If your jaw dropped while looking at the Washington Post part of the graphic above, let's be precise: 192 Republicans voted against the Infant Formula Supplemental Appropriations Act; only 12 voted for it-- half of whom are retiring and have no fear of McCarthy's ire at their decision to do the right thing for their own constituents and ignore the GOP sabotage against anything they deem could help Biden... Pretty sadistic, don't you think? Do voters even pay enough attention to realize? Nope... But J.D. Scholten wants to make sure voters in the Sioux City, Iowa see what's going on with this kind of chicanery.
Yesterday, we looked at how lax posture towards anti-trust regulation has contributed to inflation. That reminded me of a newsletter Scholten wrote and sent me last week: "America has a monopoly problem." JD is a candidate for the Iowa House of Representatives in an open Democratic leaning district that encompasses western Woodbury County and part of Sioux City, where he lives. "What the baby formula shortage says about the state of the American economy," is how he teased the newsletter. He wrote that "It’s been well documented that there is a baby formula shortage here in the U.S. Republicans in Congress are quick to blame the Biden administration for this issue, whether it’s by social media or even a press conference… Here’s the reality:"
America has a Monopoly problem. In the baby formula market, 3 companies (Abbott, Mead Johnson and Nestle) produce 98% of the U.S. supply. This means that if one factory goes down, it can disrupt the entire market. This is not anything new. In fact, journalist David Dayen reported on this back in 2018.
If you’re one of these Members of Congress pointing fingers and you’re not addressing the consolidation issue or that we don’t enforce our antitrust laws enough, you’re not solving anything and it’s only a matter of time until this happens again.
Part of the issue is that the FDA found an Abbott baby formula plant in Sturgis, Michigan produced contaminated formula that caused four infants to become ill and tested positive for a bacteria and two of them died. The product was recalled in February and the plant was shutdown.
Another part of the issue is that former President Trump imposed restrictions on imports of formula from Canada as part of the NAFTA re-negotiations that turned into USMCA. Which means that 98% of the formula consumed in the U.S. is made domestically. But when we don’t have much flexibility, we become extremely vulnerable.
We found out that Abbott has known about this plant needing repairs for several years and the FDA was concerned back in 2019. Why didn’t Abbott fix the machines? Oh because they were too busy buying back $5.73 billion of their own stock!
There are other factors but it boils down to this: there was a time in America where we enforced our antitrust laws and corporate stock buybacks were illegal. This shortage would not have happened in that time.
And if you had any doubt that Wall St. and huge corporations didn't have the best interest of the general public, check out this headline:
Inflation, inflation, inflation… corporate profits are driving 60% of inflation increases. The good news is that there are some folks in the House and the Senate who want to crack down on corporate price gouging, but as of now, Republicans seem ok with it.
Maybe you have heard or noticed that filling up your gas tank is costly these days. It’s not just the American consumer feeling it, the huge multinational gas companies are feeling it, too. Just kidding, they’re laughing all the way to the bank about it:
• It’s not just Shell crushing it, look at the stock prices of oil companies that have surged:
Remember when COVID shut the world down back in March of 2020? Do you remember what President Trump’s first Executive Order was to address the pandemic? Was it the Use of the Defense Production Act to produce more PPEs? Nope, it was to keep the meatpacking plants open.
According to a report released by a U.S. House panel, the Executive Order was written by the meatpacking industry and their lobbyists and resulted in 59,000 meatpacking workers contracting COVID-19 in the first year of the pandemic and at least 269 died.
The meatpacking industry also lied by trying to push a “meat shortage” when there wasn’t and they used this time to expand their exports…
All of this while COVID outed the meat monopoly by shining a light on them raising prices on American consumers, workers on the line working in a dangerous setting for about the same wage as folks did 4 decades ago and farmers getting squeezed.
HEALTH INSURANCE COMPANIES
One of the most troubling parts of our economy is that we are the wealthiest nation in the world and the only developed nation without universal healthcare. It’s not for a lack of money, the U.S. spends the most on healthcare than any other nation, the problem is that we aren’t getting a good bang for our healthcare buck.
Here’s one of the most troubling studies I have found: The American Journal of Medicine study from 2018 found that 42.4% of the 9.5 million people diagnosed with cancer between 2000 and 2012 had depleted their assets within two years.