I was in Israel for two weeks hearing nothing but how the
Obama administration is tougher (in action and language) on Israel
than it has been on the Muslim Brotherhood (the White House seder
included a Tahrir Square
salad)
and Syria’s dictator Bashir al-Assad.
Now it turns out that Team O is tougher on drug company
CEOs than it is on brutal dictators and a movement whose goal is
wiping out Israel. The administration is applying a little used
government approach to knee-capping executives it doesn’t like by
threatening that HHS won’t allow Forest Laboratories to sell
medications to Medicare, Medicaid, and other government health
programs (which means every health plan under Obamacare) unless it
tosses the company’s CEO, Howard Solomon. According to news
accounts, the action is being taken because government lawyers
claim that just fining the company billions isn’t stopping illegal
behavior. But neither Mr. Solomon nor Forest has been found guilty
of any wrongdoing. Here’s the WSJ
account:
The Health and Human Services department startled drug
makers last year when the agency said it would start invoking a
little-used administrative policy under the Social Security Act
against pharmaceutical executives. This policy allows officials to
bar corporate leaders from health-industry companies doing business
with the government, if a drug company is guilty of criminal
misconduct. The agency said a chief executive or other leader can
be banned even if he or she had no knowledge of a company’s
criminal actions. Retaining a banned executive can trigger a
company’s exclusion from government business.
Can you imagine the administration using this tactic against
health IT firms, unions, the New Black Panthers, ACORN, or
investment banks? For different reasons for each, the answer
is “No.”
Health IT firms are the favorite sons of HHS, the New
Black Panthers, of municipal officials who milk pension funds and
funnel money to their pet projects, unions are — well enough said
— and investment banks would never be touched because that would
trigger panic in the bond markets upon which the administration
relies to finance the mounting debt.
So picking on the CEO of a company that has already paid
out $300 million in fines to avoid a government lawsuit regarding
marketing practices makes political sense, even if Pharma supported
Obamacare. My guess is that it will lead companies to be much less
likely to make products available to government programs. Or maybe
the administration will force sales at specific prices in exchange
for a “promise” not to rough up CEOs. That is as close to
government extortion as one can get. This, from an administration
that promised to be more business friendly.
Meanwhile the threat against Forest and its CEO is more
draconian than actions the Obama administration is taking against
Assad. The dictator who has slaughtered his people, aided Iran,
built a uranium-enrichment facility, staged the Hezbollah takeover
of Lebanon, and whose country is soon to be part of the UN Human
Rights Council has received a stern warning from the president but
nothing more.
As for the administration’s toothless response to Assad
(well captured by the brilliant Barry
Rubin), note how an administration
official in quoted in the New York Times on these
points:
Administration officials say that while they lack many
effective economic tools, they believe Mr. Assad is sensitive to
portrayals of his regime as brutal and backward. “He sees himself
as a Westernized leader,” one senior administration official said,
“and we think he’ll react if he believes he is being lumped in with
brutal dictators.”
Is this for real? How cannot one be sarcastic and hypercritical
when leading U.S. officials think that a ruthless dictator — in
fact, the most cleverly ruthless dictator in the Arabic-speaking
world — really cares if people in the West say mean things about
him.”
The administration only picks on people and enterprises it
can bully for show, without thinking through the consequences.
Meanwhile it avoids taking on real evil or illegal activity when it
suits the political goal of the moment and fits those naive
narratives shaping the administration’s actions. Forest and its CEO
paid their debt in full. The effort to can Solomon is gangster
government that serves a short-term political purpose while the
administration’s inaction towards Syria emboldens a chief executive
of whom Rubin writes:
It would be impossible to find someone more eager to be a
brutal dictator and who does not see himself as a Westernized
leader. If this were the “Godfather,” Bashar would be Michael, not
Fredo.
If the Obama Administration doesn’t understand this, it
understands nothing. Yes, that’s the point. It understands
nothing.
