The Free Market At Its Worst

What steps should be taken when the principles of the free market system imperil the health and well-being of ourselves and those we love?  When human life is at stake should we coldly accept the decision of impersonal “laws of the market” that allow some people to profit off of other people’s miseries?

The anti-government, anti-regulation views of many on the extreme right like those in the Tea Party are of the view that no government intervention ever benefits consumers and individuals.  They hold that any government restrictions will impose undue hardships on the makers of good and services that will be reflected in higher costs to consumers.  Likewise they see it as a threat to personal liberty that inhibits our self-interests, even if those self-interests are choices that have a negative impact on others.

Let the free hand of the market intervene they believe and if practices that are unacceptable to the consumer become apparent then the demand for the product will decrease and force the entrepreneur to change their ways that will benefit the self-interests of both parties.  Consumers get what they want and entrepreneurs can continue to make a profit.  Besides, doesn’t the market police itself?

  

It not only makes sense, it actually works in most economic transactions.  However,  this principle has its greatest impact on small businesses that exist on a shoe string budget and can’t afford to hire lawyers and market analysis to help them alter the negative image that may befall them.  Large corporations with lots of reserve cash and huge credit lines will spend money to buy out their competitors or to change consumer perceptions of them rather than change what got them critically noticed in the first place.  Only when consumers become aware of this slight-of-hand do those businesses finally make the necessary changes they should have in the first place.

But when you’re talking about a vital life-saving commodity where the market supply has not kept pace with public demand, then the principles of the free market system can work in favor of the entrepreneur and against the consumer.  When the petroleum markets declare there is a shortage due to factors “beyond their control” they jack up the price to staunch demand.  The cost of production doesn’t change yet consumers have to pay more for fear that supplies will deplete quicker than they can be produced.  In the end, we are all forced to pay what the price is because we have become dependent on it.  The Oil Industry has seen their profits sky-rocket over the last ten years.

As important as petroleum is to our economic well-being though our very lives are not threatened by the higher costs because there are adjustments most of us can make to reduce our consumption.   There is even the hopeful prospect that clean renewable energy sources will ultimately replace the dirty finite sources of fossil fuel energy like oil and coal.

But what about medicines that are essential to some’s survival.  Should a handful of clever people who took the risk of buying life-saving drugs to sell when normal supplies ran low be expected to practice market principles when people’s lives are on the line?  If your mother, father, son or daughter were going to die if the normal supply of life saving drugs was hindered, would you applaud the free market system of those who have the drug but are demanding exorbitant prices for it; costs so high that to obtain it would deplete your savings and eventually may be out of your reach altogether to purchase?

New research by Premier, a North Carolina-based alliance of 2,500 hospitals and 73,000 other health care sites in the United States has discovered that such greedy, but apparently legal practices are occurring.

Amid growing shortages of life-saving drugs, some back-door suppliers are capitalizing on the problem, jacking up prices for medications for cancer, high blood pressure and other serious problems by as much as 4,500 percent, a new hospital survey shows.

So-called “gray market” medical suppliers — vendors who operate through unofficial channels — inflated prices by an average of 650 percent on drugs that were either back-ordered or completely unavailable. They included widely used but hard-to-get drugs aimed at fighting cancer, ensuring sedation during surgery or treating patients who need emergency care.

That’s according to new research by Premier, a North Carolina-based alliance of 2,500 hospitals and 73,000 other health care sites in the United States. During a two-week period earlier this year, 42 of Premier’s acute care hospitals reported receiving 1,745 unsolicited offers from drug suppliers proffering vital medications that are in short supply.

“The marketing offers were often in the form of e-mails and fliers that contained language such as: ‘We only have 20 of this drug left and quantities are going fast,’” said the Premier report released Tuesday.

Of the drugs offered by 18 gray market providers, 96 percent were double the normal price, 45 percent were 100 times the normal price and 27 percent were at least 20 times the normal price, Premier found.  SOURCE

The threat of dying looms largely here for many who can’t access these vital drugs.   The fact that there is a demand for them yet manufacturers can’t keep up with that demand says something is broken with this system.

Federal Food and Drug Administration officials say the shortages are caused by manufacturing problems, firms that simply stop making drugs and production delays. The agency has no power to compel manufacturers to make certain drugs, or even to inform health care providers in a timely fashion. Shortages often occur without warning and with no clear indication of when they’ll end.

A bill pending in Congress, the Preserving Access to Life-Saving Medications Act, would require that drug makers notify FDA early if shortages are likely to occur. A Senate work group is focused on stopping the shortages.

Obviously the free market principles that state people will only do those things that affect their own self-interests and by default benefit us all is not in play here.  Clearly the self-interest of one side is not benefitting the consumer market in this case, except the very wealthy and I’m sure even they would frown on such tactics by their fellow free-marketers engaging in such un-compassionate practices.  It also raises the question as to how involved are the legitimate suppliers who failed to keep up with demand.  Is there a back-door market where such “gray market” medical suppliers have an alliance with the industry and pays a special fee to them for the privileged access to such drugs?

This clearly is a case where consumers of such products can not employ the power of their pocket-book and take their business elsewhere to force the purveyors of excessive high-priced drugs to satisfy their needs.  We’re not talking about shoes or designer purses here.  People can and will die or suffer great physical pain if their supply of cancer medications are cut off.  The same happens when life saving procedures are denied by health insurance companies who are avoiding negative impacts on their profit margins.

There of course will be those “free-market” devotees who will defend this principle even in light of the human suffering that results from it.

 

It is what it is” is the attitude they hold , even incorporating the view of the tight-fisted Scrooge who would see this as means to  “decrease the surplus population”.  The market principles of capitalism are sacrosanct to such people and may even be viewed as “the will of God” as they console their conscious in their church pews.

Many right-wing Christians and their political pundits in the media are quick to point out the deterioration of “our moral values” being the cause of the riots we see over in Europe, the flash mobs robbing stores here in our own country or even the influx of those in need of unemployment benefits.  There may indeed be a lost sense of responsibility in play here with some of these people, but did it come before the apparent greed of free-marketers such as these who withhold vital drugs for excessive profit or is it a byproduct of market greed – a chicken or the egg conundrum?

When such greed goes unpunished and even rewarded as it did with those within the financial sector responsible for the market collapse of 2008, how do the rest of us assimilate that into our world view?  Do we reject it outright as we should or do we begin to feel that we have missed out on something that would keep the wolves at bay in tough economic times.  Do we tuck our moral compass away at times to enhance our material wealth but are quick to bring it out when others engage in activities we somehow deem more reprehensible than our own actions?

We are all sinners” says the scripture yet somehow fail to acknowledge this in ways that keep such sin in check.  If we are all sinners and sin can visit us at times of weakness then doesn’t it behoove us to have something or someone with oversight capabilities in place to put a road block in front of such actions before they are carried to their most destructive end?

No one wants to be told their wrong but many understand that our imperfections do exist.  Pride and greed are often the human traits that over ride the more compassionate elements of our religious, social and economic codes.  The forces of good and evil may indeed exists but may be more so in our own institutions or ideological views that we’re are all too ready to club other people with.

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