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Home | Wire | Drug Companies Want to Use the State to Shut Down the Competition

Drug Companies Want to Use the State to Shut Down the Competition

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Tags Bureaucracy and RegulationCronyism and CorporatismProtectionism and Free Trade

05/23/2018

Blue jeans have more in common with drugs than you might think.

One of the more consequential episodes in the history of crony capitalism occurred in 17th and 18th century France. Cheap clothing made from cotton was threatening the rich woolen, linen, and silk manufacturers, so they persuaded the government to ban it. In short order, government agents began spying into homes and coaches and reporting on anyone who dared to wear the new fabric. Thousands of violators of the ban were rounded up and either sent to prison or to ships as galley slaves, which was a death sentence.

In Britain, the same manufacturers demanded a similar ban from the King, but were turned down. As a direct result, Britain launched its industrial revolution by making cheap cotton clothing for the world, and began to get rich, while France stagnated economically. If France had not banned cotton, and had not fallen so far behind Britain economically, Napoleon might have had the money to build a huge fleet and successfully invade Britain. European and world history might have turned out quite differently.

It is easy to recognize and mock the absurdities of crony capitalism in the past, but not always easy to spot it today. For example, we have a replay of the cotton story in contemporary American medicine. It is increasingly recognized that food, supplements, and lifestyle changes are the most potent medicines. But this represents a threat to drug companies, oncologists, and surgeons, and they have enlisted the power of the government to protect their interests.

It is illegal to claim that any substance, even a food, not approved by the Food and Drug Administration (FDA) can cure, control, or even prevent an illness. But approval costs many billions of dollars, so with few exceptions only new to nature molecules, that is, patentable drugs, can be approved. A producer of food or supplements who violates this law will be threatened with massive fines and long jail terms.

In recent years, both walnut and cherry growers have been threatened by the FDA because they dared to share university research that their product had specific health benefits. Other producers have been convicted and put away for decades.

Meanwhile the protected drug and surgery interests charge more and more for products that may do as much harm as good, as you can read in the manufacturer’s own fine print. And the cost of this government protected monopoly, created under the guise of “protecting the public,” puts a lid on both job creation and employee raises while swelling horrific government deficits.

Nor is it only the federal government. State governments are also allied with entrenched medical interests. For example, it is against the law in California for doctors to treat cancer using anything other than drugs, radiation, or surgery. The federal government protects drug companies making vaccines from any legal liability for harm to children, but California also mandates that any child attending public or private school must have had the full schedule of vaccinations. There is even a bill pending there that would gag free speech about vaccines. No wonder drug companies regard vaccines as one of their most promising profit making opportunities.

Like cotton clothing manufacture in centuries past, what might be called natural medicine could be an enormous new American growth industry. Customer interest is so strong, the industry has grown, albeit slowly, despite being legally throttled. There is however little or no prospect that other countries will take the lead, because their governments are even better controlled by bureaucrats allied with medical special interests.

Meanwhile it is still very difficult to educate the public because of the legal barriers. Even President Trump’s White House physician does not know that a score of 20 on a vitamin D test is extremely unhealthy. He reported that the president had passed all his tests with flying colors. A physician trained in natural medicine could set him straight, but he would then no doubt be targeted by his state medical board.

Hunter Lewis is author of twelve books, including The Secular Saints: And Why Morals Are Not Just Subjective, Economics in Three Lessons & One Hundred Economic Laws, Where Keynes Went Wrong, and Crony Capitalism in America 2008-2012, and has contributed to the New York Times, the Washington Post, the Times of London, The Atlantic and many other magazines and web sites including Mises.org and LewRockwell.com. Lewis is also co-founder of Against Crony Capitalism.org as well as co-founder and former CEO of Cambridge Associates, a global investment firm. He has served on boards and committees of fifteen not-for-profit organizations, including environmental, teaching, research, and cultural organizations, as well as the World Bank.

Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.
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