Category: Uncategorized

Op-Ed: St. Paddy’s primaries were Bernie’s Waterloo

Posted on by The Progressive Policy Institute

As Americans go into isolation to slow the spread of coronavirus, we are sadly lacking in diversions. No March Madness, spring baseball or Premier League. No bars, restaurants or St. Patrick’s Day revels.

Even the long-running Democratic nomination battle seems to be shutting down. Continuing his electoral hot streak, former Vice President Joe Biden decisively swept all three Democratic primaries yesterday in Florida, Illinois and Arizona.

Sen. Bernie Sanders (I-Vt.), nurturing wan hopes of a political rebound, instead met his Waterloo in the St. Paddy’s Day primaries. He may stay in the race and scrounge delegates here and there, but his high-octane insurgency has run out of road.

Read the full piece.

Op-Ed: Biden would be nowhere without black voters. Will he accommodate black charter school parents?

Posted on by The Progressive Policy Institute
The National Education Association (NEA), the nation’s largest teachers’ union, endorsed Joe Biden for president over the weekend. Earlier the smaller American Federation of Teachers (AFT) hedged its bets by encouraging its members and affiliates to support and help Biden as well as Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.).

The NEA’s endorsement comes on the heels of last week’s “Big Tuesday” primaries in Idaho, Michigan, Missouri, Mississippi, North Dakota and Washington. For Biden, those felt like the grand finale to his Super Tuesday smash hit with African American voters, even outside the South. According to exit polls, 66 percent of black voters in all-important Michigan turned out for Biden. It confirms the intense loyalty to the Democratic Party that was on display the previous week, when more than 50 percent of black Democrats chose Biden in every southern state — and close to 40 percent did so in California and Massachusetts.

Collectively, black voters saved the Democrats from what previously seemed inevitable: Bernie Sanders’s nomination and a potential November blowout, not only against Trump but also down ballot.

It is high time, then, for Democrats to stop disrespecting millions of black voters on an issue important to them: Charter schools.

Read the full piece here.

A Bold Framework For Emergency Economics To Combat The Coronavirus Crisis

Posted on by The Progressive Policy Institute

The outbreak of COVID-19, caused by the novel coronavirus, has created a global market downturn and put the United States on track for its first recession since the 2008 financial crisis. Quarantines, social distancing, and other proactive measures that are necessary to contain the pandemic are already limiting commerce and disrupting global supply chains, essentially ensuring that the U.S. economy will contract for at least some period of time in 2020. Policymakers must adopt a combination of thoughtful public health and macroeconomic policy measures that will limit the damage caused by both this and future recessions.

Although Congress has already taken some strong first steps, much more will be needed. The Federal Reserve’s target interest rate has been reduced to zero percent, meaning it has already used its most potent tool for fighting a serious recession. But fortunately, low interest rates also make it cheaper than ever for Congress to borrow money to provide needed economic stimulus. This stimulus package must be aggressive enough to prevent an economic contagion that spirals into another financial crisis, or worse, a second great depression, but it should also be targeted towards those who are most in need and most likely to spend the money at a time when public health measures have slowed commerce to a crawl.

The best way to accomplish this goal is through the expansion of “automatic stabilizers” ­– policies that cause spending to rise or taxes to fall automatically when the economy contracts. These policies are more responsive to real economic needs because they are unconstrained by the political processes that often slow the passage of discretionary stimulus. Moreover, as the economy recovers, well-designed automatic stabilizers will actually reduce federal budget deficits and help pay back the debt that was used to finance stimulus. This structure prevents stimulus from being prematurely shut off (as it was following the 2008 financial crisis) and removes fiscal concerns as a political impediment to essential borrowing.

Read the full piece here.

PRESS RELEASE: PPI Publishes “Emergency Economics” Framework For Fighting a Recession in 2020 and Beyond

Posted on by The Progressive Policy Institute

WASHINGTON— Experts from the Progressive Policy Institute are calling on lawmakers to enact an aggressive stimulus package focused on strengthening automatic stabilizers and other measures that will not only help manage the coronavirus crisis, but also better prepare the United States for recessions that come after it.

“Congress must swiftly pass a stimulus package that is aggressive and fast-acting enough to prevent an economic contagion that spirals into another financial crisis, or worse, a second great depression,” said Ben Ritz, Director of PPI’s Center for Funding America’s Future. “Any action that experts reasonably conclude would materially help contain the virus or its economic damage should be undertaken swiftly no matter the price.”

“The automatic stabilizers detailed in our report offer the perfect tools for continually injecting stimulus into the economy so long as it is needed without being hamstrung by the political process. Strong automatic stabilizers will help avoid the mistakes Washington made following the 2008 financial crisis, when a misguided focus by Congressional Republicans on immediate rather than long-term deficit reduction undercut the recovery.

When the economy fully recovers and it comes time to get budget deficits back under control, these same policies will then drain any excess stimulus from our economy and use it to pay down our elevated debts, effectively removing fiscal concerns as an impediment to necessary borrowing today.”

Policy Options in PPI’s Emergency Economics Framework

Expand Unemployment Insurance

      • Permanently increase the number of weeks that states may pay out extended benefits during the most severe recessions.
      • Increase the share of lost income replaced by UI benefits during recessions.
      • Expand work-share programs, which compensate workers for reduced wages when their employers choose to cut back hours instead of laying off employees.

Support Vulnerable Americans

      • Automatically relax SNAP and TANF work requirements and increase funding during recessions.
      • Increase funding for programs that serve disadvantaged communities, such as AmeriCorps.
      • Send direct cash aid to all Americans when key indicators show the economy entering a recession.
      • Structure direct cash aid as a refundable tax credit so it can be reclaimed from high income households and/or those that experience no significant income loss.
      • Increase the progressivity of federal income taxes.
      • Enhance the Earned Income Tax Credit.

Provide Liquidity to Cash-Strapped People and Businesses

      • Offer low- or no-interest loans that enable otherwise financially healthy businesses to continue meeting their obligations for the duration of the crisis.
      • Allow borrowers to delay payment on federal student loans and federally insured or guaranteed mortgages for six months without accruing additional interest costs.
      • Encourage forbearance for residential rent and rent owed by small- and medium-sized businesses.
      • Allow businesses and individuals to claim stimulus-related tax incentives on their 2019 tax returns.
      • Delay the 2019 tax filing deadline and the collection of both employer-side payroll taxes and quarterly tax payments until the coronavirus outbreak has been contained.
      • Allow workers who qualified for refundable tax credits such as the EITC in 2019 to receive an advance rebate on their 2020 benefit.

Relieve Pressure on State and Local Governments

      • Automatically increase the federal share of Medicaid and other matching grants when a state enters a recession.
      • Create permanent accountability standards that enable states to better prepare for reporting requirements that created heavy compliance burdens during previous recessions.

Make Long-Term Investments in Recovery

      • Take advantage of low borrowing costs to invest in long-lasting public investments that would already be needed whether or not the economy is in recession.
      • Fund green infrastructure and energy research to help tackle climate change.
      • Automatically increase federal matching rates on infrastructure grants to states, particularly for maintenance and repair projects, when the state’s economy contracts.
      • Establish state-managed lists of “shovel ready” projects and fund them through reforms to the existing BUILD Program.

Cut Taxes on Consumption, Not Payrolls

      • Promote commerce by encouraging state and local government to temporarily cut or eliminate sales taxes, having the federal government replace lost revenue.
      • Allow states that don’t have sales taxes to create refundable tax credits for purchases made during the crisis, also funded by the federal government.
      • Suspend additional consumption taxes applied to industries most affected by the coronavirus, including airline ticket fees, hotel taxes, and taxes on prepared meals.
      • Reduce tariffs, which are consumption taxes on imported goods primarily consumed by low-income people.
      • Reject temporary payroll tax cuts, unless limited to the first $15,000 of a worker’s earnings or the earnings of workers whose production capabilities have been idled by the coronavirus.
      • Permanently replace payroll taxes with a dynamic value-added tax that has a rate which automatically falls during recessions and rises during expansions.

Embrace Fiscally Responsible Borrowing

      • Fund all interventions that experts reasonably conclude would materially help contain the coronavirus or its economic damage, no matter the cost.
      • Strengthen automatic stabilizers that provide needed stimulus in recessions and reduce budget deficits during expansions without being influenced by politics.
      • Implement structural fiscal reforms, such as those proposed in PPI’s Progressive Budget for Equitable Growth, to reduce long-term budget deficits after the economy has fully recovered.
Read the full report here.
Additional commentary about these recommendations on Forbes.com:
A Bold Framework For “Emergency Economics” To Combat The Coronavirus Crisis
How To Maximize The Benefit Of Universal Stimulus Checks
CONTACT: media@ppionline.org
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Emergency Economics: Fighting a Recession in 2020 and Beyond

Posted on by The Progressive Policy Institute

INTRODUCTION:

The outbreak of COVID-19, caused by the novel coronavirus, has created a global market downturn and put the United States on track for its first recession since the 2008 financial crisis. Quarantines, social distancing, and other proactive measures that are necessary to contain the pandemic are already limiting commerce and disrupting global supply chains, essentially ensuring that the U.S. economy will contract for at least some period of time in 2020.1 Policymakers must adopt a combination of thoughtful public health and macroeconomic policy measures that will limit the damage caused by both this and future recessions.

Congress has already taken two strong first steps. On March 6th, President Trump signed legislation that provided $8.3 billion in emergency funding for public health agencies and coronavirus vaccine research.2 Now the U.S. Senate is debating the Families First Coronavirus Response Act: a far more expansive bill carefully crafted by House Democrats to further bolster public health agencies and provide economic support to the people and businesses most likely to be harmed by the disease.3 This bill temporarily increases federal Medicaid and food-security spending, makes coronavirus testing available to patients free of charge, expands unemployment insurance benefits, mandates employees afflicted with the virus be given 14 days of paid sick leave, and creates a refundable tax credit to provide them with up to 12 weeks of additional paid medical leave, among many other things.4

Although these measures were a great start, much more will be needed. For example, the sick-leave mandate – which is essential for discouraging potentially infected employees from spreading the disease to their coworkers – covered just one fifth of workers after concessions were made to win Republican support.5 Many otherwise financially healthy businesses face the threat of going bankrupt as the crisis chokes off their cash flows, further increasing unemployment and perpetuating a vicious cycle of weakening demand.6 Millions of Americans may be unable to make their rent or mortgage payments, causing both homelessness and instability in the financial sector.

The Federal Reserve’s target interest rate has been reduced to zero percent, meaning it has already used its most potent tool for fighting a serious recession.7 But fortunately, low interest rates also make it cheaper than ever for Congress to borrow money to provide needed economic stimulus. Importantly, the current crisis is somewhat different than previous recessions in that most consumer spending will be constrained by limits on opportunities for commerce rather than a lack of money in their bank accounts. It is therefore more important than ever that stimulus money be targeted towards those who are most in need and most likely to spend. At the same time, a stimulus package must be aggressive enough to prevent an economic contagion that spirals into another financial crisis, or worse, a second great depression.

The best way to accomplish this goal is through the expansion of “automatic stabilizers” – policies that cause spending to rise or taxes to fall automatically when the economy contracts. These policies are more responsive to real economic needs because they are unconstrained by the political processes that often slow the passage of discretionary stimulus. Moreover, as the economy recovers, well-designed automatic stabilizers will actually reduce federal budget deficits and help pay back the debt that was used to finance stimulus.8 This proven structure prevents stimulus from being prematurely shut off (as it was following the 2008 financial crisis) and removes fiscal concerns as a political impediment to essential borrowing.9

This report provides a framework for new automatic stabilizers and other measures that will both combat the coronavirus recession and better prepare the United States for others that come after it. The Progressive Policy Institute recommends that policymakers prioritize giving relief to people who either lose their job or are already low-income, since both groups have a higher propensity to spend any money they receive than those who are economically secure. People and businesses should be given increased financial flexibility to inject liquidity into the market and prevent unnecessary bankruptcies during the crisis. The federal government should provide relief to cash-strapped state governments so that they are not forced to cut back their own spending and counteract federal stimulus. Finally, policymakers at all levels of government should cut taxes that discourage consumption, particularly those applied to industries hardest hit by the crisis.

READ THE FULL REPORT:

 

How To Maximize The Benefit Of Universal Stimulus Checks

Posted on by The Progressive Policy Institute

Thought leaders across the political spectrum are embracing a novel idea to manage the recession caused by the novel coronavirus: just send everyone cash.

Yesterday, Utah Sen. Mitt Romney proposed sending every American adult a check for $1000. Jason Furman, former Chair of the Council of Economic Advisors under President Obama, has proposed sending every American adult $1000 and every child $500, a proposal which former CEA Chair Greg Mankiw also endorsed. On the furthest end of the spectrum, former presidential candidate Andrew Yang has called for sending every American a check for $1000 each month until the coronavirus crisis ends.

Why are these proposals so popular among experts and politicians alike? In short, it’s because of their administrative simplicity. The bureaucracy required to create a new federal program can’t be built overnight, and the U.S. economy is already in the midst of a major crisis. The federal government needs to start pumping massive amounts of stimulus into the economy ASAP. Millions of Americans who are soon to be laid off or furloughed need cash, at least temporarily, to continue making their rent or mortgage payments – many cannot afford to waste time jumping through the usual hoops required to access many federal benefits, and the system may not even be prepared to process all qualified applicants in a timely manner during an economic crisis. A universal cash benefit ensures that nobody who needs financial support slips through the cracks.

Read the full piece here.

Vaccines, Risk, Disruptive Innovation, and Progress

Posted on by The Progressive Policy Institute

Is the coronavirus about to force us into the Biotech Century? Here’s a follow-up to my previous post.

In response to the coronavirus pandemic, government and private researchers are taking the perhaps unprecedented step of testing the safety of a new coronavirus vaccine in volunteers before testing its safety and efficacy in animals. As one researcher told STAT, a medical news publication:

“This is very unusual,” explained Akiko Iwasaki, a Yale University microbiologist who studies the immune response to viruses. “It reflects the urgency to develop vaccines to counter the Covid-19 pandemic.”

This experiment in accelerated science could fail in two ways. First, the vaccine could turn out to be unsafe or ineffective in the volunteers. That’s not at all unlikely. This particular vaccine is being developed by a new methodology from Moderna. Unfortunately, as the New York Times wrote, “no vaccine made with this technology has yet reached the market.”

The second way that the new vaccine could fail is that it could look safe and effective in clinical trials, be put into widespread use, and then show unforeseen side effects. That could be medically and scientifically devastating, and it can’t be ruled out either.  As STAT notes, medical ethicists are conflicted about the wisdom of accelerated science.

The upside, though, is potentially enormous. A vaccine against COVID-19, even one that is only partially effective, could spare millions of people from dying worldwide, while allowing the global economy to be reactivated.

This vaccine trial is not alone. Accelerated science is going on at all these tests of new coronavirus treatments and vaccines going on all around the globe. Academic researchers, companies and government regulators are willing to throw normal procedure aside because the stakes are so high.

As these tests proceed, we will also learn something important about progress and innovation.  As noted here, we’ve spent close to $2 trillion on biosciences research and development over the past 25 years,  and we haven’t gotten the payoff in better health or economic growth that we expected.

One possibility is that well-intentioned government regulation systematically impeded disruptive innovation in the biosciences, as I argued my 2014 essay “Hacking the Regulatory State” and my 2011 policy brief  on medical innovation. It wasn’t malicious, but as I wrote:

A disruptive innovation, as identified by Clayton Christensen, starts out as less capable than existing technologies, but as the innovation evolves, it gets both cheaper and more powerful.

The first automobiles, for example, were both more expensive and less reliable than a horse. Similarly, the first personal computers were basically toys compared to the existing minicomputers and mainframes. But they got better and cheaper over time.

From that perspective, it’s clear that a government regulatory body with “too-high standards” can have the effect of choking off innovation. Imagine how the history of computing would have been different if Steve Jobs and Steve Wozniak had to prove that the Apple I could meet government performance standards before it could be sold.

FDA standards require both safety and efficacy, meaning that the drug or medical device have to perform better or at a minimum just as well as existing alternatives.

It’s important to note that the first personal computers would not have met FDA-type efficacy standards, and neither would have the first cell phones.  When cell phones were first introduced in the 1980s, they were bulky, heavy devices which retailed for $4000, provided terrible reception and could barely fit in a briefcase, much less a pocket.  By any measure, they were inferior in phone quality to existing wireline services. Today, most people have given up their wirelines in favor of mobile devices.

Under ordinary circumstances, it makes sense to apply tighter standards to medical innovation than to IT innovation. Under ordinary circumstances, people want assurances that a new drug or medical device is safe, and will work at least as well as the alternative.

These are not ordinary circumstances. The tragedy of the coronavirus pandemic is forcing us to try things and make decisions that we would never do in the normal course of affairs.  We are in uncharted territory, and there are no guarantees. We could learn that the regulators were right, and disruptive innovation is the wrong model for medical science. Or we could learn that medical science has advanced far enough to produce vaccines and treatments for new diseases in far less time than normal.  And that would be the dawn of the Biotech Century.

 

 

The Biotech Century Faces a Biological Menace: What We Need to Do Now

Posted on by The Progressive Policy Institute

Can we expect the biopharma folks to quickly find a good treatment for COVID-19? Is it time to bust up regulatory barriers holding back innovation?

In March 1997, BusinessWeek magazine, now part of Bloomberg,  ran a cover story entitled “The Biotech Century.” The cover language, in part, said “Thanks to fundamental advances in genetics, biology will define scientific progress in the 21st century.”

Bloomberg BusinessWeek, March 1997 cover story

In the subsequent 23 years, biological scientists have achieved notable scientific triumphs, including the sequencing of the human genome. HIV was tamed, HepB has been cured, and gene therapies are slowly coming onto the market. Since that cover, the private and public sectors have spent probably close to $2 trillion on health-related research and development,  a truly astonishing sum.

Nevertheless, the acknowledged innovation leaders in the 21st Century have been info-tech companies like Google, Apple, and Amazon. Pharma companies like Pfizer, Gilead, and Roche have done well, both in terms of beneficial new drugs and business success. But they haven’t captured the popular imagination like the tech firms.

Unfortunately, that’s fair.  Tech applications have gotten cheaper and faster across the board. Meanwhile, bio science has moved really fast, but market applications of the new science have been much slower. Moreover, the promises of faster, cheaper, more targeted drug development seem to have fallen short. Instead, drug development has been getting more expensive and riskier.

There’s no agreement, though, on why the scientific advances have not translated into lower costs and faster drug development. There are three leading hypotheses, not mutually exclusive. First, the intricacies of medicine could be a lot harder and more complicated than scientists thought.  Second, regulatory barriers in bio could be slowing down innovation. Third, the profit motive could be diverting biopharma firms from truly important R&D.

Now the moment of truth for bio has arrived, along with a global pandemic that rages out of control. Tech companies can be helpful in maintaining the infotech infrastructure that allows the essential social distancing. But the real innovative responses have to be carried out by the university labs, the biopharma companies, and hospital researchers.

Some of that has started. Roche and Thermo Fisher have developed new faster tests for coronavirus, which received emergency clearance from the FDA. Companies such as Gilead and Regeneron are developing and testing new treatments at a breakneck pace. And vaccines are going through their initial round of tests.

But it’s not enough.  What we can do to help: Make it clear that innovation and new ideas are encouraged, even risky ones. Legitimate researchers with new tests and new solutions should be encouraged.  And unnecessary regulatory barriers that slow down drug and vaccine development should be temporarily thrust aside.  This is not a time for business as usual.

 

 

 

C-SPAN: Tony Blair on Progressive Politics and Transatlantic Relations at PPI

Posted on by The Progressive Policy Institute

“Former British Prime Minister Tony Blair sat down for a discussion at the George Washington University in Washington, DC, with the president and founder of the Progressive Policy Institute, Will Marshall. They discussed several topics, including the rise of populism in the U.K. and the U.S., Brexit, the impact of the coronavirus, the future of progressive politics, and how the technological revolution will change the world.”

Watch the full program here.

A Rare Note of Good News–Or, Why the US Isn’t Italy

Posted on by The Progressive Policy Institute

In recent years I have repeatedly demonstrated that the cost of labor is the main driving force behind rising health care costs in the U.S. ( for example, here). The US health care workforce has grown far faster than the population, even adjusting for aging.  Meanwhile cost control efforts have focused on areas like pharmaceuticals and the number of hospital beds, so that the number of hospital beds per person have been steadily declining even as the population has aged.

These two divergent trends define the nature of our current situation. Take a look at the two charts below.

When it comes to nurses per 1000 population, the U.S. compared well with most of its OECD peers. The healthcare system is doing okay in terms of human capacity–that’s what we have been spending money on. Other OECD figures show the same trends.

But when it comes to hospital beds, we are at the low end, having been squeezing out beds as a cost savings move.

These charts also explain why Italy is being hit so hard, and why Germany is relatively unworried.  Italy is weak on both nurses and beds compared to its European neighbors.  Meanwhile, Germany is strong on both nurses and beds.

More to come.

 

 

$300 Billion in Investment by Tech and Broadband Companies Over the Past Two Years Has Created a Strong Digital Infrastructure

Posted on by The Progressive Policy Institute

It turns out that the digital infrastructure was far more ready for disaster than the health infrastructure. Led by Google, AT&T, and Amazon, the top ten American tech and broadband companies have spent over $300 billion in capital investment in the past two years (the rest of the top ten, in alphabetical order, includes Apple, Charter, Comcast, Facebook, Intel, Microsoft, and Verizon).  These companies have been building data centers,expanding wired and wireless networks, constructing ecommerce fulfillment centers, and otherwise. And it’s a good thing they did, as the coronavirus crisis forces millions of Americans to move their entire lives online.

Note: These are the top ten tech and broadband providers in our latest Investment Heroes report. However, this number represents all capital expenditures by these companies, both U.S. and foreign. As such, it is not directly comparable to the domestic capital spending numbers presented in our Investment Heroes report.

 

 

House Democrats Have The Right Coronavirus Response

Posted on by The Progressive Policy Institute

The outbreak of COVID-19 (commonly known as coronavirus) has created a global market downturn and raised the prospect that the United States could enter its first recession since the 2008 financial crisis. Last night, President Donald Trump and U.S. House Speaker Nancy Pelosi offered two competing approaches for securing both the health and economic security of the American people. While the president’s proposals would arguably do more harm than good, Speaker Pelosi and House Democrats should be commended for swiftly developing a comprehensive and serious plan to effectively tackle the crisis.

During the last recession, Speaker Pelosi passed a stimulus bill that used a combination of deficit-financed tax cuts and government spending increases to boost the economy. With interest rates on government debt now below projected inflation, many are calling for her to now take similar action. The problem is that commerce is currently being constrained by proactive measures people are taking to limit the spread of a pandemic, not a lack of money in consumers’ pockets. Additionally, the coronavirus has disrupted global supply chains, which no amount of demand-side stimulus can alleviate in the short term. A unique economic problem requires a unique solution.

Read the full piece on Forbes.

The EARN IT Act Is the Wrong Answer to the Right Problem

Posted on by The Progressive Policy Institute

Senators Graham, Blumenthal, Hawley, Feinstein introduced the EARN IT Act last week and the Senate Judiciary Committee held a hearing on the bill this morning. The goal of the EARN IT Act is to “encourage the tech industry to take online child sexual exploitation seriously.” The senators have identified a real problem that needs to be addressed at the policy level. Stopping the distribution of child sexual abuse material (CSAM) and child sexual exploitation (CSE) content should be a top priorirty for both law enforcement officials and technology companies. Without close cooperation between these two stakeholders, ending the scourge of abusive and exploitative material will be impossible. 

It is also important to keep in mind the tough position platform providers are in when it comes to policing user-generated content (UGC) and private communications. Technology companies must strike a difficult balance between false positives (i.e., taking down and reporting content that is not actually CSAM) and false negatives (i.e., leaving up and not reporting dangerous or harmful content). The former restricts users’ privacy and their ability to express themselves while the latter risks harming vulnerable populations. Given these considerations, new legislation in this area must be carefully considered.

The bill makes Section 230 immunity conditional on interactive computer service (ICS) providers affirmatively certifying that they are in compliance with “best practices” as determined by a newly-created National Commission on Online Child Exploitation Prevention. While its intent is hard to argue with, the EARN IT Act would fail to achieve its goal of protecting children online due to its flawed approach. At the same time, the law would cripple innovative business models and centralize power in the attorney general’s office. Many observers have noted that Attorney General William Barr has been pushing for these powers for some time now and critics say the bill is “effectively a backdoor to a backdoor” on encryption. If that’s really what this law is about, then the co-sponsors should be explicit about it and allow for public discussion about the costs and benefits of encryption.

Furthermore, conditioning Section 230 immunity on following a vague “best practices” standard would constitute a de facto mandate on the tech industry and therefore violate the spirit of the Fourth Amendment. Section 230 immunity is so essential to the viability of business models involving user-generated content (UGC) that any conditions put on that protection are not optional for ICS providers in any practical sense. Large companies will endure billions of dollars in compliance cost and tolerate extremely high rates of false positives in order to meet whatever best practices the Commission dictates. Many startups simply won’t allow user-generated content at all. The suggested best practices will in fact be requirements for companies that host any UGC.

In addition, lowering the standard of evidence for violating 18 U.S. Code § 2252 (“Certain activities relating to material involving the sexual exploitation of minors”) from needing to show “actual knowledge” of CSAM/CSE material to only “recklessness” would make the new legal liability too broad. Depending on how the courts and enforcement officials interpret “recklessness,” ICS providers could be held liable for being innovative in how they approach policing and reporting CSAM content on their platforms (if they do not also narrowly meet the required best practices set forth by the Commission). Attempts by ICS providers to protect user privacy might also conflict with some of these yet-to-be-determined guidelines.

A real solution to the CSAM/CSE problem would be for Congress to approve the full funding that it had previously authorized for state and regional investigations. According to DOJ data, “Annual funding for state and regional investigations was authorized at $60 million, but only about half of that is regularly approved.” 

Source: NYT

Under-resourcing of agencies and under-commitment to fixing this issue has been an increasing problem in recent years. The Trump Administration reappropriated funding from the Department of Homeland Security’s cybercrime budget for immigration enforcement. The DOJ has failed to produce three of the five biennial reports on CSAM/CSE since it was first required to do so by Congress in 2008. It is unclear what passing new legislation would accomplish if law enforcement already doesn’t have the resources to respond to the increasing number of CSAM/CSE reports. The EARN IT Act is far too flawed to move forward in its current state and legislators have much more pressing priorities at the moment given the ongoing public health emergency and unfolding economic crisis.

Helping Older Americans: The Role of Point-of-Sale Rebates

Posted on by The Progressive Policy Institute

This paper discusses possible solutions to the problem of excess out-of-pocket drug costs. We argue that allowing consumers to receive drug rebates directly at the “point-of-sale,” rather than indirectly and opaquely through insurers and pharmacy benefit managers, will help make the healthcare system simpler and fairer.

Like clockwork, Congress holds hearings featuring Americans, both young and old, who are being hit hard by sky-high out-of-pocket drug costs. Surveys uniformly show that pharmaceutical companies are hugely distrusted. Many Americans regard drug costs as one of their biggest problems.

Even while politicians fume about the high prices of prescription drugs, solid statistics derived from multiple reliable sources show that out-of-pocket spending on prescription drugs as a share of household disposable income has fallen to a record low of only 0.3% (see Figure 1). By comparison, in 2005 out-of-pocket spending on prescription drugs was almost 0.6% of household disposable income, almost twice as much.

Nevertheless, some Americans find themselves with astronomical spending on drugs. We analyzed 2017 Medical Expenditure Panel Survey (MEPS) survey data on out-of-pocket prescription drug spending. Our results show that about 1% of Americans each year pay more than $2000 per year in out-of-pocket drug costs. That’s more than ten times the average, and a level that is clearly unacceptable.

[gview file=”https://www.progressivepolicy.org/wp-content/uploads/2020/03/PPI_HelpingOlderAmericans_V6-1.pdf” title=”PPI_HelpingOlderAmericans_V6 (1)”]

Good Politics and Good Policy: Why Progressives Should Support A “Flexible” Domestic Manufacturing Initiative

Posted on by The Progressive Policy Institute

It’s the S-word–shortages. The greatest manufacturing nation in the world, but we can’t make enough masks and other protective gear for our frontline healthcare workers? The coronavirus crisis points out what many of us already knew–globalization is not enough to provide the flexibility and surge response that the U.S. needs. Apparently in medical emergencies,  countries do what you would expect–cut off exports and keep supplies of critical medical equipment for their own people. And it’s not just China–France and Germany are also restricting exports of medical supplies.

Medical supplies are just the tip of the iceberg here. As has become clear, the U.S. needs a more flexible and diverse manufacturing sector, able to pivot when needed and quickly handle surges in demand and shortfalls in supply. Strategic inventories are all well and good, but you can never predict exactly what is going to happen, whether it’s an environmental disaster or the unfortunate specter of war.

As I wrote in a new column in Forbes, the coronavirus epidemic “has illustrated the fragility of global supply chains, and the potential problems with having too much global production concentrated in China. In February, for example, Coca-Cola, for example, warned of possible disruptions in the supply of sweeteners coming from China. Other industries, from steel to pharmaceuticals, face similar potential problems.”

But we don’t need investment in conventional factories,  which in ordinary times can’t compete. What’s needed is a sustained push for digital manufacturing, which is potentially far more flexible than conventional manufacturing. It’s like the difference between a point-to-point telephone system and an Internet built on general purpose routers and processing node.  The conventional telephone system, built on copper wires, worked very well for making voice calls, but was hard to reposition for other uses.  The Internet can not only handle voice calls, but excels at all sorts of new tasks.

Luckily, here’s one case where good policy is good politics. PPI recently released a new poll conducted by Pete Brodnitz. The poll surveyed 1500 registered voters in Michigan, Pennsylvania and Wisconsin in early-to-mid February, three swing states that will be critical for the 2020 presidential election in November.

The poll showed that  73% of the respondents in these three states favored a federal role in promoting manufacturing-related jobs in the United States, an overwhelming majority. Moreover, the support was stronger among Republicans and independents than among Democrats. Such a program could be crucial in a tight race.

We’re not talking about a conventional industrial policy that picks winners and losers.  Rather, progressives should support the development of a flexible digital manufacturing sector that can quickly adapt to changing circumstances, whether it’s a medical emergency, an unexpected growth in demand for electric vehicles, or political hostilities.  The program would provide short-run demand stimulus to keep people working, medium-term incentives for digital investment (which we wrote about here), and a long-term research program for flexible digital manufacturing processes. Good policy–and good politics.

 

 

 

 

 

 

 

 

 

 

Bledsoe for The Hill: “Biden must first unite the party to defeat Trump”

Posted on by The Progressive Policy Institute

While Super Tuesday’s dramatic results have boosted former Vice President Joe Biden more than anyone predicted, it’s still not enough, not yet. Nothing less than Biden going into the convention in Milwaukee with a sizable majority will convince most supporters of Sen. Bernie Sanders (I-Vt.) to rally around “Uncle Joe” as the nominee.

Fortunately, Biden’s current 70-delegate lead is certain to grow, since he will likely win by large margins — 30 points or more — in the South, giving him huge net delegate gains in Louisiana, Mississippi, Georgia, Florida, and other states. Even if Sanders wins a few primaries, it will be by very narrow margins, so he will gain only a few net delegates more than Biden in those contests, and likely never catch up.

Still, healing the rift between centrist and far-left Democrats is important to driving Biden’s turnout in the fall — and will not be that easy. After all, Sanders is a Democratic Socialist who has made it clear for many years that he believes he is leading a cause — a movement — rather than just a campaign. On the stump, Sanders is sounding increasingly paranoid, railing against the “political establishment… coming together, and they will do anything and everything” to stop him, he says.

Read the full op-ed here.