The Heritage Insider: Repealing Obamacare will offer tax relief too, government misses the energy future, the FDA is limiting competition, the welfare state is very generous, Russia is still a problem

January 7, 2017

 

 

Repealing Obamacare will offer tax relief, too. Government is missing the energy future. The Food and Drug Administration is limiting competition in drugs, which raises prices. How generous is the welfare state? Russia is still a problem.

 

Aside from screwing up insurance markets, Obamacare raised a lot of taxes, too. That means repealing Obamacare is going to be a tax cut, writes Grover Norquist: “By passing legislation repealing ObamaCare through budget reconciliation, lawmakers have an opportunity to remove nearly 20 taxes which will save taxpayers more than one trillion dollars over the next decade. Repealing these taxes is a huge win for middle class taxpayers, who were hit with an avalanche of tax increases despite Barack Obama’s “firm pledge” not to sign “any form of tax increase” on any American making less than $250,000. The trillion dollars in higher taxes have restricted health care choice, increased costs, made saving more difficult, and granted government more control over care at the expense of individual control.” [Fox News]

 

Government R&D misses the energy future. Writes Mark Mills: “In energy domains, the only significant disruption to the status quo in the past 40 years—despite hundreds of billions of dollars spent on alternatives to hydrocarbons—has been the unplanned, unsubsidized emergence of U.S. shale technology. In the past decade, shale oil and gas supplied America with 2,000% more energy than did solar and wind. Congress and the administration should refocus near-term federal energy R&D onto basic shale geosciences. Less than 10% of the DOE’s energy budget is associated with hydrocarbons, which supply over 80% of U.S. and global energy and will do so for decades, according to the U.S. Energy Information Administration. And while America’s shale industry spends billions of dollars to develop technologies, very little of this is in basic sciences. Better science can lead to better technologies with the capability to increase U.S. oil and gas production at ever-lower costs. Then, to secure America’s long-run energy advantage in the pursuit of non-hydrocarbon alternatives comparable in scale and cost to shale hydrocarbons, Congress and the administration should refocus the overall federal R&D budget more heavily onto the basic sciences.” [Manhattan Institute]

 

Want lower drug prices? Get more competition in drugs. Devon Herrick writes: “A little over a decade ago, many in the public health community began asserting that follow-on or “me-too” drugs offer little added benefit and are a waste of resources that would be better spent to research novel drug therapies. The FDA seemingly took this criticism to heart; in recent years it has fast-tracked approval of new, first-in-class drugs thought to show promise. Yet, as with any new drug, a “me-to drug” could take up to 15 years to research, develop and obtain FDA approval. A drug that comes to market one year after a first-in-class drug could have been first-in-class if that research and development team had been just a little faster. Thus, when the FDA discourages me-too drugs it is discriminating against every competitor that did not cross the finish line first. As a result, approvals for expensive drugs to treat rare diseases are at a historic high while approvals of me-too drugs are down. This limits competition within drug classes, leading to higher prices, and limits patient choices—something the FDA is just beginning to acknowledge.” [National Center for Policy Analysis]

 

If you think there are lots of people in poverty, then you aren’t paying attention to the size of our welfare state. The following graphic, from a new paper by Robert Rector and Rachel Sheffield, shows how a single mother of two earning the minimum wage fares under current means-tested programs:

[The Heritage Foundation]

 

Russia is still a problem. Frederick Kagan outlines a program for dealing with Russia: “[Vladimir Putin] is redefining Russian identity in the terms the tsars used in the 19th Century—Russian Orthodoxy, nationalism, and strong government (they called it autocracy, but he does not). He claims the right to renegotiate the terms of the bad deals Russia made with the post-Soviet states, by force if necessary. He cites the plight of ethnic Russians in the new republics as justification for eroding or even erasing the sovereignty of those states. He seeks to restore Russia to the position of global eminence it had as the Soviet Union by re-establishing its positions in the Middle East, Asia, and Africa. He stokes conflict with the West to distract it from these endeavors even as he blames the West for inventing the hostility he has created. The West cannot appease its way out of this crypto-war. Putin requires conflict to justify his rule at home and his actions in the territory of the former Soviet Union. […] The West, with the United States at its head, must rather persuade Putin and the Russian people to accept the terms they themselves negotiated for the post-Cold War settlement—or renegotiate those terms on an equal basis and in peace with their neighbors. We must persuade Russia that it will lose another confrontation, and that the consequences of another loss will be even worse than those of 1991. We must cajole Russia into developing a new national identity not bound in the subjugation of a large empire and military might but rather as a peaceful democratic state with an ancient tradition and a future of hope.” [American Enterprise Institute]

 

 

 

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