Thursday, August 17, 2006
Are price controls coming to California?
[Sally C. Pipes, "Arnold's Raw Deal: Gov. Schwarzenegger tries to sell price controls," The Wall Street Journal, 16 August 2006.]
Pacific Research Institute president Sally Pipes takes Governor Schwarzenegger to task for trying to impose price controls on pharmaceutical companies in this recent column:
Gov. Arnold Schwarzenegger is promoting his new discount drug plan as a "voluntary" agreement between pharmaceutical companies and the State of California. But it's more like a raw deal.
The California Prescription Drug Initiative calls upon drug manufacturers to offer five million low-income Californians huge discounts on prescription medications--up to 40% on brand-name drugs and a whopping 60% on generics.
Presumably, drug companies should offer these discounts out of the goodness in their hearts. But if they don't comply? Well, then they'll be coerced by the Terminator.
There is a better way.
The market economy remains the best supplier of human needs--including health needs. It has made the United States the world leader in the research and development of new medications and in health care overall.
Rather than pushing for socialist price controls, Gov. Schwarzenegger should pursue free market ideas. He should support the federal legislation proposed by Rep. Shadegg (R., Ariz.) which allows people to shop for insurance across state lines. He could make health insurance premiums tax deductible. And he could promote changing the tax code in California so that contributions to Health Savings Accounts are not subject to state income tax.
Such policies would help people afford the drugs they need without creating economic distortions. And there would be no strong-arm tactics required. Of all people, Arnie should know better than to give someone a raw deal.
[Kenneth Daniel, "The roles of doctors drugs in health care costs," The Kansas City Kansan, 26 January 2006.
Matthew Hisrich, "Sebelius is practicing black-market politics," The Wichita Eagle, 10 December 2004.
Matthew Hisrich, "Drug importation," Letter to the editor, The Kansas City Star, 9 December 2004.]
Pacific Research Institute president Sally Pipes takes Governor Schwarzenegger to task for trying to impose price controls on pharmaceutical companies in this recent column:
Gov. Arnold Schwarzenegger is promoting his new discount drug plan as a "voluntary" agreement between pharmaceutical companies and the State of California. But it's more like a raw deal.
The California Prescription Drug Initiative calls upon drug manufacturers to offer five million low-income Californians huge discounts on prescription medications--up to 40% on brand-name drugs and a whopping 60% on generics.
Presumably, drug companies should offer these discounts out of the goodness in their hearts. But if they don't comply? Well, then they'll be coerced by the Terminator.
There is a better way.
The market economy remains the best supplier of human needs--including health needs. It has made the United States the world leader in the research and development of new medications and in health care overall.
Rather than pushing for socialist price controls, Gov. Schwarzenegger should pursue free market ideas. He should support the federal legislation proposed by Rep. Shadegg (R., Ariz.) which allows people to shop for insurance across state lines. He could make health insurance premiums tax deductible. And he could promote changing the tax code in California so that contributions to Health Savings Accounts are not subject to state income tax.
Such policies would help people afford the drugs they need without creating economic distortions. And there would be no strong-arm tactics required. Of all people, Arnie should know better than to give someone a raw deal.
[Kenneth Daniel, "The roles of doctors drugs in health care costs," The Kansas City Kansan, 26 January 2006.
Matthew Hisrich, "Sebelius is practicing black-market politics," The Wichita Eagle, 10 December 2004.
Matthew Hisrich, "Drug importation," Letter to the editor, The Kansas City Star, 9 December 2004.]
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