people in the United States shouldn’t have to pay more for their medications than do those in other economically advanced countries.
The Trump administration has put forward its own plan for reducing drug prices, but industry analysts have seen little impact so far. The pharmaceutical industry said the Democratic bills would “wreak havoc on the U.S. health care system.”
The new legislation was offered by Sen. Bernie Sanders, I-Vt., Rep. Elijah Cummings, D-Md., and others. Cummings leads the House Oversight and Government Reform Committee, which is expected to take a major role on drug pricing.
The lawmakers want to:
—Open up generic competition to patent-protected U.S. brand-name drugs that are deemed “excessively priced.”
—Allow Medicare to directly negotiate with drug makers.
—Let consumers import lower-priced medications from Canada.
There was no immediate response from the administration.
“Today I say to President Trump, if you are serious about lowering the cost of prescription drugs in this country, support our legislation and get your Republican colleagues on board,” Sanders said at a Capitol Hill press conference.
“No more talk. No more tweets,” said Cummings. “The American people want action.”
Holly Campbell, a spokeswoman for the Pharmaceutical Research and Manufacturers of America, said Sanders’ plan would harm U.S. patients. The industry argues that government price regulation could limit access to some medicines, undermine financial incentives for research, and compromise safety standards. Sanders says drug makers are primarily interested in protecting profits.
As a presidential candidate, Trump initially called for Medicare to negotiate drug prices and favored allowing people to legally import lower-priced medications from abroad.
But Medicare negotiation is a political nonstarter for most Republicans, who favor a free-market approach to the U.S. pharmaceutical industry and prize its capacity for innovation.
As president, Trump has come out with a plan to lower drug costs that relies on dozens of regulatory actions. The goal is to eliminate incentives for drug makers, pharmacy benefit managers and insurers to stifle competition at the expense of consumers. Independent experts say the administration proposals would have an impact, but not limit the ability of drug companies to set high prices.
Time and again, Trump has complained that other countries where governments set drug prices are taking advantage of Americans. Indeed, one of his ideas would shift Medicare payments for drugs administered in doctors’ offices to a level based on international prices.
“We are taking aim at the global freeloading that forces American consumers to subsidize lower prices in foreign countries through higher prices in our country,” the president said when he made that proposal shortly before last year’s congressional elections.
The Democratic bills would go far beyond Trump’s approach.
The newest idea would essentially apply to any U.S. patent-protected brand-name drug, whether or not government programs are bearing the cost. By comparison, Trump’s international pricing proposal would not apply to retail pharmacy drugs purchased by Medicare beneficiaries or to medications for privately insured people. It’s the result of a joint effort between Sanders and Rep. Ro Khanna, D-Calif.
Drugs found to be “excessively priced” by the government could face generic competition. A medication’s cost would be deemed “excessive” if its price in the U.S. was higher than the median, or midpoint, price in Canada, the United Kingdom, Germany, France and Japan.
If the manufacturer was unwilling to cut its U.S. price, then the government could allow generic companies to make a more affordable version of the medication. Generic drug makers would have to pay “reasonable” royalties to the company that holds the patent.
Q&A: How the government shutdown might end
By ALAN FRAM
Friday, January 11
WASHINGTON (AP) — Somehow, some day, the nasty deadlock between President Donald Trump and congressional Democrats that’s shuttered federal agencies for a record-tying 21 days will end. The only real questions are when, how and who will be crowned the winner in public opinion polls and ultimately by voters.
Things got bleaker this week when House Speaker Nancy Pelosi, D-Calif., told Trump at a fiery White House meeting that Democrats would not bow to his demand for $5.7 billion to start building a wall along the border with Mexico. Trump slammed his hand on the negotiating table and stormed out, Democrats said. Trump said he calmly left the room, saying, “Bye-bye.”
A look at how the impasse might be resolved:
Q: What’s the easiest solution?
A: None is easy. Trump’s conservative base strongly backs his fight for wall money, even if it has meant a partial government shutdown. Democrats’ liberal stalwarts just as ardently oppose giving in. Trump and Democratic leaders have been so insistent on not surrendering that each would risk rebellion by supporters if they agreed to something viewed as a capitulation.
Q: What’s the likeliest way out?
A: Increasingly some people think that could be for Trump to declare a national emergency. By law, that could give him authority to use some money in the military’s budget for construction projects for the wall.
It’s a tactic that could let each side claim a partial victory and move on.
Trump could argue he did secure money for the wall, his most memorable campaign pledge, and overcame Democratic objections. Democrats could say they didn’t give in and they could file suits to block the move, claiming Trump had exceeded his authority by stretching the meaning of emergency. Trump could decide to finally sign bills reopening the government.
Leaving the White House Thursday to visit the southwestern border, Trump strongly suggested he would take that route. “I have the absolute right to declare a national emergency,” he told reporters. He added: “If I have to, I will. I have no doubt about it.”
Q: Why not just do it?
A: Plenty of people on both sides hate the idea, and its legality in this instance is questionable.
Some Republicans, including Texas Rep. Mac Thornberry, the top Republican on the House Armed Services Committee, say strengthening border infrastructure is not the military’s job and they oppose siphoning defense dollars for that purpose. Many Republicans worry that by stretching the definition of “emergency,” Trump opens the door to a future Democratic president circumventing lawmakers in ways the GOP would oppose.
Democrats would consider the move a fresh example of Trump abusing his authority as president. They say it would be a ploy to bypass Congress and that there’s no emergency on the border, where the number of illegal crossings has fallen in recent years.
While the law doesn’t clearly define a national emergency, some experts say a declaration here would be unwarranted.
“The idea was that the executive would have these powers on a limited basis for true emergencies,” said Andrew Boyle, who studies presidential emergency powers at the Brennan Center for Justice, which is affiliated with New York University. He said declaring a national emergency at the border would be “clearly in bad faith.”
Q: Polls show the public blames Trump more than Democrats for the shutdown. Will Republicans fold?
A: Some GOP lawmakers have had enough, especially in the Senate. Reflecting that, a group of GOP senators has talked to Senate Majority Leader Mitch McConnell, R-Ky., and White House officials about forging a compromise, though that seems an uphill battle.
Ultimately McConnell, a tough partisan also renowned for ending previous battles by cutting bipartisan deals, will decide the GOP’s path. It will take more than a few Republican defections for McConnell to abandon Trump.
Ever since Trump reversed himself and turned down an agreement to avoid the shutdown before Christmas, McConnell has stepped aside, saying Trump and Democrats should bargain.
Democrats have been trying to pressure McConnell, quoting his past ridicule of shutdowns and citing the damage the current one is inflicting on voters. With hundreds of thousands of federal workers due to miss their first paychecks Friday and constituents complaining about losing government services, pressure will only intensify.
“I think public sentiment weighing in on his members” will change his mind, House Speaker Nancy Pelosi, D-Calif., said in a brief interview. “He’s a legislator.”
“He’s watching, he’s waiting,” said retired Senate Majority Leader Trent Lott, R-Miss.
Q: What about Democrats?
A: They’ve shown no outward signs of divisions. If anything, Trump’s recent actions — leaving Wednesday’s negotiating session, seeming to blame Democrats for the recent deaths of two Guatemalan children in U.S. custody — have united them more.
“Democrats’ reaction ranges from angry to enraged,” said Rep. Gerald Connolly, D-Va.
Q: Is there a deal to be had?
A: That seems increasingly unlikely. Sen. Lindsey Graham, R-S.C., and other Republicans have explored a compromise that might include border security money plus helping hundreds of thousands of young immigrants who arrived in the U.S. illegally as children stay in this country. But Vice President Mike Pence and Graham reported no progress after a meeting Thursday.
Democrats know a deal with Trump could alienate liberals, and are loath to show Trump that they would fold during future confrontations.
They also don’t trust him. Pelosi said Trump has moved the goalposts so often that “pretty soon these goal posts won’t even be in the stadium.”
For AP’s complete coverage of the U.S. government shutdown: https://apnews.com/GovernmentShutdown
How a government shutdown affects the economy
January 10, 2019
Federal employees rally to call for an end to the partial government shutdown.
Author: Scott R. Baker, Assistant Professor of Finance, Northwestern University
Disclosure statement: Scott R. Baker does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.
Parts of the federal government have been closed since midnight on Dec. 22, making it the second-longest shutdown on record. It’s also the third since President Donald Trump took office.
The immediate and most visible impact of a shutdown is in the government’s day-to-day operations. Many national museums and parks are closed, immigration hearings are being postponed and the Food and Drug Administration isn’t doing routine inspections of domestic food-processing facilities, to name a few examples. Of the 800,000 federal employees affected by the shutdown, 420,000 are working without pay while the rest have been furloughed.
But beyond the individual workers and families affected, could a short or lengthy shutdown affect the broader U.S. economy as well?
Constantine Yannelis, a business professor at New York University, and I examined data from the 2013 government shutdown to better understand its impact.
An economic speed bump
While a shutdown affects the economy in a number of ways – from delaying business permits and visas to reducing service hours at innumerable agencies – a primary channel through which a shutdown affects the economy is through withheld or foregone pay from federal employees who don’t receive their paychecks.
Since consumer spending makes up about 70 percent of economic activity in the United States, withholding pay from even some government workers could introduce a significant economic speed bump in the short run.
And that’s exactly what we saw in 2013.
Similar to the situation today, a partisan standoff in Congress led to a partial shutdown of the government that lasted a little over two weeks beginning on Oct. 1 of that year.
Well over a million federal employees were affected and didn’t receive a paycheck during the shutdown. Some were furloughed – sent home and told not to do anything related to their job. Those deemed “essential” or “exempted” – such as security personnel screening passengers at airports or border patrol agents – were required to continue working at their jobs, although they were not receiving paychecks. The government eventually paid both groups the money owed them, regardless of whether they worked, after Democrats and Republicans reached an agreement on Oct. 16, 2013.
My colleague Yannelis and I sought to understand how households responded by tracking how they behaved in the days leading up to, during and following the shutdown using detailed financial data.
We obtained this anonymized data from a personal finance website where people track their income, expenses, savings and debt. Using the paycheck transaction descriptions, we identified over 60,000 households that contained employees of federal agencies affected by the shutdown. These affected employees included both those who were asked to work without pay and those who were furloughed.
As a comparison group, we also identified over 90,000 households with a member who worked for a state government. That would likely mean they have fairly similar levels of education, experience and financial security, yet their paychecks were unaffected by the shutdown.
Short-term impact on spending
Our study led to two primary findings.
First, we found that the shutdown led to an immediate decline in average household spending of almost 10 percent. Surprisingly, despite the fact that most federal workers have stable jobs and income sources, they were quick to cut spending on pretty much everything, from restaurants to clothing to electronics, just days after their pay was delayed.
While households with less money in the bank cut their spending by larger amounts, even those with significant resources and easy access to credit reduced their expenditures.
Second, households with a member who was furloughed and required to stay home from work slashed their spending more dramatically – by 15 percent to 20 percent, or almost twice as much as the average of those affected. This larger decline reflected the fact that these households suddenly had a lot more time on their hands. Rather than going out to eat or paying for child care for example, they were able to spend more time cooking and watching their own children.
This behavior is what tends to spread the economic effects of a shutdown that affects a slice of the population to a wider group of businesses and individuals behind Washington, D.C. And in regions with substantial numbers of federal workers, these declines in spending can greatly hurt the health of the local economy in the short run.
Whether or not a shutdown has a longer-term economic impact depends on whether employees are paid their foregone wages after its conclusion – and how long the shutdown lasts.
In 2013, the government repaid even furloughed workers what they would have earned had the shutdown not happened.
This repayment, essentially increasing the size of their first post-shutdown paychecks, had significant and immediate effects on household spending. A sudden spike in spending occurred in the days after the paychecks were disbursed, largely erasing some of the most dramatic declines in spending during the previous two weeks.
The government has usually paid all its employees, “essential” or not, back pay after other past shutdowns, such as those in the 1990s. While Congress is legally required to pay federal employees who worked during the shutdown, there’s no law requiring the same treatment for nonessential workers.
In addition, the longer the shutdown lasts, the worse its impact. Households might deplete savings or hit their credit card limits as the impasse stretches day after day, giving them additional time to adjust their spending in ways that they could not do with only a few days’ notice. For instance, in 2013, bills for health insurance or tuition payments were largely unaffected. Had that shutdown persisted, households may have started to cut back here as well.
So if Congress refuses to offer furloughed workers back pay or the shutdown lasts months rather than weeks, the economic impact could be severe.
However, if a shutdown is resolved in a relatively short amount of time, with workers being paid back their regular income, the damage would likely be fairly contained.
This is an updated version of an article originally published on Jan. 19, 2018.
Peter Redshaw: This is the strange thing about the United States system where government can have a failure in the confident and supply of the budget and yet not cause a government to fall and a new election, if a new government can not be formed. This is a huge failure in the system of the US Constitution and it Presidential form of government, because it does not hold strong enough consequences for those in power for the failure to fund government and the services government provide to the people.
How many shut downs or partial shutdowns in The US do we see used as a political tool, either by the President or by Congress? This article says this is the third shutdown under this term of Trump and his is not the only Presidency we have not seen the use of this political tool, for what is all too often lazy politics. Yet it does not have the consequences it should have for all those involved compared to here in Australia. Confidence of Supply is essential for any government in power under our system of government, because governments fall without it resulting in all too often new elections, which has consequences for both sides of power.
Bernie Sanders faces questions about political future
By STEVE PEOPLES
Friday, January 11
NEW YORK (AP) — Allies of Vermont Sen. Bernie Sanders are rallying behind the embattled presidential prospect, even as they reluctantly begin to ponder a painful possibility: a 2020 presidential field without him.
The 77-year-old self-described democratic socialist is the most prominent presidential contender to face a serious setback in the nascent 2020 campaign season. He’s been forced to confront a series of reports detailing allegations of sexual harassment of women by male staffers when he ran for president in 2016.
Sanders’ loyalists fully expect him to launch a second campaign in the coming weeks. And his broad network of die-hard supporters is hosting hundreds of events across the nation this weekend encouraging him to run.
But the persistent allegations put Sanders in an unenviable political position in the early days of a presidential contest playing out in a #MeToo era that’s offered little mercy for those associated with allegations of sexual harassment. While his Democratic competitors tour crucial states and scope out potential campaign headquarters, Sanders spent Thursday apologizing for the behavior of a handful of his 2016 staffers and looking for a new ones to run his 2020 operation should he enter the race.
Some Sanders allies expressed shaken confidence in the political future of the man who has reshaped Democratic politics in recent years and almost single-handed brought liberal priorities like “Medicare for all” and free college education into the party’s mainstream.
“If he doesn’t run, there’s a massive void in this country,” said RoseAnn DeMoro, an activist and former executive director of the National Nurses United union, who reiterated her support for Sanders. “The passion in that base goes away. That base evaporates. It doesn’t go to someone else. There would be a void so deep it would go to (President Donald) Trump, I suspect.”
Politico reported Wednesday that in July 2016, a former senior adviser forcibly kissed a young female staffer after making sexually explicit comments. Sanders’ team said the adviser, who denies the allegation, would not be involved in a second campaign should there be one; and former campaign manager Jeff Weaver, who was aware of some of the incidents, would not serve as campaign manager again.
No one has alleged that Sanders had direct knowledge of the incidents.
“Obviously, it’s impacted all of us quite a bit. It’s very upsetting,” said Heather Gautney, executive director of Our Revolution, the political arm of Sanders’ network.
Despite her concern, Gautney warned Democrats that a 2020 contest without Sanders would inflict serious damage on ambitious plans to shake up health care, education, housing and other liberal priorities.
“Bernie is holding the flank on the left. If he doesn’t run for president, then the whole horizon shifts, and universal health care maybe gets taken off the table,” Gautney said. “In my view, he is an absolutely necessary part of our political system.”
Sanders may not be taken seriously by some in the political establishment, but he would be a force in the 2020 contest should he run. Having nearly beaten Hillary Clinton in the 2016 contest, he boasts an engaged nationwide network, an incredible grassroots fundraising ability, and would almost certainly take some of the very same voters being courted by likely 2020 contenders such as Massachusetts Sen. Elizabeth Warren, New Jersey Sen. Cory Booker and former Texas Congressman Beto O’Rourke.
Former Sanders’ staffer Giulianna Di Lauro Velez, who alleged she was harassed during the 2016 campaign, wrote Thursday in The Intercept that sexual harassment is prevalent in many political campaigns. But she wrote that new allegations on Sanders 2016 campaign indicate “the depth of the problem was likely deeper than most knew.”
She called on Sanders to “take the rare step of setting up an independent investigation into the 2016 allegations.”
A Sanders spokesman did not immediately respond to questions about Velez’s comments.
Earlier in the day, Sanders apologized, as he did last week, for the harm done under his watch and offered a direct message to women affected.
“I thank them from the bottom of my heart for speaking out. What they experienced was absolutely unacceptable and certainly not what a progressive campaign — or any campaign — should be about,” Sanders said during an unrelated Capitol Hill press conference, highlighting mandatory training and a third-party hotline instituted during his subsequent Senate re-election to safeguard against further harassment.
Sanders added: “Every woman in this country who goes to work today or tomorrow has the right to make sure that she is working in an environment which is free of harassment, which is safe and is comfortable, and I will do my best to make that happen.”
Sanders’ critics in the Democratic Party — and many remain three years after his heated feud with Clinton — seized on the new revelations as reason to abandon any 2020 plans.
“These allegations inform us that Bernie is really not concerned about the well-being of women. And therefore, he would not represent us well as the president,” said Toni Van Pelt, president of the National Organization for Women. “I really think Bernie needs to sit down.”
Sanders’ vast political network does not agree.
Several groups allied with the Vermont senator have ramped up activities in recent days to bolster a likely presidential bid. Our Revolution launched a “Run Bernie Run” online campaign and petition drive on Wednesday while groups like People for Bernie Sanders and Organizing for Bernie plan to host nearly 400 events across the country on Saturday encouraging a second run.
Katherine Brezler, co-founder of People for Bernie Sanders, said the allegations of sexual harassment had absolutely no impact on her preference for Sanders. The New York activist said that sexual harassment was present in virtually every one of the 100 or so campaigns she’s worked on.
“I’ve met those people and they’re not Bernie Sanders,” Brezler said. “We are not going anywhere.”
Associated Press writers Elana Schor and Juana Summers in Washington contributed to this report.