Yesterday, the Department of Justice (DOJ) and 30 states announced a long-awaited antitrust suit against Ticketmaster and its parent company, Live Nation. The government alleges that the combination of the two entities amounts to an illegal concentration of market power and has resulted in higher prices and other harms for consumers, artists, and promoters. President Biden’s antitrust officials have initiated another frivolous antitrust suit that will waste taxpayer dollars and Americans’ time. The DOJ would do well to review its basic economics. The complaints leveled against Ticketmaster and Live Nation are almost fully the result of high prices stemming from high demand. Blaming high prices and other demand-driven inconveniences on an alleged monopoly fundamentally misunderstands the problem. Calling in the antitrust calvary is, therefore, an entirely inapt solution. Under the Biden administration, antitrust enforcement has been transformed from a limited and important law enforcement
tool into a sweeping means of centralized planning. This hurts Americans because taxpayers must fund this mission creep and businesses and consumers are forced to operate within an inefficient state-planned economy. Dynamism and innovation cannot flourish when entrepreneurs are barred from exploring beyond the narrow imaginations of Washington bureaucrats.

More Taxpayer Money for the Postal Service

For an agency that claims it “generally receives no tax dollars for operating expenses,” the U.S. Postal Service (USPS) sure does like government subsidies. Despite receiving $120 billion in taxpayer-funded bailouts since 2020, the USPS is once again asking for more money. As Washington Postreporter Jacob Bogage notes in a recent article, Postmaster General Louis DeJoy and mailing industry officials have “asked the White House to send the Postal Service $14 billion, which would come from what the agency says is decades of overpayments into the Civil Service Retirement System.” These appeals for more money ignore the real root of the USPS’ problems. The agency’s fiscal issues stem from a failed business model and lack of cost control. No amount of taxpayer dollars will fix the fiscal fiasco plaguing the USPS. America’s mail carrier is requesting that “Congress and other stakeholders…help support USPS in the implementation of key self-help initiatives outlined in the [Delivering for America]
Plan that are critically necessary, and that will ultimately enable our operational and financial success.” The USPS fails to explain why $120 billion in taxpayer dollars and double-digit percentage increases in stamp costs haven’t facilitated this “self-help.”

The USPS continues to struggle with staying under or within budget for basic operations. In November 2023, the agency’s Inspector General (IG) reported that the USPS was significantly overpaying for air transportation. The report found, “The Postal Service did not accurately plan air weight capacity on the [IG reviewed] specific lanes for the aviation supplier…Specifically, six of nine operating periods (about 67 percent) within our scope had actual mail weight that was less than the minimum [REDACTED] percent of planned air weight capacity for mail sent to the aviation supplier.” For the one aviation partnership under review, this lapse resulted in more than $25 million in losses for the USPS. These figures only provide a small glimpse into total air mail losses. The USPS spends about $3.5 billion annually for air transportation services, and the IG report only focused on $400 million-worth of deliveries. Extrapolating IG-reported figures to all air mail (rather than just one supplier),
capacity miscalculations likely cost the agency hundreds of millions of dollars per year. The USPS is poised to cut down on these cost overruns thanks to renewed competitive contracting and its expanded partnership with private providers such as the United Parcel Service (UPS). But, continued accounting lapses will not bode well for the agency.

Air transportation expenses are far from the only fiscal issue facing the USPS. Agency watchers have long been critical of “workshare discounts,” or about $15 billion worth of discounts on postage the USPS extends to private businesses that perform mailing-related work (e.g., pre-sorting and bar-coding mail) on behalf of the USPS. The basic idea of farming out postal operations and allowing private players to pocket the savings is a solid one, but only if the postage discounts correspond to actual savings. Even though nearly 90 percent of market dominant mail (i.e., letters and marketing mail) is workshared, the IG has found documented savings to be sorely lacking. According to a February 2024 IG report, the USPS “does not have detailed procedures that document responsibilities for calculating avoided costs and workshare discounts for First-Class Mail and Marketing Mail letters and enable management to effectively monitor those control activities.” In addition, the USPS fails to regularly
monitor data inputs that go into its workshare discount pricing models. The USPS is asking taxpayers and consumers to take a leap of faith and trust that it is properly extending $15 billion in discounts based on mailing companies saving the USPS money. Repeated taxpayer-funded bailouts will not fix this lack of accountability and fiscal discipline at the USPS. Instead of bilking taxpayers and consumers, America’s mail carrier needs to do some soul-searching and closely examine its many expenses.

FDA’s Slow Moving Approval Process

The Food and Drug Administration (FDA) is taking even longer than usual to approve life-saving products. On May 10, the agency announced it was delaying a decision to approve a vaccine for respiratory syncytial virus (RSV) to the end of May because of “administrative constraints” at the FDA. A decision had originally been slated for May 12. Earlier, in March, the agency announced that it was delaying approval for Alzheimer’s drug donanemab even after trial data showing the medication slowed disease progression by 29 percent over 18 months. Clearly, something has gone very wrong at the agency often (wrongly) criticized for approving medications too quickly. It’s time for the FDA to clean out its cobwebs and commit to a speedier and more flexible approvals process. Unfortunately, regulatory delays over the RSV vaccine and donanemab are just the latest in a long line of FDA missteps. Despite the ample promise of a CAR-T therapy called Abecma for the treatment of heavily pre-treated relapsed
or refractory multiple myeloma, the FDA pushed back its original decision date of December 16 to April 4. The FDA insisted on delaying its decision despite evidence that patients taking the medication lived nearly 9 months longer without their cancers getting worse. Meanwhile, the agency has earned the ire of parents for delaying coronavirus vaccine approval for young, at-risk children and failing to be transparent about the approvals process. The agency responded to pushback about its vaccine approval delays by claiming the data was incomplete, conveniently leaving out that the missing data was for cohorts of older children who were already cleared to get vaccinated.

It has long been a trope that that the FDA is “underfunded.” Pundits and policymakers have called for more taxpayer funding and user fees for everything from generic drug approvals to food safety inspections to medical device cybersecurity. In reality, the FDA’s fiscal year (FY) 2024 funding level of $6.7 billion ($3.5 billion in taxpayer funding and $3.2 billion in industry user fees) is about 15 percent higher than the FY 2014 total, even after adjusting for inflation. Increased FDA spending has not “delivered the goods” in increasing drug innovation or reducing foodborne illness. FDA malaise only succeeds in adding fuel to the fire of runaway healthcare costs and making it more difficult for Americans to access affordable medications. It costs an astounding $2.3 billion to bring a new therapy to market, with agency delays and nit-picking adding to these totals. Agency watchers have also expressed concern that the FDA’s reliance on user fees is making bureaucrats too cozy with drug
makers. In reality, the FDA is still risk-averse and reluctant to approve new medications. The agency has issued more than 80 Complete Response Letters (i.e., denials) for new molecular or biologic products since 2019, often for reasons that have little to do with clinical benefit. For example, the FDA recently rejected a drug called zolbetuximab designed to treat gastric/gastroesophageal cancer.

The issue was neither safety nor efficacy. Clinical trials demonstrated that the medication improved median progression-free and overall survival by 2-3 months compared to chemotherapy alone. Apparently, the issue boiled down to “unresolved deficiencies following its pre-license inspection of a third-party manufacturing facility.” These issues apparently aren’t insurmountable for Japanese regulators, who approved the medication. But, in the U.S., patients are left to scramble for months due to a likely-minor issue that could probably be resolved post-approval. The truth is that the FDA is far too slow to approve promising drugs and all-too-eager to axe life-saving therapies. Until the agency embraces innovation and flexibility, patients will pay the price for FDA inaction.


BLOGS:



** Monday: Time to Flush Wastewater Cronyism Down the Drain ([link removed])
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** Tuesday: TPA Urges Governor DeSantis to Line Item Veto Credit Card Interchange Study ([link removed])
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** Wednesday: Louisiana’s Age-Verification Proposal Is Unconstitutional and Anti-Parent ([link removed])
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** Wednesday: TPA Joins Coalition Letter Urging House to Oppose Sunset of Section 230 ([link removed])
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** Thursday: Department of Justice Antitrust Suit Against Ticketmaster and Live Nation Strikes the Wrong Note ([link removed])

Friday: Biden Tax Proposal Ominous for American Families ([link removed])
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MEDIA:

May 17, 2024: Before It’s News ran TPA’s op-ed, “Electric Vehicle Subsidies As Complex And Costly As Ever.”

May 17, 2024: Zero Hedge ran TPA’s op-ed, “Electric Vehicle Subsidies As Complex And Costly As Ever.”

May 17, 2024: The Highland County Press (Hillsboro, Ohio) ran TPA’s op-ed, “Electric Vehicle Subsidies As Complex And Costly As Ever.”

May 17, 2024: Filter Mag ran TPA’s op-ed, “Recent Reports Reflect How the FDA Props Up the Cigarette Trade.”

May 17, 2024: Freedom Bunker ran TPA’s op-ed, “Electric Vehicle Subsidies As Complex And Costly As Ever.”

May 17, 2024: The Boston Herald (Boston, Mass.) ran TPA’s op-ed, “Fiscal woes; Postal Service wants another taxpayer bailout.”

May 17, 2024: KPTV Fox12 (Portland, Or.) quoted me in their story about NTSB funding.

May 18, 2024: The Daily Inter Lake (Kalispell, Mont.) ran TPA’s op-ed, “Postal Service asking for another taxpayer bailout.”

May 18, 2024: Florida Daily ran TPA’s op-ed, “FDA Moving at Turtle Speed.”

May 19, 2024: The Citrus County Chronicle (Crystal River, Fla.) ran TPA’s op-ed, “U.S. Postal Service asking for another taxpayer bailout.”

May 19, 2024: KJTV Fox34 (Lubbock, Tx.) quoted me in their story about NTSB funding.

May 19, 2024: KSCW CW (Wichita, Ks.) quoted me in their story about NTSB crash response.

May 20, 2024: WBFF Fox45 (Baltimore, Md.) interviewed me about the Board of Estimates.

May 20, 2024: I appeared on KZIM 960 AM (Cape Girardeau, Mo.) to talk about the Credit Card Competition Act.

May 20, 2024: The New Hampshire Patch (Concord, N.H.) ran TPA’s op-ed, “U.S. Postal Service Asking for Another Taxpayer Bailout.”

May 20, 2024: The Baltimore Sun (Baltimore, Md.) ran TPA’s op-ed, “FDA still rejects far too many drugs.”

May 21, 2024: WBFF Fox45 (Baltimore, Md.) quoted TPA in their story, “Baltimore embraces teleworking as Philadelphia returns to full office days.”

May 21, 2024: The Advocate (Baton Rouge, La.) ran TPA’s op-ed, “Streetcar bill more about a desire for money than trademark issues.”

May 21, 2024: Dan Savickas appeared on Memphis Morning News, News Talk 98.9 (Memphis, Tn.) to discuss the Credit Card Competition Act, Social Security insolvency, and the proposed federal menthol ban.

May 22, 2024: Must Read Alaska (Homer, AK) ran TPA’s op-ed, “Are electric vehicles the most subsidized product in America?”

May 22, 2024: WiredFocus ran TPA’s op-ed, “Are electric vehicles the most subsidized product in America?”

May 22, 2024: Atlanta News First (Atlanta, Ga.) quoted me in their article, “NTSB aviation investigations questioned over reliance on outside help.”

May 22, 2024: WLUC NBC (Marquette, Mich.) quoted me in their story about the NTSB.

May 23, 2024: WBFF Fox45 (Baltimore, Md.) interviewed me about teleworking for Baltimore City employees.

May 23, 2024: I appeared on WBOB 600 AM (Jacksonville, Fla.) to talk about economic populism.

May 23, 2024: David McGarry joined the Lars Larson Show (Portland, Ore.) to discuss the DOJ antitrust suit against Ticketmaster and Live Nation.

May 24, 2024: TheDailyPouch published TPA's op-ed "Part Two – Sunak’s capitulation on vaping illustrates how the UK government has descended into abject farce."

Have a great weekend!
Best,

David Williams
President
Taxpayers Protection Alliance
1101 14th Street, NW
Suite 1120
Washington, D.C. xxxxxx

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