Thursday, December 06, 2012 7:10:32 PM
Corporate Profits Reach Record High, While Workers Struggle
11/30/2012
http://www.huffingtonpost.com/2012/11/30/corporate-profits_n_2217414.html [with comments]
--
US productivity grows at faster 2.9 percent rate in Q3, labor costs down sharply
December 5, 2012
http://www.washingtonpost.com/business/us-productivity-revised-up-to-29-percent-growth-rate-in-third-quarter-labor-costs-down/2012/12/05/713ee8cc-3ee1-11e2-8a5c-473797be602c_story.html [with comments]
===
Top Two Percent To GOP: Tax Us
12/06/2012
http://www.huffingtonpost.com/2012/12/05/top-two-percent-tax_n_2245596.html [with embedded video report, and comments]
--
Who Got the Biggest Tax Break in the Last 30 Years? (The Rich, of Course)
Dec 1 2012
http://www.theatlantic.com/business/archive/2012/12/who-got-the-biggest-tax-break-in-the-last-30-years-the-rich-of-course/265804/ [with comments]
===
High-Speed Traders Profit at Expense of Ordinary Investors, a Study Says
The economist Andrei Kirilenko's findings are still being reviewed by peers and have encountered opposition.
Mendoza College of Business
Bart Chilton of the C.F.T.C. says high-speed traders are taking "some of the cream off the top."
Hiroko Masuike/The New York Times
By NATHANIEL POPPER and CHRISTOPHER LEONARD
Published: December 3, 2012
A top government economist has concluded that the high-speed trading [ http://topics.nytimes.com/top/reference/timestopics/subjects/h/high_frequency_algorithmic_trading/index.html ] firms that have come to dominate the nation’s financial markets are taking significant profits from traditional investors.
The chief economist at the Commodity Futures Trading Commission, Andrei Kirilenko, reports in a coming study that high-frequency traders make an average profit of as much as $5.05 each time they go up against small traders buying and selling one of the most widely used financial contracts.
The agency has not endorsed Mr. Kirilenko’s findings, which are still being reviewed by peers, and they are already encountering some resistance from academics. But Bart Chilton, one of five C.F.T.C. commissioners, said on Monday that “what the study shows is that high-frequency traders are really the new middleman in exchange trading, and they’re taking some of the cream off the top.”
Mr. Kirilenko’s work stands in contrast to several statements from government officials who have expressed uncertainty about whether high-speed traders are earning profits at the expense of ordinary investors.
The study comes as a council of the nation’s top financial regulators is showing increasing concern that the accelerating automation and speed of the financial markets may represent a threat both to other investors and to the stability of the financial system.
The Financial Stability Oversight Council, an organization formed after the recent financial crisis to deal with systemic risks, took up the issue at a meeting in November that was closed to the public, according to minutes that were released Monday.
The gathering of top regulators, including Treasury Secretary Timothy F. Geithner and Ben S. Bernanke, the Federal Reserve chairman, said in its annual report this summer that recent developments “could lead to unintended errors cascading through the financial system.” The C.F.T.C. is a member of the oversight council.
The issue of high-frequency trading has generated anxiety among investors in the stock market, where computerized trading first took hold. But the minutes from the oversight council, and the council’s annual report released this year, indicate that top regulators are viewing the automation of trading as a broader concern as high-speed traders move into an array of financial markets, including bond and foreign currency trading.
Mr. Kirilenko’s study focused on one corner of the financial markets that the C.F.T.C. oversees, contracts that are settled based on the future value of the Standard & Poor’s 500-stock index. He and his co-authors, professors at Princeton and the University of Washington, chose the contract because it is one of the most heavily traded financial assets in any market and is popular with a broad array of investors.
Using previously private data, Mr. Kirilenko’s team found that from August 2010 to August 2012, high-frequency trading firms were able to reliably capture profits by buying and selling futures contracts from several types of traditional investors.
The study notes that there are different types of high-frequency traders, some of which are more aggressive in initiating trades and some of which are passive, simply taking the other side of existing offers in the market.
The researchers found that more aggressive traders accounted for the largest share of trading volume and made the biggest profits. The most aggressive scored an average profit of $1.92 for every futures contract they traded with big institutional investors, and made an average $3.49 with a smaller, retail investor. Passive traders, on the other hand, saw a small loss on each contract traded with institutional investors, but they made a bigger profit against retail investors, of $5.05 a contract.
Large investors can trade thousands of contracts at once to bet on future shifts in the S.& P. 500 index. The average aggressive high-speed trader made a daily profit of $45,267 in a month in 2010 analyzed by the study.
Industry profits have been falling, however, as overall stock trading volume has dropped and the race for the latest technological advances has increased costs.
Mr. Kirilenko, who is about to leave the C.F.T.C. for an academic position at the Massachusetts Institute of Technology, presented a draft of the paper at a C.F.T.C. conference last week. He said that the markets were a “zero sum game” in which the high-speed profits came at the expense of other traders.
Mr. Kirilenko warned that the smaller traders might leave the futures markets if their profits were drained away, opting instead to operate in less transparent markets where high-speed traders would not get in the way.
“They will go someplace that’s darker,” Mr. Kirilenko said at the conference. That could destabilize futures markets long used by traders to hedge risk.
A spokesman for the C.F.T.C. said the agency had no comment on the study. But the paper was immediately hailed by Mr. Chilton, who is a Democrat and a critic of recent shifts in the markets.
Mr. Chilton said that the study would make it easier for regulators “to put forth regulations in a streamlined fashion. It’s a key step in the process and it should fuel-inject the regulatory effort going forward.”
Terrence Hendershott, a professor at the University of California, Berkeley, said there was a limit to the importance of Mr. Kirilenko’s work because it focused on profits and did not address the benefits high-speed traders bring.
Mr. Hendershott and many other academics have found that the competition between high-speed traders has helped lower the cost of trading for ordinary investors. But Mr. Hendershott said that limited data available to researchers had made it hard to determine whether the benefits outweighed the costs.
The speed and complexity of the financial markets jumped onto the agenda of regulators after the so-called flash crash of 2010, when leading stock indexes fell almost 10 percent in less than half an hour, before quickly making up most of the losses.
In its first annual report, in 2011, the Financial Stability Oversight Council noted the concerns raised by the flash crash, but not in great detail. This year’s report included a much fuller discussion of the risks posed by the increasing speed and complexity of the financial markets and called for regulators to look for more ways to limit the risks.
Regulators have said that devising new rules has been hard, in part because the trading world has become so complex, making it difficult to determine the total effect that all the innovations have had on traditional investors. Mr. Kirilenko said in an interview Monday that his study was intended to address that.
“We’re not estimating,” he said. “Our data is excellent.”
Ben Protess contributed reporting.
© 2012 The New York Times Company
http://www.nytimes.com/2012/12/04/business/high-speed-trades-hurt-investors-a-study-says.html [ http://www.nytimes.com/2012/12/04/business/high-speed-trades-hurt-investors-a-study-says.html?pagewanted=all ]
--
(linked in) http://investorshub.advfn.com/boards/read_msg.aspx?message_id=42616686 and preceding and following
===
Ted Nugent: 'Slaughter' Medicare, Medicaid, Social Security, Revoke Voting Rights For Welfare Recipients
12/04/2012
http://www.huffingtonpost.com/2012/12/04/ted-nugent-fiscal-cliff_n_2238490.html [with comments]
===
Grover Norquist: 'Tea Party 2 Is Going To Dwarf Tea Party 1 If Obama Pushes Us Off The Cliff'
Anti-tax advocate Grover Norquist warned the panelists on Sunday's Meet The Press that the regulation and taxes which are part of President Barack Obama's health care reform legislation are due to be implemented in Obama's second term. In combination with the tax increases he is seeking as a resolution to the fiscal cliff, Norquist said that he believes "Tea Party 2 will dwarf Tea Party 1."
"He's talking about seducing -- that the Republicans have been seduced. You talk about 'impure thoughts. This is not a pornographic debate, Grover," CNBC host Jim Cramer told the Americans for Tax Reform chief. "I know you don't want a recession. You don't want people laid off. You're going to sacrifice that on the cross of 2 percent. Is that what you want?"
"No," Norquist replied. "We need to have economic growth instead of higher taxes." He said that Reagan-era taxation levels would promote growth which would pay down the debt racked up in the last four years.
Cramer replied that the Clinton-era rates, which America will return to in January unless the fiscal cliff is resolved, netted more growth and revenues to the government than at any point in the 1980s.
Both Norquist and CNBC anchor Maria Bartiromo replied that this is simply a different economic and regulatory environment than the 1990s. Norquist specifically cited the president's health care reform law and the majority of its regulation and increased taxes which were designed to not be fully implemented until 2013-2014.
"We got four bad years of regulation, higher taxes. He wants to add more taxes to that. Tea Party 2 is going to dwarf Tea Party 1 if Obama pushes us off the cliff," Norquist concluded.
http://www.youtube.com/watch?v=YiRWM0i2rLQ [also at http://www.youtube.com/watch?v=XLsisF8J3_I ]
--
How Dummies Show Off Their Boehner
The Dummies sit down with John Boehner, the next Speaker of the House.
http://www.youtube.com/watch?v=pWm8hUCsnRw
[(linked in) http://investorshub.advfn.com/boards/read_msg.aspx?message_id=80049629 and preceding (and any future following),
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81378664 and preceding and following,
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81514565 and preceding (and any future following)]
--
How Dummies Set A New Tone
The Dummies Follow Boehner and Read aloud the Constitution.
Notes found on our Facebook page and here:
http://mockthedummy.com/2011/01/27/how-dummies-set-a-new-tone/
http://www.youtube.com/watch?v=7tg_87Gx0XM
[(linked in) http://investorshub.advfn.com/boards/read_msg.aspx?message_id=80058624 and preceding (and any future following),
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81179821 and preceding (and any future following),
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81514565 and preceding (and any future following)]
--
How Dummies Usurp A Party
Zombie dummies recite the pledge of allegiance to Americans For Tax Reform and Grover Norquist for whom it stands.
http://www.youtube.com/watch?v=eOBWaEykRPY [as for that last bit, see the "The 12 Days of Conservative Movement Christmas" video in the post to which this is a reply]
===
The Best Idea for the Debt Ceiling? Abolish It Forever
Nov 30 2012
http://www.theatlantic.com/business/archive/2012/11/the-best-idea-for-the-debt-ceiling-abolish-it-forever/265773/ [with comments]
--
The Next Debt-Limit Debacle
Editorial
Published: December 5, 2012
Republicans clearly sense that they are being outmaneuvered in the fiscal talks by the Obama administration, unable to stop the inevitable rise in tax rates for the rich. But they have one last card to play and they intend to use it, knowing it will endanger economic progress: They are threatening once again to default on the credit of the United States if President Obama doesn’t do their bidding.
Party officials say that if they do not reach an acceptable deal with the White House this month, they will wait until the country reaches the debt ceiling early next year, then refuse to lift it until they get their way on cuts to spending and taxes, The Times reported on Wednesday [ http://www.nytimes.com/2012/12/05/us/politics/gop-seeks-fallback-position-on-tax-fight.html ].
Apparently, they learned nothing from the debacle of 2011, when they first tried this extortionate tactic. The nation lost its AAA credit rating, stock values plunged, and the approval rating of Congress sank to historically low levels. Republicans portray themselves as spending hawks, but that episode cost the Treasury $1.3 billion in higher borrowing costs [ http://www.gao.gov/assets/600/592832.pdf ] in 2011, according to the Government Accountability Office. Last week, the Bipartisan Policy Center estimated [ http://bipartisanpolicy.org/sites/default/files/Debt%20Limit%20Analysis.pdf ] that the 10-year cost of higher interest rates was $18.9 billion.
Republicans savor that potential catastrophe, caring only that the threat won them $2 trillion in spending cuts over a decade from Mr. Obama. Now they want to do it again, and this time they want something the last agreement missed: big cuts to Social Security, Medicare, Medicaid and other programs that primarily benefit middle- and low-income people. Grover Norquist, who leads the party’s anti-tax cult, even suggested that the debt limit be raised only enough to get through a month at a time, so that Republicans can maximize their blackmail power.
This is one of the worst imaginable ways to run a government, and Treasury Secretary Tim Geithner is desperate to prevent it from recurring. As part of the administration’s initial fiscal offer last week, Mr. Geithner proposed a way to eliminate this threat, allowing the president to raise the debt ceiling unless two-thirds of Congress overruled him. This idea provoked immediate laughter in Republican offices in the Capitol.
“Congress is not going to give up this power [ http://www.foxnews.com/on-air/fox-news-sunday-chris-wallace/2012/12/02/treasury-secretary-timothy-geithner-and-house-speaker-john-boehner-talk-fiscal-cliff ],” House Speaker John Boehner said, as if the debt ceiling was enshrined in the Constitution. It’s not, of course; the limit is an unnecessary World War I era measure [ http://graphics8.nytimes.com/packages/pdf/opinion/editorial/1961Editorial.pdf ] providing the illusion that Congress is carefully overseeing borrowing. What most people don’t know is that the limit does not affect future borrowing, but instead allows the Treasury to borrow to cover money Congress has already voted to spend. Republicans oversaw the tax cuts, war spending and recession that are the biggest components of the debt [ http://www.nytimes.com/2011/07/24/opinion/sunday/24sun4.html ], but don’t want to take responsibility. Ending the ceiling would not in any way diminish the Congressional power of the purse.
Mr. Geithner’s proposal is a good one, but it is clear this batch of Republicans will never vote to give up its most powerful leverage.
Mr. Obama said firmly on Wednesday that he had no intention of playing the Republican debt ceiling game again. This time he might want to enlist the help of every American who holds federal, state or municipal bonds, investments that would be under threat in a debt crisis. If nothing else works, he should cite the 14th Amendment’s ban on questioning the public debt, and declare an end to the debt ceiling once and for all. The country can no longer tolerate government by brinkmanship and extortion.
© 2012 The New York Times Company
http://www.nytimes.com/2012/12/06/opinion/the-next-debt-limit-debacle.html [with comments]
--
(linked in):
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=82178286 and preceding (and any future following);
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=64989749 and preceding and following
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=82214870 and following
--
How Dummies Sell Their Boehner
To commemorate Boehner and the debt ceiling debacle, the Tea Party dummies sell a t-shirt. Get the limited edition T-shirt here: http://mockthedummy.com/limited-edition-t-shirt/
https://www.youtube.com/watch?v=vb-Bpn5O-e0
[(linked in) http://investorshub.advfn.com/boards/read_msg.aspx?message_id=80049629 and preceding (and any future following),
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81378664 and preceding and following,
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81514565 and preceding (and any future following)]
===
Race to the Bottom
Editorial
Published: December 5, 2012
Competition among states and cities to lure businesses in hopes of creating jobs is not new, but it has become more fierce in recent years. An investigation [ http://www.nytimes.com/2012/12/02/us/how-local-taxpayers-bankroll-corporations.html , http://www.nytimes.com/2012/12/03/us/winners-and-losers-in-texas.html , http://www.nytimes.com/2012/12/04/us/when-hollywood-comes-to-town.html ] by The Times found that state and local governments are giving out $80 billion a year in tax breaks and other subsidies in a foolhardy, shortsighted race to attract companies. That money could go a long way to improving education, transportation and other public services that would have a far better shot at promoting real economic growth.
Instead, with these giveaways, politicians and officials are trying to pick winners and losers, almost exclusively to the benefit of big corporations (aided by highly paid lobbyists) at the expense of small businesses. Though they promise that the subsidies are smart investments, far too often the jobs either don’t materialize or are short-lived, leaving the communities no better off.
The three-part series by Louise Story described how in places like Texas and Ohio, state and local governments have lavished millions of dollars in tax breaks on corporate giants like Samsung and the Big Three automakers — even as they faced budget deficits and were forced to cut spending on critical services. The tax revenues forgone in this giveaway frenzy should concern Congress deeply. After all, federal funds account for one-fifth of state and local budgets.
In one particularly egregious example in Pontiac, Mich., the State of Michigan gave $14 million in tax credits and a state pension fund guaranteed $18 million in bonds to a movie studio that created just 12 permanent jobs. In Texas, Amazon.com, the online retailer, received tax abatements, sales tax exemptions and other benefits totaling $277 million to open a warehouse that promises to employ 2,500 people. Those benefits were granted after the retailer closed another warehouse because of a dispute with the government involving sales taxes.
Many governments don’t know the full value of the subsidies they hand out in the form of tax refunds, rebates, loans, grants and more. And they don’t know if the jobs created would have been created anyway. The fact is, numerous studies show that such incentives result in only a small increase in jobs and that any gains usually come at the expense of other cities and states.
Local governments would be much better off investing tax dollars in education and public works that would deliver long-term benefits to both businesses and workers. California, for instance, is among the least generous of the larger states in doling out tax breaks. It gave out just $112 per capita compared with $759 in Texas, $672 in Michigan, and $210 in New York. Its experience leaves no doubt that investments made in public institutions like the University of California system can remain critically important to economic growth decades later.
The senseless race to give away billions in subsidies is, of course, hard to stop when elected leaders think a pledge of potential jobs might help in their next election. But even when attracting businesses is a legitimate goal, it has to be done in ways that are fair and transparent.
The trouble with targeted incentives is that they are little more than transfers of wealth to a handful of powerful corporations from all other taxpayers, including other businesses. If the problem is excessive tax burdens on businesses in general, then the solution is broad tax reform that also benefits small business owners, who are more likely to stick around if the regional economy weakens and who are unlikely to hopscotch around the country in search of a bigger tax break.
© 2012 The New York Times Company
http://www.nytimes.com/2012/12/06/opinion/race-to-the-bottom.html
--
(linked in) http://investorshub.advfn.com/boards/read_msg.aspx?message_id=82039823 and following
===
The Legal Crusade to Undermine Obamacare—and Rewrite History
Michael Cannon (Cato Institute)
December 5, 2012
http://www.tnr.com/blog/plank/110770/obamacare-cannon-irs-federal-state-exchange-subsidies-bagenstos-jost [with comments]
===
U.S. Barred From Prosecuting Off-Label Sales of Drugs
By Margaret Cronin Fisk - Dec 4, 2012 1:06 AM CT
Pharmaceutical companies and their sales staff can’t be prosecuted for promoting drugs for “lawful,” unapproved uses, a federal appeals court said, reversing a conviction of a salesman.
Alfred Caronia, a sales representative for Orphan Medical Inc., was convicted in 2008 of conspiracy to introduce a misbranded drug into commerce by promoting the narcolepsy medication Xyrem for unapproved uses. Under the U.S. Food, Drug and Cosmetic Act, or FDCA, doctors are allowed to prescribe drugs for unapproved uses while drugmakers and their sales representatives are barred from promoting such prescriptions.
Caronia appealed, contending that the conviction violated his First Amendment right of freedom of speech. The U.S. Court of Appeals in New York yesterday found that the government “clearly prosecuted Caronia for his words” and reversed the conviction.
“The government cannot prosecute pharmaceutical manufacturers and their representatives under the FDCA for speech promoting the lawful, off-label use of an FDA-approved drug,” U.S. Circuit Judge Denny Chin said in a 2-1 decision. “The proscribed conduct for which Caronia was prosecuted was precisely his speech in aid of pharmaceutical marketing.”
Dean Boyd, a Justice Department spokesman, declined to immediately comment.
‘Repeatedly Prosecuted’
The U.S. has “repeatedly prosecuted” drug companies and sales representatives for off-label promotion, the appellate court said, citing multiple cases including one that resulted in a $3 billion settlement by GlaxoSmithKline Plc (GSK) earlier this year.
The 2-1 decision by the appeals court may restrict such prosecutions in the future, U.S. Circuit Judge Debra Ann Livingston said in her dissent. “The majority calls into question the very foundations of our century-old system of drug regulation,” she wrote.
That system “developed to protect consumers from misleading and unsubstantiated claims about drugs’ safety and efficacy, and the prohibition on off-label promotion by drug manufacturers is essential to maintaining the effectiveness of that system,” Livingston said.
The U.S. claimed that Caronia engaged in improper promotion of Xyrem in 2005 while working for Orphan Medical. Orphan Medical was acquired that year by Dublin-based Jazz Pharmaceuticals Plc (JAZZ), according to the appeals court.
The case is U.S. v. Caronia, 09-5006-cr, U.S. Court of Appeals for the Second Circuit (New York).
To contact the reporter on this story: Margaret Cronin Fisk in Detroit at mcfisk@bloomberg.net
To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net
©2012 BLOOMBERG L.P.
http://www.bloomberg.com/news/2012-12-04/u-s-barred-from-prosecuting-off-label-sales-of-drugs.html [no comments yet]
--
Ruling Is Victory for Drug Companies in Promoting Medicine for Other Uses
By KATIE THOMAS
Published: December 3, 2012
In a case that could have broad ramifications for the pharmaceutical industry, a federal appeals court on Monday threw out the conviction of a sales representative who sold a drug for uses not approved by the Food and Drug Administration [ http://topics.nytimes.com/top/reference/timestopics/organizations/f/food_and_drug_administration/index.html ]. The judges said that the ban on so-called off-label marketing violated the representative’s freedom of speech.
The 2-to-1 decision by a three-judge panel of the Court of Appeals for the Second Circuit in Manhattan addresses a long-running and costly issue for the industry, which has paid billions of dollars in penalties to the federal government in recent years after being accused of marketing blockbuster drugs for off-label uses.
In July, for example, the British drug maker GlaxoSmithKline agreed to pay [ http://www.nytimes.com/2012/07/03/business/glaxosmithkline-agrees-to-pay-3-billion-in-fraud-settlement.html?pagewanted=all ] $3 billion in fines, in part for promoting antidepressants and other drugs for unapproved uses; a month later, Johnson & Johnson [ http://topics.nytimes.com/top/news/business/companies/johnson_and_johnson/index.html ] announced that its pharmaceutical unit had reached a $181 million consumer fraud settlement with 36 states and the District of Columbia over its marketing of Risperdal, an antipsychotic drug.
“Most if not all of these cases have been based on a central premise: that it is unlawful for a company and one of its employees to be promoting a drug or a medical device off-label,” said John R. Fleder, a director at the law firm Hyman, Phelps & McNamara who represented the F.D.A. while working at the Justice Department. “And this decision hits at the heart of the government’s theory.”
The ruling, in United States v. Caronia [ http://www.fdalawblog.net/fda_law_blog_hyman_phelps/2012/12/in-landmark-ruling-court-reverses-conviction-involving-off-label-promotion.html ], involved the conviction of Alfred Caronia, a former sales representative for Orphan Medical, which was later acquired by Jazz Pharmaceutical. Mr. Caronia was selling Xyrem, a drug approved for excessive daytime sleepiness, known as narcolepsy. He was accused of promoting it to doctors as a treatment for insomnia, fibromyalgia and other conditions. He became the target of a federal investigation in 2005 and was caught on an audiotape discussing the unapproved uses of the drug with a doctor who was a government informant. He was convicted by a jury in 2008.
Mr. Caronia appealed the conviction, arguing that his right to free speech under the First Amendment was being illegally restricted. The appellate court decision applies only to the Second Circuit, which comprises New York, Connecticut and Vermont, but some lawyers said that the government was likely to appeal and that the case could find its way to the Supreme Court.
Under the Food, Drug and Cosmetic Act, which gives the F.D.A. the authority to regulate drugs, selling a “misbranded drug,” or one that is intended to be used for purposes not listed in the label, is illegal. Doctors, on the other hand, are free to prescribe a drug for any use. The agency has argued that off-label promotion of drugs is evidence that a sales representative or company intended to sell misbranded drugs.
In its decision, the court said this view violated the First Amendment and cited as precedent a 2011 Supreme Court decision, Sorrell vs. IMS Health [ http://www.scotusblog.com/case-files/cases/sorrell-v-ims-health-inc/ ]. In that case, the high court, citing freedom of speech, overturned a Vermont law restricting pharmaceutical companies from using prescription data for marketing purposes.
“The government clearly prosecuted Caronia for his words — for his speech,” the majority wrote, concluding later “the government cannot prosecute pharmaceutical manufacturers and their representatives under the F.D.C.A. for speech promoting the lawful, off-label use of an F.D.A.-approved drug.”
The lone dissenting judge, Judge Debra Ann Livingston, vigorously disagreed, arguing that by throwing out Mr. Caronia’s conviction “the majority calls into question the very foundations of our century-old system of drug regulation.” She argued that if drug companies “were allowed to promote F.D.A.-approved drugs for nonapproved uses, they would have little incentive to seek F.D.A. approval for those uses.”
Gerald Masoudi, a former chief counsel of the F.D.A., said the ruling made a distinction between truthful discussion of off-label uses of drugs, many of which are considered legitimate by the medical community, and those that are misleading or false. He noted that “anyone on the planet” could discuss off-label uses of drugs, except for pharmaceutical companies.
“It’s very significant,” he said, “because it’s going to make F.D.A., in its promotion cases, focus on the kinds of speech that are more likely to harm consumers, such as false or misleading marketing versus something that is not approved.”
In a statement, the trade group for the pharmaceutical industry, Pharmaceutical Research and Manufacturers of America, said it was pleased with the ruling.
“PhRMA believes that truthful and nonmisleading communication between biopharmaceutical companies and health care professionals is good for patients, because it facilitates the exchange of up-to-date and scientifically accurate information about new treatments,” the statement said.
A spokeswoman for the F.D.A. said the agency did not comment on active litigation.
Lawyers said the government would most likely ask for a rehearing before the circuit court’s full panel of judges and after that, it could be taken up by the Supreme Court.
Because pharmaceutical companies market their drugs nationally and the ruling applies only within the Second Circuit, the ruling is not likely to lead drug makers to change their marketing policies. Rather, some said, the F.D.A. will be unlikely to pursue convictions in similar cases until the legal issues are resolved.
© 2012 The New York Times Company
http://www.nytimes.com/2012/12/04/business/ruling-backs-drug-industry-on-off-label-marketing.html
===
Scott Walker On Eliminating Same-Day Voter Registration: 'This Is A Ridiculous Issue'
Wisconsin Gov. Scott Walker (R) says his focus is not on eliminating same-day voter registration.
12/06/2012
http://www.huffingtonpost.com/2012/12/06/scott-walker-same-day-voter-registration_n_2250447.html [with comments]
===
Stuart Stevens: 'I Never Had A Good Feeling' About Romney Win After Hurricane
12/06/2012
http://www.huffingtonpost.com/2012/12/06/stuart-stevens-romney-hurricane_n_2248926.html [with embedded video report, and comments]
===
Massive Ideological Republican Hypocrisy
12/05/2012
http://www.huffingtonpost.com/chris-weigant/republicans-fiscal-cliff_b_2247890.html [with comments]
===
Harry Reid Questions GOP's Rationality On Fiscal Cliff After Disability Treaty Fails
12/05/2012
http://www.huffingtonpost.com/2012/12/05/harry-reid-fiscal-cliff-gop_n_2244928.html [with comments]
--
(linked in):
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81841911 and preceding (and any future following)
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=82116029 and following
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=82158345 (and any future following)
===
Obama Approval Rating Reaches Three-Year High In Poll
President Barack Obama gestures as he asks if the back of the room could hear him after the podium microphone stopped working while he was speaking about the fiscal cliff during an address before the Business Roundtable, an association of CEOs, Wednesday, Dec. 5, 2012, in Washington.
12/06/2012
http://www.huffingtonpost.com/2012/12/06/obama-approval-rating_n_2250788.html [with comments]
===
Steve Doocy, Brian Kilmeade Outraged MSNBC Hosts Invited To White House (VIDEO)
12/05/2012
[...]
This is not the first time the president has met with MSNBC hosts. Maddow visited with the president numerous times [ http://www.theatlanticwire.com/entertainment/2012/01/rachel-maddow-frequent-white-house-visitor/47506/ ] throughout his first term ...
http://www.huffingtonpost.com/2012/12/05/steve-doocy-brian-kilmead_n_2243935.html [with embedded video report, and comments]
===
Sheldon Adelson Is A Low-Information Billionaire, Apparently
12/05/2012
http://www.huffingtonpost.com/2012/12/05/sheldon-adelson_n_2245666.html [with comments]
===
Joe Lieberman Wishes He Had Left Obama Criticism Out Of 2008 Convention Speech
12/06/2012
http://www.huffingtonpost.com/2012/12/05/joe-lieberman-obama_n_2247892.html [with complete WaPo video interview with Lieberman embedded, and comments]
===
Here's an Idea That Could Save America's Economy: More Americans
Increasing immigration may be our simplest path to long-term growth.
Nov 30 2012
http://www.theatlantic.com/business/archive/2012/11/heres-an-idea-that-could-save-americas-economy-more-americans/265776/ [with comments]
--
Raise the Economy’s Speed Limit
Daniel Stolle
By JARED BERNSTEIN
Published: December 5, 2012
Washington
WITH the budget-and-tax showdown dominating headlines, most Americans probably missed an even more ominous story: according to a report by the Congressional Budget Office, America’s underlying growth rate — that is, the best the economy could do, under optimal conditions, without driving up inflation — has slowed from just under 4 percent a year in 2000 to just under 2 percent [ http://www.cbo.gov/publication/43707 ] today.
Why does this matter? For one thing, the combination of a lower underlying growth rate, which you could think of as the economy’s speed limit, and a less equitable distribution of that growth was a reason middle-income households did so badly and poverty went up in the 2000s.
During the 1990s, in contrast, stronger demand for goods and services led to much faster job growth and the last real gains experienced by middle- and lower-income households. Faster growth in those years also spun off a lot more government revenues, which interacted with slightly higher tax rates to take the budget from deficit to surplus.
Why has the underlying growth rate slowed? It’s actually pretty simple: growth is determined by the supply of labor and capital — i.e., people and machines — and how efficiently we use those inputs to make the output, or gross domestic product.
According to the report, we’re slipping on all fronts. As baby boomers head toward retirement, the growth of the labor force is decelerating; it is expected to grow about half as fast over the next decade as over the last.
This problem was exacerbated by the deep recession, as even younger un- and underemployed workers got discouraged with their job prospects and left the job market (though many will be back when things pick up). Also, for years the influx of women into the labor force raised the economy’s speed limit; that trend plateaued about a decade ago.
We’ve done better on the productivity side. But we’ve underinvested in our capital stock — factories, the machines inside them and software. In the 1990s, when the economy’s speed limit was growing, the flow of services from capital stock increased 4.7 percent a year; in the 2000s, its growth slowed sharply to 2.4 percent, even though tax rates on such investment were considerably lower.
In other words, our workers and machinery are still highly productive, but we’ve been underinvesting in them. In fact, according to the Congressional Budget Office, this investment deficit explains more than a third of the slower underlying growth rate.
Can we do anything about this? Some economists think of the potential growth rate as they do a person’s height: it may be too bad they’re short, but if you try to make them taller, you’ll just waste resources on a lost cause. Recessions may be amenable to monetary and fiscal policy, but structural shortfalls are a function of demographics, resource constraints and technological limits.
But that’s not quite right. Sometimes people don’t hit their potential height because they didn’t get enough nutrition, and it’s the same thing with economies. Bad public policy is to blame as well.
Our whole policy focus in this space tends to be on tax policy — specifically, on cutting taxes on investors and so-called job creators. But that type of “supply-side” taxation has obviously been a bust. We have to look elsewhere, and fast.
First of all, the distinction between the cyclical and the structural is artificial. Bad cyclical growth begets bad structural growth; persistent cyclical weakness in demand — a long recession, long periods of high unemployment — reduces potential growth. Workers who experience long-term unemployment thanks to a harsh cyclical downturn can find themselves less employable because of skill deterioration once the market picks up.
A weak-demand economy requires fewer workers and less capital investment. It also dampens forward-looking investment, and thus the supply of productive capital: American corporations are sitting on almost $2 trillion in reserves that they’re not investing for lack of good options.
The first thing to do is keep applying the accelerator on pro-growth policies that strengthen near-term demand and labor quality, including paycheck supports (like the payroll tax break), training for unemployed workers and investment in bridges, tunnels and other infrastructure. Over the longer term, we might want to think of immigration reform as a way to counteract our decelerating work force.
For now, though, we’re into a negative loop where persistently weak demand is chipping away at the labor and capital supply and productivity advances needed to increase our potential growth rate. Supply-side, deregulatory zeal has deprived the economy of investments in infrastructure and other public goods, innovative research and the oversight necessary to prevent the shampoo cycles — bubble, bust, repeat — that are whacking away at our potential growth rates.
This can all be corrected, but we’ve got to stop setting fiscal traps for ourselves and squabbling about a few points on the marginal tax rate. Instead, let’s start taking the steps that can get this economy back up to speed.
Jared Bernstein [ http://jaredbernsteinblog.com/ ], a senior fellow at the Center on Budget and Policy Priorities, was the chief economist and economic adviser to Vice President Joseph R. Biden Jr. from 2009 to 2011.
© 2012 The New York Times Company
http://www.nytimes.com/2012/12/06/opinion/a-slow-growth-rate-is-the-real-threat.html [with comments]
===
David Phan, Utah Teen, Commits Suicide Outside School After What Peers Call Extensive Bullying
11/30/2012
http://www.huffingtonpost.com/2012/11/30/david-phan-utah-teen-suicide_n_2220457.html [with embedded video report, and comments]
11/30/2012
http://www.huffingtonpost.com/2012/11/30/corporate-profits_n_2217414.html [with comments]
--
US productivity grows at faster 2.9 percent rate in Q3, labor costs down sharply
December 5, 2012
http://www.washingtonpost.com/business/us-productivity-revised-up-to-29-percent-growth-rate-in-third-quarter-labor-costs-down/2012/12/05/713ee8cc-3ee1-11e2-8a5c-473797be602c_story.html [with comments]
===
Top Two Percent To GOP: Tax Us
12/06/2012
http://www.huffingtonpost.com/2012/12/05/top-two-percent-tax_n_2245596.html [with embedded video report, and comments]
--
Who Got the Biggest Tax Break in the Last 30 Years? (The Rich, of Course)
Dec 1 2012
http://www.theatlantic.com/business/archive/2012/12/who-got-the-biggest-tax-break-in-the-last-30-years-the-rich-of-course/265804/ [with comments]
===
High-Speed Traders Profit at Expense of Ordinary Investors, a Study Says
The economist Andrei Kirilenko's findings are still being reviewed by peers and have encountered opposition.
Mendoza College of Business
Bart Chilton of the C.F.T.C. says high-speed traders are taking "some of the cream off the top."
Hiroko Masuike/The New York Times
By NATHANIEL POPPER and CHRISTOPHER LEONARD
Published: December 3, 2012
A top government economist has concluded that the high-speed trading [ http://topics.nytimes.com/top/reference/timestopics/subjects/h/high_frequency_algorithmic_trading/index.html ] firms that have come to dominate the nation’s financial markets are taking significant profits from traditional investors.
The chief economist at the Commodity Futures Trading Commission, Andrei Kirilenko, reports in a coming study that high-frequency traders make an average profit of as much as $5.05 each time they go up against small traders buying and selling one of the most widely used financial contracts.
The agency has not endorsed Mr. Kirilenko’s findings, which are still being reviewed by peers, and they are already encountering some resistance from academics. But Bart Chilton, one of five C.F.T.C. commissioners, said on Monday that “what the study shows is that high-frequency traders are really the new middleman in exchange trading, and they’re taking some of the cream off the top.”
Mr. Kirilenko’s work stands in contrast to several statements from government officials who have expressed uncertainty about whether high-speed traders are earning profits at the expense of ordinary investors.
The study comes as a council of the nation’s top financial regulators is showing increasing concern that the accelerating automation and speed of the financial markets may represent a threat both to other investors and to the stability of the financial system.
The Financial Stability Oversight Council, an organization formed after the recent financial crisis to deal with systemic risks, took up the issue at a meeting in November that was closed to the public, according to minutes that were released Monday.
The gathering of top regulators, including Treasury Secretary Timothy F. Geithner and Ben S. Bernanke, the Federal Reserve chairman, said in its annual report this summer that recent developments “could lead to unintended errors cascading through the financial system.” The C.F.T.C. is a member of the oversight council.
The issue of high-frequency trading has generated anxiety among investors in the stock market, where computerized trading first took hold. But the minutes from the oversight council, and the council’s annual report released this year, indicate that top regulators are viewing the automation of trading as a broader concern as high-speed traders move into an array of financial markets, including bond and foreign currency trading.
Mr. Kirilenko’s study focused on one corner of the financial markets that the C.F.T.C. oversees, contracts that are settled based on the future value of the Standard & Poor’s 500-stock index. He and his co-authors, professors at Princeton and the University of Washington, chose the contract because it is one of the most heavily traded financial assets in any market and is popular with a broad array of investors.
Using previously private data, Mr. Kirilenko’s team found that from August 2010 to August 2012, high-frequency trading firms were able to reliably capture profits by buying and selling futures contracts from several types of traditional investors.
The study notes that there are different types of high-frequency traders, some of which are more aggressive in initiating trades and some of which are passive, simply taking the other side of existing offers in the market.
The researchers found that more aggressive traders accounted for the largest share of trading volume and made the biggest profits. The most aggressive scored an average profit of $1.92 for every futures contract they traded with big institutional investors, and made an average $3.49 with a smaller, retail investor. Passive traders, on the other hand, saw a small loss on each contract traded with institutional investors, but they made a bigger profit against retail investors, of $5.05 a contract.
Large investors can trade thousands of contracts at once to bet on future shifts in the S.& P. 500 index. The average aggressive high-speed trader made a daily profit of $45,267 in a month in 2010 analyzed by the study.
Industry profits have been falling, however, as overall stock trading volume has dropped and the race for the latest technological advances has increased costs.
Mr. Kirilenko, who is about to leave the C.F.T.C. for an academic position at the Massachusetts Institute of Technology, presented a draft of the paper at a C.F.T.C. conference last week. He said that the markets were a “zero sum game” in which the high-speed profits came at the expense of other traders.
Mr. Kirilenko warned that the smaller traders might leave the futures markets if their profits were drained away, opting instead to operate in less transparent markets where high-speed traders would not get in the way.
“They will go someplace that’s darker,” Mr. Kirilenko said at the conference. That could destabilize futures markets long used by traders to hedge risk.
A spokesman for the C.F.T.C. said the agency had no comment on the study. But the paper was immediately hailed by Mr. Chilton, who is a Democrat and a critic of recent shifts in the markets.
Mr. Chilton said that the study would make it easier for regulators “to put forth regulations in a streamlined fashion. It’s a key step in the process and it should fuel-inject the regulatory effort going forward.”
Terrence Hendershott, a professor at the University of California, Berkeley, said there was a limit to the importance of Mr. Kirilenko’s work because it focused on profits and did not address the benefits high-speed traders bring.
Mr. Hendershott and many other academics have found that the competition between high-speed traders has helped lower the cost of trading for ordinary investors. But Mr. Hendershott said that limited data available to researchers had made it hard to determine whether the benefits outweighed the costs.
The speed and complexity of the financial markets jumped onto the agenda of regulators after the so-called flash crash of 2010, when leading stock indexes fell almost 10 percent in less than half an hour, before quickly making up most of the losses.
In its first annual report, in 2011, the Financial Stability Oversight Council noted the concerns raised by the flash crash, but not in great detail. This year’s report included a much fuller discussion of the risks posed by the increasing speed and complexity of the financial markets and called for regulators to look for more ways to limit the risks.
Regulators have said that devising new rules has been hard, in part because the trading world has become so complex, making it difficult to determine the total effect that all the innovations have had on traditional investors. Mr. Kirilenko said in an interview Monday that his study was intended to address that.
“We’re not estimating,” he said. “Our data is excellent.”
Ben Protess contributed reporting.
© 2012 The New York Times Company
http://www.nytimes.com/2012/12/04/business/high-speed-trades-hurt-investors-a-study-says.html [ http://www.nytimes.com/2012/12/04/business/high-speed-trades-hurt-investors-a-study-says.html?pagewanted=all ]
--
(linked in) http://investorshub.advfn.com/boards/read_msg.aspx?message_id=42616686 and preceding and following
===
Ted Nugent: 'Slaughter' Medicare, Medicaid, Social Security, Revoke Voting Rights For Welfare Recipients
12/04/2012
http://www.huffingtonpost.com/2012/12/04/ted-nugent-fiscal-cliff_n_2238490.html [with comments]
===
Grover Norquist: 'Tea Party 2 Is Going To Dwarf Tea Party 1 If Obama Pushes Us Off The Cliff'
Published on Dec 2, 2012 by NewsPoliticsNow2
Anti-tax advocate Grover Norquist warned the panelists on Sunday's Meet The Press that the regulation and taxes which are part of President Barack Obama's health care reform legislation are due to be implemented in Obama's second term. In combination with the tax increases he is seeking as a resolution to the fiscal cliff, Norquist said that he believes "Tea Party 2 will dwarf Tea Party 1."
"He's talking about seducing -- that the Republicans have been seduced. You talk about 'impure thoughts. This is not a pornographic debate, Grover," CNBC host Jim Cramer told the Americans for Tax Reform chief. "I know you don't want a recession. You don't want people laid off. You're going to sacrifice that on the cross of 2 percent. Is that what you want?"
"No," Norquist replied. "We need to have economic growth instead of higher taxes." He said that Reagan-era taxation levels would promote growth which would pay down the debt racked up in the last four years.
Cramer replied that the Clinton-era rates, which America will return to in January unless the fiscal cliff is resolved, netted more growth and revenues to the government than at any point in the 1980s.
Both Norquist and CNBC anchor Maria Bartiromo replied that this is simply a different economic and regulatory environment than the 1990s. Norquist specifically cited the president's health care reform law and the majority of its regulation and increased taxes which were designed to not be fully implemented until 2013-2014.
"We got four bad years of regulation, higher taxes. He wants to add more taxes to that. Tea Party 2 is going to dwarf Tea Party 1 if Obama pushes us off the cliff," Norquist concluded.
http://www.youtube.com/watch?v=YiRWM0i2rLQ [also at http://www.youtube.com/watch?v=XLsisF8J3_I ]
--
How Dummies Show Off Their Boehner
Uploaded by MockTheDummy1 on Nov 12, 2010
The Dummies sit down with John Boehner, the next Speaker of the House.
http://www.youtube.com/watch?v=pWm8hUCsnRw
[(linked in) http://investorshub.advfn.com/boards/read_msg.aspx?message_id=80049629 and preceding (and any future following),
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81378664 and preceding and following,
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81514565 and preceding (and any future following)]
--
How Dummies Set A New Tone
Uploaded by MockTheDummy1 on Jan 27, 2011
The Dummies Follow Boehner and Read aloud the Constitution.
Notes found on our Facebook page and here:
http://mockthedummy.com/2011/01/27/how-dummies-set-a-new-tone/
http://www.youtube.com/watch?v=7tg_87Gx0XM
[(linked in) http://investorshub.advfn.com/boards/read_msg.aspx?message_id=80058624 and preceding (and any future following),
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81179821 and preceding (and any future following),
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81514565 and preceding (and any future following)]
--
How Dummies Usurp A Party
Published on Nov 28, 2011 by MockTheDummy1
Zombie dummies recite the pledge of allegiance to Americans For Tax Reform and Grover Norquist for whom it stands.
http://www.youtube.com/watch?v=eOBWaEykRPY [as for that last bit, see the "The 12 Days of Conservative Movement Christmas" video in the post to which this is a reply]
===
The Best Idea for the Debt Ceiling? Abolish It Forever
Nov 30 2012
http://www.theatlantic.com/business/archive/2012/11/the-best-idea-for-the-debt-ceiling-abolish-it-forever/265773/ [with comments]
--
The Next Debt-Limit Debacle
Editorial
Published: December 5, 2012
Republicans clearly sense that they are being outmaneuvered in the fiscal talks by the Obama administration, unable to stop the inevitable rise in tax rates for the rich. But they have one last card to play and they intend to use it, knowing it will endanger economic progress: They are threatening once again to default on the credit of the United States if President Obama doesn’t do their bidding.
Party officials say that if they do not reach an acceptable deal with the White House this month, they will wait until the country reaches the debt ceiling early next year, then refuse to lift it until they get their way on cuts to spending and taxes, The Times reported on Wednesday [ http://www.nytimes.com/2012/12/05/us/politics/gop-seeks-fallback-position-on-tax-fight.html ].
Apparently, they learned nothing from the debacle of 2011, when they first tried this extortionate tactic. The nation lost its AAA credit rating, stock values plunged, and the approval rating of Congress sank to historically low levels. Republicans portray themselves as spending hawks, but that episode cost the Treasury $1.3 billion in higher borrowing costs [ http://www.gao.gov/assets/600/592832.pdf ] in 2011, according to the Government Accountability Office. Last week, the Bipartisan Policy Center estimated [ http://bipartisanpolicy.org/sites/default/files/Debt%20Limit%20Analysis.pdf ] that the 10-year cost of higher interest rates was $18.9 billion.
Republicans savor that potential catastrophe, caring only that the threat won them $2 trillion in spending cuts over a decade from Mr. Obama. Now they want to do it again, and this time they want something the last agreement missed: big cuts to Social Security, Medicare, Medicaid and other programs that primarily benefit middle- and low-income people. Grover Norquist, who leads the party’s anti-tax cult, even suggested that the debt limit be raised only enough to get through a month at a time, so that Republicans can maximize their blackmail power.
This is one of the worst imaginable ways to run a government, and Treasury Secretary Tim Geithner is desperate to prevent it from recurring. As part of the administration’s initial fiscal offer last week, Mr. Geithner proposed a way to eliminate this threat, allowing the president to raise the debt ceiling unless two-thirds of Congress overruled him. This idea provoked immediate laughter in Republican offices in the Capitol.
“Congress is not going to give up this power [ http://www.foxnews.com/on-air/fox-news-sunday-chris-wallace/2012/12/02/treasury-secretary-timothy-geithner-and-house-speaker-john-boehner-talk-fiscal-cliff ],” House Speaker John Boehner said, as if the debt ceiling was enshrined in the Constitution. It’s not, of course; the limit is an unnecessary World War I era measure [ http://graphics8.nytimes.com/packages/pdf/opinion/editorial/1961Editorial.pdf ] providing the illusion that Congress is carefully overseeing borrowing. What most people don’t know is that the limit does not affect future borrowing, but instead allows the Treasury to borrow to cover money Congress has already voted to spend. Republicans oversaw the tax cuts, war spending and recession that are the biggest components of the debt [ http://www.nytimes.com/2011/07/24/opinion/sunday/24sun4.html ], but don’t want to take responsibility. Ending the ceiling would not in any way diminish the Congressional power of the purse.
Mr. Geithner’s proposal is a good one, but it is clear this batch of Republicans will never vote to give up its most powerful leverage.
Mr. Obama said firmly on Wednesday that he had no intention of playing the Republican debt ceiling game again. This time he might want to enlist the help of every American who holds federal, state or municipal bonds, investments that would be under threat in a debt crisis. If nothing else works, he should cite the 14th Amendment’s ban on questioning the public debt, and declare an end to the debt ceiling once and for all. The country can no longer tolerate government by brinkmanship and extortion.
© 2012 The New York Times Company
http://www.nytimes.com/2012/12/06/opinion/the-next-debt-limit-debacle.html [with comments]
--
(linked in):
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=82178286 and preceding (and any future following);
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=64989749 and preceding and following
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=82214870 and following
--
How Dummies Sell Their Boehner
Uploaded by MockTheDummy1 on Aug 9, 2011
To commemorate Boehner and the debt ceiling debacle, the Tea Party dummies sell a t-shirt. Get the limited edition T-shirt here: http://mockthedummy.com/limited-edition-t-shirt/
https://www.youtube.com/watch?v=vb-Bpn5O-e0
[(linked in) http://investorshub.advfn.com/boards/read_msg.aspx?message_id=80049629 and preceding (and any future following),
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81378664 and preceding and following,
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81514565 and preceding (and any future following)]
===
Race to the Bottom
Editorial
Published: December 5, 2012
Competition among states and cities to lure businesses in hopes of creating jobs is not new, but it has become more fierce in recent years. An investigation [ http://www.nytimes.com/2012/12/02/us/how-local-taxpayers-bankroll-corporations.html , http://www.nytimes.com/2012/12/03/us/winners-and-losers-in-texas.html , http://www.nytimes.com/2012/12/04/us/when-hollywood-comes-to-town.html ] by The Times found that state and local governments are giving out $80 billion a year in tax breaks and other subsidies in a foolhardy, shortsighted race to attract companies. That money could go a long way to improving education, transportation and other public services that would have a far better shot at promoting real economic growth.
Instead, with these giveaways, politicians and officials are trying to pick winners and losers, almost exclusively to the benefit of big corporations (aided by highly paid lobbyists) at the expense of small businesses. Though they promise that the subsidies are smart investments, far too often the jobs either don’t materialize or are short-lived, leaving the communities no better off.
The three-part series by Louise Story described how in places like Texas and Ohio, state and local governments have lavished millions of dollars in tax breaks on corporate giants like Samsung and the Big Three automakers — even as they faced budget deficits and were forced to cut spending on critical services. The tax revenues forgone in this giveaway frenzy should concern Congress deeply. After all, federal funds account for one-fifth of state and local budgets.
In one particularly egregious example in Pontiac, Mich., the State of Michigan gave $14 million in tax credits and a state pension fund guaranteed $18 million in bonds to a movie studio that created just 12 permanent jobs. In Texas, Amazon.com, the online retailer, received tax abatements, sales tax exemptions and other benefits totaling $277 million to open a warehouse that promises to employ 2,500 people. Those benefits were granted after the retailer closed another warehouse because of a dispute with the government involving sales taxes.
Many governments don’t know the full value of the subsidies they hand out in the form of tax refunds, rebates, loans, grants and more. And they don’t know if the jobs created would have been created anyway. The fact is, numerous studies show that such incentives result in only a small increase in jobs and that any gains usually come at the expense of other cities and states.
Local governments would be much better off investing tax dollars in education and public works that would deliver long-term benefits to both businesses and workers. California, for instance, is among the least generous of the larger states in doling out tax breaks. It gave out just $112 per capita compared with $759 in Texas, $672 in Michigan, and $210 in New York. Its experience leaves no doubt that investments made in public institutions like the University of California system can remain critically important to economic growth decades later.
The senseless race to give away billions in subsidies is, of course, hard to stop when elected leaders think a pledge of potential jobs might help in their next election. But even when attracting businesses is a legitimate goal, it has to be done in ways that are fair and transparent.
The trouble with targeted incentives is that they are little more than transfers of wealth to a handful of powerful corporations from all other taxpayers, including other businesses. If the problem is excessive tax burdens on businesses in general, then the solution is broad tax reform that also benefits small business owners, who are more likely to stick around if the regional economy weakens and who are unlikely to hopscotch around the country in search of a bigger tax break.
© 2012 The New York Times Company
http://www.nytimes.com/2012/12/06/opinion/race-to-the-bottom.html
--
(linked in) http://investorshub.advfn.com/boards/read_msg.aspx?message_id=82039823 and following
===
The Legal Crusade to Undermine Obamacare—and Rewrite History
Michael Cannon (Cato Institute)
December 5, 2012
http://www.tnr.com/blog/plank/110770/obamacare-cannon-irs-federal-state-exchange-subsidies-bagenstos-jost [with comments]
===
U.S. Barred From Prosecuting Off-Label Sales of Drugs
By Margaret Cronin Fisk - Dec 4, 2012 1:06 AM CT
Pharmaceutical companies and their sales staff can’t be prosecuted for promoting drugs for “lawful,” unapproved uses, a federal appeals court said, reversing a conviction of a salesman.
Alfred Caronia, a sales representative for Orphan Medical Inc., was convicted in 2008 of conspiracy to introduce a misbranded drug into commerce by promoting the narcolepsy medication Xyrem for unapproved uses. Under the U.S. Food, Drug and Cosmetic Act, or FDCA, doctors are allowed to prescribe drugs for unapproved uses while drugmakers and their sales representatives are barred from promoting such prescriptions.
Caronia appealed, contending that the conviction violated his First Amendment right of freedom of speech. The U.S. Court of Appeals in New York yesterday found that the government “clearly prosecuted Caronia for his words” and reversed the conviction.
“The government cannot prosecute pharmaceutical manufacturers and their representatives under the FDCA for speech promoting the lawful, off-label use of an FDA-approved drug,” U.S. Circuit Judge Denny Chin said in a 2-1 decision. “The proscribed conduct for which Caronia was prosecuted was precisely his speech in aid of pharmaceutical marketing.”
Dean Boyd, a Justice Department spokesman, declined to immediately comment.
‘Repeatedly Prosecuted’
The U.S. has “repeatedly prosecuted” drug companies and sales representatives for off-label promotion, the appellate court said, citing multiple cases including one that resulted in a $3 billion settlement by GlaxoSmithKline Plc (GSK) earlier this year.
The 2-1 decision by the appeals court may restrict such prosecutions in the future, U.S. Circuit Judge Debra Ann Livingston said in her dissent. “The majority calls into question the very foundations of our century-old system of drug regulation,” she wrote.
That system “developed to protect consumers from misleading and unsubstantiated claims about drugs’ safety and efficacy, and the prohibition on off-label promotion by drug manufacturers is essential to maintaining the effectiveness of that system,” Livingston said.
The U.S. claimed that Caronia engaged in improper promotion of Xyrem in 2005 while working for Orphan Medical. Orphan Medical was acquired that year by Dublin-based Jazz Pharmaceuticals Plc (JAZZ), according to the appeals court.
The case is U.S. v. Caronia, 09-5006-cr, U.S. Court of Appeals for the Second Circuit (New York).
To contact the reporter on this story: Margaret Cronin Fisk in Detroit at mcfisk@bloomberg.net
To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net
©2012 BLOOMBERG L.P.
http://www.bloomberg.com/news/2012-12-04/u-s-barred-from-prosecuting-off-label-sales-of-drugs.html [no comments yet]
--
Ruling Is Victory for Drug Companies in Promoting Medicine for Other Uses
By KATIE THOMAS
Published: December 3, 2012
In a case that could have broad ramifications for the pharmaceutical industry, a federal appeals court on Monday threw out the conviction of a sales representative who sold a drug for uses not approved by the Food and Drug Administration [ http://topics.nytimes.com/top/reference/timestopics/organizations/f/food_and_drug_administration/index.html ]. The judges said that the ban on so-called off-label marketing violated the representative’s freedom of speech.
The 2-to-1 decision by a three-judge panel of the Court of Appeals for the Second Circuit in Manhattan addresses a long-running and costly issue for the industry, which has paid billions of dollars in penalties to the federal government in recent years after being accused of marketing blockbuster drugs for off-label uses.
In July, for example, the British drug maker GlaxoSmithKline agreed to pay [ http://www.nytimes.com/2012/07/03/business/glaxosmithkline-agrees-to-pay-3-billion-in-fraud-settlement.html?pagewanted=all ] $3 billion in fines, in part for promoting antidepressants and other drugs for unapproved uses; a month later, Johnson & Johnson [ http://topics.nytimes.com/top/news/business/companies/johnson_and_johnson/index.html ] announced that its pharmaceutical unit had reached a $181 million consumer fraud settlement with 36 states and the District of Columbia over its marketing of Risperdal, an antipsychotic drug.
“Most if not all of these cases have been based on a central premise: that it is unlawful for a company and one of its employees to be promoting a drug or a medical device off-label,” said John R. Fleder, a director at the law firm Hyman, Phelps & McNamara who represented the F.D.A. while working at the Justice Department. “And this decision hits at the heart of the government’s theory.”
The ruling, in United States v. Caronia [ http://www.fdalawblog.net/fda_law_blog_hyman_phelps/2012/12/in-landmark-ruling-court-reverses-conviction-involving-off-label-promotion.html ], involved the conviction of Alfred Caronia, a former sales representative for Orphan Medical, which was later acquired by Jazz Pharmaceutical. Mr. Caronia was selling Xyrem, a drug approved for excessive daytime sleepiness, known as narcolepsy. He was accused of promoting it to doctors as a treatment for insomnia, fibromyalgia and other conditions. He became the target of a federal investigation in 2005 and was caught on an audiotape discussing the unapproved uses of the drug with a doctor who was a government informant. He was convicted by a jury in 2008.
Mr. Caronia appealed the conviction, arguing that his right to free speech under the First Amendment was being illegally restricted. The appellate court decision applies only to the Second Circuit, which comprises New York, Connecticut and Vermont, but some lawyers said that the government was likely to appeal and that the case could find its way to the Supreme Court.
Under the Food, Drug and Cosmetic Act, which gives the F.D.A. the authority to regulate drugs, selling a “misbranded drug,” or one that is intended to be used for purposes not listed in the label, is illegal. Doctors, on the other hand, are free to prescribe a drug for any use. The agency has argued that off-label promotion of drugs is evidence that a sales representative or company intended to sell misbranded drugs.
In its decision, the court said this view violated the First Amendment and cited as precedent a 2011 Supreme Court decision, Sorrell vs. IMS Health [ http://www.scotusblog.com/case-files/cases/sorrell-v-ims-health-inc/ ]. In that case, the high court, citing freedom of speech, overturned a Vermont law restricting pharmaceutical companies from using prescription data for marketing purposes.
“The government clearly prosecuted Caronia for his words — for his speech,” the majority wrote, concluding later “the government cannot prosecute pharmaceutical manufacturers and their representatives under the F.D.C.A. for speech promoting the lawful, off-label use of an F.D.A.-approved drug.”
The lone dissenting judge, Judge Debra Ann Livingston, vigorously disagreed, arguing that by throwing out Mr. Caronia’s conviction “the majority calls into question the very foundations of our century-old system of drug regulation.” She argued that if drug companies “were allowed to promote F.D.A.-approved drugs for nonapproved uses, they would have little incentive to seek F.D.A. approval for those uses.”
Gerald Masoudi, a former chief counsel of the F.D.A., said the ruling made a distinction between truthful discussion of off-label uses of drugs, many of which are considered legitimate by the medical community, and those that are misleading or false. He noted that “anyone on the planet” could discuss off-label uses of drugs, except for pharmaceutical companies.
“It’s very significant,” he said, “because it’s going to make F.D.A., in its promotion cases, focus on the kinds of speech that are more likely to harm consumers, such as false or misleading marketing versus something that is not approved.”
In a statement, the trade group for the pharmaceutical industry, Pharmaceutical Research and Manufacturers of America, said it was pleased with the ruling.
“PhRMA believes that truthful and nonmisleading communication between biopharmaceutical companies and health care professionals is good for patients, because it facilitates the exchange of up-to-date and scientifically accurate information about new treatments,” the statement said.
A spokeswoman for the F.D.A. said the agency did not comment on active litigation.
Lawyers said the government would most likely ask for a rehearing before the circuit court’s full panel of judges and after that, it could be taken up by the Supreme Court.
Because pharmaceutical companies market their drugs nationally and the ruling applies only within the Second Circuit, the ruling is not likely to lead drug makers to change their marketing policies. Rather, some said, the F.D.A. will be unlikely to pursue convictions in similar cases until the legal issues are resolved.
© 2012 The New York Times Company
http://www.nytimes.com/2012/12/04/business/ruling-backs-drug-industry-on-off-label-marketing.html
===
Scott Walker On Eliminating Same-Day Voter Registration: 'This Is A Ridiculous Issue'
Wisconsin Gov. Scott Walker (R) says his focus is not on eliminating same-day voter registration.
12/06/2012
http://www.huffingtonpost.com/2012/12/06/scott-walker-same-day-voter-registration_n_2250447.html [with comments]
===
Stuart Stevens: 'I Never Had A Good Feeling' About Romney Win After Hurricane
12/06/2012
http://www.huffingtonpost.com/2012/12/06/stuart-stevens-romney-hurricane_n_2248926.html [with embedded video report, and comments]
===
Massive Ideological Republican Hypocrisy
12/05/2012
http://www.huffingtonpost.com/chris-weigant/republicans-fiscal-cliff_b_2247890.html [with comments]
===
Harry Reid Questions GOP's Rationality On Fiscal Cliff After Disability Treaty Fails
12/05/2012
http://www.huffingtonpost.com/2012/12/05/harry-reid-fiscal-cliff-gop_n_2244928.html [with comments]
--
(linked in):
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=81841911 and preceding (and any future following)
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=82116029 and following
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=82158345 (and any future following)
===
Obama Approval Rating Reaches Three-Year High In Poll
President Barack Obama gestures as he asks if the back of the room could hear him after the podium microphone stopped working while he was speaking about the fiscal cliff during an address before the Business Roundtable, an association of CEOs, Wednesday, Dec. 5, 2012, in Washington.
12/06/2012
http://www.huffingtonpost.com/2012/12/06/obama-approval-rating_n_2250788.html [with comments]
===
Steve Doocy, Brian Kilmeade Outraged MSNBC Hosts Invited To White House (VIDEO)
12/05/2012
[...]
This is not the first time the president has met with MSNBC hosts. Maddow visited with the president numerous times [ http://www.theatlanticwire.com/entertainment/2012/01/rachel-maddow-frequent-white-house-visitor/47506/ ] throughout his first term ...
http://www.huffingtonpost.com/2012/12/05/steve-doocy-brian-kilmead_n_2243935.html [with embedded video report, and comments]
===
Sheldon Adelson Is A Low-Information Billionaire, Apparently
12/05/2012
http://www.huffingtonpost.com/2012/12/05/sheldon-adelson_n_2245666.html [with comments]
===
Joe Lieberman Wishes He Had Left Obama Criticism Out Of 2008 Convention Speech
12/06/2012
http://www.huffingtonpost.com/2012/12/05/joe-lieberman-obama_n_2247892.html [with complete WaPo video interview with Lieberman embedded, and comments]
===
Here's an Idea That Could Save America's Economy: More Americans
Increasing immigration may be our simplest path to long-term growth.
Nov 30 2012
http://www.theatlantic.com/business/archive/2012/11/heres-an-idea-that-could-save-americas-economy-more-americans/265776/ [with comments]
--
Raise the Economy’s Speed Limit
Daniel Stolle
By JARED BERNSTEIN
Published: December 5, 2012
Washington
WITH the budget-and-tax showdown dominating headlines, most Americans probably missed an even more ominous story: according to a report by the Congressional Budget Office, America’s underlying growth rate — that is, the best the economy could do, under optimal conditions, without driving up inflation — has slowed from just under 4 percent a year in 2000 to just under 2 percent [ http://www.cbo.gov/publication/43707 ] today.
Why does this matter? For one thing, the combination of a lower underlying growth rate, which you could think of as the economy’s speed limit, and a less equitable distribution of that growth was a reason middle-income households did so badly and poverty went up in the 2000s.
During the 1990s, in contrast, stronger demand for goods and services led to much faster job growth and the last real gains experienced by middle- and lower-income households. Faster growth in those years also spun off a lot more government revenues, which interacted with slightly higher tax rates to take the budget from deficit to surplus.
Why has the underlying growth rate slowed? It’s actually pretty simple: growth is determined by the supply of labor and capital — i.e., people and machines — and how efficiently we use those inputs to make the output, or gross domestic product.
According to the report, we’re slipping on all fronts. As baby boomers head toward retirement, the growth of the labor force is decelerating; it is expected to grow about half as fast over the next decade as over the last.
This problem was exacerbated by the deep recession, as even younger un- and underemployed workers got discouraged with their job prospects and left the job market (though many will be back when things pick up). Also, for years the influx of women into the labor force raised the economy’s speed limit; that trend plateaued about a decade ago.
We’ve done better on the productivity side. But we’ve underinvested in our capital stock — factories, the machines inside them and software. In the 1990s, when the economy’s speed limit was growing, the flow of services from capital stock increased 4.7 percent a year; in the 2000s, its growth slowed sharply to 2.4 percent, even though tax rates on such investment were considerably lower.
In other words, our workers and machinery are still highly productive, but we’ve been underinvesting in them. In fact, according to the Congressional Budget Office, this investment deficit explains more than a third of the slower underlying growth rate.
Can we do anything about this? Some economists think of the potential growth rate as they do a person’s height: it may be too bad they’re short, but if you try to make them taller, you’ll just waste resources on a lost cause. Recessions may be amenable to monetary and fiscal policy, but structural shortfalls are a function of demographics, resource constraints and technological limits.
But that’s not quite right. Sometimes people don’t hit their potential height because they didn’t get enough nutrition, and it’s the same thing with economies. Bad public policy is to blame as well.
Our whole policy focus in this space tends to be on tax policy — specifically, on cutting taxes on investors and so-called job creators. But that type of “supply-side” taxation has obviously been a bust. We have to look elsewhere, and fast.
First of all, the distinction between the cyclical and the structural is artificial. Bad cyclical growth begets bad structural growth; persistent cyclical weakness in demand — a long recession, long periods of high unemployment — reduces potential growth. Workers who experience long-term unemployment thanks to a harsh cyclical downturn can find themselves less employable because of skill deterioration once the market picks up.
A weak-demand economy requires fewer workers and less capital investment. It also dampens forward-looking investment, and thus the supply of productive capital: American corporations are sitting on almost $2 trillion in reserves that they’re not investing for lack of good options.
The first thing to do is keep applying the accelerator on pro-growth policies that strengthen near-term demand and labor quality, including paycheck supports (like the payroll tax break), training for unemployed workers and investment in bridges, tunnels and other infrastructure. Over the longer term, we might want to think of immigration reform as a way to counteract our decelerating work force.
For now, though, we’re into a negative loop where persistently weak demand is chipping away at the labor and capital supply and productivity advances needed to increase our potential growth rate. Supply-side, deregulatory zeal has deprived the economy of investments in infrastructure and other public goods, innovative research and the oversight necessary to prevent the shampoo cycles — bubble, bust, repeat — that are whacking away at our potential growth rates.
This can all be corrected, but we’ve got to stop setting fiscal traps for ourselves and squabbling about a few points on the marginal tax rate. Instead, let’s start taking the steps that can get this economy back up to speed.
Jared Bernstein [ http://jaredbernsteinblog.com/ ], a senior fellow at the Center on Budget and Policy Priorities, was the chief economist and economic adviser to Vice President Joseph R. Biden Jr. from 2009 to 2011.
© 2012 The New York Times Company
http://www.nytimes.com/2012/12/06/opinion/a-slow-growth-rate-is-the-real-threat.html [with comments]
===
David Phan, Utah Teen, Commits Suicide Outside School After What Peers Call Extensive Bullying
11/30/2012
http://www.huffingtonpost.com/2012/11/30/david-phan-utah-teen-suicide_n_2220457.html [with embedded video report, and comments]
Greensburg, KS - 5/4/07
"Eternal vigilance is the price of Liberty."
from John Philpot Curran, Speech
upon the Right of Election, 1790
F6
Join the InvestorsHub Community
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
