Tuesday, February 9, 2016

Governor Rauner Wants to Use Bankruptcy as a Leverage against Unions in Illinois




“Gov. Bruce Rauner wants to give cities, towns and counties the authority to file for bankruptcy protection, a move that could give local governments a stronger foothold when negotiating with local police and fire officials over costly pension obligations… Rauner aides would not elaborate on how it might work…

“Federal law only allows municipalities to file for bankruptcy with explicit permission from the state where they are located, said James Spiotto, a municipal bankruptcy expert and attorney who is managing director of Chicago-based Chapman Strategic Advisors. Currently, only the Illinois Power Agency has been given such authority. It would take passage of a new state law to extend the authority to municipalities. Asked to explain how the law would be structured, Rauner spokesman Lance Trover said, "The specific details regarding authorizing communities to pursue that option will be part of an ongoing dialogue in the coming weeks…’”



Commentary:

The Center on Budget and Policy Priorities affirms that “it would be unwise to encourage states to abrogate their responsibilities by enacting a bankruptcy statute. States have adequate tools and means to meet their obligations, [particularly Illinois]... Confusion between short-term cyclical deficits and debt, pensions and retiree insurance – and the overstatement of the magnitude of the latter set of problems – draw attention away from the need to modernize state and local budget and revenue systems and address structural problems that have built up over time in these systems. 

“States suffer from ‘structural deficits’ or the failure of revenues to grow as quickly as the cost of services… Structural deficits stem largely from out-of-date tax systems [as in Illinois], coupled with costs that rise faster than the economy in areas such as health care. Fixing these structural problems would help states and localities balance their operating budgets without resorting to [desperate measures]… It is far more constructive to focus on fixing these basics of state and local finance than to proclaim a crisis based on exaggerations of imminent threats.”


Sunday, February 7, 2016

Drug company profiteer Martin Shkreli and a few questions about legitimate rights, duty and morality



    


“When the ‘most hated man in America’ acquired his latest title, felony suspect, on Thursday, he may have been the only one surprised. The controversial entrepreneur was accused of taking ‘blood money’ from Americans and refused to answer questions. Minutes after being released from the hearing, Shkreli posted on Twitter: ‘Hard to accept that these imbeciles represent the people in our government.’

“The firm Shkreli created and ran until his arrest in December, Turing Pharmaceuticals, is under fire for hiking the price of the drug Daraprim by more than 5,000% overnight, from $13.50 to $750 a pill, after acquiring it from another company. Shkreli had already warned that he intended to invoke the Fifth Amendment and decline to answer questions in order to avoid the risk of incriminating himself. Nonetheless, Shkreli’s short appearance in Washington became explosive when committee members were infuriated by his discourteous facial expressions as the event unfolded. One member begged him to examine his conscience.

“Earlier, Shkreli and Turing’s chief commercial officer, Nancy Retzlaff, were criticized for hiking the price of Daraprim despite the fact it is the only government-approved treatment for the rare infection toxoplasmosis, which can be fatal for some Aids and cancer patients and endangers babies in-utero…” (Analysis Pharmaceutical (and Wu-Tang) villain Martin Shkreli has courted controversy). 

Commentary/Questions:

Are there legitimate rights that “ought to” take precedence in particular circumstances or situations such as in the one described above? How do the words “ought to” entail an obligation for CEOs of pharmaceutical companies? How do the words “ought to” differ from the word, “duty?” Are duties required by conscience or by law? Would we say that the failure of someone who can lower the costs of a life-saving drug for thousands of people when he is knowingly in a position to do so is morally wrong? Do moral rights exist prior to and independent of a government's recognition of them, or when they are made legal? Is Shkreli morally and legally responsible for lowering the costs of Daraprim? How can morality be justified to someone, like Shkreli, who is not moved by moral considerations?