Who Owns Governor Rick Scott?

Once you realize how common pill addiction has become in this nation - how many people are addicted to pills, how many pills they take, and how many pills are diverted from legitimate markets to illicit sales, it becomes pretty obvious that 'legitimate' industries are involved. Sure, there are problems with doctor shopping, forged prescriptions, individuals who sell the drugs they are prescribed to take... Sure, there are doctors who are nothing more than drug dealers with prescription pads. Tens of millions of pills are 'stolen' between the point of manufacture and the point of sale. But when you read about a state like Florida, it's reasonable to infer that there's a lot more to the picture:

Turns out that Florida medical practitioners bought 41.3 million oxycodone pills in the first half of 2010, almost 10 times more than their counterparts in all 49 other states combined. There is simply no legitimate explanation for that.

And there's no way that pharmaceutical companies aren't tracking those highly profitable sales, or that they don't know that Florida's doctors are purchasing far more pills than the population of the state could reasonably be expected to need. Under Jeb Bush, Florida had slowly started to take steps toward tracking prescriptions for controlled substances, a step that although far from perfect makes it much harder for doctors to engage in wholesale prescription fraud and drug dealing of the type recently seen in Florida.

Thirty-five states, including Virginia, and the District have found a way to manage the trade-off: prescription drug monitoring programs (PDMPs), paid for with both their own funds and federal grants. PDMPs generally require doctors and pharmacies to report dispensing of controlled substances to a central database, where the information is kept securely, available only to authorized persons - such as doctors and pharmacists - with a need to know if patients have a history of "doc-shopping." Studies by both the Government Accountability Office and a Justice Department-funded consulting firm have found that PDMPs deter overprescription and reduce the probability of drug abuse.

Florida, not surprisingly, lags in this respect. In 2009, the state established a PDMP to be funded only through private donations; it has not yet gone into operation. Newly elected Gov. Rick Scott (R) wants to repeal even that weak measure, calling it an invasion of privacy.

Why am I skeptical that Rick Scott's concern is privacy. Florida's not alone in this regard:

Perhaps more surprising, Maryland has done less than Florida has. This is especially troubling given that medical practitioners in Maryland purchased 423,000 oxycodone pills in the first half of 2010, more than those of all but three states, including Florida, according to Drug Enforcement Administration (DEA) statistics. That is eight pills for every 1,000 residents, 10 times the rate of California and 53 times the rate of New York.

Did you catch that? California's doctors, who have a reputation for being quick to prescribe pain pills to their legitimate patients, prescribe them at a tenth the rate of doctors in Maryland. We're talking about hundreds of millions of dollars here, folks. When I read about the governors of states in which massive diversion is occurring blocking modest measures that could help reduce that problem in their states, I think it's more than fair to ask, "What's in it for them?"

I'm not suggesting that they're in the pocket of their states' drug cartels. But let's not forget that when this much money is at stake, and when we're talking about the diversion of millions of pills, the legitimate side of the industry has a huge financial interest in preserving the status quo. Here's where some transparency could be useful - I would like to hear Governors Scott and Maryland's former governor, Robert L. Ehrlich Jr., explain why they worked so hard to block PDMPs in their states - including the identities of the industries that lobbied against the PDMPs and the amounts those industries contributed to the governors' election campaigns.

Thomas Friedman's Search for Magic Men...

Continues unabated. It seems that there's no problem in the world of business or politics that cannot be cured by finding a new Nelson Mandela, Steve Jobs... has he evoked MLK?

Why think hard and work hard to solve problems, when it's so much easier to lament that if only the other side had a "magic man" who had the "courage" to act "against the popular will of his country or party" - with courage, of course, defined as the unstoppable will to do exactly what Thomas Friedman wants - the problems would go away all by themselves?

While Friedman hopes that his "suck on this" war will inspire a host of Nelson Mandelas who can lead their nations to happiness and unity, perhaps he should stop to think about the implications of his suggestion. This would be the Nelson Mandela who was imprisoned as a terrorist, and held for decades during which he adamantly refused to renounce violent resistance. It may well be that there is somebody who is roughly equivalent to Nelson Mandela in Iraq or the occupied territories, but perhaps he is presently preaching violent resistance against occupation and perhaps he's also presently in prison.

But perhaps it would also make sense for him to consider that the circumstances that give rise to a "magic man" are sui generis, which is why to date there is only one Gandhi, only one MLK, only one Nelson Mandela.... Even if you cloned them, you wouldn't duplicate them or their success. And perhaps he should consider that it was Gandhi's education in England that enabled him to become what he became, not so much the fact that his country was colonized. Does Friedman truly believe that bombing and occupying a country is the best way to produce the type of leader who only comes along once in a generation - in unprecedented numbers?

(Sadly, he probably does.)

Perhaps his column should be retitled from "Surprise, Surprise, Surprise" to "No Suprise, and condensed to, "I just saw a movie presenting fictionalized versions of real events and now I know how to solve the world's problems." Funny how when you fictionalize things, they become so much simpler and neater.

Chrysler in Bankruptcy

The American Enterprise Institute offers a drawn-out whine about how the Chrysler bankruptcy isn't sufficiently fair to creditors. As if you haven't guessed, I'm not impressed. The piece opens by comparing the Chrysler bankruptcy to "equity receivership", a contrived mechanism for the sale of distressed companies that predates Chapter 11 bankruptcy. The author, David Skeel, complains that the Obama Administration's desire for the bankruptcy court to quickly sell Chrysler to Fiat amounts to the same thing.

Except... Fiat's the only interested bidder. There may be other companies willing to buy small pieces of Chrysler, or who will buy some of its intellectual property, brands, equipment or real estate holdings at auction. But there's no other company even slightly interested in acquiring Chrysler as a going concern. The Obama Administration's pressure for a quick sale has to do with maintaining Chrysler's viability and not scaring off that single bidder. If the creditors who want to squeeze more money out of Chrysler manage to slow things down or increase the cost to Fiat, the odds are that Chrysler will fail. Skeel assumes that the creditors who are imeding the sale (who hold a minority share of Chrysler's debt) are acting in good faith; but it seems more like a continuing game of chicken. Can they coerce more money out of the other creditors, or out of Fiat, and will they really risk losing even more of their investment if they don't get the concessions they demand? Maybe; but it would not be responsible for the bankruptcy court to risk killing off Chrysler to find out.

As for Skeel's whinging about the union's share of the future Chrysler, coming out of bankruptcy:

It also seems to flout bankruptcy’s priority rules by giving Chrysler’s employees (who are general creditors) a big stake in New Chrysler while forcing senior lenders to take a major haircut. The usual rule is that senior creditors must be paid in full before lower priority creditors are entitled to anything.

Here's the deal: Chrysler only presently survives at all because it's benefiting from huge infusions of taxpayer money that, realistically speaking, won't be paid back. If Chrysler also backs out of its commitments to retirees, that's another burden that's places on the taxpayer, as the Pension Benefit Guaranty Corp. covers Chrysler's default on its pensions. While the AEI seems to be a huge fan of lemon socialism, some of us don't think it's unreasonable that at least some portion of the private losses involved remain in private hands. After all, but for the government bailout, the creditors who are whining about their losses would be suffering a far worse fate.

From there, it gets sillier. To "protect" creditors from the sale to Fiat, Skeel suggests,

First, [the bankruptcy judge] could insist on an independent valuation of the sale, rather than just taking the administration’s numbers for granted. Inviting competing bids, which Judge Gonzalez did this week, might serve as an adequate test of the government’s price in an ordinary case.

So we get an appraisal. But here's the thing about appraisals: They don't actually tell you market value. Do you know how you find out what something will sell for on the market? You sell it.

Oh, but "bidders who are willing to go head to head with the U.S. government are not likely to be thick on the ground"? Give me a break. Cerberus has been ready to dump Chrysler for at least a year, and the only company who made a viable offer was Fiat. It's childish to pretend that the dearth of bidders comes from Administration pressures, as opposed to the fact that Chrysler's a basket case that nobody wants. And while I'm sure the creditors who are trying to squeeze more money out of Chrysler's carcass are happy to have Skeel shill for them, the fact is that any attempt to "restructure" the deal could cause the only company willing to take on Chrysler to change its mind, or to line up with other companies to pick over the carcass of a dead company, returning far less to creditors than will be obtained through Chrysler's sale as a going concern.