You cannot have your cake and eat it, too. It is a tale as old as time. But apparently, with its latest “Most Favored Nation” executive order on drug pricing, the Trump administration has stumbled upon a solution to this conundrum.
Or so they would have you believe.
The entire phenomenon centers around the hotly contested Affordable Care Act (ACA), or Obamacare. On one hand, the Trump administration is litigating before the Supreme Court in favor of the entire law being struck down as unconstitutional. On the other hand, the administration would like to use an obscure provision within the very same law in order to implement its new drug pricing mandate.
Can you see the problem?
Before we can even discuss the merits of price controls and their implications for our healthcare system, simple logic should have dismissed this latest action when it was first proposed. If you believe a law to be unconstitutional and invalid, how can you then use that law to carry out a particular policy agenda? The numbers simply do not lie. And perhaps this is why this particular executive order stayed under lock and key until September 13th—nearly two months between its signing and when it officially went into effect.
If you still are not sold, that is OK. After all, the Supreme Court could very well uphold the ACA as constitutional. If that happens, it would be easy to assume that President Trump’s executive order would then be in the clear. Fortunately, these assumptions are far from accurate and there is plenty of policy and precedent standing in stark opposition to this executive action.
A “most favored nation” pricing model is an extreme form of international price indexing (IPI), where price caps on certain drugs are put in place based on an average price obtained from a select group of other countries. These arbitrary price controls would have devasting effects on our access to groundbreaking drugs. The U.S. would be basing its drug market off of Europe, where socialized, restricted medicine is the norm. And such an approach exceeds the statutory authority of the executive branch. Under basic constitutional separation-of-powers principles, “sweeping” and “very dramatic”—the president’s own words—changes to major federal programs must be authorized by Congress. To date, Congress has flatly rejected any form of international price controls. Period.
The executive branch hopes to carry out its ambitious plan through an obscure clause in the Affordable Care Act, whereby modest authorization for testing “pilot projects” in underserved populations is authorized. According to President Trump, however, this new order contains “the most far-reaching prescription drug reforms ever issued.” But an unprecedented new program that will disrupt the entire healthcare sector is a far cry from a modest “pilot project.”
Simply put, the authority to execute this administration’s latest drug pricing mandate simply is not there. The same administration is fighting to strike down the very law it is using for this order. Congress has already plainly rejected the international pricing model. And the ACA itself does not grant the statutory authority for such a measure in the first place.
Until recently, this administration had a good record on healthcare—fighting to protect American innovation and promoting measures such as rebate reform and price transparency. Why, then, reverse this approach in favor of dangerous and unconstitutional executive actions?
President Trump is at his best when he is fighting for America, and he must return to supporting our pharmaceutical innovators that will get us through the current health crisis. We must stop “global freeloading” off of American innovation and negotiate more favorable deals with foreign governments. We need them to contribute their fair share toward research and development costs for new treatments and vaccines that are changing the world. These are solutions that will lower drug prices.
The president is a dealmaker, and that is exactly what we need during COVID-19. America must leave the cake outside and return to the head of the table.
Unexpected expenses are never welcome and no one likes a costly surprise. So it isn’t surprising that there has been a lot of talk in Washington and Congress about “protecting” patients from surprise medical bills. And if rumors swirling around Washington are true, the Administration will enter the fray with an announcement about an executive order that will supposedly “fix” the surprise medical billing problem. This may sound good, but in reality it won’t be good news despite the Administration’s best intentions. In the end, a government “solution” will simply drive out and crowd out market forces which if allowed to work would not only solve the surprise billing problem and reduce costs to consumers, but also maintain the highest levels of quality and incentivize innovation in our healthcare system.
The most common cause of a surprise medical bill is when a person uses a healthcare provider that is not in their insurance plan’s network of providers. While it doesn’t happen that often, it is a real challenge for consumers when it does happen. Insurance companies have contracts with healthcare providers to provide medical services at discounted rates. That makes them “in-network.” The “out-of-network” providers charge a price without any pre-negotiated discounted rates which means the out of network costs are greater.
These circumstances, no matter how rare, are used by politicians to make us think they are proactively solving problems for our benefit. Sadly, they are doing nothing of the sort. One only needs remember how President Obama and Vice President Biden repeatedly promised that they would save us all thousands of dollars every year and allow us to keep our health insurance and our doctor. Obviously, Obama and Biden failed to deliver on that promise. It was the lie of the year even as judged by liberal fact checkers. Literally, millions of Americans lost their preferred plans and virtually everyone saw their health insurance costs increase — not decrease by thousands.
So a healthy dose of skepticism about promises to fix surprise billing with government price controls is entirely justified. Government imposed price controls skew incentives and reduce the availability of quality healthcare. To make things worse, government imposed price controls also reduce the likelihood of future healthcare innovations and slow the development of promising medicines and procedures. But the bad news doesn’t end there — government mandates almost invariably shift power to government bureaucrats and health insurance companies, rather than giving consumers more control over their own healthcare.
And it is fair to ask what is the government’s track record on reducing costs? And on top of that, government mandates will do nothing to reward innovation or to empower consumers.
The marketplace — and the negotiations that take place when you have two or more parties all trying to maximize the value that they receive — has a knack for providing high quality goods and services for the lowest possible prices. That is the process that has brought us smart phones that have more computing power than was used in the 1960s in the Apollo program. Today, the average American eats better and spends a lot less to feed themselves than our great grandparents did. We also have access to all manner of foods — something even kings didn’t have a few generations ago. Additionally, we work far fewer hours to obtain that food. This is the power of the marketplace and the innovation that it encourages.
We need to harness that market power which will deliver high quality and low prices in the medical arena. Because the government has historically been such a big player in the medical field and because it is always arguing for a larger and more powerful role, we will see less quality and higher prices than the marketplace could have provided.
Instead of continuing to empower government, let’s try reforms that put economic power back in the hands of healthcare consumers. Where’s the proof that government run schemes produce the needed quality and lower costs? Let’s trust the marketplace to do what it does so well — boost quality and keep prices comparatively low. We trust the marketplace to provide us with food, housing, technology, and a thousand other things. Why not healthcare?
Why politically correct institutions cave to Communist China
Last week a few sharp-eyed members of the audience for Disney’s live-action remake of Mulan noticed something ugly in the credits. The film’s producers thanked, among others, the publicity department of the “CPC Xinjiang Uyghur Autonomous Region Committee” as well as the “Turpan Municipal Bureau of Public Security.” These are the same political and disciplinary institutions that oppress China’s Uighur minority. Disney cooperated with them without batting an eye.
But Disney is more than happy to call attention to human-rights abuses in the United States. Since George Floyd died in police custody earlier this year, the corporation and its subsidiaries, including ABC and ESPN, have issued statements in support of Black Lives Matter. The House of Mouse has reaffirmed its commitment to the ideology and practices of diversity, equity, and inclusion. Nor is Disney the only film studio to ignore repression in the People’s Republic of China while embracing the cause of social justice at home. They all do it. The question is why.
Part of the reason is parochialism. Americans just don’t care very much about what happens in other countries. Another motivation is profit. All companies desire access to the largest possible markets. Angering the Chinese Communist Party, or violating the tenets of political correctness, endangers the bottom line. Meanwhile the legitimacy of political, cultural, and economic institutions, including the corporation, has come into question. To ensure their survival, corporations must conform to the values and regulations of host societies and governments. That means playing nice with China, embracing “stakeholder capitalism,” and adopting the teachings of Ibram X. Kendi.
Selective indignation is not new. What’s striking about this latest version is its zones of prevalence. The sectors of the economy most wedded to the view that American society is systemically racist—entertainment, sports, media, tech—are the least concerned with the real and concrete injustices of the antidemocratic and hostile Chinese regime. This is the woke dialectic: dissent in America, acquiescence to China.
Just as people became aware of Mulan’s complicity in injustice, the Academy of Motion Picture Arts and Sciences promulgated a complicated set of ethnic, racial, and sexual quotas that films must meet in order to become eligible for the best picture Oscar. “The Academy Museum of Motion Pictures is committed to building an antiracist, inclusive organization that will contextualize and challenge dominant narratives around cinema, and build authentic relationships with diverse communities,” read part of the statement announcing the rules. But the Academy is less interested in contextualizing and challenging the absence of civil and political rights elsewhere. In 2013 it was happy to accept $20 million from one of China’s largest multinationals.
The NBA is no different. Its front offices, coaches, and athletes are among the most progressive in the country. Social justice messages adorn players’ uniforms. “Black Lives Matter” is painted on the court. LeBron James has leveraged his celebrity to earn further political concessions from the league, including the transformation of arenas into polling places on Election Day. But James has also made embarrassing comments regarding the conflict between democracy and autocracy in Hong Kong. And the league itself carries the shameof having operated training facilities in Xinjiang.
The Washington Free Beacon has shown that the same newspapers that devote so much space to advancing America’s racial reckoning (and whose foreign desks often report on the foulness of China’s dictatorship) also accepted millions from the Chinese government to run propaganda. The same company, Alphabet, that earlier this year announced millions in donations to social justice nonprofits expressed no qualms in 2017 when it opened an AI research center in China.
In other words, the same businesses that promote the progressive reconstruction, radical reform, or transformation of the United States are intertwined with the revisionist great power that aims to replace the United States as global hegemon. This synthesis of the woke dialectic lends an additional meaning to the term “allyship.” And it is why champions of individual rights, equality under the law, due process, and pluralism stand athwart both political correctness at home and authoritarianism abroad.
Is feudalism our future?
The closer the 2020 election comes, the more urgent the necessity for understanding the wealth gap which underlies the entire debate.
The fundamental issue at stake in this election is how America will deal with the fact that the American Dream we all pursue has in fact become unattainable for many Americans. With most national politicians in their 70’s – or even older – the reality is that they simply do not understand that too many Americans today face a gloomy future. They are at a loss to explain why the nightly riots and violence can happen at all let alone why the public officials at least tacitly, and some openly, support such chaos.
What they don’t understand is that there is a great deal of anger in our land, that the traditional mantras of the American ethic just don’t work anymore for a segment of the American population. “Work hard, keep your nose clean, and you too can live the American dream” just isn’t true for these folks, and hasn’t been for a long time.
Who are these people? And why are they so desperate for change?
One of the oldest questions in the American lexicon is, “What happens to the manual workers when the American quest for labor-saving technologies finally succeeds and the need for human labor ends?”
Now we know the answer to that question: The many American workers who have lost their jobs to technology are still there. But now they have nothing – not even their pride.
There is, of course, another segment of our society which has done somewhat better financially through these years. They are the so-called “upper middle class” who have adapted to the technological society, although they are concentrated now in the service industries, since manufacturing has all but disappeared.
Even their children, however, have been affected by their estrangement from two work-alcoholic parents, whose closeness to their children is questionable as is their loyalty to each other. Many of the protesters are white, middle class youths, whose sympathies lie closer to their African American comrades than to their befuddled parents.
It is well known that a coalition opposing this President exists, consisting of the Democrat Party, the Deep State bureaucracy, and the Press, as well as the dedicated Far Left organizers and followers, who have coalesced around the issues of class and race so prominently featured in the violent summer of 2020.
It is clear that while these players have picked by various names the wealth gap as the key issue in this campaign, their timing of the current crisis was not dependent on their discovery of this issue. They have simply taken advantage of the uproar as it occurred.
So, what did happen?
What happened was the transfer of the asset wealth of the American population from the middle class (approximately 50% of the population) to the super rich (1% of the population). (The term, “assets”, is used instead of “income” because income can go up and down while assets tend to be more stable.)
How did this happen? Many factors came together and finally created one of the worst nightmares Americans have ever faced. The most obvious of these factors are three:
The result of this movement on the US working man was catastrophic. As the factories left American soil, the skilled workers were left behind with no job, no marketable skill, and eventually no hope.
The principle victims of this exodus were American men. Whereas their place in society and the family had always been respected and secure, they lost that place in both as they sought and were forced to take lower paying jobs or welfare.
Their self esteem followed their decline. Divorce rates soared along with family abuse, alcoholism, drug addiction, desertion, homelessness, and suicide and the decline of our cities left social services rare and bankruptcy all too common.
Through all this, the latch-key children bounced around helplessly, caught up in the whirlwind that their life had become. As they grew older, they asked “Work hard?” –“At what?” “College?” — “OK” and then no jobs available. “American dream?” — “What a crock!”
What they want is change. The old system isn’t working for them. Why is socialism suddenly becoming so popular? After all, it has been around since the 1930’s. Franklin Roosevelt’s Vice President, Norman Thomas, was an avowed socialist. Few believed in socialism as long as we had the American dream. People believe in socialism now because for them the American dream is gone. And socialists are the only ones listening to the cries of our suffering youth.
First, we must all recognize the underlying problem: it is the transfer of wealth! Prosperity for all tends to reduce all social tensions, as the Trump economy was beginning to show before COVID.
Secondly, if we do not want to watch our beloved country go the way of Venezuela, we had better face the realities of our situation and find a solution.
Finally, while some our people were caught in a vortex of tribulation, others were developing a new way, a new path to the American dream.
A third way: Luckily, many of these pioneers of a new capitalism have been not only inventing a new type of business process, but also organizing a potentially vast new movement to what will become, in my estimation, a new America, open to all races, genders and religions.
The most advanced of these renewed American businesses seem to be the Conscious Capitalistorganization, currently with 16,000 member companies, representing 3 million workers.
It aspires to become a new kind of business, one which is driven by its service to the community – whether that be a local factory, a retailer, or a worldwide marketplace.
The idealism of this brand of business is appealing to the young, who may not know socialism from a community swimming pool, but who do know that they are Americans who value their personal freedom and the room to grow into a happy future without a government telling them what they can and cannot do.
The dilemma facing this country is that conscious capitalists see politics, as do most Americans, in the light of partisanship. As a result, they want to be apolitical so that all sides feel welcome.
Nevertheless, in today’s America, you are either a socialist or a capitalist, either in favor of big government controlling the transfer of wealth from the 1% or in favor of devising a solution which is voluntary and based on merit rather than welfare.
Unfortunately, there are no candidates running for national office who present new alternatives to the socialist programs of the Democrats. The Republican alternative stands for continuing to implement Reagan economics, believing that the wealth gap will solve itself in time.
It seems clear that this is a better alternative than the opposition. At least a victory here would buy us time. By 2024 perhaps a “third way” capitalist will come forward.
As Alexander Pope wrote in 1734, “Hope springs eternal in the human breast.”
Even before the outbreak of the COVID-19 pandemic, the political, economic, financial, cultural, and moral health of the world have been quite unsettling. Most importantly, for centuries there has existed a yawning gap politically between nations whose constitutional foundations have been based on democratic principles and authoritarian states in which the participation of the people in their governments have been either non-existent or merely fictitious. While in the former elected politicians have been accountable in regular intervals to their respective electorates, in the latter either a single dictator or a small minority have reduced the people to fearful, passive, indifferent, and easily corruptible masses. Adding insult to injury, these authoritarian dictators have pretended to use their unlimited powers to transform their states from poverty stricken entities to developing and prosperous democracies. In reality, their sole objective has been to maintain absolute power regardless of the short and long term harm and damage they have caused to the states they have ruled by ruthless brutality.
To wit, this wholesale demoralization on the state level has metastasized globally and has succeeded to corrupt every single international organization. Presently, under the pretext of the notion of absolute equality of states and the aggressive promotion of multiculturalism, this spirit of authoritarianism threatens to annihilate the international order. Furthermore, it is an axiom of every authoritarian dictatorship that a fellow power-crazed and corrupt state is a better partner than a cumbersome democracy. Anti-democratic disposition, therefore, is an absolute sine qua non of acceptance into the club consisting of these malcontent collections of authoritarian dictatorships. Naturally, under their wretched conditions, an almost unimaginable degree of cynicism, falsehood, ignorance, cruelty, and ruthlessness have flourished. Logically, ideological subversion and psychological warfare have been the necessary global extensions of these authoritarian dictatorships, which comprise the majority of states in the world, to maintain their powers domestically as well as internationally.
Today, the whole world faces real turbulent times due to the coronavirus pandemic. The decline and even the ruin of national wealth in many countries caused by the highly contagious disease, the expected world-wide recession and even depression, the initial and ongoing mistakes and errors of the various bureaucracies, and the lack of coordination in responding to the pandemic have all contributed to the feeling of uncertainty and outright fear across the globe. In this situation, everyone suffers and will suffer. Moreover, general discontent with governments, their bureaucracies, financial institutions, businesses will certainly lead to silent or open protests. Conspiracy theories are already abound resulting in a spike of ethnic and religious hatred. The circumstances are ripe for sowing ideological confusion, pernicious brainwashing, and even extremist revolutionary schemes. The Communist Party of China and a colorful assortment of communist and socialist organizations throughout the world are pushing a mostly corrupted form of Marxism, hoping to capitalize on the peoples’ fresh misery. As usual, they traffic in an all encompassing revolution that will overthrow capitalism and replace it with a perfect earthly paradise. Conversely, the exploitation of the ubiquitous fear momentarily gripping the vast majority of the world’s population is equally dangerous to domestic as well as international tranquility.
The world is in dire need of global political leadership and great statesmanship. Contrary to the prevailing misplaced admiration, China is not ready, and will not be ready in the foreseeable future, to assume even a leading regional role in Asia. Although President Xi Jinping might disagree, he is not a statesman. Rather he is a tactician in the clothes of a dictator. As a dictator for life, i.e. dictator perpetuus, he has accumulated an immense amount of power. Simultaneously, his list of enemies has also grown exponentially. On the one hand, he has continuously violated both his country’s constitution and the constitution of the Chinese Communist Party, of which he has repeatedly declared himself a faithful servant. On the other hand, even with his enormous powers, he has not been able to stop the slow erosion of his government’s powers in the periphery of the People’s Republic. In this context, the continuing disintegration of the Party’s rule is a certainty. Equally importantly, China’s economy has been in steady decline since 2010. Furthermore, China’s finances are a mess, especially within its banking sector. International overextension, mainly driven by President Xi’s personal ambitions and hubris, will only exacerbate China’s financial woes. The undeniable fact that the COVID-19 virus originated in Wuhan will only add to his mounting problems and challenges. Information disseminated by a multitude of officials and media personalities controlled tightly by the Chinese Communist Party, have been mostly lies and fictions. Of course, having been conditioned by over seventy years of ruthless dictatorship, the Chinese people have known better.
However, the least believers in the official propaganda have been those close to President Xi and his colleagues in the Politburo, their top advisers, attendants, and secretaries. Not surprisingly, the most gullible individuals have been those foreigners whose knowledge of China is close to zero. Starting with the corrupt and incompetent director general of the WHO and continuing with the multitude of foreign politicians and journalists, they have been babbling on in unison about how great the Chinese government has been in managing of the coronavirus crisis. Yet, most alarmingly for President Xi, the circumstances of the emergence of this new coronavirus have shed a very negative light on the most vaunted ancient and allegedly superior Chinese culture. The ubiquitous existence of the “wet markets” are stark reminders of the devastating backwardness and periodic hungers of the destructive Mao era. One does not have to possess prophetic qualities to predict that President Xi will fail in his quest to make China the premier superpower. Moreover, it is almost certain that he will not remain the president for life. During his reign and thereafter, China will experience major upheavals and perhaps even a bloody revolution.
Beyond the domestic repercussions, the People’s Republic of China and its Communist Party will certainly face a great and protracted backlash internationally. The list of states demanding to hold China financially responsible for the pandemic and the resulting health, economic, and financial crises is growing daily. In the likely case that China would refuse to pay off, based upon relevant court decisions, confiscations of Chinese properties across the globe must be initiated. Finally, the United States of America must lead the campaign to clean house at the WHO, beginning with the immediate removal of its corrupt and incompetent Director General, the Ethiopian Tedros Adhanom Ghebreyesus.
Next in line is Russia or as it is officially designated the Russian Federation. As in the case of President Xi, Vladimir Putin is not a statesman. Like the former, the Russian president is also a tactician. Although his declared lofty objective has been to restore Russia to its 20th century greatness, his real political ambition is to cling to power indefinitely. Strategically, Russian politicians have been unable to overcome their geophobia, namely the fact that their territorially immense state stretches from continental Europe to deep into Asia. This geopolitical reality historically has manifested itself in a psycho-ideological schizophrenia. The resulting division between the so-called Westernizers and the Slavophiles has left Russia in a political, economic, and cultural vacuum. This permanent oscillation between two cultures only gave the Russian people uninterrupted misery in the form of autocracy and dictatorship. Byzantine Christianity merely exacerbated the basic characteristics of the Russian people, namely, deceit, dishonesty, falsehood, prevarication, superstition, and fatalism. Putin’s Russia combines all these forces and characteristics into an old fashioned centralized autocracy, in which stagnation and arrested development will keep both the state and the people in shackles. Fundamentally, Russia will never regain its 20th century international status. Beyond its militarism, it will remain both economically and financially a second or even a third rate power.
In its current condition, the European Union is a barely functioning chaotic mess. Unless its member states understand that the key to their survival as a powerful organization is a more perfect union based on undivided solidarity, the European Union’s political, economic, financial, monetary, and cultural disintegration can be predicted with high certainty. Politically, the most important problem is the lack of leadership within and among the various institutions. The European Council presently headed by Donald Tusk has been incapable of providing strategic guidance and of setting policy objectives. The European Commission has been a bureaucratic bottleneck. Its efficiency in implementing EU decisions and common policies has been abysmal. The Council of the European Union, also known as the Council of Ministers, has always resembled more a marauding society than an organ of legislation and execution. The European Parliament has traditionally been the weakest part of the European Union. Its bloated membership and its many caucus groups have relegated the European Parliament to a veritable debating society with questionable legislative benefits.
The United Kingdom’s exit from the European Union might signal the beginning of a mass exodus from the organization. The list of unhappy member states is long. Perhaps with the exception of the founding members and the Scandinavian countries, all the other member states have registered their specific complaints and reservations against the political, financial, and economic policies of Brussels. In short, the vision of a united Europe after two devastating wars was and is still very appealing. Yet, in its current condition, the European Union is unbalanced and highly susceptible to real and imaginary dangers.
One of these real dangers is financial. The other closely related danger is the state of the economy. The EURO and the economy have suffered from the fact that both have been designed as inflexible models, incapable of adjusting to changing circumstances. Unlike the United States of America, China, Japan, Israel, South Korea, Singapore, and a score of other states, there is not a single new company within the European Union that is based on the emerging technologies of the fourth Industrial Revolution, such as Artificial Intelligence.
Compounding the economic stagnation, the single currency has not contributed to the promotion and a more efficient functioning of the single market. As a result, the eurozone economies have shown anemic growth in the last three decades. Even the quantitative easing (QE) of the European Central Bank (ECB) of the last ten years has run its course and has worn off before the pandemic. The obvious solution would be to correct the inflexible structure within the monetary union.
As far as its defense and foreign policies are concerned, the European Union resembles another chaotic mess. The so-called Common Foreign and Security Policy (CFSP) has remained an unfulfilled dream. Disappointments with the competency and efficiency of various organizations of the European Union have caused Greece, Italy, and Spain to act upon their perceived national interests, often to the detriment of the common foreign policy objectives of the entire union. Moreover, the newly admitted members of the now defunct Warsaw Pact have openly revolted against many foreign policy directives of the European Union. In the extreme case of Hungary, its Prime Minister Viktor Orban has pursued a clearly revanchist foreign policy by awarding Hungarian citizenship and voting rights to ethnic Hungarians residing in the neighboring countries.
Emerging anti-Americanism in the guist of anti-Trumpism has only aggravated the already existing tensions between the United States of America and the European Union. Yet, these two powers are also allies in NATO. They both need each other politically, economically, and militarily. The overall effects of the pandemic call for a comprehensive conference with the objective of readjusting the relationship to the new realities of world politics and thus strengthening the alliance between the United States of America and the European Union.
The greater Middle East coupled with South-East Asia are real powder kegs. Enormous domestic problems and challenges have weighed heavily on the politics and the histories of these regions. Centuries old ethnic differences and pigheaded grievances return to inform policies in predictable intervals. Historically, every minority in these two regions has been a volcano ready to erupt at any moment. Religious hostilities disguised as political controversies have been tearing apart families, clans, tribes, societies, and nations to the detriment of their political and economic progress. Added to this mix of enduring miseries are the personal ambitions and hubrises of political leaders that as a rule do not tolerate any competition. Turkey’s Erdogan is feuding with the Islamic Republic of Iran on politics and religion. He also fights the Kingdom of Saudi Arabia for the leadership of the Sunni world. Meanwhile, the Arabs do not want to return to the past 1918 Ottoman domination, in which the former were treated as less than second class citizens of an Empire. And then there is the Islamic Republic of Iran. A country that was Islamicized by the sword of the Arabs but succeeded to maintain its Persian character and language. Having had adapted a minority version of Islam in the mid-17th century to fight the Sunni Ottoman Empire, the Shi’a religious establishment have fought hard since 1979, to regain Iran’s historic glory and influence.
Meanwhile, the leading Arab states are facing mounting domestic pressures and international challenges. The Kingdom of Saudi Arabia is struggling to modernize, while its oil revenues are on the decline. Egypt is on the verge of political and economic bankruptcy and total financial ruin. Libya, Syria, Lebanon, Iraq, and Afghanistan have been destroyed by the ongoing civil wars. Algeria and Sudan are oscillating between military rule and attempts at civilian transition.
Foreign interference has only exacerbated these situations. None of the intervening powers has contributed to the solution of any major problem in these two regions. On the contrary, they only added new complications to the already existing predicaments. To expect any meaningful changes in the near or longer term is futile. Thus, the greater Middle East and South-East Asia will remain the two regions ready to explode. A second so-called “Arab Spring,” more bloody and more transitional than the first in the near future is a real possibility.
The collapse of the Soviet Union in 1991, drew out most of the states of the African continent of their collective socialist slumber. However, this hiatus did not last long. Instead of putting their political houses in order, most of these states reverted back to mild or strict authoritarianism. In this process, they have succumbed to the corrupting influence of Chinese bribes to the detriment of the present and the future of their peoples. Presently, African rulers are busy propping up their autocracies, while keeping the bulk of their nations as near to the lowest degree of miserable existence as possible. Under these conditions, no person could develop his or her abilities without losing every vestige of human dignity, independence, and individuality.
The overall picture is not much better in Central and South America. Mismanagement, corruption, organized criminal syndicates, and masses with mentalities of slaves have rendered the states of the southern hemisphere teetering on the verge of political, economic, and financial abyss. As a consequence, the numbers of peoples voting with their feet and storming the northern borders are staggering. In spite of the new USMCA, the possibility of Mexico turning the corner politically, economically, and financially are fairly slim. The other large South American states, such as Brazil and Argentina are also in dire political, economic and financial conditions. Even Chile, the poster child of the past of good governance, has descended lately into a protracted political chaos.
Indubitably, the only power that could lead a worldwide recovery from the current economic and financial malaise is the United States of America. Although the outbreak of COVID-19, the coronavirus, has been unexpected in its scope and gravity, domestically the Trump Administration has mostly taken the right steps in a timely fashion to curb and mitigate the effects of this pandemic. The closing of the borders, the creation of the Coronavirus Task Force headed by the Vice President, the enhancing of public private partnerships, the stimulus packages, the actions of the Federal Reserve, the harnessing of the nation’s scientific, technological, and manufacturing potential, the rapid increase of tests, and the establishment of daily consultations with the governors, all have contributed to the saving of lives. What is needed now is an exit strategy that will hopefully help the United States of America to move forward by speedily returning to normalcy. Mainly, people must return to work and children to the schools.
Encouragingly the leaders of this nation have been setting a good example. From the daily press briefings at the White House one can surmise that the President, the Vice President, and members of the Task Force understand that the fight against the coronavirus is a learning process, and that mistakes made must not be repeated. Moreover, the stimulus packages and all other measures taken are designed to strengthen the free market by not favoring special groups but the nation at large. In other words, financial and economic assistance is not based on the strength of the players but on what the national economy needs. Finally, the way the Trump Administration has managed the coronavirus crisis has shown the rest of the world the quality of leadership and the character of the American nation.
For the United States of America the question now is: What in addition needs to be done domestically and internationally? For starters, the coronavirus pandemic is not just a political, economic, financial, and health crisis. It is equally important to recognize that the COVID-19 has also unleashed a psychological crisis. To put it more succinctly: the coronavirus pandemic has shaken the entire world and within it almost every large and small community. For these reasons, the recovery measures in the United States of America must be created with a global perspective in mind. Within this global framework solutions must be formulated by strategic thinking. This strategy, in turn, must be based on what the national and the global economies require and not on the political influence and relative economic strength of the players. The rebuilding of the shrinking middle class is imperative. Otherwise, the next crisis will destroy the American economy. Equally important is the need to strengthen the relationship between the politicians and the scientific community. Finally, citizens must vote for politicians with creative ideas and not for political hacks whose only concern is to grab power and cling to it at any cost to the present and the future detriment of the nation.
Internationally, the United States of America is still looking for its place in the world. This search takes place in a world that lacks enduring guiding principles. Presently, nothing is stable. Everything is changeable and replaceable. Consequently, chaos and anarchy are mounting. Disorders are ready to explode into bloody civil wars, regional armed conflicts are multiplying, and even the specter of a larger worldwide confrontation is not out of the question. Under these multiple threats merely managing international affairs is not enough. Successive Republican and Democrat administrations have failed to build on the international successes of the Reagan Administration in the 1980s. Political appointments have been made in the State Department as well as on the ambassadorial levels that have harmed American foreign policy and the global reputation of the United States of America. Civil servants at the State Department have also been hired based on their political leanings and personal connections than their professional abilities. Ambassadors have been rewarded exclusively for their political contributions to presidential campaigns without questioning their suitability to represent the United States of America in the designated country. This practice must be stopped. Otherwise, the United States of America will be considered either unserious or a nation of morons across the globe. Collectively, these individuals cannot inform knowledgeably the policy makers in the federal and local governments.
The multitude of international organizations, starting with the United Nations, must be paid more attention. Discipline must be enforced. Rogue states with outlandish actions must be punished immediately and severely, mostly through economic and financial actions. NATO must be reformed and its cohesion must be strengthened. Those member states that deviate from the political and joint security interests of the organization must be forced to fall in line. The relationship with the European Union must be taken more seriously. Particularly, in light of the present condition of the organization, the White House must rethink its globalist approach and begin to deal more intensively with the individual states.
The bilateral relationship with the People’s Republic of China must also be reevaluated. Instead of viewing it through the fog of five or three thousand years of idealized culture, China must be judged by its past failures and its 20th century misery. Even the successes of the post-Deng era must be objectively analyzed. In particular the role of the Chinese Communist Party that has proven its inflexibility concerning the country’s political and economic progress. The demise of the Soviet Union might provide a fair indication regarding the future prospects of the People’s Republic of China. In this context, to designate China as an enemy does not really help in formulating a coherent American policy. Clearly, Beijing cannot continue taking advantage of Washington and Brussels the old ways. Its expansionist designs must be countered, curbed, and stopped. Its corruption as a tool of foreign policy must be exposed. The inherent racism of the Chinese must be revealed. The false propaganda concerning its successes must be shown to be mostly lies. The substandard quality of Chinese manufactured products must be unmasked. The United States of America must stop relying on the cheap Chinese labor. Manufacturing must be brought back, especially for strategic goods. Otherwise, cooperation where it is mutually beneficial must be maintained and expanded.
In the greater Middle East Iran must be contained without humanistic consideration. The Mullahcracy, particularly an Islamic Republic of Iran armed with nuclear weapons, must be eliminated. The Arab world must be helped to sort out its many problems and challenges. However, getting again involved in the many internal squabbles and rivalries must be stopped. Russia and Turkey will fail abysmally in their quests to benefit from the present chaos and anarchy. The special relationship with the state of Israel must be further strengthened.The only true meaning of a superpower is a system of government that serves as a positive example to the rest of the world. Therefore, the objective domestically must be to strengthen the constitutional principles of the Republic. Within this democratic framework, there is no rational reason to experiment or modify the political and spiritual realms of the nation. Conversely, states across the globe have made repeated attempts at experimenting and modifying their political and spiritual realms. As Italian Fascism, German National Socialism, and Soviet Communism were rejected and defeated in the 20th century, the fashionable cannons of the early 21st century, such as the idiotic doctrine of political correctness, the self-serving call for social justice, and the rallying cry for ersatz human rights, will also end up in the proverbial dustbin of history. In a peaceful and stable world no social policies that contradict the historic traditions of the majority of nations can be sustained for a long time. Due to these factors, the United States of America will continue to remain the shining light of the world throughout the 21st century and beyond, unless the American people will decide otherwise.
By The Hill•
Americans are anxious to get back to work and to send their children to school. The science backs them up. We have learned a lot over the past months, and we are putting that knowledge to use. We are capitalizing on the advanced capabilities that we have developed, as we redouble our efforts to protect vulnerable populations and deliver new and effective treatments in record time.
Here’s what we now know:
We know who is at risk. Only 0.2 percent of U.S. deaths have been people younger than 25, and 80 percent have been in people over 65; the average fatality age is 78. A JAMA Pediatrics study of North American pediatric hospitals flatly stated that “our data indicate that children are at far greater risk of critical illness from influenza than from COVID-19.”
We may see more cases as social interactions pick up, because this is a contagious disease. However, the overwhelming majority of cases are now occurring in younger, low-risk people — decades younger, on average, than seen in the spring. And the vast majority of these people deal with the infection without consequence; many don’t even know they have it.
While we saw more cases in July and August, we are not seeing the explosion of deaths we saw early on. An analysis of CDC data shows that the case fatality rate has declined by approximately 85 percent from its peak.
That is partly because we are much better now at protecting our most vulnerable, including our senior citizens. States have learned from those that experienced outbreaks before them, and they have implemented thoughtful policies as a result.
We are doing much better with treating hospitalized patients. Lengths-of-stay are one-third the rate in April; the fatality rate in hospitals is one-half of that in April. Fewer patients need ICUs if hospitalized, and fewer need ventilators when in ICUs.
We are progressing at record speed with vaccine development. This is due to eliminating bureaucracy and working in partnership with America’s world-leading innovators in the private sector.
Despite these gains, our economy has yet to fully reopen. At least 16 states have travel warnings and quarantines in place that are not consistent with Centers for Disease Control and Prevention (CDC) guidelines; in most states, retail stores are limited to pick-up or reduced shopping capacity. Even in states where cases are low, restaurants are often take-out only, and 42 states and territories have seating capacity limited to 25 percent or 50 percent. Fitness centers and gyms have largely reopened, but at reduced capacity.
Beyond those business limits, schools in many cities and states will be opened this fall on a delayed or limited basis. According to the U.S. Department of Education’s tracking, of 5,425 major school districts (about one-third of districts nationwide), almost half plan to operate on hybrid models and another 20 percent plan to operate online-only. That not only harms children, it prevents many parents from working.
A key – but flawed – assumption driving these restrictions is that the number of cases is the most important metric to follow. Yet, whatever effect these restrictions may have on cases, they don’t eliminate the virus. And they impose harms on the country and its citizens, particularly when they require the isolation of large segments of the low-risk and healthy, working populations.
Unlike his critics, who have focused on the wrong goal and engaged in unfounded fear-mongering, President Trump has been implementing a three-pronged, data-driven strategy that is saving lives while safely reopening the economy and society, averting the disastrous calamities of continued lockdown.
First is protecting the high-risk group with an unprecedented focus. This is being done by relying upon highly detailed, real-time monitoring; a smart, prioritized, intensive testing strategy for nursing home staff and residents; deployment of massive extra resources, including point-of-care testing, personal protective equipment (PPE), infection control training and rapid mobilization of CDC strike teams for nursing homes; and extra PPE and point-of-care testing for the environments with elderly individuals outside of nursing homes, like visiting nurse in-home care and senior centers.
Second, we are carefully monitoring hospitals and ICUs in all counties and states with precision to prevent overcrowding, and rapidly increasing capacity in those few hospitals that may need additional personnel, beds, personal protective equipment (PPE) or other supplies.
Third, we are leveraging our resources to guide businesses and schools toward safely reopening with commonsense mitigation measures. We must safely reopen schools as quickly as possible, and keep them open. The harms to children from school closures are too great to accept any other outcome.
While the lockdown may have been justified at the start, when little data was known, we know far more about the virus today. It’s time we use all we have learned and all we have done to reopen our schools and our economy safely and get back to restoring America.
Larry Dean is not as famous as he deserves to be but, as the man who developed the code that allows automatic teller machines to accept cards from other banks and outlets, he birthed a revolution in banking that forever changed the way people shop and get cash. His innovation allowed debit cards to function like credit cards, taking money directly from accounts and pushing the nation and world closer to a cashless economy.
Dean’s innovation made banking easier for millions. The application programming interfaces – the APIs – he developed were protected by copyright, meaning his intellectual labors produced great wealth. Outside Atlanta, he built Dean Gardens, a 33,000 square-foot, 15-bedroom home was so extravagant the annual up-keep alone cost $1.5 million. Infamous for the iconic “Liberace Meets Napoleon” style later imposed by Dean’s son – who lived there until 1994 – it featured a Moroccan theater, 24-karat gold sinks, a gallery of Hawaiian art, 13 fireplaces, an 18-hole golf course, and a 14-seat dining room whose most prominent feature was a wall-sized aquarium known as the “Predator Tank.”
This monument to conspicuous consumption, which might have given even pre-presidential Donald Trump pause, was bulldozed into rubble ten years ago. What endures is his code which, thanks to a legal push by Google seeking to eliminate the copyright protections coders enjoy for the APIs they develop might make innovators like Dean a thing of the past.
Whether that happens is in the hands of the United States Supreme Court which, in a matter of weeks will finally hear oral arguments in the matter of Google v. Oracle, a landmark case that will decide the course of intellectual property development going forward. If a majority of the justices side with Google, then future innovations like what Dean wrought will likely be few and far between.
The case stretches back over a decade. At one time, hard as it may be to believe, Google was losing out to BING in the critical mobile search engine market while the Apple iPhone was beating its brains out in the competition among smartphones.
Seeking to improve its competitive position, Google took 11,500 lines from Java’s API coding which the company used to pay to use to construct the Android mobile operating platform, installing its search engine as the default option. As Android grew more popular, so did the Google search engine, creating a boom for the company without, the suit alleges, paying licensing fees for the use of Java to its owner Oracle.
Google does not dispute it took the code. What its briefs do argue is that these types of software APIs may not be copyrightable and, even if they are, that Oracle cannot force them to pay for using it because what it did is covered under the fair use doctrine – and copyright law exception often used when news stories are reposted and circulated for comment but seldom in commercial situations.
As even those who are not lawyers may recognize, Google’s interpretation of the copyrightability of software and the fair use doctrine as applied in this situation cannot be sustained by historical and legal precedent or by common sense, not that it bothers the biggest of big tech very much.
Google’s layers have already admitted the company “doesn’t care much about precedent or law” when it comes to copyright. When the company didn’t like the licensing terms offered to it by Sun Microsystems (then the owner of Java) Adam Rubin, the father of Android, bluntly wrote in an e-mail the company would simply “do Java anyway and defend our decision, perhaps making enemies along the way.”
Being big doesn’t allow you to ignore the law. Google’s lack of concern for intellectual property doesn’t come as a surprise – some have argued its business model depends on using the IP of others without paying for it. And the court would do well to note that others have made similar complaints in the past including the American Association of Publishers, which settled a case alleging Google has posted books online with the permission of the authors, a lawsuit by PayPal arguing an ex-employee turned over trade secret IP used to construct Google Wallet, and a suit settled with Viacom over videos posted without permission to YouTube.
These issues persist, in part because of the lack of clarity in the law protecting intellectual property and because the white shoe lawyers employed by big tech make fortunes of their own finding, exploiting, even creating loopholes that end up exploiting consumers and inventors alike. The Supreme Court is being asked to slam the door on this kind of exploitation and should.
No one likes government interference in the marketplace or the court making law from the bench but that is not what a decision favorable to Oracle would do. A decision favorable to Google would set a precedent adversely affecting software development and every other industry that relies on innovation and creativity to maintain and enhance its market petition. For the sake of private property and our nation’s founding principles, the court must come down firmly on the side of protecting intellectual property rather than affirm the idea that loopholes exist allowing big tech to take the innovations of others for their use without compensation or consent. That’s not the American way.
The United States is in a race for strategic mineral supremacy. Many of the essential minerals involved in the design of computer components vital to the nation’s defenses are found, ever increasingly, overseas. And that, during a time of conflict, would leave America in an untenable position.
Just as both President Donald Trump and former Vice President Joe Biden have promised to bring manufacturing jobs back to our shores they should also place America on a course to minimize our reliance on other countries in potentially dangerous parts of the world to provide us with the strategic resources needed to keep the economy flowing and our defenses strong.
The opening of Alaska’s Pebble Mine, which analysts believe may be one of the richest sources of gold and copper remaining untapped anywhere in the world, would significantly reduce the nation’s need to import certain vital minerals. It’s in the final stage of the permitting process and, since the U.S. Army Corps of Engineers recently gave it a positive environmental review, there should be nothing in the way of its beginning to operate save for a few final, minor bureaucratic hurdles.
Unfortunately, that’s not the case. America’s so-called “green” organizations, which oppose the expansion of U.S. development of indigenous fossil fuel resources like oil and natural gas are equally bent on bringing the once robust mining industry to heel. Through their efforts they’ve managed to elevate the possibility of damage to the “native” salmon population to a level that’s getting the attention of policymakers that, incredible as it seems given what’s at stake, block the Trump Administration’s “final Record of Decision” expected sometime in the next few weeks that would give Pebble Mine the green light to begin operations.
The project, just like any that come before the Army Corps of Engineers for review, has been through a well-established environmental review process. It should be given the go-ahead. For some reason, some former senior Trump officials including Nick Ayers, the former chief of staff to Vice President Mike Pence, are reportedly engaged in efforts to stop it.
Pebble Mine would not only be a source of strategic minerals, it would provide jobs at a time when the economy needs them desperately. The U.S. Bureau of Labor Statistics recently reported that, in the last quarter for which the numbers are available, on an annualized basis nearly a third of the nation has become jobless because of the coronavirus lockdown. As the final Environmental Impact Statement compiled by the Army Corps found the concerns regarding the salmon to be baseless and pose no significant threat to its genetic diversity, the continued effort by the greens to push this line of argument is without merit.
Yet the implications of the outcome go well beyond this one project. “Pebble Mine is the poster-child of critical projects delayed by a broken permitting process,” Mike Palicz, a policy analyst with the non-profit group Americans for Tax Reform recently blogged. “The Obama Administration went as far as issuing a preemptive veto to prevent the mine from even receiving a proper environmental review. Last year, the Trump Administration righted this wrong by withdrawing Obama’s preemptive veto, allowing the project to move through the standard review process.”
That process is now nearing completion. The administration has the power to keep things on track and get the mine open. It should ignore additional calls from both environmental activists and those who pretend to be its friends for additional delays and unneeded further evaluation. The final Record of Decision, based on the Army Corps’ review, is expected to be favorable and should be allowed to stand.
Many of those who oppose the Pebble Mine project oppose all mining projects. They want the industry to go the way of the Passenger Pigeon and other extinct species. Their interests and America’s do not coincide.
Everyone knows that goods made in China have a massive hold on what Americans buy. Now China wants the world to be dependent on them for how things are delivered, as well as how they are made.
The closest parallel is the explosive growth of Amazon, with its mastery of logistics to dominate delivery as well as dominating sales.
FedEx once owned the slogan, “When it absolutely, positively has to be there overnight.” Jeff Bezos studied, learned and prepared, then ended Amazon’s partnership with FedEx so that we now associate quick delivery with Amazon, which has built a fleet of jets and 60,000 delivery trucks (plus 100,000 more on order). This has made Bezos the richest man in the world.
China meanwhile would like its Communist system to replace the United States as the richest economy in the world and dominating delivery is its new objective. Rather than trucks and airplanes, they’ve realized that 90 percent of global trade moves by ship and that is where they have shifted their focus.
The Chinese have a worldwide plan to take control of the logistics of global trade as part of their mega-billion Belt and Road Initiative and to push aside competitors in the process. In 2013, President Xi Jinping announced the initiative that now involves acquiring road, rail and maritime infrastructure in 138 countries, including ports on every continent except Antarctica, facilities at both ends of the Panama and Suez Canals and control of other global chokepoints.
To describe how “How China Rules the Waves,” The Financial Times listed scores of global ports where China has paid tens of billions to buy control. A headline in Forbes warned, “China’s Seaport Shopping Spree: What China Is Winning By Buying Up The World’s Ports.” And a new report by the bipartisan Center for Strategic & International Studies states it as follows:
Chinese companies are increasingly dominant across the entire global maritime supply chain, controlling the world’s second-largest shipping fleet by gross tons and constructing over a third of the world’s vessels in 2019.
They also produce 96 percent of the world’s shipping containers . . . and own seven of the ten busiest ports in the world . . . [with] state-owned China Merchant Group the largest port and logistics company in the world.
In short, America is being pushed out of trade on the high seas. Only 182 American ships are among the 41,000 ocean-going cargo ships today. Of 2,900 such ships now under construction, the U.S. is only building eight. China is building 1,291.
Incredibly, some now propose that we allow China to take over our domestic water routes as well. Fortunately, we still control our domestic waters – our coastlines, rivers, harbors and the Great Lakes – where 40,000 vessels handle U.S. internal trade. China cannot barge in thanks to the Jones Act, a 100-year-old law requiring domestic shipping to use vessels that are American-built, -owned, and -crewed.
Yet some groups clamor to repeal the Jones Act, saying we can get cheaper prices if we invite in other countries like China. If they succeeded, then the next proposal might be to change our laws that won’t let foreign airlines take over domestic air travel. (They can only connect between a foreign city and an American city). After that, they might ask that foreign trucks be permitted to deliver goods into our heartland and not just to border areas. To these advocates, national security and the national interest is a non-factor – it’s only about “saving money.”
Why can China undercut costs? It uses a different system of values. Hidden government subsidies, slave labor, having their People’s Liberation Army operate supposedly-private enterprises, industrial espionage, disregard for intellectual property rights, far fewer government regulations of labor, public safety, and environment, and of course human rights violations and suppression of free speech like in Hong Kong and Tiananmen Square. As China enters a new phase – not only to make us dependent on their products but also to depend on them to transport and deliver our needs – we must be careful not to let them take advantage of us.
Yet this is forgiven by some policy experts who treat it like laissez faire economics, rather than acknowledging that it is not a free market but part of China’s government-run plan. After all, if only money matters and not American values, we can ignore whether foreign powers gain control over us, whether it be China, Russia or any other nation.
A Frontiers of Freedom white paper I recently authored provides a more detailed warning of this issue, but the core message is simple: money isn’t everything. Our national security is also important, both to protect America’s values and to guard against the continuing viral growth of China’s plan.
The coronavirus has wreaked havoc on Americans’ health as well as the health of our economy over the past several months. The real estate industry is certainly no exception. Due to challenges and unpredictability ahead, combined with record unemployment and cost-cutting layoffs, many Americans have put their plans to purchase a home on hold.
At the pandemic’s onset, new home sale listings dropped by as much as 70 percent in some markets but the April numbers suggested some recovery was underway. Web traffic to real estate portals like Zillow plunged by almost 40 percent. Further, nearly 4 million homeowners are in the midst of forbearance plans – delaying payments on their mortgages – making up almost 8 percent of all mortgages.
While challenges presented by the coronavirus introduce uncertainty, a competitive real estate market and an environment that rewards fair competition and promotes collaboration within the industry will help foster a faster recovery.
Today, key industry partnerships and collaborations between mortgage service providers or banks, fintech and realtech developers offer products and services that bridge the gap between the huge swaths of available data and informed consumer decision-making. These innovations empower home buyers or sellers to make more informed decisions, at a time when few can afford to spend more or sell for less than they should based on constantly fluctuating home markets. A prime example is how Amrock, one of the nation’s leading title insurance, property valuations, and settlement services providers, has focused on developing innovative solutions, such as their eClosing platform, to improve the real estate experience for all parties involved. Because of the rapidly evolving and highly dynamic nature of the industry, partnerships have become key to finding innovative ways to use data to provide the best product for consumers.
Regrettably, such ingenuity and the necessary B2B collaboration faces challenges that predate the current pandemic raddled housing markets. The real estate industry and those who rely on it all pay the price for the increasing onslaught of litigation abuses by the hands of legal profiteers seeking to exploit our courts and our industries for financial gain.
Fortunately, on June 3, the Texas 4th Court of Appeals issued a decision offering hope that the trend of increasing abusive litigation, particularly that within the real estate industry, may not be so inevitable.
This ruling marks a milestone for homeowners who pay title insurance, which protects both real estate owners and lenders against loss or damage occurring from liens (mortgage loans, home equity lines of credit, easements), encumbrances, or defects in the title or actual ownership of a property. Critically, title insurance offers buyers and sellers the assurance they need to buy, sell, and reinvest, all critical components of a recovery.
The Texas 4th Court of Appeals follows a March 2018 decision by a Bexar County, TX, jury who awarded HouseCanary, a software developer, nearly three-quarters of a billion dollars after mistakenly believing Amrock allegedly stole their trade secrets. In truth, Amrock had hired HouseCanary on a $5 million contract to develop an automated valuation model (AVM) mobile application for use by appraisers in the field – a key development in streamlining the real estate buying/selling process. AVMs are formulas that are used to appraise real estate property based on key variables like historical price data, tax assessments, sales history and past lending transactions. However, after HouseCanary had failed to deliver a functional application after more than a year and no clear progress, Amrock sued for breach of contract, and built their own AVM for appraiser use.
The facts of that case – and the weakening standard of what makes up a trade secret – painted a distressing picture for the future of American innovation.
In an effort to cover their inability to develop the application they were hired to produce, HouseCanary countersued – alleging Amrock had stolen their trade secrets and used proprietary information in the development of their own AVM. After ignoring key facts and employing several faulty legal arguments and highly questionable calculations, HouseCanary was able to convince the jury that Amrock had misappropriated their trade secrets – and that such information was valued at $235 million dollars – more than 100 times HouseCanary’s total revenues for all product sales during the period in question.
Beside the fact that the ruling was 150 times the value of the initial $5 million contract, there is another piece of fundamental misinformation the entire ruling hinges on: HouseCanary had no trade secrets or any proprietary information – hence their inability to produce the mobile AVM application Amrock contracted them to create.
This was confirmed by four HouseCanary executives-turned-whistleblowers, who, alarmed by the massive damages figure, testified that “there was never a working version of the App,” and that HouseCanary had deceived Amrock by “representing that the App was more functional than it actually was.” In a then-anonymous email to Amrock CEO Jeff Eisenshtadt, former HouseCanary Director of Appraiser Experience Anthony Roveda wrote “housecanary never had any proprietary anything…”
The original 2018 decision, as it stood before June 3, established a dangerous precedent for the future regarding what was classified as protectable “trade secrets,” which deterred innovation and the partnerships needed to provide the best product for consumers.
As the nation emerges from the coronavirus pandemic, the government – from policymakers to judges – have a duty to provide stability, create meaningful policy, uphold our justice system, and provide clarity where needed. The Texas appeals court decision to overturn Amrock v. HouseCanary sent a loud and clear message that this kind of frivolous litigation has no place in our courts – providing a reassuring and much-needed signal to innovators and developers that collaboration remains welcome here in the United States.
The California Legislature is back from its summer recess and has frantically resumed its quest for new revenue sources.
One of the latest ideas is Assembly Bill 1253. This proposed legislation would add new income tax brackets for high earners on top of the existing ones.
Income between $1 million and $2 million would receive a one percentage point surcharge, bringing the marginal rate to 14.3 percent. Those earning between $2 million and $5 million would pay an additional three percentage points, and those earning over $5 million would pay an additional 3.5 percentage points, bringing their marginal rates to 16.3 percent and 16.8 percent respectively.
This plan constitutes a continuation of California’s soak-the-rich approach to raising revenues.
While some seem to believe that high earners can provide unlimited resources, the evidence from prior tax hikes suggests that the introduction of these tax rates is not even likely to raise revenue for the state. At the same time, it will hammer job creation.
The problem is that high earners do not simply sit there and take it when the state goes after their income.
In a detailed study of the 2012 California ballot measure that raised the top state rate to 13.3 percent, Ryan Shyu and I found that just two years later, the state was only collecting 40 cents of every dollar that it had hoped to raise from the tax increase.
High income taxpayers affected by the 2012 tax increase suddenly began to flee the state at higher rates, especially to zero tax states like Nevada, Texas, and Florida.
Even more importantly for the state budget, those that stayed began declaring considerably less taxable income than they would have otherwise, apparently either scaling back their productive activities or engaging in tax avoidance.
The economist Arthur Laffer has famously argued that there is a tax rate beyond which a government’s revenue will decline if it raises taxes further, due to the disincentive effects of high taxes.
While the federal government may be helped by limits on what American citizens can do to escape federal taxation, state governments tread on much thinner ice when faced with the ability of taxpayers to move their residences and their earnings generation to other states.
In 2012, California was at least still at the point where raising top income tax rates led to some increase in near-term revenue, albeit with grave long-term consequences.
Today, however, the state is starting from a 13.3 percent tax rate that is the highest in the nation.
Furthermore, Congress has since moved to protect federal taxpayers against bloated state spending by placing a $10,000 cap on state and local tax deductions as part of the 2017 Tax Cut and Jobs Act.
So while the blow of a 3 percentage point tax increase in 2012 was strongly cushioned by deductibility against top-bracket federal rates, California taxpayers today would feel the full force of this proposed round of increases.
Once taxpayers have responded by voting with their feet, reducing their business activities, and re-upping with their tax attorneys, the state will likely lose revenue if it attempts to increase rates.
To make matters worse, Sacramento’s narrow focus on tax revenues ignores that fact that this tax avoidance behavior will lead to job losses. These rates also apply to business income to non-corporate entities (such as partnerships and LLCs) which account for over half of all employment in the US.
In another study, Xavier Giroud and I found that each percentage point increase in individual tax rates that the average state implements leads to losses of up to 0.4 percent of all non-corporate jobs in the state.
Starting from California’s already astronomical top rate, the impact would be expected to be even larger.
These job losses will negatively impact the well-being of Californians and further reduce state tax revenues.
California’s approach to relying on the taxation of top earners has sown the seeds of its own destruction. The top 0.5 percent of taxpayers pay over 40 percent of individual income taxes in the state.
Officials are blaming COVID-19 for the budgetary havoc, but this structure means that in any downturn, California revenues will tank due to the excessive reliance on both the ordinary income and capital gains of top earners.
If the Legislature is interested in promoting economic growth and prosperity in the California, and securing the state’s own fiscal future, it should reject further top income tax rate increases.
Instead, it should work towards putting the state back on a path towards being a competitive place for high-income individuals and businesses to locate their economic activity.
If all you did was listen to the politicians and commentators, you’d think America’s health care system was on the verge of collapse. Nothing could be further from the truth. There are problems, but most of them have been caused by the self-same reformers who’ve been trying for more than two decades to “fix” it.
Much progress has been made since the New York Times and presidential candidate Bill Clinton declared a crisis existed and proposed solving it by increasing the role played by the government in managing the delivery of services and prices. Once the voters learned the potential adverse impacts on the quality of care they received, the debate changed.
Through it all, America has continued providing the best care anywhere. The spirit of invention and innovation that is the hallmark of our civilization exists robustly in the health care sector and, because it does, people are living longer, generally healthier lives. Yet, instead of encouraging that, scholars and policymakers continue to focus on flattening the cost curve through fiat. Price controls and rationing may reduce the perceived costs of medical care but won’t solve the problem.
The real solutions will come from innovations in care. That means continuing the development of radical new treatments that were unthinkable a generation ago and, in a few cases, going back to what was working before the government messed things up.
One place where looking back is already helping us move forward is kidney dialysis. In 1972, thinking they were helping, Congress passed legislation creating a Medicare program to pay for dialysis treatment and patients with end-stage renal disease gravitated to more expensive, center-based care using machines built for use in centers that are large, hard-to-use, and too expensive for home use.
In 1973, 40 percent of dialysis patients received treatment at home. Today, 90 percent receive treatment at dialysis centers and hospitals — at much greater cost and at greater risk to their health because the entire time they are there, checking in, checking out, waiting for and receiving treatment, they’re in the company of others who might be sick with something like COVID-19 that science tells us preys on those whose immune systems are compromised.
We spend more than $110 billion on kidney disease, the ninth leading cause of death in the United States. More than 37 million Americans have some form of this disease and the money paying for their dialysis comes from Uncle Sam through Medicare. That’s not sustainable.
The alternative to spending more is to spend smarter. The Trump Administration, which earlier this year announced a plan to “shake up” the kidney care medical complex is pushing for a return to home-based hemodialysis as a cost-saving measure and one more in line with patient concerns. His executive order on the issue included a direction to the Department of Health and Human Services to develop policies to reduce the number of Americans getting dialysis treatment at dialysis centers.
That’s the right move. The in-home care alternative will have the biggest impact in the shortest amount of time. The current care cycle, where treatment begins when it’s too late to stop disease progression. Must be broken. Instead of throwing more money at dialysis clinics, the priority is being repurposed in the right place, on early diagnosis, better patient education, and comprehensive and holistic care services.
Home-based options for hemodialysis, where blood is pumped out of the body under supervision into a machine that acts as a kidney and filters the blood before returning it to the body, and peritoneal dialysis, where blood vessels in the lining of the belly filter the blood with the help of a cleansing fluid, exist and should be utilized to the fullest extent possible.
Starting in 2021, ESRD patients will also be able to enroll in Medicare Advantage plans – great for the ESRD patients, but it could increase premiums for all seniors if we don’t help these plans negotiate for fair rates and prevent costs from rising. The Centers for Medicare and Medicaid Services should remove any roadblocks that exist to making this option viable.
With COVID-19 is changing how people go about their lives, the incentive to adapt and innovate in the health care sector is there. Telehealth, which was generally frowned upon before the current crisis, has taken off like a moonshot. Changing the kidney dialysis model to one where the care is mostly provided at home could liberate those receiving treatment now held prisoner by their illness and could lead the transformation of American medicine. Anyway, it’s worth a try.
In Ecclesiastes 1:4-11, the author muses over the eternal cycles of human existence. Among the many examples that he brings up, the most compelling one states the following: “What has been is what will be, and what has been done is what will be done, and there is nothing new under the sun.”
To illustrate the sagacity of this insight, it should suffice to examine the history of minority rules. From times immemorial, all forms of minority rules have been based on mutual fears. Majorities have been afraid of their kings, emperors, dictators, and despots. In turn, the rulers have feared the people, because their reign has been based on oppression and not the consent of the governed. Ultimately, these cycles of mutual fears have always grown exponentially until they have led to violent and all consuming political explosions.
Belarus (in Russian: Belorussia), ruled with an iron fist since July 20,1994, by President Alyaksandr Ryhoravich Lukashenka (in Russian: Alexander Grigoryevich Lukashenko), is no exception. Prior to being engaged in politics, President Lukashenka was the director of a Soviet-style collective farm, called kolkhoz. Before this job, he became a member of the Communist Party of the Soviet Union (CPSU) and a uniformed guard of the Soviet Border Troops. Having been appointed as a deputy to the Supreme Council of Belarus, he earned the dubious distinction of having cast the only vote against the 1991 dissolution of the Soviet Union.
Having been labeled “Europe’s last dictatorship,” President Lukashenka has steadfastly prevented Belarus to even begin its transformation as a sovereign state from a Soviet-style dictatorship to a more Westernized pluralistic country. However, like Stalin’s constitution of 1936, the Constitution of the Republic of Belarus of 1994, are modelled in its language after the Western constitutions and at least formally entails all the institutional as well as the personal guarantees, rights and freedoms of a normal, pluralistic state. Accordingly, Section One solemnly declares that the government of the Republic of Belorus belongs to the people. The government is defined as a multi-party representative democracy. While the government guarantees the protection of rights and freedoms of all citizens, Section One also states that the individual citizen “bears a responsibility towards the State to discharge unwaveringly the duties imposed upon him by the Constitution.”
During Lukashenka’s reign, there were three crucial Amendments to the constitution. All Amendments were designed to significantly enhance the powers of the presidency. Approved by a fraudulent national referendum in May 1995 by a majority of 77%, the First Amendment authorized the President to unilaterally disband the Parliament.
The Second Amendment, unilaterally initiated by President Lukashenka, further strengthened his powers. The unicameral parliament, fittingly named the Supreme Soviet, was simply abolished. It was replaced by the National Assembly, a bicameral parliament. Demonstrating President Lukashenka’s increasing arrogance and megalomania, this Amendment was allegedly approved by 84% of the electorate. As a result, all opposition parties were excluded from the new parliament. To wit, due to the lack of transparency as well as ballot stuffing, the United States of America, the European Union, and many other states refused to acknowledge the legitimacy of either Amendment.
Finally, the Third Amendment abolished the presidential term limits in its entirety in 2004. Again, approved by a national referendum, 77.3% of the people consented to President Lukashenka’s demand to serve in the highest office for life. As with the 1996 referendum, the Organization for Security and Cooperation in Europe (OSCE) called the legitimacy of this referendum into question. The organization bluntly declared that the referendum did not meet the requirements of “free and fair elections.” To add a final political insult to the death of legality, the Minister of Justice of Belorus and almost all the legal scholars in the country came up with a completely novel interpretation of the rule of law. In their opinion, laws are constitutional if they follow the will of President Lukashenka and the people. Those laws that do not fall into this category are non-existent and shall be ignored. As a result, the Constitution and most of the legal provisions are in contradiction.
Similarly, the economy of Belarus, which is the world’s 72nd largest, is almost totally controlled by the state. Dubbing his economic policies “Market Socialism,” he reintroduced in 1994 a purely Socialist economy in Belorus. Politically motivated Russian oil and gas deliveries have rendered Belorus completely energy dependent on the Kremlin. President Lukashenka’s feeble attempts to flirt with the West only made him another East European political prostitute of the region.
The most recent Soviet-style presidential election, held on August 9, 2020, delivered the expected result. Proving that in an orderly dictatorship there are no miracles, President Lukashenka beat the stand-in candidate of the opposition for her jailed husband Sergey Tsikhnousky, Sviatlana Tsikhanouskaya by 80.10% to 10.12%. The opposition cried foul, while President Lukashenka declared that “You speak about unfair elections and want fair ones? I have an answer for you. We had the elections. Unless you kill me, there will be no other elections.” The ensuing protests have been answered with brutal and ruthless crackdown. Calling the protesters “bands of criminals” and “rats,” President Lukashenka has pleaded with Russian President Putin to come to his rescue immediately. Meanwhile, thousands have been detained and at least two persons have died. More importantly, however, President for life Lukashenka has proved again that the mentality of the Soviet Union is well alive and kicking strongly in the eastern part of the continent.
His soulmate in governance, Russian President Vladimir Putin has been strangely silent throughout President Lukashenka’s ordeal. Clearly, he must have learned something from the events that surrounded former Ukrainian President Yanukovich’s dismal performance at the end of 2013 and the beginning of 2014 in Kyiv and across Ukraine. President Putin’s restraint might have also been motivated by the potential threat of additional sanctions against his country. Be that as it may, Russia would only save President Lukashenka’s hide if Belorus would move decisively into the orbit of the European Union and NATO. Otherwise, a relaxation or even the demise of President Lukashenka’s severe dictatorship would not rattle the Kremlin.
Yet, the people of Belarus deserve the sympathy and support of the rest of the world. Russia’s eventual intervention should not discourage the United States of America and the European Union to provide political and any other support for the people who have unequivocally expressed their desire to finally live free in a democracy. Clearly, President Lukashenka’s days are numbers. Politically, he is done and not even Russia could save his dictatorship. In the Kremlin, President Putin and his colleagues must finally comprehend that the days of dictators in Europe are coming to an end. In case they would resist, their countries would become not only the graveyards of failed ideas, but also the economic catastrophes of the rest of the world.