Dissecting George Will
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Although I am a McCain supporter, I feel I've been pretty fair-minded about it. I certainly have been upfront about my motivations and reasoning, as well as making no secret of the fact that Fred Thompson more closely suited my own views.
As part of my fair and reasonable approach, I found no small frustration in reading George Will's recent article which, I think, has been reasonably well-received at Redstate.
Dissection might be too strong a word. Also, it is the nature of blog entries such as these to be a bit churlish, peeved, and perhaps petulant. I'm sure I'll not avoid sounding so, though I'll try throughout.
I do intend to start, however, by sounding churlish, peeved, and perhaps petulant. I feel that is in-kind retaliation after reading this opening:
In 2004, one of John McCain's closest associates, John Weaver, spoke to John Kerry about the possibility of McCain running as Kerry's vice presidential running mate. In "No Excuses," Bob Shrum's memoir of his role in numerous presidential campaigns, including Kerry's, Shrum writes that Weaver assured Kerry that "McCain was serious about the possibility of teaming up with him," and Kerry approached McCain. He, however, was more serious about seeking the 2008 Republican nomination.
But was it unreasonable for Kerry to think McCain might be comfortable on a Democratic ticket? Not really."
I'm sorry, and by that I mean I'm not at all sorry, but this is just another variation on "fake but true". McCain was not interested in being Kerry's running mate, but, AHA! Kerry thought he might be. Very compelling. After all, we know how revered John Kerry is as an astute observer and keen thinker. If only we could get Kerry's insights into other politicians in order to better understand them as well. Oh wait, here's one:
"Who better than Barack Obama to bring new credibility to America’s role in the world and help restore our moral authority?"
Yes, well, let's certainly keep a sharp ear on John Kerry, soothsayer of the soul.
However, let it not be said, or rather not by me, that George Will is a bad man. I do not say he is a bad reporter, columnist, opinion ... ater. I think he is wrong. The fact that he was cantankerously wrong doesn't bother me, I often enjoy his irritated writing.
So in fairness, Will did not rely solely on John Kerry. Here's another excerpt:
In ABC's New Hampshire debate, McCain said: "Why shouldn't we be able to reimport drugs from Canada?" A conservative's answer is:That amounts to importing Canada's price controls, a large step toward a system in which some medicines would be inexpensive but many others – new pain-relieving, life-extending pharmaceuticals – would be unavailable. Setting drug prices by government fiat rather than market forces results in huge reductions of funding for research and development of new drugs.
I find this wholly misleading. Senator McCain didn't suggest that price controls were good or that government fiat should supplant market forces, or even that we should dabble in such things. Senator McCain suggested that allowing reimportation would introduce competition (also known as market forces). Whether you agree or disagree with Senator McCain I leave to you. My disagreement here is with Will.
We do not become price controllers by association or osmosis. It is not contagious. That the free market would be forced to compete with price controlled drugs does not make us price controllers. By that logic, we would have to stop all imports on all freely traded goods where the foreign government controlled prices. None of which is material to the point. George Will hopes you will follow his guilt-by-osmosis reasoning to determine that John McCain opposes free markets. Now there's an assertion that could do with some free-market competition.
By the way, Will's reasonable conclusion from the above was:
"McCain's evident aim is to reduce pharmaceutical companies' profits."
Does anyone really need me to analyze that? His "evident" aim? His stated aim was to introduce competition, and to allow access to drugs that perhaps cost less. Senator McCain is suggesting removing an artificial restriction on free trade. George Will's liberal interpretation leaves much to be desired.
So far we have guilt by association, then guilt by importation, and then:
"Because McCain is a 'maverick' – the media encomium reserved for Republicans who reject important Republican principles – he would be a conciliatory president. He has indeed worked with Ted Kennedy on immigration reform, with Russ Feingold on restricting political speech (McCain-Feingold) and with Kennedy and John Edwards – a trial lawyer drawn to an enlargement of opportunities for litigation – on the 'patients' bill of rights.'"
What a streak! Ted Kennedy! Russ Feingold! Ted Kennedy! John Edwards! Media! Trial Lawyers!
Guilt by association is great. Did you know that George Will is part of the media? That he writes for Newsweek? That he went to Harvard? Media! Liberal press! Elitist liberal universities!
McCain says he would nominate Supreme Court justices similar to Antonin Scalia, Clarence Thomas, John Roberts and Sam Alito. But how likely is he to nominate jurists who resemble those four: They consider his signature achievement (McCain-Feingold) constitutionally dubious.
Well it's an ad hominem circumstantial argument, but clearly Will is not averse to fallacies given the number of instances of guilt by association. It is also a weak argument. He asks you to agree with him that McCain-Feingold is John McCain's overriding concern in life. Given Senator McCain's history, his family, and his personal beliefs, such agreement requires a particularly bitter and nasty point of view.
Moreover, if President Bush taught us anything, it is what happens when you nominate Harriet Miers. I trust Senator McCain's word, his interests, and his political reality. He'll appoint good judges.
Will ends his article on the most obvious point of all:
When McCain and Joe Lieberman introduced legislation empowering Congress to comprehensively regulate U.S. industries' emissions of greenhouse gases in order to "prevent catastrophic global warming," they co-authored an op-ed column that radiated McCainian intolerance of disagreement. It said that a U.N. panel's report "puts the final nail in denial's coffin about the problem of global warming." Concerning the question of whether human activity is causing catastrophic warming, they said, "the debate has ended."
Will's first straight talk of the article. That was, indeed, the closing paragraph of the editorial. John McCain is an AGW subscriber. We are clearly meant to conclude that this makes him a Democrat. Due respect to Mr. Will, but I'll be satisfied with concluding that Senator McCain is merely wrong.
George Will is a thinker and, in many ways, a libertarian voice; But he is not the author of the Republican party, the steward of its rolls or, indeed, its conscience. He is a good writer, and a good man, but he is wrong.
John McCain is no Democrat. He believes in life, patriotism, National Defense, fiscal responsibility, personal responsibility, honor, courage and commitment. I call those conservative views. On some issues, he is wrong.
George Will and John McCain have that in common. They are fallible. This article managed to show that about both of them.
I love George Will, but the strangest thing about this column is that back in May, Will was writing that John McCain was an acceptable conservative alternative.
"The Constitution was made to guard the people against the dangers of good intentions."
Back then, social conservatives were justifiably alarmeed--and we remain so.
I think it's obvious that everything was just fine when Rudy appeared to be the frontrunner.
"People will not look forward to posterity who never look backward to their ancestors." -Edmund Burke
..and how about the quote where he advocates for McCain as the "acceptable conservative alternative", which you seem to be implying was some type of endorsement.
If anything, Will has been vocally against McCain, especially on so called "campaign finance", et al other issues.
"Nec Aspera Terrent"
bene ambula et redambula
Contributor to The Minority Report
McCain is not my first choice, but to make McCain a liberal villain the way he did was absurd and not supported by facts.
The current status quo on international drug prices seems terribly unjust to me.
How it works is this, if I'm not mistaken: Drugs cost alot of money to make--not the marginal cost of producing each additional dose, but the intense research and development costs. These costs are incurred only in anticipation of the prices that can be charged--prices that are in some part dependent on the strong protection against imitation versions that can be reproduced very quickly.
So who pays this cost? The current situation--which is just fine by the pharmaceutical companies--is that American consumers pay all the R&D costs, while citizens of other countries (e.g, Canada) get to pay simply the manufacturing costs, because their governments negotiate bulk-sale agreements.
It REALLY ticks me off that these American executives have no problem sticking their fellow citizens with the jacked-up price, while providing a bargain to foreigners.
So let's allow the importation of drugs from Canada. What might happen? Well, lo and behold, those same drug companies might just have to shift their energies from lobbying Congress to renegotiating their sweetheart deals with foreign govnernments. And their socialized systems will lose the subsidy provided by sick Americans.
"People will not look forward to posterity who never look backward to their ancestors." -Edmund Burke
The problem these drug research companies face, is that the socialist confiscatory countries out there have no real respect for property right. And so supply and demand don't apply: if the politicians in Canada or elsewhere don't like the price offered, or if the company refuses the deal and doesn't sell at all, the company's patent will be revoked and they won't be able to make *any* money back.
I'm not sure what the answer to this is? We don't really have any tools to fight countries that attack American firms abroad that don't hurt Americans, too.
if the company refuses the deal and doesn't sell at all, the company's patent will be revoked
If that really is true, then we have a serious issue with Canada. I think you're mistaken, but since I don't follow that issue closely I could be mistaken. Do you have some documentation that Canada violates U.S. drug patents when the seller rejects their offer, or has threatened to do so?
My understanding is that Canada offers a take it or leave it price for a drug (or maybe negotiates), and the U.S. companies are free to say "No deal" in which case Canada won't use that drug. The property rights in that transaction (whether negotiation or take-it-or-leave-it) are the same as between any other potential buyer and seller, though in this case Canada as a big customer (like say a huge HMO) has leverage to press for a better price.
The pharmaceutical companies generally do accept the offer, because selling at the controlled price is still better than not selling at all in Canada. Nobody takes away their right to walk away from the offer.
I never read anywhere that Canada would use an illegal generic version of the drug in violation of international patent agreements. Some third world countries have flouted such patents, but Western countries generally take patents and copyrights seriously, as part of the international trading system where they want to be in good standing.
And further, the whole world is against us on this. See the Pharmaceutical part of the TRIPS agreement. Quoting the WTO, with emphasis added:
The TRIPS Agreement provides flexibility for governments to fine tune the protection granted in order to meet social goals. For patents, it allows governments to make exceptions to patent holders’ rights such as in national emergencies, anti-competitive practices, or if the right-holder does not supply the invention, provided certain conditions are fulfilled. For pharmaceutical patents, the flexibility has been clarified and enhanced by the 2001 Doha Declaration on TRIPS and Public Health. The enhancement was put into practice in 2003 with a decision enabling countries that cannot make medicines themselves, to import pharmaceuticals made under compulsory licence. In 2005, members agreed to make this decision a permanent amendment to the TRIPS Agreement, which will take effect when two thirds of members accept it.
If the US allows reimportation, we could literally kill the industry and the life-saving drugs it creates. This is a tough issue.
Thanks for providing the link. That raises the theoretical possibility that it could be interpreted to use compulsory licensing as a way to force a lower price than the drug is sold in the producing country. That would require that the U.S. company's offer to sell the drug at the same price as it sells domestically is not "reasonable commercial terms and conditions" that would prohibit compulsory licensing. I'm not quite so skeptical as I was before I saw your link, but in the absence of any report that this actually has happened or been threatened under current treaties, it's just literary speculation on the quoted words. I googled "compulsory licensing" combined with Canada and various other drug terms, and didn't find any such reports.
If the US allows reimportation, we could literally kill the industry and the life-saving drugs it creates.
Kill the industry? Being able to sell drugs in other countries does pump more money into the incentive for research, but I don't buy that the companies would all halt research if they can't sell in Canada.
How about this as a policy: The U.S. government will block drug reimportation from any country that doesn't respect drug patents. I doubt Canada is such a country, but if it is, I'm with you on blocking reimportation.
For any other country, which doesn't violate the pharmaceutical patents, it's the pharmaceutical company's job to sort out its deals with that country, and they shouldn't expect me to pay taxes for custom inspectors to do their work for them.
If a drug company wants to tell Canada they'll only sell for the U.S. price (hence no incentive to reimport) that's their business and fine with me. Ditto if they want to negotiate a deal selling drugs to Canada only if Canada prevents those drugs from being shipped outside Canada; if it's ok between the company and Canada, who am I to object. What I do object to is expecting me to pay for inspectors to do what the drug companies are free to do for themselves.
Basically, I think your idea would be worth trying, if we can make ourselves credible in the eyes of the firms. If they believe us, then they can negotiate accordingly. If they don't believe us that we'll keep the policy, then they're in trouble.
I think I'll quit now while we at least partly agree on something. Back to usual soon enough no doubt ;-)
"If they don't believe us that we'll keep the policy, then they're in trouble."
Considering the way we enforce our immigration laws, I don't think our threats of future retribution and enforcement would mean much to anybody.
The "Third Worst Person in the World" and aiming higher.
Compulsory licensing is alive and well around the world. Canada hasn't been, to my knowledge, a culprit of the practice but if you look to places like Brazil, Thailand, and India the practice is becoming increasingly commonplace when dealing with the most expensive drugs (especially AIDS retrovirals in those cases I just mentioned).
"The Constitution was made to guard the people against the dangers of good intentions."
Except I can't help but add something that would be objected to here--Drug companies must offer the same deals to US wholesalers that they offer to foreign governments.
"People will not look forward to posterity who never look backward to their ancestors." -Edmund Burke
I think you and Neil covered this pretty well, including the part abut the TRIPS agreements, which give foreign governments just enough leverage to do what they do.
But I believe you're wrong here:
"American executives have no problem sticking their fellow citizens with the jacked-up price, while providing a bargain to foreigners."
It isn't the "jacked-up" price we pay, but the real price. It's the price necessary to cover ALL costs and generate some profit. It isn't set by the government here, it's set by the market. But you say, "Hey, the company gets whatever it asks for." Not quite true, because they do have competitors who develop similar drugs. They don't come and pry the money out of our pocket. You don't HAVE to buy the drugs. You CHOOSE to do so because you want to (and if you can't really afford to, there are ways to get reduced prices).
This will be the case in any country that doesn't have government directed pricing.
Now, take Canada. (All prices imaginary.) Let's say they want to import Lipitor, so they strike a deal with Pfizer to sell it in Canada for $150 per 90-day supply. They will pay Pfizer $100 for it. Pfizer can make and deliver it for $50 dollars, so they agree, knowing that they'll make 100% profit on their cost to produce and deliver.
Meanwhile, in the US, Pfizer makes $75 per batch by selling to distributors at $125 the drug that still costs $50 to make and deliver. Pfizer's profits are much bigger in the US than in Canada, because the US market is bigger and because the profit per batch is bigger. But in neither case is the actual profit $50 or $75, because Pfizer is also paying down it's development costs, which are far greater than its production costs.
If Pfizer didn't have the added revenue from the Canadian sales, it would have to charge even more for the US drugs in order to recoup those development costs.
What's wrong with re-importation from Canada? Well, imagine that all the US sales now bring in just $50 above production and delivery cost. And imagine that doesn't produce any profit at all over the development cost. What will Pfizer do? It'll lose money on every batch until it writes off its development investment as a loss. Then it becomes just like any other generic drug maker, but one that has sustained a multi-billion dollar loss, and so will it's shareholders, including me and probably including you if you own any kind of broad market mutual fund or pension plan.
Now imagine what Pfizer will do in the future. Not develop new drugs; they are sure losers. It will just continue to make copies of other companies' drugs. And what will those companies do? The same thing. Which is why Neil is exactly right when he says below that reimportation will kill our drug industry. Eventually, no new drugs will be developed, and that is what Will meant when he said "innovation would stop." It would have to, because there wouldn't be enough profit in innovation to make it worth trying.
This really isn't complex economics, but it clearly is above McCain's head, or else he would rather play dumb than confront the issue (which, I believe, he brought up). On economic matters, Romney gets it, McCain doesn't. What would McCain give away to our international competitors simply because he doesn't understand economics?
The "Third Worst Person in the World" and aiming higher.
It's not that the other thing is not done on occasion at RedState, but it does require metal implements and is best done with power tools.
Kill the terrorists
Protect the borders
Punch the hippies -- Frank J
Good job on the McCain/Kerry part. I don't believe he came close to running with Kerry.
McCain does cosy up to and make deals with the most liberal of the Dems. My senator Orrin Hatch has a habit of doing that with Kennedy in the last few years and has caused the loss of my support. As I view Hatch being well to the right of McCain, I can not see myself forgiving McCain for doing far worse.
As for AGW it is the biggest tax scheme in history. The only way you can defend McCain on AGW is if you believe it yourself.