The Daily Dish

November 24th Edition

The debate about inversions is back with the proposed merger of drug companies Pfizer and Allergan. The deal would move the two companies to Allergan’s headquarters in Dublin, Ireland. The White House called on Congress to take action against these companies, but by taking action against inversion, they would miss the bigger picture of our tax structure. What happens and why do companies invert? Click here for this Eakinomics video on the process.

Despite calls from Congress and the public to improve broken systems, the VA still has thousands of veterans waiting to find out if they will receive care. According to the Washington Examiner, “The waiting list includes nearly 2,000 applications that are sitting at just one office in Atlanta, but that the VA refuses to acknowledge as actual applications, according to an agency whistleblower.” One expert knowledgable on the situation said that the VA was “acting as if it's the veterans' burden to correct this issue.”

Eakinomics: “Small” Damage Undone?

Congress is asking the Federal Communications Commission (FCC) to limit the damage to small broadband providers done by the newly minted Open Internet Order. According to the Hill “Thirty-four Republican members of Congress sent a letter Friday to FCC Chairman Tom Wheeler encouraging him to make the exemption permanent and change the criteria by which it is applied. In the letter, they asked Wheeler to forsake the 100,000-or-fewer-subscribers standard in favor of applying the exemption to any provider with 1,500 employees or fewer or, alternately, to any with 500,000 or fewer subscribers. The former is the Small Business Administration’s definition of a small telecommunications provider while the latter is how the commission defines a small wireless carrier.”

Seasoned Eakinomics readers are familiar with how the White House strong armed the FCC into adopting Title II regulation of the internet in pursuit of its notion of “network neutrality” for the internet. This is the latest chapter in a long history of addressing the key issues, and the danger of trying to implement this utopian policy vision via “Title II Reclassification”. Now that the FCC’s attempt to defy the laws of networks, economics, and time and to turn broadband into 1950s-style local phone service has been launched, the goal should be to minimize the damage. 

For example, research by AAF scholar Will Rinehart indicates Title II reclassification could result in lower investment and fewer jobs in the broadband sector. Specifically, in 2019, there could be 174,233 fewer jobs, pushing workers to less dynamic locations in the economy. Accordingly, it is a relief to see that Congress is cognizant of the problem. If it were to succeed, exempting small broadband providers would have two benefits. First, small businesses would see real improvements in investment, innovation, and jobs because the unnecessary legal hindrance was stopped. Second, it establishes the legitimacy of concern over the entire regulatory enterprise, something that cannot happen too soon.

From the Forum

Bakken Region Prospers from Oil Boom, Even the Environment Benefits by Sam Batkins, AAF Director of Regulatory Policy

Reimbursement Policy for Biosimilars Will Have Negative Consequences for Patients by Tara O’Neill, AAF Health Care Policy Analyst

Fact of the Day

EPA’s proposed methane standards for landfills and fracking sites would cost $460 million, as methane emissions continue to decline in the U.S.

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