Later On

A blog written for those whose interests more or less match mine.

Archive for May 9th, 2021

Why Joe Biden Punched Big Pharma in the Nose Over Covid Vaccines

leave a comment »

Matt Stoller has a very interesting column today:

Today I’m writing about Joe Biden’s attack on vaccine monopolists. What happened is a bit technical and involves a bunch of weird international agreements on patents and IP, but the short story is that what Biden just did could be as significant as Reagan firing the air traffic controllers in 1981, or Teddy Roosevelt taking on JP Morgan in 1904 over a giant railroad combination. It’s a signal that the American order is changing.

Plus, beef prices are at record highs, so why are cattle producers going bankrupt? And why did we face meat shortages during the pandemic? I talked to South Dakota ranching advocate Bill Bullard about why our national food systems are collapsing.

Biden: We Must Vaccinate Everyone in the World

Three days ago, United States Trade Representative Katherine Tai announced that the United States supports a global waiver on intellectual property protections for Covid vaccines. There are two excellent vaccines. The first is produced by a partnership between industry giant Pfizer and the German company BioNTech, the second by multi-billion dollar start-up success story Moderna in a partnership with the National Institute of Health. Biden took the first step in a legal process to force these firms, among others, to share their technology.

The announcement sent shock waves throughout the world. French President Emanuel Macron jumped on board, director of the World Health Organization Tedros Adhanom Ghebreyesus called it a “monumental moment in the fight against Covid,” the FT’s Edward Luce said Biden had made “a brilliant move,” and political leaders globally began putting pressure on their own governments to follow suit. “Thank you, President Biden and USTR Katherine Tai,” said Lori Wallach of Global Trade Watch, a key leader in the campaign.

The pharmaceutical industry reacted with shock and anger. “In the midst of a deadly pandemic, the Biden Administration has taken an unprecedented step that will undermine our global response to the pandemic and compromise safety,” read a statement from the trade association group PhRMA. The US Biotechnology Innovation Organization pronounced “extreme disappointment” and the European Federation of Pharmaceutical Industries and Associations warned this move will lead to counterfeit vaccines.

What just happened? And what does it actually mean?

There are multiple layers to this story. I’m going to offer an explanation of how this waiver affects the global attempt to address the pandemic, the politics behind the decision, and what it means going forward. The short story is that this is an unexpected and major defeat for the pharmaceutical industry, all the more bizarre that it comes from Joe Biden, who in his career generally deferred to big business. As one Washington lobbyist told the Financial Times, “Nobody really thought Biden was going to take on the pharmaceutical lobby, [they thought] that he would be too scared. But before the financial crisis, everybody thought the financial services industry was untouchable, then that changed. This week showed that pharma companies are the new banks.”

To understand what happened, we have to start with the development of the vaccines themselves.

The Vaccine Success Story

The development of Covid vaccines is the single most successful U.S. government program since the elimination of polio. Vaccines have traditionally taken more than a decade to develop. Yet, in this case, less than a year after the virus was first genetically sequenced by Chinese scientists and posted to the web, trucks began rolling out of factories with safe and effective vaccines ready for deployment. Today, more than a billion doses have been injected into arms, and wealthier countries are seeing the pandemic recede.

In part, the global spread of pharmaceutical technology is one reason for this success. China, Russia, Europe, and the U.S. all have put out vaccines that work. Yet the best new vaccines come from the U.S. or Europe, and use a new technology called mRNA. The old way of making vaccines consisted of growing a weakened or deactivated germ, which would create an immune response by getting your body to respond to something that looked like a deadly virus. But making these kinds of viruses was cumbersome because they have to be grown, and they don’t always work well. Flu vaccines are grown in chicken eggs, for instance, and that takes a long time.

The mRNA vaccine by contrast is not a weakened germ, it is a set of instructions to your body to produce a custom-designed protein shaped like a part of the Covid virus, which your immune system then responds to. In doing so, you acquire immunity. The mRNA vaccine is programmable, meaning that it’s easy to update the vaccine to address new diseases or new variants, and because it is chemical, production scales quickly. Think of the difference between the old way of doing vaccines and mRNA as similar to printing books by woodblocks, each of which has to be carved by hand, versus using moveable type printing presses.

The mRNA technology comes from Katalin Kariko, a Hungarian immigrant who perfected the technology with fellow scientist Drew Weissman at the University of Pennsylvania. The two licensed mRNA to two small firms, BioNTech in Germany and Moderna in the United States. BioNTech spent years perfecting the technology and eventually got German government support. Meanwhile, Moderna received U.S. government funding in the 2010s from the Defense Advanced Research Projects Agency (DARPA), the same unit that helped create packet-switching technology in the 1970s.

When the pandemic hit, three things happened. First, Pfizer and BioNTech quickly agreed to work together to scale and develop their mRNA vaccine. Second, government scientists at the National Institute of Health designed a spike protein molecule and sent it to Moderna, which used it as the basis for its mRNA vaccine. Third, the U.S. government, through what was called Operation Warp Speed, created a market for vaccines, signing guaranteed-purchase agreements with a number of firms, including Pfizer/BioNTech and Moderna, to secure hundreds of millions of vaccine doses for the U.S. population.

This process worked remarkably well. The first country to have more than 50% of its population vaccinated, Israel, basically has no Covid anymore, and Covid is dropping rapidly everywhere these vaccines have been widely deployed. If we could deploy vaccines worldwide, we could effectively eradicate Covid, or at the very least, make the outbreak of new variants that can evade vaccines much less likely.

Where there’s great success, there’s great money. Pfizer is projecting it will make $26 billion in 2021 from its vaccine, and Moderna will make $18.4 billion. That’s a good thing. These firms should make large sums of money from a fantastically useful vaccine, even though the technology was publicly financed.

Still, despite this success, there’s a significant vaccine shortage. The world will need 10-12 billion to be fully vaccinated, and Moderna and Pfizer/BioNTech won’t produce that much. Pfizer/BioNTech, for instance, forecast production of 2 billion doses in 2021, and Moderna will make something on the order of a billion doses. That’s a lot, it’s just not nearly enough. Indeed, at this rate, some countries aren’t going to start significant vaccination campaigns until 2023. That’s quite dangerous, because if the pandemic keeps raging, it’s more likely that a vaccine-resistant Covid variant emerges. If that happens, such a variant will spread across the already vaccinated areas of the world.

So making sure we have a global vaccination campaign looks like a logistical challenge, but also a necessary one. That said, there’s a fly in the ointment, a ghoulish incentive at work for Pfizer, BioNTech, and Moderna.

Pfizer and the “Durability of the Franchise”

On an investor call last month, the CEO of Pfizer, Frank D’Amelio, discussed what would happen to revenue from his vaccine product as the Covid pandemic ends, what he called the “durability of the franchise.” He told analysts not to worry. People in rich countries will need annual booster shots, and that is where Pfizer will make real money.

For these annual treatments, Pfizer will be able to charge much more than it does now. The current price for a covid vaccine, D’Amelio noted, is $19.50 per dose. He told analysts of his hope Pfizer could get to a more normal price, “$150, $175 per dose,” instead of what he called “pandemic pricing.”

The ghoulish part, however, is why there will need to be annual boosters. It’s not because the vaccine strength wanes over time, though that might happen. It’s because, as D’Amelio told Wall Street, there will be new variants emerging from abroad that can evade the vaccine. And how will variants emerge abroad? Well as outbreaks occur in non-vaccinated parts of the world, new strains will naturally occur as the virus mutates. If the rest of the world gets vaccinated, however, new variants won’t arise.

What D’Amelia really wants is to be able to charge $150 for a vaccine he is now charging $19.50 for. But D’Amelio is also assuming that there won’t be a global effective vaccination campaign. And, in a narrow sense, while Pfizer’s main goal is to keep prices high, it is actually against Pfizer’s financial interest to have the rest of the world vaccinated. If the world gets vaccinated, Pfizer won’t necessarily be able to sell expensive booster shots in rich countries who can afford them. Yikes.

The corporate world, sans Pfizer, has a very strong reason not to want a vaccine-resistant variant. A new variant of Covid could force the world back into lockdown, which is expensive. The International Chamber of Commerce, hardly a bastion of lefties, put out a study asserting that not sufficiently vaccinating poor countries will cost $9.2 trillion (with wealthy countries like the U.S. bearing half the cost). Covid isn’t good business for most firms, but it’s great for Pfizer and Moderna.

So what is the holdup for global vaccination? One argument is that there isn’t . . .

Continue reading. There’s much more.

Later in the column, he discusses why beef prices are rising as cattle prices are dropping. That begins:

Beef Is Expensive. So Why Are Cattle Ranchers Going Bankrupt?During the Covid pandemic, Americans went to the supermarket and found something that hadn’t happened for decades – a meat shortage. There was plenty of cattle, but the beef wasn’t getting to the supermarket shelves.

What happened and why?

To answer this question, I asked Bill Bullard, a former cattle rancher and the current CEO of R-CALF, a cattle producer-only membership organization focused on the viability of the U.S. cattle ranching industry. “We have so skeletonized the entire live cattle and beef supply chains that it is no longer capable of withstanding a shock,” he said, “whether it be the covid pandemic or a climatic circumstance.” This shortage was a wake-up call. “The industry is incapable of meeting our national food security needs.”

Bullard is an ardent anti-monopolist, a viewpoint developed through hard-won experience dealing with a consolidated meatpacking industry. He noticed problems with our cattle markets becoming more severe in 2014. That’s when beef prices and cattle prices started to diverge. . .

Read the whole thing.

Written by Leisureguy

9 May 2021 at 5:19 pm

Why Trump Still Has Millions of Americans in His Grip

leave a comment »

Thomas Edsall’s column in the NY Times today makes good points, some of which relate to the previous post on the coming automation of trucking:

Beginning in the mid-1960s, the priorities of the Democratic Party began to shift away from white working- and middle-class voters — many of them socially conservative, Christian and religiously observant — to a set of emerging constituencies seeking rights and privileges previously reserved for white men: African-Americans; women’s rights activists; proponents of ethnic diversity, sexual freedom and self-expressive individualism.

By the 1970s, many white Americans — who had taken their own centrality for granted — felt that they were being shouldered aside, left to face alone the brunt of the long process of deindustrialization: a cluster of adverse economic trends including the decline in manufacturing employment, the erosion of wages by foreign competition and the implosion of trade unionism.

These voters became the shock troops of the Reagan Revolution; they now dominate Trump’s Republican Party.

Liberal onlookers exploring the rise of right-wing populism accuse their adversaries of racism and sexism. There is plenty of truth to this view, but it’s not the whole story.

In “The Bitter Heartland,” an essay in American PurposeWilliam Galston, a veteran of the Clinton White House and a senior fellow at Brookings, captures the forces at work in the lives of many of Trump’s most loyal backers:

Resentment is one of the most powerful forces in human life. Unleashing it is like splitting the atom; it creates enormous energy, which can lead to more honest discussions and long-delayed redress of grievances. It can also undermine personal relationships — and political regimes. Because its destructive potential is so great, it must be faced.

Recent decades, Galston continues, “have witnessed the growth of a potent new locus of right-wing resentment at the intersection of race, culture, class, and geography” — difficult for “those outside its orbit to understand.”

They — “social conservatives and white Christians” — have what Galston calls a “bill of particulars” against political and cultural liberalism. I am going to quote from it at length because Galston’s rendering of this bill of particulars is on target.

  • “They have a sense of displacement in a country they once dominated. Immigrants, minorities, non-Christians, even atheists have taken center stage, forcing them to the margins of American life.”

  • “They believe we have a powerful desire for moral coercion. We tell them how to behave — and, worse, how to think. When they complain, we accuse them of racism and xenophobia. How, they ask, did standing up for the traditional family become racism? When did transgender bathrooms become a civil right?”

  • “They believe we hold them in contempt.”

  • “Finally, they think we are hypocrites. We claim to support free speech — until someone says something we don’t like. We claim to oppose violence — unless it serves a cause we approve of. We claim to defend the Constitution — except for the Second Amendment. We support tolerance, inclusion, and social justice — except for people like them.”

Galston has grasped a genuine phenomenon. But white men are not the only victims of deindustrialization. We are now entering upon an era in which vast swaths of the population are potentially vulnerable to the threat — or promise — of a Fourth Industrial Revolution.

This revolution is driven by unprecedented levels of technological innovation as artificial intelligence joins forces with automation and takes aim not only at employment in what remains of the nation’s manufacturing heartland, but also increasingly at the white-collar managerial and professional occupational structure.

Daron Acemoglu, an economist at M.I.T., described in an email the most likely trends as companies increasingly adopt A.I. technologies.

A.I. is in its infancy. It can be used for many things, some of them very complementary to humans. But right now it is going more and more in the direction of displacing humans, like a classic automation technology. Put differently, the current business model of leading tech companies is pushing A.I. in a predominantly automation direction.

As a result, Acemoglu continued, “we are at a tipping point, and we are likely to see much more of the same types of disruptions we have seen over the last decades.”

In an essay published in Boston Review last month, Acemoglu looked at the issue over a longer period. Initially, in the first four decades after World War II, advances in automation complemented labor, expanding the job market and improving productivity.

But, he continued, “a very different technological tableau began in the 1980s — a lot more automation and a lot less of everything else.” In the process, “automation acted as the handmaiden of inequality.”

Automation has pushed the job market in two opposing directions. Trends can be adverse for those (of all races and ethnicities) without higher education, but trends can also be positive for those with more education:

New technologies primarily automated the more routine tasks in clerical occupations and on factory floors. This meant the demand and wages of workers specializing in blue-collar jobs and some clerical functions declined. Meanwhile professionals in managerial, engineering, finance, consulting, and design occupations flourished — both because they were essential to the success of new technologies and because they benefited from the automation of tasks that complemented their own work. As automation gathered pace, wage gaps between the top and the bottom of the income distribution magnified.

Technological advancement has been one of the key factors in the growth of inequality based on levels of educational attainment, as the accompanying graphic shows:

Acemoglu warns:

If artificial intelligence technology continues to develop along its current path, it is likely to create social upheaval for at least two reasons. For one, A.I. will affect the future of jobs. Our current trajectory automates work to an excessive degree while refusing to invest in human productivity; further advances will displace workers and fail to create new opportunities. For another, A.I. may undermine democracy and individual freedoms.

Mark Muro, a senior fellow at Brookings, contends that it is essential to look at the specific types of technological innovation when determining impact on the job market.

“Two things are happing at once, when you look at traditional ‘automation’ on the one hand and ‘artificial intelligence’ on the other,” Muro wrote in an email. “The more widespread, established technologies usually branded ‘automation’ very much do tend to disrupt repetitive, lower-skill jobs, including in factories, especially in regions that have been wrestling with deindustrialization and shifts into low-pay service employment.”

In contrast, Muro continued, “Artificial intelligence really is a very different set of technologies than those we label as ‘automation, and it will for a while mostly affect college educated workers.” But, and it’s a big but,

there is a greater chance that such white collar workers, with their B.A.s, will be better equipped to coexist with A.I. or even benefit from it than will non-B.A. workers impacted by other forms of automation. And yet, there’s no doubt A.I. will now be introducing new levels of anxiety into the professional class

In a November 2019 paper, “What jobs are affected by A.I.? Better-paid, better-educated workers face the most exposure,” Muro and two colleagues found that exposure to A.I. is significantly higher for jobs held by men, by people with college degrees or higher, by people in the middle and upper pay ranks and by whites and Asian-Americans generally.

In contrast, in a March 2019 paper, “Automation perpetuates the red-blue divide,” Muro and his colleagues found that automation, as opposed to A.I., hurts those who hold jobs that do not require college degrees the most, and that exposure to automation correlates with support for Trump:

The strong association of 2016 Electoral College outcomes and state automation exposure very much suggests that the spread of workplace automation and associated worker anxiety about the future may have played some role in the Trump backlash and Republican appeals.

More specifically, Muro and his colleagues found:

Heartland states like Indiana and Kentucky, with heavy manufacturing histories and low educational attainment, contain not only the nation’s highest employment-weighted automation risks, but also registered some of the widest Trump victory margins. By contrast, all but one of the states with the least exposure to automation, and possessing the highest levels of educational attainment, voted for Hillary Clinton.

How do the risks of automation, foreign-trade-induced job loss and other adverse consequences of technological change influence politics? . . .

Continue reading.

Written by Leisureguy

9 May 2021 at 12:32 pm

Liz Cheney and Big Lies (including lies of omission)

leave a comment »

Maureen Dowd has a good column in the NY Times:

I miss torturing Liz Cheney.

But it must be said that the petite blonde from Wyoming suddenly seems like a Valkyrie amid halflings.

She is willing to sacrifice her leadership post — and risk her political career — to continue calling out Donald Trump’s Big Lie. She has decided that, if the price of her job is being as unctuous to Trump as Kevin McCarthy is, it isn’t worth it, because McCarthy is totally disgracing himself.

It has been a dizzying fall for the scion of one of the most powerful political families in the land, a conservative chip off the old block who was once talked about as a comer, someone who could be the first woman president.

How naïve I was to think that Republicans would be eager to change the channel after Trump cost them the Senate and the White House and unleashed a mob on them.

I thought the Donald would evaporate in a poof of orange smoke, ending a supremely screwed-up period of history. But the loudest mouth is not shutting up. And Republicans continue to listen, clinging to the idea that the dinosaur is the future. “We can’t grow without him,” Lindsey Graham said.

Denied Twitter, Trump is focusing on his other favorite blood sport: hunting down dynasties. “Whether it’s the Cheneys, the Bushes or the lesser bloodlines — such as the Romneys or the Murkowskis — Trump has been relentless in his efforts to force them to bend the knee,” David Siders wrote in Politico.

Yet an unbowed Liz Cheney didn’t mince words when, in a Washington Post op-ed a few days ago, she implored the stooges in her caucus to “steer away from the dangerous and anti-democratic Trump cult of personality.”

That trademark Cheney bluntness made Liz the toast of MSNBC and CNN, where chatterers praised her as an avatar of the venerable “fact-based” Republican Party decimated by Trump.

But if Liz Cheney wants to be in the business of speaking truth to power, she’s going to have to dig a little deeper.

Let’s acknowledge who created the template for Trump’s Big Lie.

It was her father, Dick Cheney, whose Big Lie about the Iraq war led to the worst mistake in the history of American foreign policy. Liz, who was the captain of her high school cheerleading team and titled her college thesis “The Evolution of Presidential War Powers,” cheered on her dad as he spread fear, propaganda and warped intelligence.

From her patronage perch in the State Department during the Bush-Cheney years, she bolstered her father’s trumped-up case for an invasion of Iraq. Even after no W.M.D.s were found, she continued to believe the invasion was the right thing to do.

“She almost thrives in an atmosphere where the overall philosophy is discredited and she is a lonely voice,” a State Department official who worked with Liz told Joe Hagan for a 2010 New York magazine profile of the younger Cheney on her way up.

She was a staunch defender of the torture program. “Well, it wasn’t torture, Norah, so that’s not the right way to lay out the argument,” she instructed Norah O’Donnell in 2009, looking on the bright side of waterboarding.

She backed the futile, 20-year occupation of the feudal Afghanistan. (Even Bob Gates thinks we should have left in 2002.) Last month, when President Biden announced plans to pull out, Liz Cheney — who wrote a book with her father that accused Barack Obama of abandoning Iraq and making America weaker — slapped back: “We know that this kind of pullback is reckless. It’s dangerous.”

For many years, she had no trouble swimming in Fox News bile. Given the chance to denounce the Obama birther conspiracy, she demurred, interpreting it live on air as people being “uncomfortable with having for the first time ever, I think, a president who seems so reluctant to defend the nation overseas.”

Thanks to that kind of reasoning, we ended up with a president who fomented an attack on the nation at home.

In her Post piece, Cheney wrote that her party is at a “turning point” and that Republicans “must decide whether we are going to choose truth and fidelity to the Constitution.”

Sage prose from someone who was a lieutenant to her father when he assaulted checks and balances, shredding America’s Constitution even as he imposed one on Iraq.

Because of 9/11, Dick Cheney thought he could suspend the Constitution, attack nations preemptively and trample civil liberties in the name of the war on terror. (And for his own political survival.)

Keeping Americans afraid was a small price to pay for engorging executive power, which the former Nixon and Ford aide thought had been watered down too much after Watergate.

By his second term,

Continue reading.

Written by Leisureguy

9 May 2021 at 11:24 am

Long-haul trucking

leave a comment »

In the coming decade one or two million jobs will be lost as autonomous trucks become practical. Obviously, some trucking jobs will remain, but serious thought and effort is going into eliminating as many of the 3.5 million trucking jobs as possible. This brief video provides a good overview of the industry:

And here’s a little more detail from the trucker’s own point of view:

Written by Leisureguy

9 May 2021 at 10:42 am

%d bloggers like this: