Saturday, October 27, 2018

Capitalism or socialism, the strong will win.

"According to a report in the Financial Times, published about two-and-a-half weeks ago, Nirmal Mulye, the chief executive officer (CEO) of Missouri, US-based Nostrum Laboratories, defended the increase in the price of a bottle of Nitrofurantoin from $474.75 to $2,392," wrote VA Nageswaran. He defended it by saying that it was "moral requirement" to sell the drug at the highest price possible to protect shareholder value. Nitrofurantoin is an off-patent drug used to treat urinary infections and "is listed as an essential medicine by the World Health Organization". Earlier the price of another off-patent drug Pyrimethamine, used to prevent Pneumocystis carinii infections in AIDS patients, was increased by 5,000% in the US. Holding sick people to ransom is unacceptable so what is the answer? In India, the government controls prices of essential drugs which makes manufacture unprofitable. The price of Methyldopa, essential for treating high blood pressure in pregnancy, was controlled so companies simply stopped manufacturing the drug. However, the government did not stop taxing the drug. "The costing and selling price of the drug is not sustainable. The costing is Rs 2.20 per tablet and approved selling price is Rs 2.50. The government expects us to pay taxes from our pocket," said RC Juneja, CEO of Mankind Pharma. Similarly, it is very difficult to find Nitrofurantoin in India because of price control, forcing doctors to prescribe unnecessarily stronger antibiotics. Danske Bank has confessed to laundering $233 billion, tax authorities in Britain did not assist in a French investigation "into Lycamobile on charges of money-laundering and tax fraud because it was a big corporate donor to the Conservative Party" and American companies shift their earnings to tax havens to avoid paying taxes in the US. Companies in the US have to pay a one-time tax on money kept abroad. In India, "In some companies, the CEO compensation to median worker ratio exceeds 1,000 times. In an extreme case, it is more than 25,000 times." Robber barons are back "because political parties of all stripes are in the hock". No one in India gets punished for riots because politicians do everything to protect the guilty. Politicians and civil servants doubled their salaries between 1993 and 2012 while workers saw an improvement of only 44%. They have made themselves into VIPs which means that rules do not apply to them, wrote Prof R Thakur. No wonder India has a 'twin surplus' problem. "Big egos and small minds are in surplus," wrote Nageswaran. "Morality and fair play are the bedrock of capitalism. Without them, it is Kleptocratic Darwinism." Human beings are super predators. They prey on other humans. 

No comments: