PolicyGuy

Monday, April 26, 2004


Michigan Announces New Drug Cartel
The federal government has endorsed the Michigan Multi-State Prescription Drug Initiative. Michigan already has a few states that will pool with them to form a buyer's club, and hopes to attract more.

In a sign that perhaps Governor Granholm recognizes that price controls are not popular, the press release announcing the program says "Unlike typical price control programs - such as Canada's - where the government sets prices, Michigan, Vermont, and Hawaii use a competitive bidding process that allows manufacturers to work with states and lower their prescription drug prices."

In the abstract, there's nothing wrong with government banding together to buy in bulk, and thus save taxpayer dollars. But given that half of all medical care is currently purchased by governments, we could in a de facto sense be on our way to price controls anyway.

"Justice Louis D. Brandeis'?s metaphor of the states as "laboratories" for policy experiments ... had almost nothing to do with federalism and everything to do with his commitment to scientific socialism. .... To this day, it continues to inhibit a truly experimental, federalist politics." -- Michael S. Greve

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