Relevant and even prescient commentary on news, politics and the economy.

Three Mile Island to Close

Eighty year old retired salesman John Garver the morning of March 28, 1979 remembers the acrid odor permeating Harrisburg as he walked out of a restaurant in Pennsylvania’s capital city.

“We had this smell in the air, wondering what it was. Well it didn’t take us long to find out … that the accident started.”

Fourteen miles away, the “accident” was unfolding in Unit 2 at the Three Mile Island Nuclear Power Plant, triggering panic, confusion, and within days an evacuation order.

The partial meltdown sparked national protests, prompted increased safety standards for the nuclear power industry, and largely stymied the industry’s momentum for decades until recent alarm over climate change has made some begin to embrace expanding carbon-free nuclear power.

Today, the remaining reactor (Unit 1) will generate its last kilowatt of energy and close. Three Mile Island was not a victim of the anti-nuclear movement; but rather, it lost out to simple economics. Even though the plant is licensed to operate until 2034, Exelon Generation is ceasing operations after the state of Pennsylvania earlier this year refused to throw the company a financial lifeline to keep it open.

The plant’s four cooling towers will remain a part of the landscape for now as foreboding concrete tombstones seemingly out of place in the bucolic Susquehanna Valley of central Pennsylvania and a reminder of what happened March 28, 1979.

Taking a Second Look

Senator Cory Booker; “Right now, nuclear is more than 50% of our non-carbon causing energy. People who think we can get there without nuclear being part of the blend just aren’t looking at the facts.”

Economic factors such as cheap natural gas and increasingly affordable renewable sources are slowly driving nuclear power out of business. Additionally, diminished demand has also hurt profitability in addition to rising operational costs. The closure of the Three Mile Island facility will leave 97 commercial reactors at 59 plants, scattered across 30 states, remaining in operation.

According to U.S. Energy Information Administration, the Watts Bar Unit 2 in Tennessee was the last nuclear power plant to come on line in 2010. Two more reactors are under construction in Georgia (Nuclear Regulatory Commission [NRC]). No more are planned as of yet.

Pro-industry group, World Nuclear Association: “Public confidence in nuclear energy in the US declined following the Three Mile Island accident. It was a major cause of the decline in nuclear construction through the 1980s and 1990s.”

Harrisburg resident and Chair of the Three Mile Island Alert organization Eric Epstein: “If there is a good thing that happened because of TMI, it had ignited a fierce debate on the viability of nuclear power being safe, reliable, economical, etc.”

It still remains to be seen if more reactors will be built to supplement US energy needs.

Three Mile Island closes: meltdown changed nuclear energy in America,” USA Today, Ledyard King, September 20, 2019

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The Strike On Saudi Oil Facilities

The Strike On Saudi Oil Facilities

This is going to be a tentative post because there is much that remains unclear. What I am going to do is to make it clear that stories that are being told by US authorities and largely repeated by the MSM with little critical commentary is highly questionable.

As it is, it looks like the economic impact of the knocking out of about 60 percent of Saudi oil processing capacity by an attack by 20 drones will not amount to too much. The Saudis have now announced that they should have 70 percent of their damaged production capacity back in operation within a week or two. While crude oil prices initially surged 20 percent up, they have largely fallen back toward where they were before the attack. This is a massive contrast with how all this used to be back in the 1970s when, for example, crude prices would triple or even quadruple with a supply disruption from the Persian Gulf, with dramatic stagflationary effects on all the oil importing national economies. This does not look remotely likely to happen.

The matter that remains very much in the air, with a threat of war breaking out worse than it is already happening, involves the source of the attack on the facilities in Khurais and Abqaiq. SecState Pompeo outright said the attack came from Iran. Supposedly US intelligence agencies are supporting this, although there seem to be doubts. Buried deep in the press reports are caveats suggesting that maybe not quite all the attacks came from there. Of course, it is essentially impossible to evaluate these claims as we know these agencies have their secret methods and sources they are not leaking. But then we see both the Saudis and President Trump holding back from fully going along with this report.

So why might this be wrong? Well, at least one alternative version appears to have been decisively repudiated. That is that the attack came from Shia militias in Iraq. This theory was put forth by Bibi Netanyahu of Israel, perhaps as a desperate part of his reelection campaign, with it looking like he has not done well in that election, although the full outcome is still not known. But this apparently blatantly ridiculous report may be the beginning of the end of people taking publicly announced Israeli intelligence reports as things to be taken seriously.

However, the more serious alternative to Iran as a source is the Yemeni Houthis. Almost certainly the drones were from Iran, although even that is not definitely certain. In any case several statements have come supposedly from US intel agencies that the Yemeni Houthis could not have done this, even though they themselves have been loudly claiming that they did it, while the Iranians are loudly denying that they did it. Supposedly this all distraction from the role of the Iranians. But Juan Cole has pointed out things that the media are simply not reporting things that suggest that indeed the Yemeni Houthis appear to have the capability. In particular in May the Houthis launched a drone attack on an oil pumping station at al-Duadimi, well over 800 miles from Sana’a. The sites struck in this attack are only another 100 miles further, and the Shehad 129 Iranian drone supposedly can travel a full 1100 miles. Why are we seeing no reports of this in the media?

As it is, it may be that both the Saudis and even Trump may be aware of this matter that has not been well publicized. If so, no wonder they are not fully signing on to saying it was Iran, quite aside from a reluctance to get into a new war there. Whatever has really gone down, let us hope at least there will be no new war.

Barkley Rosser

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Affordable Housing

The other night, ten Democratic presidential, hopeful, nominees took stage and debated their plans for America’s future. There never was a mention beyond a few garbled words hastily thrown together about an issue which is plaguing many young voters ing to raise families and one which has surfaced in my community, the shortage of affordable homes. Senator Elizabeth Warren knows of the issue as she has discussed it in one of her talks, “The Two Income Family.”

Moderators have bypassed the issue and not asked the question of a candidate’s plan for Affordable Housing which is a growing problem for many people in the US especially young people. In lieu of their not asking, here is a site 2020 Because Housing is Built with Ballots from which you can read each of the candidate’s plans.

The housing crisis has hit urban, suburban, and rural areas with some states being worst(see chart above) than others with regard to supply. Nationally, there is a shortage of 7 million homes affordable and available to the lowest-income renters. Rents have risen faster than renters’ incomes over the last two decades, more people are renting than ever, and the supply of apartments they can afford has lagged. Fewer than four affordable and available rental homes exist for every 10 of the lowest-income renter households nationwide. People of color are disproportionately impacted. Racial segregation persists and concentrated poverty is growing.

Meanwhile, policy makers have disinvested in the nation’s public housing infrastructure, leaving families living in unsafe, unhealthy, and unacceptable conditions. After almost a decade of decline, homelessness is back on the rise, and is in the news in an adversarial manner. The same as with immigrants, people do not want to provide solutions and they want the homeless to disappear. Where they should go has not been determined.

Jumping on this bandwagon pre – election, the one man who has a history of discrimination as learned from a father who was depicted by in song by Woodie Guthrie, President Donald Trump has signaled his intentions to address California’s homeless crisis in a harmful, unjust, and unlawful manner. Involving criminalization, sweeps of unsheltered people living on the streets, they will (potentially?) be moved to federal homeless camps.

Affordable housing and homelessness has been in the news across the country and debate moderators have yet to ask the question of what can be done or what are your solutions to the crisis.

While providing good and affordable healthcare is important; housing, besides a cardboard box, is one of the prerequisites to having good health. One way or another, we will be paying for it.

The Question the Presidential Candidates Don’t Get Asked, City Lab, Diane Yentel

The GAP, A Shortage of Affordable Homes March 2018

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Has 21st century conservatism contributed anything useful at all ?

(Dan here…lifted from Robert’s Stochastic Thoughts)

by Robert Waldmann

Has 21st century conservatism contributed anything useful at all ?

This is a question I haven’t asked myself. I have long looked for reasonable and reasonably honest conservatives. It is frustrating, because I have found many, but few are still conservative. I don’t want to get distracted from my distraction; but there is a pattern of me finding a conservative whom I consider reasonable, then that guy breaks with the conservative movement within a year.The new topic is conservative ideas. The question is, is there any conservative thought which is worth consideration, which they hadn’t already written and which not been said by 1900. I suppose this might be considered an unfair question, since I demand something new from a school centered on suspicion of the new. However, they have embraced many new and worthless ideas and proposals (see below) so I don’t think I am being unfair.

This is a long very self indulgent post. It is twitter overload. I am going to:

1) bring a twitter discussion over here,

2) try to think of worthwhile 21st century conservative ideas, and

3) try to think of worthwhile 21st century non-conservative ideas (to be fair — it might just be that my effort under 2 fails because of my ignorance or my interpretation of “worthwhile” and “2st century”).

OK the twitter thread (which will make it painfully clear why I surfed over to blogger I mean “4.1/3” really ???).

It starts with this very interesting post on challenges to liberalism and liberals’ responses.

Ross Douthat asked a constructive and interesting (implied) question

Ross Douthat @DouthatNYT

18h

The question I’m left with at the end of this interesting @zackbeauchamp crisis-of-liberalism survey is whether he thinks there’s anything that liberalism can learn or drawn on from the *right* in order to survive and flourish anew?

I replied @robertwaldmann

Obviously the reason you are left with that question is that neither he nor you can think of anything useful that anyone can learn from conservatives. The reason is that all alleged conservative insights have been disproven by massive evidence.

In fact I challenge you. I suspect the answer will be to claim for conservatism universal values and widespread beliefs or to pretend that the only alternative to conservatism is something like Marxism. I say conservatism has the same epistemic standing as astrology.

Dilan Esper contributed reasonable thoughts aiming for constructive discussion. I want to thank Dilan Esper for being helpful and constructive. I fear my tone on twitter and here does not communicate my sincere appreciation of a good faith effort. Also MuchTL:DR , his effort confirms my prediction.

 

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F**king Old Enough to Vote

It’s That Day again. I mostly stayed off Facebook (except for birthday greetings) and Twitter, but even LinkedIn has posts of now-yellowed newspaper articles of survivors–and probably some of those who didn’t.

In another ten years, it will be as far from 11 Sep 2001 as that date was from 11 Sep 1973.

At least now, most people know what a sh*t Rudy Giuliani was, both in setting up the firefighters for disaster and moving the NYC Office of Emergency Management Command Center from the safest location in the city–the basement of 1 Police Plaza–to the 23rd floor of a building in a complex that had already been bombed once before he did it. While he and Bernard Kerik got to Be Adulterers on taxpayer money, somewhere between one-third and one-half of the 343 firefighters they murdered outright certainly could have been saved. Though that would have been more people who, but for the grace (and anger) of Jon Stewart, would still be trying to get health care. Rudy’s tombstone should read: ““This group’s finding is that the security of the proposed O.E.M. Command Center cannot be reasonably guaranteed” — July 1998″

Yes, I’m still bitter. No, I’m not going to post anything nearly as subtle as this, which is probably my ultimate contribution to the genre of In The Shadow of The Towers. I’m going to talk about Milton Friedman. Because it’s the 18th anniversary, so it’s now old enough to vote–or, especially in the pre-26th Amendment world–be drafted.

Let’s be clear: Milton Friedman had one good idea in his life, and that was that his alma mater should not sponsor a football team. Even a broken clock, and the program whose highlights are Ray Rice and Greg Schiano (whose skills included guiding the team to a money-losing Bowl appearance) isn’t exactly something that could justify Superstar Economics Theory.

Milton Friedman, like Gary Becker, was wrong about almost every social policy recommendation he made. While it might be difficult to identify what he was most wrong about, a leading contender is The Elimination of the Draft, which he championed for years and finally shepherded through the Nixon Administration.

After all, people should be Free to Starve Choose, and conscription is certainly not a “choice.” Choice can discriminate; conscription means mandatory attendance or a demonstrable reason to be excused. Friedman’s ghost, twirling at Mach 3 in the Eighth Circle, probably rues that males still must register for Selective Service.

So we have a story published just over two years ago on America’s only remaining news source becoming evermore real. While before people who didn’t want to be subject to two years of training and possibly warfare had to at least come up with a somewhat reasonable excuse (*cough* bone spurs *cough*) or face jail time, the scions of the elite have no “skin in the game.” So the Longest War in U.S. History continues: planned as well as it was executed, executed as well as its objectives were planned. While the planners well know that their sons (and daughters) will not even have to come up with the lies they did to avoid any chance of being killed.

Because Milton Friedman said that would not be Freedom. And people believed him, because “freedom” means you don’t have to “have skin in the game” (literally, in this case) if you don’t want to, even if your actions caused the problem.

I suspect Rudy Giuliani approves.

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Healthcare News PBM Profits, Expensive Drug(s), Food Protein, and the Opioid Scam

Cigna gets major boost from Express Scripts in Q2,” Robert King, FierceHealthcare, August 1, 2019

And some claim PBMs do not matter in the cost of healthcare? Cigna healthcare insurance generated ~ $38 billion in revenue the second quarter 2019 and a major increase due mostly to a merger with pharmacy benefit manager (PBM) Express Scripts.

According to company financial results released Thursday, Cigna’s pharmacy services business generated $23.5 billion in revenue in the second quarter which represents a massive increase compared to the $1.1 billion generated in the second quarter of 2018. The company reported $1.41 billion in net income.

The major reason for the spike is the gain from the membership and resources achieved from the deal for Express Scripts. Cigna completed the $67 billion merger with the PBM giant late last year.

More Plant-Based Protein in Diet May Add Years,” Nicole Lou, MedPageToday, August 27, 2019

“Significant reductions were found (specifically) in mortalities related to cardiovascular disease. Norie Sawada, MD, PhD, of Japan’s National Cancer Center in Tokyo reported and colleagues reported a positive result in a prospective cohort study of plant protein being substituted for meat protein. It was reported in recent JAMA Internal Medicine study, “Association of Animal and Plant Protein Intake With All-Cause and Cause-Specific Mortality.”

The JAMA study (Association of Animal and Plant Protein Intake With All-Cause and Cause-Specific Mortality) suggests diets with higher plant-based protein intake may contribute to long-term health and longevity. In this cohort study; 70,696 Japanese adults were followed up on for a mean period of 18 years. The outcome associated a higher intake of plant protein resulted in lower total mortality. Moreover, the substitution of plant protein for animal protein, mainly for red or processed meat protein, was associated with lower risk of total, cancer-related, and cardiovascular disease–related mortality.

Furthermore, switching out 3% of daily calories from red meat to plant protein — approximately 260 g of a soy-based food for the average person eating 2,000 calories per day — was linked in statistical models (not through analysis of individuals who actually changed their diets) to reductions in mortality risk.

It is no secret retail drives the meat processing market where large manufacturers and meat packers are big enough to control the market and can drive the pricing down or up per each of cattle. Smaller cattle producers can be driven out of the market as they do not have the massive volume ability to lower their costs of production past a certain point. The criticisms of the plant based protein study I have read are similar to the criticism I have read limiting opioid prescriptions in which they advocate do not limit opioid at all. We could all do with less red meat in our diets which still remains a reality.

The $6 Million Drug Claim, Katie Thomas and Reed Abelson, NYT, August 25, 2019

The link should take you to a different site other than the NYT where you can read the article.

Alexion Pharmaceuticals manufactures Strensiq a drug used to treat a rare bone disease perinatal/infantile and juvenile – onset hypophosphatasia. Adult Dawn Patterson also suffers from the same disease, the excruciating pain from it, which leaves her struggling to work or care for her family. It is a rare disease found more often in children and even rarer in adults.

Dawns husband’s union covers the cost of the drug. The union is suffering sticker shock from the mounting bills for treatments of her and her two of her children who also have the disease. In 2018, the union faced a potential $6 million bill for the Patterson household with an estimated a lifetime cost of $60 million to treat the family over 10 years.

The cost of Strensig as well as other drugs is coming under increased scrutiny and debate over whether any drug should cost $millions of dollars after cost of R&D and start up are recovered. Americans are being priced out of lifesaving treatments as drug companies maximize their profits well beyond start up costs. It has been found, the investment of $1 invested in R&D has provided $14.50 in revenue for cancer drugs (World Health Organization).

As I reported in “Cigna gets major boost from Express Scripts in Q2” (above), Pharmacy Benefit Managers are taking a hefty cut in the process in representing insurance companies with manufacturers. In an earlier post “Can you Patent the Sun,” I had talked more on the topic of costs and company reasoning to set higher prices. Manufacturers are pricing new and older drugs higher and establishing a pseudo morality to maximize their profits.

The US is more vulnerable than is European countries only because Europe sets pricing rather than allow the market to do so.

Opioid Maker Turned Blind Eye to Diversion, Kristina Fiore, MedPage Today, August 28, 2019

In newly unsealed documents, Mallinckrodt employees were worried the existing programs to prevent opioid diversion were not working. One former employee testified about Mallinckrodt not having a computerized system from 2008 to 2009 for tracking unusual orders. Employees had to use their judgment to identify suspicious sales. U.S. Drug Enforcement Agents met with Mallinckrodt PLC and informed the company the agency viewed it “as the kingpin within the prescription drug cartel.”

Superior Court for the State of Alaska Third Judicial District in Anchorage, State of Alaska, Plaintiff vs. Mallinckrodt PLC, Mallinckrodt LLC, and SPECGX LLC.

“In reality, however Mallinckrodt shipped opioids into Alaska without an adequate system in place to prevent diversion of its opioids and to investigate, report, and refuse to fill orders that it knew or should have known were suspicious, breaching both its common law duties and its statutory duties under Alaska law. Despite its legal and ethical duty to report “suspicious orders” of its drugs, and, upon information and belief, ample red flags of potential diversion, Mallinckrodt has never once reported a single prescriber to state law enforcement or the Alaska State Medical Board. Instead, Mallinckrodt incentivized distributors to flood the State with opioids beyond even what the expanded market for chronic pain market could bear.”

Mallinckrodt Was Required to and Failed to Maintain Effective Controls Against Diversion and to Report Suspicious Prescribers. , Page 35, B

There are multiple state lawsuits being filed federal courts nationwide claiming pharmaceutical companies misled people as to the safety of opioid usage.

Opioid settlement would divide money based on local impact, Geoff Mulvihill and Andrew Welsh-Huggins, AP, August 30, 2019

Purdue the maker of OxyContin is negotiating a multi-billion-dollar settlement to resolve a crush of lawsuits over the nation’s opioid crisis. The settlement contains formulas for dividing up the money amongst state and local governments across the country.

The formulas would take into account several factors; opioid distribution in a given jurisdiction, the number of people who misuse opioids, and the number of overdose deaths.

Spelling out the way the settlement is to be split is meant to prevent squabbles over the money avoiding the mistakes experienced with the hundreds of billions of dollars received under the nationwide settlement with Big Tobacco during the 1990s.

September 8; States Attorneys and Purdue have reached an impasse and it is expected Purdue will now file for bankruptcy. It is not clear what the breakdown is over. One of the four states attorneys negotiating with Purdue, Pennsylvania’s Josh Shapiro said Saturday he intends to sue the Sackler family as other states have.

“I think they are a group of sanctimonious billionaires who lied and cheated so they could make a handsome profit. I truly believe that they have blood on their hands.”

Run75441 (Bill H)

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IS TREND PAYROLL EMPLOYMENT REALLY WEAK?

For seven years from 2012 to 2018 the monthly payroll employment showed a solid trend of around 200,000 gains each and every month.  If it was much above or below this trend, analysts found some excuse to explain the difference and expected the off-trend observation to be quickly reversed.  So far this year most analysts continued to act as if this pattern was being repeated.

However, in August the Bureau of labor Statistics (BLS) rebenchmarked the data to more recent Census data. They announced that it would lower reported employment growth but they did not release the revised data until the August employment report last Friday.  The new data shows that 2019 payroll employment was significantly weaker than originally reported. The January monthly increase was still around the old 200,000 trend.  But in the seven months from February, 2019 to August,2019 the average monthly gain was only 123,000, roughly 60% of the old trend. Moreover, the 12 month moving average fell from 225,000 in January to 165,000 in August and every observation from February to August was below the still declining  12 month moving average.

Seven consecutive months should be enough to clearly demonstrate that trend payroll employment growth has fallen to a new, significantly lower trend than the old 200,000 trend.

 

Figure 1

 

Analysts tend to focus on the month over month change so it was understandable that they did not notice that the revised data was showing much more weakness than the old data. Remember,guessing monthly economic releases was a game created by the brokerage house, especially the bond houses, to generate volume because their earnings was much more sensitive to volume changes than other variables.

 

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Labor Day

I was doing my usual reading in the internet world and ran across this comment to another commenter who claimed Labor Day is a made up holiday. A lot of history in this reply:

“‘A made-up holiday that never had a great basis for its existence?’

How about the Ludlow Massacre where 57 miners were killed by Rockefeller guards that set fire to miners tents even though they were on private property? Their union leader was held by two militia members and shot in the back by a third. All they wanted was mine safety, their own doctor instead of a company doctor, an eight-hour day, fair pay and a union. Or how about the five workers shot in the back at McCormick Iron Works as they ran from armed guards. They too were just demonstrating for an eight-hour day and better working conditions generally. How about the women who died in a shirt manufacturing factory in New York? They died because they were deliberately locked in a room with no way out when the building caught on fire. How about the workers hung in Chicago after the Haymarket Riot because the Chicago Tribune just about sealed their fate with a horrific attack on them? The Governor of Illinois pardoned others scheduled to be hung because of what he thought was shaky evidence. What about the five marchers shot by police in a Hunger march in Detroit in the middle of the Depression? Or what about the Battle of the Overpass, where UAW organizers were beaten and bloodied by Ford thugs while the Dearborn police stood by and watched. That is except for one time when they stopped the Ford goons from further beating on a lady unionist. The police thought Fords thugs were going to kill the lady. What about Walter Reuther, who was picked up an thrown down again over three flights of stairs, probably avoided being killed because some reporters saw what was happening, picked Reuther up and threw him in their car, then drove away. Then there was the Homestead strike at Carnegie’s steel mill in Pennsylvania—more unionists killed.

How about the practice of blackballing workers if they gave management any grief? It was common practice for owners to put the word out about a worker to other businesses if that worker was deemed a problem or in favor of a union. A blackball meant that a worker would not be hired by other businesses. Indeed, the leader of the Homestead union, nicknamed Lucky by the way, was blackballed and could not find work in this country. He was last seen working in a mine in Mexico.

Closer to home, the accepted narrative is that Henry Ford was a generous man. He wanted his employees to be able to purchase the cars that they were manufacturing. So he started the five dollar day pay rate. Ford deserves his elevated place in history because he was a pioneer in the standardization of parts necessary for mass production. That being said, the five dollar a day came about, not because Ford cared about his employees, but because the annual employee turnover rate was 309%. Work conditions were so bad in Ford’s factory that nobody would stick around. Ford had to replace his entire workforce three times a year. He had to pay five dollars a day to keep the workforce in his shop. Even then Ford’s Sociology Department could enter your home for inspection. If your lifestyle dissatisfied Ford, you did not get five dollars a day.

Let’s touch briefly on the law and government, starting with the Clayton and Sherman Anti-Trust laws. Inspired by the great trust-buster Teddy Roosevelt, those laws were clearly intended to hinder a monopoly condition by business interests, Unfortunately President Grover Cleveland and his Attorney General, Richard Olney, thought differently. When union members went on strike during Cleveland’s administration, they turned the Clayton and Sherman laws on their respective heads, claiming that unions, as monopoly’s, were in restraint of trade, Clearly, that was not the intent of the legislature that created Clayton and Sherman. That’s just one of a ton of examples.

More recently, the Republican legislature and Governor in Michigan passed an anti-union Right to Work bill. Then they attached a financial appropriation to the bill, in affect disallowing Michigan citizens from putting the issue on the ballot through a referendum procedure,

From the Republican’s point of view, that’s probably a good thing as a recent poll shows 64% of Americans favoring unions.

>>> never a great basis for its existence? Aside from the people of color among us, I doubt that any group in this country has so been so hammered and consistently beaten down as America’s workforce. Let’s not forget that today the top 1% are in possession of 40% of the country’s total wealth while wages have been stagnant for forty years. The CEO of Disney makes 1100 times what the average worker makes. If I have read Adam Smith correctly, there is no economic theory that justifies either being the case. Let’s also not forget that our current President has put a corporate lawyer that has spent a lifetime litigating against unions and employees generally at the head of the federal Department of Labor.

Those among us that have grabbed a cup of coffee and a piece of toast on the way to work as employees have earned a special day and much more respect than Matt is able to give us.

I know. I walked on a picket line with one of the brightest, most imaginative, man this country has ever produced — ‘Walter Reuther.'”

Al Churchill’s Comment

Bridge Magazine, “Labor Day has lost some luster, as partisanship pulls us apart,” Phil Power, August 30, 2019

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Purdue Offers Up $10 – 12 Billion to Settle All Lawsuits – MedPage Update

Just revealed:

The opioid/OxyContin maker Purdue and members of the billionaire Sackler family owning the company have offered to settle thousands of lawsuits against the company for $10 to $12 billion. according to people briefed on the offer. More than 2,000 states, cities, and counties across America are pursuing the OxyContin maker over the large bills for cleaning up the opioid crisis — and are deciding whether to accept the offer by Friday. The Financial Times is reporting on this offer from the Sacklers and Purdue.

On August 26, Purdue paid $270 million to Oklahoma and Teva Pharmaceuticals paid $75 million also to Oklahoma.

From the Financial Times: “Purdue said it believes a ‘constructive global resolution is the best way forward’ and is working with state attorneys-general and other plaintiffs to achieve it. While Purdue Pharma is prepared to defend itself vigorously in the opioid litigation, the company has made clear that it sees little good coming from years of wasteful litigation and appeals”.

For all the harm done to this nation due to purposeful deceit and lies on the use of opioids claiming it was not addictive, someone needs to go to prison from the Sackler family.

Purdue Exposed

Medpage Today, Kristina Fiore, August 28,2019

I suspect with the new information being available, Purdue finally threw in the towel and offered a settlement. I also suspect this will impact other companies decisions to appeal as J & J is doing.

STAT News Wins Legal Fight Over Purdue Documents

A trove of documents detailing Purdue Pharma’s role in the opioid epidemic will be made public, STAT News reported, as the Kentucky Supreme Court denied the company’s request to review lower courts’ decisions to release them.

STAT waged a 3.5-year legal battle to make those records public. While some remain under seal, the outlet posted a sought-after video deposition of Richard Sackler. It had obtained a transcript of that deposition in February, which gained further attention when comedian John Oliver hired famous actors including Bryan Cranston and Michael Keaton to re-enact it.

The documents promise new information on how Purdue promoted its oxycodone product OxyContin and what, exactly, its executives knew about its risk of addiction. Among those documents are depositions of other Purdue executives; physician testimony; emails and memos about marketing strategies; internal reports on clinical trials; and communications about earlier legal cases.

All of the documents were part of Kentucky’s lawsuit against Purdue over its alleged illegal marketing of OxyContin. That suit was settled in 2015, with Purdue shelling out $24 million.

Purdue may soon be paying a far higher bill, with media including NBC News reporting that the company has pitched a $10 to $12-billion settlement in the consolidated cases set to go to trial before a federal judge in Ohio in October.

This does not bode well for Purdue, its settlement, or threat of years of litigation. The smoking gun was always there and pieces of it can be found in previous posts of mine. Relating the US Senate Joint Committee numbers to when Oxycontin was introduced after 1995 and the incremental increase in deaths from opioids, the use of a part of the Porter and Jink letter to the NEJM which said opioids were not addictive “minus the part where it said when used in a hospital setting,” the abuse of the Porter and Jink letter in the number of citations, the millions spent in lobbying state legislatures to block new laws, etc.

John Oliver uses Keaton and Cranston to portray Richard Sackler in this 20 minute Clip. It is worth watching. “the launch (Oxycontin) would be followed by a blizzard of prescriptions that will bury the competition. The blizzard will be so deep, dense, and white,.”

Run75441 (Bill H)

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J & J and It’s Subsidiary Janssen’s Actions “Created a Public Nuisance”

“The court found that Johnson & Johnson’s actions had created a “public nuisance,” which Oklahoma law defines to mean an act (or failure to act) that ‘annoys, injures or endangers’ the health and safety of an ‘entire community.’

In a 42-page opinion, Oklahoma State Judge Thad Balkman details how Johnson & Johnson’s sales and marketing assured doctors the appearance of addiction in patients due to the use of J & J opioid products was actually evidence of ‘under-treated pain’ and required the prescribing of more opioids. Sales representatives used these aggressive marketing tactics to target prescription-happy doctors referred to as ‘Key Customers’ in internal correspondence.”

I can not help but feel there comes a time when one must look at the continuing misuse of opioids under a doctor’s care and wonder what the doctors were thinking.

Multiple times I have written on the deadliness of opioids. To market and promote the use of opioids, the pharmaceutical industry deliberately took one sentence of a letter written by Doctors Porter and Jink to the NEJM in 1980 and claimed the use of opioids as safe in all environments and not mentioning Porters and Jink’s study was done in a hospital setting.

Addition Rare in Patients Treated with Narcotics, NEJM 1980: “Recently, we examined our current files to determine the incidence of narcotic addiction in 39,946 hospitalized medical patients who were monitored consecutively. Although there were 11,882 patients who received at least one narcotic preparation, there were only four cases of reasonably well documented addiction in patients who had no history of addiction. The addiction was considered major in only one instance. The drugs implicated were meperidine in two patients, Percodan in one, and hydromorphone in one. We conclude that despite widespread use of narcotic drugs in hospitals, the development of addiction is rare in medical patients with no history of addiction.” Boston Collaborative Surveillance Drug Program, Boston University Medical Center, Waltham NA 02154

From 1980 till 2015 the letter was cited 491 of 608 times affirming the use of opioids does not cause addiction. There was a significant increase in citation after the introduction of OxyContin in 1995. The “median number” of citations of a NEJM letter was 11 times in total. The citation of one sentence in whole or partially was many times more.

In Prescription Painkiller Addiction: A Gateway to Heroin Addiction,” Recall Report documents the start of the explosion in opioid use tying it to the introduction of OxyContin by Purdue Pharma in 1995/96.

The United States Congress Joint Economic Committee provides two charts detailing the total “number” of deaths per year from overdoses solely from opioids and Overdoses from all drugs during the time period of 1968 to 2015. The bar chart on the right represents the “numbers” of deaths per 100,000 (rate) of population from Overdoses solely from opioids and Overdoses from all drugs during the time period of 1968 to 2015. There has been arguments made there is no discernable evidence showing the impact of prescription opioids on the numbers of deaths. These two charts certainly points in a direction of the impact of prescribed opioids on the death rate.

Up till seeing the Joint Committee data, I had not seen earlier data. In these charts can be seen the additional yearly data predating 1980 when the Jick and Porter letter had been written to the NEJM going back as 1968. This data is important to see the magnitude of the introduction of prescribed opioids such as Oxycontin and the influence of them and the pharmaceutical industry on the usage of opioids said to be a safe drug to use outside of supervision.

State Judge Thad Balkman’s verdict will be appealed in higher state courts. If upheld, it will go to the federal courts. J & J is not a company without financial resource and they will contest this verdict as far as they can take it. The importance of the verdict is in holding a company, a citizen amongst us as declared by SCOTUS responsible for the abuse of opioids as shown in the numbers presented in this post, in earlier posts, and in the related documentation presented in all of my posts on opioids.

Reference Data

What the Oklahoma Johnson & Johnson Verdict Means for the Future of Opioid Litigation, Jay Willis, Microsoft News, August 27, 2019

Opioid Use since 1968 and Why It’s Abuse Increased, run75441 (Bill H), April 7, 2019

The Rise in Opioid Overdose Deaths, US Senate Joint Economic Committee, August 01 2017

Prescription Painkiller Addiction: A Gateway to Heroin Addiction, Recall Report

run75441 (Bill H)

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