March, 27 2019, 12:00am EDT
EPI Economist Testifies About Rising Economic Inequality
WASHINGTON
Today, EPI Economist Elise Gould testified before the U.S. House of Representatives Ways and Means Committee on rising inequality in the United States.
In her testimony, Gould argued the poor performance of American workers' wages in recent decades--particularly the failure of workers' wages to grow anywhere near the pace of overall productivity--is one of the country's central economic challenges. She notes that a range of other economic challenges--reducing poverty, increasing mobility, closing racial and gender wage gaps, and spurring a more complete recovery from the Great Recession--also rely largely on boosting hourly wage growth for the vast majority.
"Going forward, policymakers should prioritize keeping labor markets tight while also strengthening institutions and policies that provide workers the leverage they will need to achieve decent wage growth even when the economy is not at full employment," said Gould. "Policymakers should strengthen and enforce labor standards, make it easier for workers to collectively bargain, and raise the federal minimum wage."
Gould explained income inequality is the primary reason why the vast majority of Americans experienced disappointing gains in their living standards over the last four decades. Since labor market income (wages and wage-related income) representing the largest source of income for most Americans, policymakers cannot tackle income inequality without tackling wage growth.
Wage growth has been uneven in the last four decades, with sizable growth only occurring at the top, while wages for most workers have failed to rise with productivity growth. This uneven wage growth continued through the 2000s, as wage gaps between demographic groups persisted and, in some cases, worsened. Recent wage gains for the lowest-wage workers can be explained by tight labor markets and the institution of a number of state-level minimum wage increases.
EPI is an independent, nonprofit think tank that researches the impact of economic trends and policies on working people in the United States. EPI's research helps policymakers, opinion leaders, advocates, journalists, and the public understand the bread-and-butter issues affecting ordinary Americans.
(202) 775-8810LATEST NEWS
Big Pharma Drug Patent Abuses Cost Medicare Billions: Report
"As CMS negotiates the prices Medicare will pay for top-selling drugs, it should take into account the billions we've already lost due to these patenting tactics," said one researcher.
Dec 11, 2024
When the Inflation Reduction Act became law in 2022, it included a historic provision that gave the Centers for Medicare and Medicaid Services (CMS) the ability to negotiate maximum fair prices for select drugs. This means that CMS now has an important tool to resist high prices imposed by pharmaceutical companies and lower the cost that Medicare recipients pay for their drugs. So far, Medicare has negotiated the maximum fair prices for 10 drugs, which will go into effect January 1, 2026.
But according to a report released Wednesday by the watchdog group Public Citizen, the manufacturers behind these drugs are able to rely on another method to protect their profits: patent abuses and evergreening tactics.
The report defines "evergreening tactics" as the practice of "patenting trivial and/or obvious modifications of existing medications to lengthen exclusivity on branded medicines."
The makers of the drugs Eliquis, Imbruvica, Jardiance, Farxiga, and Entresto, for example, obtained patents on what constitute trivial or minor changes to earlier patent claims, "such as crystalline forms of drug compounds which would be discovered and managed during routine testing that is part of the drug approval process," according to Public Citizen. These new patents allow the manufacturers to extend their monopoly on these drugs.
"Big Pharma patent abuse is cheating Medicare enrollees of more affordable drugs and costing taxpayers billions," said Public Citizen Access to Medicines program researcher Jishian Ravinthiran in a statement.
"Patent abuses enable Big Pharma companies to unfairly extend their monopolies and keep prices artificially high. As CMS negotiates the prices Medicare will pay for top-selling drugs, it should take into account the billions we've already lost due to these patenting tactics," he added.
The report makes this same point, arguing that the agency's initial offers on pharmaceuticals should take into account how long-monopoly drugs have been able to obtain longtime exclusivities on medicines by manipulating patents.
This is paramount, Public Citizen argues, given the scope of lost savings. The group estimates that Medicare will lose somewhere between $4.9 and $5.4 billion in savings that should have accrued to taxpayers if four out of the 10 drugs did not take advantage of patenting tactics, and therefore would have faced greater competition prior to negotiation.
"These lost savings are nearly as much as what Medicare is expected to save if negotiated prices go into effect on all of the selected drugs in the first year of the program ($6 billion)," according to the report.
As an example, the drug etanercept, which is marketed as Enbrel, is on the list of 10 drugs that will be subject to a negotiated cap come January 2026. Etanercept's maker Amgen did not contribute to the original research and development of etanercept, per Public Citizen, it just acquired the original maker of the drug, Immunex, in 2002.
Immunex's patent of etanercept was set to expire in 2019, but "by using abusive patent practices" Amgen was able to extend the patent protections through 2029, according to Public Citizen. Amgen was able to evade competition of two potential "biosimilar" competitors, Erelzi and Eticovo, which received FDA approval in the 2010s.
Referencing analysis done in a separate report, Public Citizen estimated "that biosimilars could have entered the market after August 2019 were it not for Amgen's unwarranted patent exclusivities, and we calculated Medicare would have spent $1,891,500,836 less on a net basis had enrollees been able to use lower-cost alternatives by the time negotiated prices go into effect on January 1, 2026."
Keep ReadingShow Less
Survivor of US Atomic Bombing Makes Plea to World With Nobel Acceptance Speech
"Let us all strive together to ensure that humanity is not destroyed by nuclear weapons, and to create a human society where there are no nuclear weapons and no war," said Terumi Tanaka.
Dec 11, 2024
Accepting the 2024 Nobel Peace Prize on behalf of the grassroots Japanese anti-nuclear group he co-chairs, Terumi Tanaka warned on Tuesday night that the world is moving in the opposite direction than the one hibakusha—survivors of the U.S. bombings of Hiroshima and Nagasaki—have demanded for nearly seven decades.
Tanaka is a co-chair of Nihon Hidankyo, an organization founded in 1956 by survivors of the bombings that had killed an estimated 140,000 people in Hiroshima and 70,000 in Nagasaki, with the death toll continuing to rise in later years as people succumbed to the effects of radiation.
The group accepted the Nobel Peace Prize in Oslo, with the Nobel Committee honoring Nihon Hidankyo "for its efforts to achieve a world free of nuclear weapons."
The organization aims to maintain a taboo around the use of nuclear weapons, which have only been used in combat by the U.S. in Japan in 1945.
Tanaka warned that there are currently 12,000 nuclear warheads in the arsenals of the U.S., Russia, China, and six other countries, and 4,000 of those "could be launched immediately."
"This means that the damage that occurred in Hiroshima and Nagasaki could be multiplied by hundreds or even thousands," said Tanaka, who is 92. "Let us all strive together to ensure that humanity is not destroyed by nuclear weapons, and to create a human society where there are no nuclear weapons and no war."
"It is the heartfelt desire of the hibakusha that, rather than depending on the theory of nuclear deterrence, which assumes the possession and use of nuclear weapons, we must not allow the possession of a single nuclear weapon," he added.
"I hope that the belief that nuclear weapons cannot—and must not—co-exist with humanity will take firm hold among citizens of the nuclear weapon states and their allies, and that this will become a force for change in the nuclear policies of their governments."
Tanaka said that "the nuclear taboo threatens to be broken," as evidenced by Israeli Heritage Minister Amihay Eliyahu's recent comment that a nuclear attack on Gaza would be "one way" to defeat Hamas.
"I am infinitely saddened and angered" by such statements, said Tanaka.
He described his experience as a 13-year-old when the U.S. bombed Nagasaki, just a couple of miles away from his family's house, which was crushed by the impact.
He said he later found the charred body of one of his aunts and saw his grandfather close to death from the burns that covered his body.
"The deaths I witnessed at that time could hardly be described as human deaths," Tanaka said. "There were hundreds of people suffering in agony, unable to receive any kind of medical attention."
"I hope that the belief that nuclear weapons cannot—and must not—co-exist with humanity will take firm hold among citizens of the nuclear weapon states and their allies, and that this will become a force for change in the nuclear policies of their governments," said Tanaka.
The International Campaign to Abolish Nuclear Weapons (ICAN) applauded Nihon Hidankyo and the hibakusha "for their resilience and willingness to share their stories over and over again, so that the world may learn and come together to say 'never again.'"
"It was their courage that enabled the [Treaty on the Prohibition of Nuclear Weapons] to be adopted, which represents the first progress on nuclear disarmament in decades," said Melissa Parke, executive director of ICAN, referring to the treaty that's been ratified by 73 countries.
"Listening to Mr. Tanaka describe the horrendous effects on his family and city when the Americans dropped their atomic bomb should convince world leaders they have to go beyond simply congratulating the hibakusha of Nihon Hidankyo for this award. They must honor them by doing what the hibakusha have long called for—urgently getting rid of nuclear weapons," said Parke. "That is the only way to ensure that what Mr. Tanaka and the other hibakusha have been through never happens to anyone ever again. As long as any nuclear weapons remain anywhere, they are bound one day to be used, whether by design or accident."
Jørgen Watne Frydnes, chair of the Nobel Committee, condemned the nine nuclear powers for "modernizing and building up their nuclear arsenals."
"It is naive to believe our civilization can survive a world order in which global security depends on nuclear weapons," Frydnes said. "The world is not meant to be a prison in which we await collective annihilation."
Keep ReadingShow Less
US Ambassador to UN Slammed Over 'Right to Food' Rhetoric as Israel Starves Gaza
"She is on a shamelessness tour," journalist Jeremy Scahill said of American diplomat Linda Thomas-Greenfield.
Dec 11, 2024
The U.S. ambassador to the United Nations is facing backlash after delivering a speech earlier this week touting the universal "right to food" as the Israeli military—armed to the teeth with American weaponry—fuels widespread and increasingly deadly hunger in the Gaza Strip.
In remarks Monday at a gathering of U.N. and civil society leaders focused on global food insecurity, Thomas-Greenfield called hunger, starvation, and famine "man-made tragedies" that "can be stopped by us."
"Let me be clear: Every human being, everywhere, has the right to food," she continued. "For the United States, this is a moral issue. And it's an economic and national security issue."
Thomas-Greenfield's speech sparked derision given the Biden administration's continued military support for an Israeli government that has been accused of wielding starvation as a weapon of war in Gaza, where—according to the latest U.N. Food and Agriculture Organization assessment—food aid has reached an all-time low under Israel's suffocating blockade.
"Hunger is a man-made tragedy that you helped make in Gaza."
Oxfam and other human rights groups have said that by arming the Israeli military as it obstructs humanitarian aid, the Biden administration is complicit in the starvation of Palestinians in Gaza and Israel's repeated attacks on aid workers attempting to feed the enclave's hungry.
"She is on a shamelessness tour in her final weeks as U.S. ambassador to the U.N.," journalist Jeremy Scahill wrote Wednesday in response to Thomas-Greenfield's speech. "She presided over numerous cease-fire vetoes as part of an administration that facilitated Israel's starvation policy against the Palestinians of Gaza. Listen to her remarks on 'hunger' in that context."
Yesterday, @USUN brought together humanitarian leaders to discuss solutions to the global food insecurity crisis.
Hunger is a man-made tragedy. But if it caused by man, that means it can be stopped by us, too.
Every human being, everywhere, has the right to food. pic.twitter.com/zczlerRHEc
— Ambassador Linda Thomas-Greenfield (@USAmbUN) December 10, 2024
Middle East scholar and analyst Assal Rad, wrote that Thomas-Greenfield's vetoes at the U.N. "have helped Israel continue its genocide and deliberately starving people."
"Hunger is a man-made tragedy that you helped make in Gaza," Rad added.
Despite Thomas-Greenfield's insistence that addressing global food insecurity has long been a priority for the world's wealthiest and most powerful nation, the U.S. and Israel were the only two countries to vote against a U.N. committee draft on the right to food in 2021.
On Tuesday, the Biden administration welcomed to the White House former Israeli Defense Minister Yoav Gallant, who—along with Prime Minister Benjamin Netanyahu—is facing an arrest warrant from the International Criminal Court for "the war crime of starvation as a method of warfare," among other crimes.
"Today is Human Rights Day—a date chosen to honor the UN’s adoption of the Universal Declaration of Human Rights in 1948," the Institute for Middle East Understanding Policy Project wrote Tuesday. "Biden's White House is dishonoring this day by hosting a confirmed war criminal who conducted a genocide, and starved and targeted Palestinian civilians."
Keep ReadingShow Less
Most Popular