Is the 340B Discount Drug Program Working?

Letter to The WSJ.

"Your editorial “The Great 340B Healthcare Grift” (May 8) highlights a program that has strayed far from its original mission. While drug therapies are essential to cancer care, access to these medications is increasingly entangled in the 340B discount drug program—an initiative in desperate need of reform.

The American Society of Clinical Oncology recently published a policy statement detailing how to make the program more transparent and accountable. Essential reforms include requiring participating entities to meet select federal nonprofit charity care standards and implementing strict rules to ensure savings are used for direct patient care rather than unrelated hospital acquisitions or construction projects. Transparent financial reporting should demonstrate measurable improvements in care for underserved areas, backed by financial penalties for noncompliance.

Reform must also allow community-based nonhospital providers, which form the backbone of oncology in rural and underserved areas, to participate if they meet established thresholds for treating Medicaid and uninsured patients.

The 340B program is so embedded in our healthcare system that complete elimination risks harm to vulnerable patients. Instead, oncologists and policymakers must reform it.

Clifford Hudis, M.D., FASCO, FACP

American Society of Clinical Oncology

Alexandria, Va."

The World’s Most Surprising Capitalist Makeover Is Under Way in Sweden

The shake-up of cradle-to-grave care is lowering government spending, spurring innovation and stirring fears about those left behind

By Tom Fairless of The WSJ. Excerpts:

"nearly half of primary healthcare clinics are privately owned"

"One in three public high schools is privately run"

"The capitalist makeover has allowed Sweden to . . . shrink the size of the state. That has enabled the government to sharply lower taxes and . . . sparked a surge in entrepreneurship and economic growth."

"Its total public social spending bill . . . has fallen to 24% of gross domestic product, similar to the U.S. and well below the over 30% for nations like France and Italy."

"Sweden’s economy is expected to grow by around 2% a year through 2030, roughly the same pace as the U.S. and double the growth rates of France and Germany"

"Sweden didn’t always have a big public sector. The country climbed from being one of the poorest to the third-richest country in Europe over 100 years through 1970 without high levels of taxation. 

But starting in the 1960s, the center-left Social Democratic Party—which dominated the country’s postwar politics—sharply raised taxes and spending, ultimately taking government spending as high as 70% of GDP by the 1990s. 

The changes triggered a long period of weak growth, stagnant after-tax incomes and ballooning budget deficits and debt that culminated in a banking crisis in the early ’90s."

"the government instituted sweeping economic reforms over the next two decades. They included cuts to unemployment benefits and housing subsidies and the privatization of public services, as well as tax cuts and a reform of the pension system to make it more affordable. Strict limits were imposed on government debt. (Sweden’s debt to GDP is a meager 36%, compared with 129% for the U.S.) In the mid-2000s, the government eliminated wealth and inheritance taxes."

"Wealthy entrepreneurs who had fled Sweden’s high taxes have been returning"

"The country saw more than 500 initial public offerings over the 10 years through 2024, more than Germany, France, the Netherlands and Spain combined"

"It has now moved ahead of the U.S. in the number of billionaires per capita"

"healthcare spending per capita in Sweden grew around 1% a year on average between 2014 and 2024 after adjusting for inflation—roughly half the pace in the U.K. and a third of the pace in the U.S."

"Stefan Fölster, an economist and former Finance Ministry official, argues that the vast majority of Swedes have benefited from the reforms. Households’ inflation-adjusted incomes have doubled on average since the 1990s, after stagnating during the 1970s and ’80s under high taxation, Fölster noted."

"Sweden has recently fallen down international education rankings, a shift that proponents of free schools attribute to high levels of immigration." 

Mass Transit in the Sky: How Air Travel Went from Elite to Affordable

The golden age of airline service was also an era of restriction and high prices. From deregulation to the downfall of no-frills Spirit, competition exposes what travelers are truly willing to pay for. 

By Donald J. Boudreaux. Excerpt:

"Prior to deregulation that began in the late 1970s, interstate commercial air travel was governed by the 1938 Civil Aeronautics Act. With that legislation, the federal government restricted entry into the industry. It also established and assigned interstate routes, and regulated the fares that airlines charged passengers for seats on planes that flew those routes. This regulation was meant to ensure airline profitability and, thus, aimed to restrict competition among the airlines. On interstate routes, airlines could not compete for customers by lowering prices, which were set by the Civil Aeronautics Authority, later to become the Civil Aeronautics Board (CAB).

The airlines in the mid-20th century did indeed profit from the government’s regulatory efforts on their behalf. Nevertheless, even the government cannot prevent competition; its interventions can only divert competition into other channels that are less beneficial for consumers.

Unable to compete by lowering fares, airlines competed on the customer-service front. Compared to today, the standard coach seat during the era of regulation had more legroom. Full meals were common. As opposed to today’s use of the hub-and-spoke system, direct flights were the norm. (Although this costly feature was required by the regulators, it likely would have been commonplace even without being mandated.) And flight attendants were overwhelmingly young and attractive single women. Forced to pay high prices to fly, at least customers got something in return for the additional dollars the regulators obliged them to fork over for the privilege of flying.

Deregulation of fares allowed market experimentation to discover how better to serve airline passengers. Airfares fell dramatically, which seems necessarily to be an obvious benefit for consumers. But we know this fall in airfares to be a benefit to consumers only because it happened in a more-competitive market. Obviously, consumers would love to pay the lower fares while still having more legroom, more direct flights, and full meals with free booze in coach class served by attractive and charming flight attendants.

These nice amenities aren’t free, however. They must be paid for. If the flying public had valued those regulation-era amenities enough to continue paying regulation-era airfares, airlines would have been happy to continue to supply those amenities at those high fares. But the public spoke with its purse: competition revealed that most air passengers prefer to pay lower prices, even if doing so means fewer amenities, than to pay higher prices in exchange for the many amenities. (The relatively few customers with different preferences choose to upgrade to seats in ‘economy plus’ or in first class.)

Flying today is much less costly, in real terms, than it was before airlines were deregulated. (And, by the way, deregulation did nothing to slow the improvement in airline safety.) As such, the commercial-aviation experience today — unlike when I was a boy and young man — is commonplace and hardly luxurious (adjusting for the reality that, nevertheless, when in an airplane you are flying through the air while seated in a chair, an experience that everyone before the twentieth century would have regarded as miraculous). Even for a working-class American family today, going to the airport simply to behold a relative boarding an airplane is as unimaginable as going to a local bus stop simply to behold that same relative boarding a bus.

It’s worth noting that competition also reveals the limits to consumers’ tolerance for sacrificing amenities for lower fares. Spirit Airlines’ business model was to eliminate as many as possible ‘free’ amenities, stripping the base ticket price down and charging separately for virtually everything else, including carry-on bags, seat selection, snacks, even water. Spirit also offered infamously little legroom.

Because ‘optimal’ market outcomes cannot be divined in the abstract — because these outcomes can only be discovered through competitive market processes in which entrepreneurs are free to experiment — it was a good idea to run this experiment. As it happens, though, too few consumers were willing to pay even low fares for that level of minimal amenities. Spirit was on the verge of bankruptcy well before the price of aviation fuel was sent soaring by the war in Iran, which is why JetBlue in 2022 offered to merge with Spirit – a move that would have enabled JetBlue to obtain Spirit’s equipment and landing slots.

In a monumental feat of economic ignorance, the Biden administration sued to block the merger on the grounds that it would reduce competition and raise fares. Spirit has now gone forever to the economic spirit world.

Here’s the view from 30,000 feet. When producers are allowed to compete on all margins, including price, they discover the optimal mix of prices and amenities that best satisfy their customers. When governments obstruct that competition, it gets redirected into changing the quality of goods and services such that the resulting price-quality mixes are less desirable than would be the mixes that emerge without government intervention.

After airlines were deregulated almost 50 years ago, consumers revealed that they wanted lower prices with less quality. And by more recently rejecting the bare service offered by Spirit Airlines, consumers revealed that quality can be so low that even very low prices are insufficient compensation to put up with such low quality. These results emerged from competitive market processes and deserve respect. But alas, just as airline regulation forced American air passengers to buy what they would have preferred not to buy, the government’s continuing itch to override market processes will oblige consumers in the future — whenever such interventions occur — to suffer worse economic outcomes."

Cato Immigration Studies Director David J. Bier Testifies Before the House Judiciary Committee

Click here.

"Chairman McClintock, Ranking Member Jayapal, and distinguished members of the subcommittee, thank you for the opportunity to testify.

For half a century, the Cato Institute’s research has shown that people—whatever their ancestry, background, or birthplace—can thrive in a free society.

Our research finds immigrants—legal and illegal—work at higher rates, generate more income and taxes, and have reduced the national debt by $14.5 trillion over the last 30 years.

Immigrants improve public safety by reducing violent crime rates, meaning that you are less likely to be a victim.

Fairfax highlights this reality. About half the county’s residents are immigrants or children of immigrants.

Its household income is double the national average, and its murder rate is less than half the average.

If illegal immigrants in Fairfax were their own city, they’d have a lower homicide rate than 90 percent of America’s largest cities and the country overall.

Nationwide, illegal immigrants are half as likely to commit crimes that land them in prison as US-born Americans.

Despite all this, Congress refuses to allow most would-be immigrants to come legally, which leads to illegal immigration.

Just 3% of applicants seeking legal permanent resident status were approved in 2024.

That was before the current administration banned a majority of the legal immigrants previously allowed to come, including half of all spouses of US citizens.

It has cut legal immigration twice as much as illegal immigration.

At the same time, it terminated legal status for over 2 million immigrants who were already here, creating four times as many new illegal immigrants as it has deported.

America’s cities must manage the fallout from this sabotaged system. Many have decided not to volunteer their cops, jails, and resources to DHS.

DHS doesn’t like that, but under our Constitution, cities and states don’t take orders from the feds.

And thank James Madison for that because we all know we wouldn’t want the Feds to dictate environmental policy, gun policy, or COVID policy to the states.

If you want Fairfax to change its policy, you must convince them.

The first step would be to give up the mass deportation dream.

About one in five Fairfax residents is someone who could be deported or who lives with them.

It would destroy neighborhoods, rip Americans from their spouses, parents, friends, families, customers, employees, employers, nurses, nannies, and teachers.

Let me be clear: Noncitizens who harm Americans should be arrested, convicted, and deported.

I think cities can help with that, but deportation is DHS’s job.

Indeed, you all passed the Laken Riley Act in 2025 to require DHS to immediately take custody of people charged with violence or theft.

Yet DHS is ignoring that law. It has deprioritized threats to focus on easy targets.

They aren’t tracking down serious criminal fugitives like the monster who killed Stephanie Minter.

Instead, DHS agents are racially profiling Americans at Home Depots, arresting spouses of US citizens at green card interviews, beating the parents of US Marines, and dragging legal immigrant nursing mothers from their homes without warrants.

Only 6% of ICE arrests have a violent criminal conviction. ICE has arrested 150,000 people who have no criminal convictions or even charges.

And we know it’s not because they got everyone with a serious record. Stephanie’s case and many others prove it.

It’s because they care about, as one ICE agent put it, “quantity over quality.”

How many Stephanies will get murdered before DHS follows the law and prioritizes serious criminals?

How many?

Most Americans don’t want to wait for the answer. They want to pause the mass deportation fantasy and focus on protecting Americans.

That’s the only policy that will defend our safety, prosperity, and freedom.

Thank you."

Raising an extra dollar of business income tax revenue costs the Ontario economy $1.66

By Ergete Ferede, Professor of Economics at MacEwan University. From The Fraser Institute.

How Costly Are Corporate Income Taxes in the Short Run?

• Corporate income tax (CIT) is an important source of revenue for Canadian provinces, and governments often increase CIT rates to address budgetary pressures.
• Higher CIT rates can reduce productivity and discourage investment and business activity, creating broader economic costs beyond the revenue generated. The marginal cost of public funds (MCPF) helps assess these trade-offs by measuring the economic cost of generating an additional dollar of tax revenue.
• This study estimates the short-run MCPF for provincial CIT in four major provinces: British Columbia, Alberta, Ontario, and Quebec. The analysis first focuses on investigating how sensitive the CIT base is to changes in tax rates.
• Results show that a one percentage-point increase in the CIT rate reduces the tax base by 4.82% in British Columbia, 4.00% in Alberta, 3.47% in Ontario, and 3.10% in Quebec.
• Using these estimates, the study then computes the short-run MCPF as follows: 2.37 for British Columbia, 1.47 for Alberta, 1.66 for Ontario, and 1.55 for Quebec. This suggests that raising one additional dollar of CIT revenue costs the economy $2.37 in British Columbia, $1.47 in Alberta, $1.66 in Ontario, and $1.55 in Quebec. The results highlight significant differences across provinces, with British Columbia facing the highest economic cost.
• A key policy message is that a higher CIT rate can be an inefficient way to raise revenue. Policy makers should weigh these economic costs against fiscal needs and long‑term goals such as improving investment, productivity, and growth. Greater reliance on less distortionary taxes may reduce economic costs while supporting fiscal sustainability.

The Failed Promise of Housing First

Housing First has failed to improve health outcomes, or save taxpayer money, but has significantly increased public expenditures for the homeless

By Christopher J. Calton of The Independent Institute. 

"In October, the San Francisco Chronicle shared the story of Austin Draper, a homeless fentanyl addict who has been hospitalized several times for endocarditis, a heart condition that is often caused by intravenous drug use. Only 35 years old, Draper has already undergone open-heart surgery to install a pacemaker. “The cost of his [medical] care likely exceeds $1 million,” the Chronicle reports, “though Austin, who is on Medi-Cal, hasn’t paid anything.”

Draper is a beneficiary of California’s Housing First policy for homelessness. He was placed in permanent-supportive housing, which indefinitely subsidizes his rent and imposes no constraints on his drug use. Although he is no longer living on the streets, his addiction continues to land him in the hospital, always at the taxpayer’s expense.

Ironically, Draper’s tragedy is reminiscent of a New Yorker article titled “Million-Dollar Murray,” written by Malcom Gladwell in 2006 to promote Housing First. Murray Barr was a chronically homeless alcoholic whose addiction repeatedly landed him in the hospital, leaving taxpayers on the hook for more than $1 million in medical bills. “It would probably have been cheaper to give him a full-time nurse and his own apartment,” Gladwell argued.

Gladwell sold the idea that Housing First would not only reduce chronic homelessness, but the cost of placing people in permanent-supportive housing would be offset by savings on medical costs and other services. Twenty years later, Austin Draper’s story suggests that subsidized housing would likely have done nothing to ameliorate Murray Barr’s underlying problems.

An extensive 2018 study, in fact, found that with the exception of HIV/AIDS patients, permanent-supportive housing failed to produce any discernible changes in health outcomes or healthcare costs. Nonetheless, the authors assert that stable housing generally improves health outcomes because it “provides a platform from which other physical, mental, and social concerns can begin to be addressed.”

This idea, known as “Platform Theory,” is common among Housing First apologists, but its logic crumbles in the context of Housing First. A failure to adequately address mental illness and substance abuse is what landed many chronically homeless persons on the streets to begin with, so it hardly stands to reason that housing alone will provide the impetus for them to finally seek the care they need.

As Draper illustrates, permanent-supportive housing residents rarely pursue treatment without direct intervention. He knows that substance abuse is the source of his medical woes, but he continues to refuse recovery services, as is his prerogative under Housing First guidelines. His city’s devotion to platform theory has produced disastrous outcomes, with 30 percent of San Francisco’s overdose deaths occurring in permanent-supportive housing.

Contrary to Gladwell’s expectations, Housing First has failed to improve health outcomes or save taxpayer money. Instead, it has significantly increased public expenditures for the homeless. California’s Legislative Analyst’s Office recently reported that the state has spent more than $37 billion on housing and homelessness programs over the past five years. Of course, people might gladly accept Housing First’s high price tag if it fulfilled its promise of reducing chronic homelessness. Yet in California, the chronically homeless population has ballooned from less than 49,000 in 2020 to more than 66,000 in 2025.

Gladwell’s main point in “Million-Dollar Murray” was that most people who experience homelessness do so only briefly, while the chronically homeless minority consume the lion’s share of resources. Under Housing First, the formula has changed. Today, the bulk of homelessness spending goes to permanent-supportive housing, whose residents are no longer counted as homeless.

San Francisco alone spends three-quarters of a billion dollars per year fighting homelessness, but 60 percent of the budget goes to people like Austin Draper. In other words, the city’s 13,000 permanent housing beds draw resources away from the more than 8,000 people still living on the streets, rendering homelessness more common and more chronic.

If Million-Dollar Murray represented the promises of Housing First, Million-Dollar Draper reflects its failures."

How Much Has Shale Gas Saved U.S. Consumers?

By Alex Tabarrok.

"Every US president since Nixon has called for freeing the US from ‘dependence on foreign oil’ (within ten years!). Every president has failed. Fracking, however, has delivered the goods. Fracking has reduced the price of energy, reduced net emissions of greenhouse gases and turned the US into an energy exporter.

In How Much Has Shale Gas Saved U.S. Consumers? Lucas Davis compare LNG prices in the US ($5.3 Mcf), Europe ($14.4 Mcf) and Japan ($16.1 Mcf) to offer some plausible back of the envelope calculations:

Advances in hydraulic fracturing and horizontal drilling caused U.S. natural gas production to increase significantly, and the U.S. went from being a net importer of natural gas to being the world’s largest exporter. This paper calculates how much shale gas has saved U.S. natural gas consumers. Using price differences between the United States, Europe and Japan, we calculate that U.S. natural gas consumers have saved $4.5-$5.3 trillion between 2007 and 2025, equivalent to $237-$276 billion annually. Access to low-price U.S. natural gas has been particularly valuable during major supply shocks such as the war in Ukraine, and the benefits of shale gas have been experienced broadly across sectors and states."