Smart People Sure Are Easy To Fool

A recurrent motif of the climate scam is that the melting of glaciers in certain regions of the world will shortly cut off the water supply of otherwise dry downstream areas that draw their water supplies from the runoff of the glaciers.  

The most famous example of this motif appeared in the IPCC's Fourth Assessment Report that came out in 2007.  Here is the section of that Report relating to the Himalayan Glaciers.  Excerpt:

Himalayan glaciers cover about three million hectares or 17% of the mountain area as compared to 2.2% in the Swiss Alps. They form the largest body of ice outside the polar caps and are the source of water for the innumerable rivers that flow across the Indo-Gangetic plains. Himalayan glacial snowfields store about 12,000 km3 of freshwater. About 15,000 Himalayan glaciers form a unique reservoir which supports perennial rivers such as the Indus, Ganga and Brahmaputra which, in turn, are the lifeline of millions of people in South Asian countries (Pakistan, Nepal, Bhutan, India and Bangladesh). . . .  Glaciers in the Himalaya are receding faster than in any other part of the world (see Table 10.9) and, if the present rate continues, the likelihood of them disappearing by the year 2035 and perhaps sooner is very high if the Earth keeps warming at the current rate.    

Got that?  The Himalayan glaciers are a "lifeline" for well over a billion people!  Without the glaciers to supply the water, the billion people are toast!

When I first read this, I thought it was completely ridiculous.  Kindly think about this for one minute.   The runoff from the glaciers in any given year is equal to whatever precipitation falls on them plus any net melting.  Suppose there is no net melting and the glaciers are perfectly stable at their current size.  Then the amount that runs off from the glaciers in a year is exactly equal to the amount added by new precipitation.  Now suppose that the glaciers have completely melted away and the temperature has gotten so warm that no snow and ice any longer accumulate; all precipitation runs off within the year.  Then the amount that runs off from the previously-glaciated area in a year is exactly equal to the amount added by new precipitation.  So stable glaciers and no glaciers lead to exactly the same result:  runoff equal to precipitation.  Then why is the melting of the glaciers a problem for water supply in downstream areas?  It never made any sense, and it still doesn't.

But it turned out that the IPCC Himalayan glacier story of 2007 fell apart for an entirely different reason.  In early 2010, various independent researchers did some checking on the IPCC claim, and found both the claim and its source to be highly dubious.  The actual melt rate of the Himalayan glaciers did not remotely support the claim that they would be gone, or even significantly diminished, by 2035.  The 2035 prediction proved to be based on a non-peer reviewed WWF pamphlet from 2005.    Here is a report from early 2010 from climateaudit blogger Steve McIntyre on how the IPCC story fell apart.   Similar reports appeared at the time on other blogs, including Watts Up With That here.    But as far as I can find, nobody questioned the underlying premise that it would make any difference to the water supply of downstream areas whether the glaciers were there or not.

The disintegration of the IPCC's 2007 melting glacier story caused the organization a good deal of embarrassment, and led to calls for the resignation of its then-head, Rajendra Pachauri.  But the way in which the glacier melting scare had imploded left it open for the IPCC to come back in its next big assessment with another claim that melting glaciers were somehow going to leave masses of people without drinking water.  The IPCC's Fifth Assessment Report came out in 2013.  Sure enough, Mr. Pachauri was still around, and still peddling ridiculous stories that melting glaciers were going to leave the masses waterless.  Here is an article from the Financial Times from September 2013, reporting on an interview with Mr. Pachauri at the time of the release of the IPCC's Fifth Assessment Report.  Excerpt:

The glaciers of the Himalayas are melting so fast they will affect the water supplies of a population twice that of the US within 22 years, the head of the world’s leading authority on climate change has warned. . . .   [T]he UN’s Intergovernmental Panel on Climate Change, . . . this week starts releasing its first extensive report in six years on how the global climate is changing. . . .  This is the panel’s first big study since it was mired in controversy four years ago over a mistaken suggestion in its last assessment in 2007 that the Himalayan glaciers could disappear as early as 2035, a date it admitted was “poorly substantiated”. . . .  While the glaciers may not vanish by 2035, [Pachauri] added, the pace at which they are melting is bound to affect vast numbers of people depending on them for water.  “Even before 2035 it’s going to start showing up in terms of changes in water flows, which affect, as we had estimated, 500m people in south Asia and 250m people in China,” he said.

Needless to say, the FT reporter nowhere questions Mr. Pachauri as to whether his premise makes any sense whatsoever.

And finally, I bring up this history today because the melting glaciers scare is back, this time in an article in Nature Geoscience published Monday August 17.  The next day the Wall Street Journal covered the story, in a piece titled "Asian Glaciers Melting Faster."   This time it's the Tien Shan mountains of Central Asia, rather than the Himalayas:

The glaciers of Central Asia’s Tien Shan mountain range have lost a quarter of their ice mass over the past five decades, largely because of increased melting linked to a rise in summer temperatures, according to new research.  

So why again is this a problem?  

Both glacial melting and snow are vital sources of water for people living in semiarid parts of Kazakhstan, Kyrgyzstan, Uzbekistan, Turkmenistan and China. The worry is that continual glacial shrinkage could affect the water cycle and reduce the water supply in coming decades.  

Now I don't know whether the glaciers in the Tien Shan mountains -- or for that matter the Himalayas -- are actually experiencing net melting at all, let alone rapidly disappearing.  What I do know is that if these glaciers completely disappeared tomorrow, then the annual runoff going forward would be exactly the same as it would be if the glaciers were totally stable at today's size, namely that annual runoff would be equal to annual precipitation in both cases.  

Uber Shows How To Break Crony Capitalism

The taxi medallion scam is one of the worst examples of crony capitalism.  Uber (and some other app-driven services) are in the process of defeating the scam in New York and, apparently, in many other places as well.  It's about time.

The scam is simple.  A city issues a limited number of so-called "medallions," which convey exclusive rights to pick up passengers on the streets, and often at airports as well.  I have never heard anybody articulate a good rationale for why the number of medallions should be limited.  Fake rationales include preventing "destructive" competition (don't we have that in every industry?) and so-called environmental concerns (always articulated by those holding medallions whose only value lies in artificial scarcity). 

I have a long-time friend, call him R, who is head of one of those lenders that specialize in loans for the purchase of taxi medallions.  Twenty or so years ago I went for the first time to a fundraising event for a candidate for City office, and there was R.  Since then, I haven't been to many fundraising events for candidates for local offices, but at the few I have attended, somehow R was always there.  I can't say I was surprised when Bloomberg News reported last month that the medallion taxi industry had contributed over $500,000 to the campaign of Bill de Blasio for Mayor.  Probably, they contributed that amount or close to it to other candidates as well.  Other than the City employee unions and real estate interests, the taxi medallion guys have been right at the top of the political contribution heap.

Back when I first found out from R what business he was in (I think this was in the 90s), I expressed some very severe skepticism.  From there, the conversation went something like this:

R:  It's literally the best industry to lend in.  We have not had a single default in decades.

Me:  That will be true until the day that all the value suddenly disappears.  Basically, all the value comes from the artificial scarcity.  One day that will disappear, and the medallions will suddenly be worthless all at once.

R:  They've been saying that for decades.  Meanwhile we are diversifying to some degree.  

Since this was before this blog recorded all my thoughts, I don't have an official record of my prediction.  However, it is now rapidly coming true.

For the past few years, New York City taxi medallions have been trading for over $1 million each.  With over 13,000 medallions issued, this has represented a value of over $13 billion -- a good measure also of the value of the inconvenience inflicted on people in neighborhoods where taxis have been systematically unavailable for decades due to the corrupt crony system.  But with the advent of Uber, the value of the medallions has suddenly plummeted.  This article from CNN Money in July reports that the value of a medallion is off by some 40% from its peak just last year.

And that's if you can sell a medallion at all.  Many reports indicate that the market has gone dead as lenders have been spooked and refuse to lend. 

When the medallion market first started to plummet, de Blasio and his friends on the City Council (all takers of industry cash) floated several proposals to put the reins on Uber, including, for example, a limit on Uber licenses.  But when the reports started to come out about the unbelievable amounts of political contributions they had received from the medallion taxi industry, suddenly they were in a tough spot.  Turns out that our "progressive" Mayor and City Council would happily sell their outer-borough constituents down the river, inflicting them with $13 billion of inconvenience, and handing the $13 billion to a handful of cronies, in return for a paltry few million of political contributions.

The latest news is that de Blasio and the Council are refusing to help out their medallion-owning friends, so the medallion owners are now pinning their hopes on a litigation contending that existing law restricting non-medallion owners to only "pre-arranged travel" effectively outlaws the Uber model.  Good luck with that.  Of course de Blasio and the Council will gladly help out their medallion-owning friends as soon as nobody is looking; but it seems that people are going to be looking at this one, at least for a while.  Now, will anybody start to pay attention to, for example, the "green energy" scam?

Government Spending Is Just A Fact Of Nature. Get Used To It, Peasants!

For a picture window view into the official Washington mindset, check out the editorial from the Washington Post from this past Friday titled "Republican presidential candidates' reckless anti-tax crusade." 

It seems that the majority of the Republican presidential candidates have signed on to the no-tax pledge of activist Grover Norquist (to "oppose and veto any and all efforts to increase taxes").  Something must be done to stop this foolishness!  So the Washington Post marshals all of its vast intellectual brain power to come up with the best argument it can for the other side.  Here goes:

[The Republican candidates are] kneeling before Mr. Norquist’s make-believe anti-tax theology.  Why do we say make-believe? Here are some facts for the truth-tellers. Federal spending averaged 20.1 percent of gross domestic product from 1965 to 2014. With the baby boomer generation retiring, the population aging and health costs rising, the Congressional Budget Office projects that government spending will grow to 25.3 percent of GDP by 2040.

That's right -- our opponents' views are "make-believe."   Nyah, nyah!  The "facts" are that government spending must grow by 5+ points of GDP.  These are the facts of nature!  The CBO has projected it!  It's what is absolutely necessary to provide the "things Americans expect from government."  And you thought that Congress and the President had to agree to that and actually vote to spend the money?  You have just proved yourself to be a peasant!

Meanwhile Post columnist George Will comes back with a column (in National Review Online) the next day identifying just a few of the ridiculous things that government pays for while nobody is looking.  The title is "How American Government Became Encrusted with Subsidies."  Will particularly focuses on subsidies for whaling museums ($9 million per year) and mohair ($6 million per year). 

You probably never knew of the federal funding of museums commemorating America’s long-gone whaling industry. The funding existed for nearly nine years, until fiscal 2011, because almost no one knew about it. A mohair subsidy continues six decades after it was deemed a military necessity in the context of the Cold War. The subsidy survives because its beneficiaries are too clever to call attention to it by proclaiming it necessary, which of course it isn’t. To understand these two matters is to understand how American government functions.

Will's column is fine so far as it goes, but really these issues are only illustrative and not even the tip of the iceberg in the big picture.  Dare we mention some of the things that should be gone from the federal government down to the last dollar before anyone even considers a tax increase?  How about: Department of Education, Department of Commerce, Department of Energy (except for nuclear weapons program), most of Department of Labor, agriculture subsidies, all crony capitalism, green energy subsidies, all kinds of insurance programs (flood, crop, pension, terrorism, most of bank deposit).  Ex-Im Bank should be a complete no-brainer.  How about NASA -- it's fun, but I've never understood why hard-working taxpayers have to pay for it.  Getting rid of Obamacare will save a bundle.  There's hundreds of billions to lop off before we get to anything that ought to be remotely controversial.

I guess I've marked myself as a peasant in the eyes of the Washington Post and all the really, really smart people down there in the capital.

The Regulatory State And The "Main Project" Of Government

A couple of weeks ago economist John Cochrane of the Hoover Institution had a very important blog post that I have just now seen.  It is titled "Rule of Law in the Regulatory State."   The post records and expands on a presentation that Cochrane made at a Hoover panel discussion in July celebrating the 800th anniversary of the Magna Carta.

Cochrane's post is a thorough treatment of what I have called the "main project" of the government and all of its agencies, which is to grow the government and expand the power of the agencies.  They may say that they are just regulating banks or drug companies or polluters or whomever in the public interest, but whatever actual regulatory thing they may be doing at any given moment is always secondary and subsidiary to the main project of growing the agency and the government and expanding their powers.

Cochrane asks a very important question:  Do you ever notice a major regulated entity publicly criticizing or attacking its government regulator, even for the most outrageous of conduct?  As examples, do you ever notice a large pharmaceutical company publicly criticizing the FDA -- even, for example, when the FDA instigates criminal prosecution for what is the clearly constitutionally protected free speech known as "off-label marketing"?  Or do you ever notice a big bank publicly criticizing one of its regulators or the Justice Department -- even when the regulators and prosecutors initiate one after another completely phony shakedown prosecution for things like "robosigning" of mortgage documents or "insufficient controls" over money laundering or supposedly "defrauding" Fannie and Freddie?  Or do you ever notice a large securities firm publicly criticizing the SEC -- even when the SEC regularly initiates phony non-insider insider trading enforcement actions in the unconstitutional rigged forum of its own administrative law judges?  Or do you ever notice a large mining company publicly criticizing the EPA -- even when needed permits are unjustifiably held up for years?  And so on and on for many more examples.

And of course the answer is that with extremely limited exceptions the large regulated companies in these and many other industries do not and cannot publicly criticize the regulators because the regulators hold sway over innumerable discretionary approvals and actions that the regulated companies need to operate.  The regulators are supposed to be disinterested, neutral experts just looking out for the best interest of the public.  But what they care about far and away above everything else is that they should never be criticized publicly.  If you want their go-ahead on any one of a hundred things you want to do, the price is that you must support their political agenda, at the top of which is that the agency and its power must grow.  And if you make the mistake of criticizing them publicly, they have infinite ability to harm or destroy your business -- the FDA can delay the approval of your next three drugs for years; the bank regulators can disapprove your next merger or design a "stress test" that you cannot pass; the EPA can shut down one of your mines or never let you open one in which you have invested millions; etc., etc., etc.

This rule of law always has been in danger. But today, the danger is not the tyranny of kings, which motivated the Magna Carta. It is not the tyranny of the majority, which motivated the bill of rights. The threat to freedom and rule of law today comes from the regulatory state. The power of the regulatory state has grown tremendously, and without many of the checks and balances of actual law. We can await ever greater expansion of its political misuse, or we recognize the danger ahead of time and build those checks and balances now. . . . 
We’re headed for an economic system in which many industries have a handful of large, cartelized businesses— think 6 big banks, 5 big health insurance companies, 4 big energy companies, and so on. Sure, they are protected from competition. But the price of protection is that the businesses support the regulator and administration politically, and does their bidding. If the government wants them to hire, or build factory in unprofitable place, they do it. The benefit of cooperation is a good living and a quiet life. The cost of stepping out of line is personal and business ruin, meted out frequently.  
Cochrane then goes through a litany of no fewer than thirteen instances where individuals and industries are systematically coerced to do the political bidding of regulators due to some combination of vague or endless (Dodd-Frank, Obamacare) statutes and regulations and unbounded discretion given to the regulators.  The examples range from bank regulation (Cochrane cites the "stress tests" -- that can be engineered to destroy any bank in regulatory disfavor -- and the "robosigning" shakedowns); the SEC (he cites insider trading actions brought before SEC ALJs); the FDA (approvals held up for as long as 20 years for the politically disfavored); campaign finance (the Scott Walker "John Doe" investigations); Education (the retaliatory investigation against Laura Kipnis for criticizing the DOE's made-up policies for how colleges should deal with allegations of sexual abuse); and many more.  There is this quote from EPA Region 6 head Al Armendaris caught on tape discussing how to deal with some oil companies who were pushing back against an EPA initiative:

The Romans used to conquer little villages in the Mediterranean. They’d go into a little Turkish town somewhere, they’d find the first five guys they saw and they would crucify them. And then you know that town was really easy to manage for the next few years. . . .  we do have some pretty effective enforcement tools. Compliance can get very high, very, very quickly.

A remarkable thing about all of this is the extent to which these highly discretionary and therefore lawless regulatory regimes are extremely recent.  This is not how the American government has traditionally operated.  Sure some bank regulation existed going back to before World War II; but the real explosion is just in the last five years with Dodd-Frank.  The EPA only goes back to the 70s, and their gigantic mission expansion, including the currently-attempted takeover of the entire energy sector of the economy, is again in the last few years.  Obamacare only dates from 2009.  Most so-called "money laundering" regulation only started in the 70s, with a big expansion in the Patriot Act of 2001.  And so forth.

The only section of Cochrane's post that I find disappointing is the last one, dealing with what to do about this situation.  Given the fundamental threat to our democracy and constitutional government posed by the metastasizing administrative bureaucracies, some fundamental changes are in order.  Cochrane has some good suggestions, like giving the people more rights to appeal and to challenge regulatory decisions in court.  But I'm not sure that would make much difference.  Here are my proposals:

• The courts, and particularly the Supreme Court, need to do their fundamental duty and enforce the number one provisions of the Constitution, which are that only the Congress has legislative powers and only the courts have judicial powers, and all legislative powers and judicial powers currently residing in administrative agencies are unconstitutional and done.  And only the President has executive powers, so all executive powers residing in the so-called "independent" agencies (like SEC, FTC, FCC -- where the President cannot fire people) are unconstitutional and done.
• And then Congress needs to shrink the U.S. Code by about 80%.

Being the optimist that I am, I actually think that we may see some progress on these fronts within my remaining life time.  But of course the agencies will use all of their powers to prevent any push back from ever gaining traction.

 

The Latest Scam From The New York Times -- Part II

There it was, splayed across fully half the front page of the print edition of the Sunday New York Times, and continuing onto a full interior page as well -- another one of those big feature expose Pulitzer-Prize-bait articles that the Times is so famous for.   I previously covered one of these things back in May ("The Latest Scam From The New York Times").  That one involved the supposedly horrific working conditions in the New York nail salon industry.  It was exposed by the Manhattan Contrarian as a total hoax.  This one is titled "A Year After Ferguson, Housing Segregation Defies Tools to Erase It."  Byline is John Eligon.

So is it just another scam?  Absolutely.

The thesis of this article is that African Americans are prevented from achieving success in America because they lack access to "good jobs, high-performing schools, and low-crime neighborhoods."  The reason for that lack of access is "barriers," including discriminatory housing and lending practices, that keep black people out of "prosperous, mostly white communities."  Benevolent government programs bravely seek to break down the "barriers" but the government programs are frustrated at every turn by evil communities and landlords that use every trick and device to forcefully steer the blacks into the segregated neighborhoods:

Questions about whether minorities have access to good jobs, high-performing schools and low-crime neighborhoods have been fiercely debated. And for many, one question informs all those others: Can the barriers that keep blacks out of prosperous, mostly white communities be toppled?

This, coming from the New York Times, located at 40th Street and 8th Avenue in Manhattan.  Really, is it possible to believe this narrative and work in Manhattan?  Only if you sit completely confined in your office blinded by your Ivy League indoctrination and willfully refuse ever to go out and walk around the streets.

So Mr. Eligon, if you were ever to leave the Times' office in Manhattan and go out and walk around, what would you observe?  You would see that Manhattan is far and away the wealthiest county in the United States, with by far the highest concentration of high-paying jobs in any one small place.  And you will see that the New Yorkers have gone to truly extraordinary lengths to assure that poor people, most black, have full access to living in Manhattan, including locations in or adjacent to some of the most prosperous precincts on this wealthy island.  Thus low-income housing has been built on the Upper West Side (including next door to Lincoln Center), in West Midtown, in Chelsea, along miles of the Lower East Side waterfront, on Upper Broadway right next to Columbia University, along a big stretch of Park Avenue, and so forth.

Probably the most expensive and wealthy of all of Manhattan's sub-neighborhoods is the approximately 1.5 mile stretch of Park Avenue running from the East 60s to about 95th Street.  Apartments in the old-line co-op buildings lining that stretch go for multiple thousands of dollars per square foot, easily $5 million for anything that could house a family.  And then, at 99th Street and Park, no more than 0.2 miles away, we have the Carver Houses:

View fullsize

So, Mr. Eligon, is that close enough to meet your definition of "access" to prosperous communities and good jobs?  If it isn't, nothing is.

But of course Manhattan's vast estates of low income projects have done nothing to transform the lives of their poor and black inhabitants.  The opposite.  These are poverty traps that only make it harder, if not impossible, for the poor to rise up, and it doesn't make the slightest bit of difference how close they may be located to the wealthiest sections.  For our huge investment in subsidized housing immediately adjacent to the wealthiest neighborhoods in the country, what we have gotten is the highest income inequality in the country and the embarrassment of a poverty rate well above the national average in the very wealthiest county.  Mr. Eligon's entire thesis is completely refuted by the evidence right under his nose, and he seems totally unaware of it.

Mr. Eligon embellishes his article with the stories of numerous struggling African Americans, each living in a segregated area around St. Louis, and each according to his account trapped in a poor existence by the "barriers" erected around them.  But one after the other the stories are so full of holes that they are insulting to the intelligence of the reader.  I'll consider just one, the story of one Crystal Wade:

With violent crime common in her neighborhood, Ms. Wade said she looked over her shoulder when she walked in the house. Her rambunctious and curious 2-year-old daughter, Crystian, once rambled toward the window when gunshots popped outside. Ms. Wade and her boyfriend, Bryant Goston, 26, also have a 7-month-old daughter, Ava. Mr. Goston’s 7-year-old daughter from a previous relationship, Tamia, stays with them occasionally.  Five days a week, Ms. Wade takes a 30-minute drive with her best friend to their jobs at a Verizon call center in St. Charles County, where they work eight-hour shifts. She clocks 40 hours a week, but her roughly $10-an-hour salary has not been enough to afford housing in the area where she works.

Can we just parse this a bit?  Ms. Wade struggles to make ends meet on her $10 per hour job, which would be about $20,000 for full time work for the entire year.  Well, how about this Goston guy?  He's the "boyfriend."  He has at least three kids by two different women, but hasn't bothered to marry either of them.  Does he recognize any responsibility for contributing to the family?  Somehow Eligon doesn't even ask the question.  Really?  If Goston could trouble himself to get one of those $10 per hour jobs, that would make the family income $40,000.  A couple of paragraphs down, Eligon reports the median family income for the St. Louis area as $35,000.  So all Goston needs to do is join the family and get a job -- literally any job -- and instantly they are out of poverty and indeed above the median income.  Then they can walk into any neighborhood where other people around the median income live -- and most of those people are white -- and get themselves a place.  Remember, housing discrimination is illegal!

Of course, if Mr. Goston got a job and joined the family, that would undermine Ms. Wade's eligibility for her housing subsidy.  A fair inference is that Goston and Wade prefer the housing subsidy, and the very inexpensive "bad" neighborhood that it comes with, to the hard work needed to move up in life.  OK.  That's just one more example of how segregation, like income inequality, is caused and worsened by the very well-intentioned government policies that were supposed to alleviate it.  And anyway, in what sense is acceptance of a housing subsidy a "barrier" imposed on Goston/Wade by somebody else?  

The Weekend In Phony Prosecutions -- Part III

The third big piece of news this week in the area of Phony Prosecutions came on Friday from Southern District of New York Judge Paul Engelmayer.  The good judge enjoined -- yes, enjoined -- the FDA from enforcing its so-called "off-label marketing" restrictions against a company called Amarin and its drug Vascepa.  Here is a copy of Judge Engelmayer's decision.    The injunction is preliminary, so the case will continue.  However, Judge Engelmayer took the time to write up a very careful 71 page decision.  This one may actually throw the FDA back on its heels.

I have previously covered the subject of the FDA's so-called "off-label marketing" restrictions here.  That article, back in 2012, reported on the Second Circuit's then-new decision reversing on First Amendment grounds the criminal conviction of a guy named Caronia for promoting a drug for uses that had not been specifically approved by the FDA.  Yes, the poor guy had to suffer years in criminal prosecution hell and a conviction in order to vindicate First Amendment rights that should have been obvious to everybody.  My 2012 article also linked to an article I wrote way back in 1999, called "Top Ten Federal Government Efforts To Suppress Free Speech."  The 1999 article gave the number one ranking to the FDA's restrictions on off-label marketing of drugs that had been approved as safe and effective.  Here are some of my prescient words:

No agency can top the FDA when it comes to imposing bureaucratic control over free speech, even at the expense of human life. The FDA believes it has an absolute veto power over all speech concerning anything consumed by human beings. . . .   On February 16, 1999, after years of litigation, Judge Royce Lamberth of the U.S. District Court of the District of Columbia enjoined [a] particular [FDA] rule as contrary to the First Amendment, and ordered that the FDA could not prevent manufacturers from circulating articles just because they described new uses of a drug that the FDA had not yet approved.  But Judge Lamberth's decision is just one small victory against the FDA's massive efforts at speech suppression. Even as a few formerly suppressed articles begin circulating, the FDA wages an aggressive, multi-front campaign to regulate and squash prescription drug advertising. . . .  The agency may lose in court in the end, but the FDA is unlikely to learn from yet another defeat in court and does not appear willing to curtail what it views as the righteous fight to suppress free speech. Do the bureaucrats at the FDA have any idea what the United States is all about?

We are now sixteen years past that article, and the FDA just keeps fighting pitched battle after pitched battle to preserve its bureaucratic privileges.  Amarin even went through the trouble of doing a big double-blind study to support the effectiveness of its drug for uses that had previously not been part of the initial FDA approval.  But the FDA declined to "allow" Amarin to promote the results of the study.  As in all matters that relate to off-label marketing, the FDA's bureaucratic position had nothing to do with safety or effectiveness of the drug, both of which had already been established.  The FDA has a convoluted legal theory under its statute to claim the authority to prohibit the making of true statements about a drug whose safety and effectiveness have been established.  Essentially, they call off-label marketing "misbranding" of the drug.  Huh?  There's no understanding it, other than that they view defending and enhancing their bureaucratic prerogatives as far more important than things like mere lives of patients or free speech.

With no legal leg to stand on, it is truly remarkable how long the FDA can keep this game going.  Sadly, none of the big pharma companies are willing to challenge it.  They all just cave.  For that reason the decisions knocking down the FDA are few and far between, but meanwhile the FDA shakes down one pharma company after the next for what should be First Amendment-protected speech.  Judge Englemayer's opinion lists some of the recent settlements (including criminal guilty pleas) and fines paid by the big guys in obeisance to the FDA: $1 billion paid, plus a criminal guilty plea, by GSK in 2012 for alleged "misbranding" relating to Paxil and Wellbutrin; $500 million paid by Abbott Labs in 2012 for alleged "misbranding" relating to Depakote; $375 million paid by Allergan in 2010 for alleged "misbranding" relating to Botox; and so forth.  My 2012 article lists multiple others, including a settlement by Pfizer for over $1 billion.  None of the big players will take a case to trial.  Nor would any of them have brought the injunctive action that Amarin brought here.  They have too much at stake, and the FDA can kill them in a thousand other ways on a thousand other issues if the company is perceived to have "dissed" the regulator.  So it took one of the tiny players in the business (Amarin's 2014 sales were just $54 million) to pursue this case.

So how big is this decision?  In my opinion, big.  The FDA is going to lose in the end.  Having written this big opinion, there's no way that Judge Engelmayer is going to change his mind after a trial on the merits for the permanent injunction.  The Second Circuit?  They're the people who reversed in Caronia.

But I wouldn't expect the big guys to start major off-label advertising campaigns any time soon.  They're just too pusillanimous.  Not that I blame them.  It's going to take a series of victories by little guys following in Amarin's footsteps to slowly open the floodgates.  Really, it's disgusting that that's how our government works.  Keep this in mind next time you find yourself thinking that government regulators are just neutral, apolitical experts doing their best to protect the public.