RESISTING PROTECTIONISM IN THE PHARMACEUTICAL SUPPLY CHAIN

By Clark Packard and Bill Watson

INTRODUCTION

For about 80 years, the United States has aggressively pursued a policy of expanding overseas markets and lowering domestic tariffs and other non-tariff barriers. This process was achieved through a series of bilateral and regional free trade agreements (FTAs), as well as multilateral agreements through the World Trade Organization (WTO) and its precursor system, the General Agreement on Tariffs and Trade (GATT). Liberalizing international trade in this manner increased the U.S. Gross Domestic Product per capita by about $7,000 and by more than $18,000 (in 2016 dollars) per household.1 Not only that, the poor benefitted disproportionately because they tend to “concentrate spending in more traded sectors.”2 Through these agreements, American firms also were able to establish the certainty they needed to invest abroad, foreign firms invested here and a system of complicated supply chains quickly developed that lowered prices for consumers and enhanced the competitiveness of American firms in globalized markets.

Despite these successes, protectionist opponents on the left and right have long criticized the prevailing consensus for its effect on the domestic manufacturing base.3 “Offshoring,” critics contend, has favored multinational corporations at the expense of the working class.4 Critics also argue that, as a services-heavy economy, the United States is too dependent on imported products from hostile countries and that the U.S. “doesn’t make anything anymore.”5

But, these charges are largely untrue. Today, the United States is the second-largest exporter in the world.6 And, although manufacturing employment (as a percentage of the overall workforce) in the United States has declined, its peak occurred shortly after World War II and began declining in the late 1970s—“long before the North American Free Trade Agreement existed or Chinese imports were more than a rounding error in U.S. GDP.”7 In fact, before the outbreak of COVID-19, manufacturing output was near record highs.8 Instead, it is productivity gains and technological improvements that are the primary drivers of America’s shift away from labor-intensive manufacturing, not import competition or offshoring.9

Despite this reality, American politicians are increasingly interested in reshoring supply chains of various products, especially those deemed “strategic” or required for U.S. national security.10 Hawkish politicians are concerned about U.S. reliance on imports from China and have pushed the United States to embrace a new era of industrial policy.11 Such arguments have intensified since the outbreak of COVID-19, particularly with respect to pharmaceuticals and other products necessary to combat the pandemic. The justification is that non-allies may withhold exports of these critical products, particularly when we need them most. And, accordingly, the administration and Congress are currently considering ways to re-shore some or all of the pharmaceutical supply chain, including a blunt protectionist requirement for the federal government to purchase only pharmaceutical products that are made in the United States.12

Such “Buy American” proposals recently drew a stern rebuke from over 250 leading economists, including Nobel laureates and officials from previous presidential administrations, who warned in a letter organized by the National Taxpayers Union that: “The variety, supply and price of goods available to Americans will suffer under a Buy American regime. Taxpayers and patients will pay more for drugs and medical supplies.”13 And, in fact, any such risk is unnecessary, as there are ways to responsibly increase domestic manufacturing of various pharmaceuticals and active pharmaceutical ingredients (APIs) without resorting to misguided protectionism.

What’s more, to exploit this crisis as a way to radically overhaul pharmaceutical supply chains could be disastrous, especially if done in a haphazard way. For this reason, the present study first explains the costs of re-shoring pharmaceutical supply chains and the benefits of diversity. It then dispels the dubious national security arguments made by politicians, and makes concrete recommendations for the consideration of policymakers who wish to ensure a secure U.S. pharmaceutical supply chain, including steps to responsibly increase domestic production.

DISPELLING MYTHS

In a May 11 op-ed in The New York Times, U.S. Trade Representative Robert Lighthizer criticized the “blind pursuit of efficiency” that resulted in “extended, overseas supply lines.”14 He went on to accuse American businesses of following an offshoring “craze,” as they were “swept up by the herd mentality” and a “lemming-like desire for ‘efficiency’” but without adequately considering the risks that come when “long supply lines flow at the whim of local politics, labor unrest and corruption.” He then claimed that the pandemic “has revealed our over reliance on other countries as sources of critical medicines” and called on policymakers to “remedy this strategic vulnerability […] by shifting production back to the United States.”15

This general antipathy toward globalization has been further energized by concerns that the Chinese government has too much power over the American medical supply. Last December, for example, four U.S. senators warned that “overreliance on Chinese API exports raises the possibility that China could terminate or raise the cost of prescription drugs.”16 They further warned that the Chinese government could choose to “weaponize pharmaceuticals, by restricting exports to the United States” or “incorporating lethal ingredients in final products,” and concluded ominously that this “national security threat cannot be overstated.”17 In fact, such a threat is constantly and dramatically overstated, primarily because of the faulty assumption upon which it is based: namely, that our supply chain is over-reliant on China. Like all products created through complex global supply chains, understanding the country of origin for all components of a finished product can be challenging, and pharmaceuticals are certainly no exception. However, the promotion of false statistics is hardly helpful. For example, in the midst of the current pandemic, irresponsible policymakers and even mainstream media outlets persist in promoting the figure that “80 percent of our drugs come from China.”18 And, while that may sound scary (and is likely designed specifically for that purpose), it is simply false.19

To accurately analyze the source of drug imports is complicated in two important ways. One is the distinction between finished drugs and active pharmaceutical ingredients (APIs), which are the chemicals (like acetaminophen and dextromethorphan) used to make the drugs (like NyQuil) people actually consume. The second is the fact that both finished drugs and APIs are scattered across multiple product codes in national trade databases, and some of those codes include non-pharmaceutical products. It is therefore difficult to accurately estimate the true value and origin of API imports and impossible to know the origin of all APIs that are imported as existing components of finished drugs.

For at least the last 20 years, the FDA has “estimated” that imports from all foreign countries make up “approximately” 40 percent of finished drugs and 80 percent of APIs used by U.S. manufacturers of finished drugs.20 But, in addition to the fact that it is unclear how the agency arrived at this estimate, the number also does not tell us where the APIs in the imported drugs are coming from. And, what’s more, any reasonable attempt to approximate these values does not indicate that anything close to 80 percent of finished drugs—or even 80 percent of the APIs consumed by Americans—are made in China. For example, we know that Chinese manufacturers supply only a small share of the APIs used to make finished drugs in the United States, because the source of those imports is recorded in U.S. trade data. According to analysis by the American Action Forum, a mere “18 percent of total active pharmaceutical ingredient imports, 9 percent of total antibiotic imports, and less than 1 percent of total vaccine imports” come from China.21 In reality, the largest source of imported APIs is Ireland—at about 30 percent.22 And certainly no one would credibly claim that Ireland poses any national security threat to the United States.

Moreover, in recent testimony to Congress, even the director of the FDA’s drug division stated that the agency “cannot determine with any precision the volume of API that China is actually producing, or the volume of APIs manufactured in China that is entering the U.S. market.”23 They do, however, have data on the location of facilities registered with the agency to produce APIs for specific approved drugs. For example, the FDA reports that there are 1,788 facilities in the world that manufacture APIs for drugs consumed in the United States.24 Only 13 percent of these facilities are in China.25 India and the European Union actually produce more of these APIs—at 18 and 26 percent, respectively. Twentyeight percent of the facilities are located here in the United States.26 Of course, even looking at the number of facilities does not tell us the actual volume of APIs from each country, as some facilities may be producing vastly greater quantities than others. But the data we do have does not indicate an excessive reliance on China. On the contrary, it shows that the U.S. pharmaceutical market is served by a diverse array of suppliers from all over the world, including here at home. It also shows that these market-driven supply chains are not, as Ambassador Lighthizer argues, the result of an irrational craze to cut costs at the expense of jobs. In truth, globalization has enabled the U.S. pharmaceutical industry to become a dynamic driver of economic growth in the United States

In a global economy, it is true that the United States is not the best place to invest in large-scale, labor-intensive chemical manufacturing. But America has excelled at inventing new drugs that improve lives and at developing innovative manufacturing techniques that make drug treatments safer, more effective and more affordable. Indeed, the U.S. Dept. of Commerce’s most recent report on the state of the pharmaceutical market certainly does not describe an industry hollowed out by short-sightedness: “Large, diversified and global, the U.S. pharmaceutical industry is one of the most critical and competitive sectors in the economy.”27 The U.S. market for pharmaceuticals is enormous and the United States is indeed the world’s number one importer of finished drugs. But because most drugs made in the world are not consumed in America, the United States is also a major exporter.

While the industry was developing “extended, overseas supply lines,” the value of U.S. pharmaceutical exports tripled to over $50 billion per year.28 The U.S. Bureau of Labor Statistics estimates that approximately 300,000 Americans work in the pharmaceutical industry with a median wage 56 percent higher than the national average.29 This is only made possible by access to the very global network of suppliers that reshoring advocates want to eliminate.

And global supply chains have also not made the market more vulnerable to disruption—intentional or otherwise. Supply chain risk is a well-studied phenomenon, and experts have not found that reliance on domestic production and short supply lines is the best way to avoid risk.30 The robustness of a supply chain (that is, its ability to continue operating when faced with an unforeseen disruption like a natural disaster) can be negatively affected by complexity because it takes more resources and oversight to maintain operations.31 But robustness can also be harmed by geographic concentration because a greater portion of the system is susceptible to a single incident.32 It makes sense, therefore, for companies to seek a diverse network of suppliers and potential suppliers with constant knowledge of their relative capacities. Forcing pharmaceutical companies to rely only on U.S. suppliers would likely expose their operations to greater risk of disruption by prohibiting them from adequately spreading risk.

Rather than reveal dangerous vulnerabilities, the coronavirus pandemic has actually demonstrated that supply lines for the U.S. pharmaceutical market are quite robust compared to other industries. We have seen notable problems in markets for face masks, household goods and food, but the U.S. medicine supply has been almost entirely unaffected. In fact, in its most recent update on the status of drug supplies during the COVID-19 outbreak, the FDA stated that only one drug had been added to the drug shortage list due to a pandemic related factory shutdown in China and that “there are other alternatives that can be used by patients.”33 The agency also identified only 20 drugs (all non-critical) with APIs sourced only from China, and none of those had reported any short-ages.34 Put simply, the evidence to date strongly suggests that the U.S. pharmaceutical supply chain is adequately diverse and robust in the face of unforeseen disruption. Efforts to re-shore all manufacturing of APIs is therefore likely to do more harm than good.

COSTS OF PHARMACEUTICAL AUTARKY

Because of the complex and efficient pharmaceutical supply chains that have developed over the years, prices of prescription drugs are lower than they would be if they were entirely manufactured in the United States. With a growing bipartisan chorus of policymakers in the Trump administration and Congress looking at ways to reduce drug prices, reshoring the entire pharmaceutical supply chain would not only undermine that worthwhile goal, but would raise drug prices.35

In fact, there are a number of reasons why the United States imports finished pharmaceuticals and active pharmaceutical ingredients, which include tax laws, simple comparative advantage and access to raw materials.36 Indeed, a 2011 study from the Food and Drug Administration noted:

Both India and China offer a number of cost advantages, most notably the cost of skilled labor. India in particular trains six times the number of chemists annually than the U.S. produces and companies can access this talent for 10% of the cost of the same talent in America.37

The study also finds that manufacturing in India, for example, can “reduce costs for U.S. and European companies by 30 to 40%.”38 These cheaper production costs mean cheaper drug prices for American consumers. If the United States were to entirely re-shore the pharmaceutical supply chain, it would dramatically increase prescription drug costs for American purchasers, including individuals, federal and state governments, hospitals and insurance companies.

Ironically, forced re-shoring could also bring about the exact result its proponents fear from Chinese interference. That is, by prohibiting American patients, pharmacists and doctors from acquiring safe and effective medicines available on the global market merely because they have a Chinese or other foreign ingredient, the U.S. government may cause the very shortages and price hikes it fears could result from malevolent foreign action. Consider, for example, the recent recall of metformin. Americans managing Type 2 diabetes spend over $3 billion per year filling prescriptions for metformin.39 After the FDA discovered potentially unsafe levels of nitrosamine in some batches of the drug, numerous drug makers pulled their metformin pills off the market.40 But the recall is not expected to affect patients at all because, according to the FDA, “there are additional manufacturers of the metformin ER formulation that supply a significant portion of the U.S. market, and their products are not being recalled.”41 Without access to global supplies, a single instance like this of drug contamination at a manufacturing plant would severely cut the nation’s supply and force patients to go without treatment. Instead, the FDA merely advises anyone currently taking one of the recalled products to “consult with their health care professional who can prescribe a replacement.”42

OVERVIEW OF CURRENT PROPOSALS

Even before the outbreak of COVID-19, policymakers had already begun proposing government interventions in the pharmaceutical chain in order to minimize or eliminate the role of Chinese manufacturing. For example, in October 2019, the House Energy and Commerce Committee held a hearing following a report from the U.S.–China Economic and Security Review Commission, which warned that the Chinese could “use U.S. dependence on China as an economic weapon and cut supplies of critical drugs.”43 That report made a number of recommendations, including additional monitoring and reporting by the FDA, mandatory country-of-origin labels for API and a requirement that all federally funded health systems (including Medicare and Medicaid) “purchase their pharmaceuticals only from U.S. production facilities” subject to some broad exceptions.44 It’s also worth noting that some of the recommendations are directed at all imported drugs and APIs instead of just ones from China, which certainly suggests that protectionism rather than national security is the true motivation behind such measures.

Moreover, a number of bills have been proposed recently in Congress that would enact reforms similar to one or more of the report’s recommendations. The most appropriate, common-sense proposals offered so far in Congress are ones meant to improve our knowledge of the existing supply arrangement through enhanced monitoring and reporting.45 Such knowledge may assuage rising anxiety about Chinese dominance but, even if it does not, a better understanding of the situation is crucial for government planners trying to redesign any major American industry.

In addition to this, a provision of the already enacted CARES Act calls for a report by the National Academies of Sciences, Engineering and Medicine to examine the current state of pharmaceutical and medical device supply chains and to recommend ways to improve resiliency.46 Other bills have called on the FDA to track API production with greater detail so we can know the volume of APIs originating in every country for each approved drug.47 Some proposals seek to promote domestic manufacturing of APIs through targeted tax breaks, grants or regulatory reform. One example of this approach is Senator Marsha Blackburn’s (R-Tenn.) “Securing America’s Medicine Cabinet Act,” which would reform the FDA’s Emerging Technology Program in order to fast-track the approval of new manufacturing methods that could help prevent supply chain disruptions.48

A number of more drastic proposals have been offered that would actively restrict access to drugs with foreign-sourced APIs. One ambitious example is the “Protecting our Pharmaceutical Supply Chain from China Act” proposed by Sen. Tom Cotton (R-Ark.) and Rep. Mike Gallagher (R-Wis.). In addition to having the FDA better track the origin of APIs, requiring country-of-origin information on labels and giving tax breaks to companies expanding domestic manufacturing, the bill would also prohibit U.S. government entities from buying any drugs made from APIs produced in China.49 Such a policy would undoubtedly incentivize pharmaceutical companies to source APIs from elsewhere, but it would also deny patients at VA and other federal hospitals access to drugs. The result would be healthcare decisions driven by industrial policy rather than medical needs. It would also expand the gap between private and public health systems, with the latter burdened by politically motivated inefficiencies that raise costs and reduce the quality of care.

POLICY RECOMMENDATIONS

Sen. Marco Rubio (R-Fla.) has offered a similarly broad bill with four Democratic co-sponsors that also employs a Buy-American strategy but is less targeted at China specifically. Their “Strengthening America’s Supply Chain and National Security Act” would deny any Buy American preferences to U.S.-manufactured drugs made with foreign-sourced APIs.50 Rather than embracing aggressive protectionism through Buy American requirements for federal pharmaceutical purchases, there are better ways to ensure the security of the supply chain and provide proper incentives to re-shore some portions of it to maintain affordable pharmaceuticals and a globally competitive industry. The following sections outline some of the most effective strategies.

Get better data and a clearer picture

As a preliminary matter, better data is needed before policymakers can truly make informed decisions about the future of the pharmaceutical supply chain. Data exists to determine the exact portion of imported APIs used by U.S. drug manufacturers and the countries from which they come. But, there is no data to determine the portion of APIs and their countries of origin used by foreign drug manufacturers exporting to the United States. In order to rectify this, Congress could mandate the disclosure of APIs to the FDA for any drug exported to the United States by foreign drug manufacturers. If such a method is adopted, precautions should be taken to ensure that trade secrets are protected.

Likewise, as mentioned, the CARES Act, passed by Congress in March 2020, requires the National Academies of Science, Engineering and Medicine to perform a study on the security of the pharmaceutical supply chain.51 Rather than exploiting a crisis to make swift and dramatic changes without a clear picture, policymakers should wait for and then use this study to carefully craft an appropriate response.

Lead the charge for liberalization

Since World War II, the United States has been the global leader in the creation and cultivation of the rules-based trading system. The bulwark of this system is the WTO. Every president from Harry Truman to Barack Obama was largely supportive of the WTO and its predecessor, the GATT. Today, that is not the case. The Trump administration has a wellknown antipathy for the Geneva-based forum.52

To be sure, the WTO’s negotiating function has been stuck in neutral for the last several years.53 This is partially understandable, as new rules are necessary to cover various disciplines, such as trade in digital products, that have risen in popularity with the emergence of internet-based commerce but were not accounted for originally. With the outbreak of COVID-19, there is an opportunity for the WTO to reestablish itself as the primary forum for crafting new rules to facilitate predictable rules-based trade in pharmaceutical and other medical products. As the world’s largest economy, the United States should play a leading role in facilitating such trade negotiations.

Additionally, Phil Hogan, the European Union’s Trade Commissioner, recently proposed a global trade negotiation that seeks to “permanently eliminate tariffs on medical goods needed to respond to the COVID-19 health crisis.”54 While lowering tariffs on pharmaceuticals and other medical supplies would be good, it does not go far enough. The larger concern during emergencies is that countries will restrict exports in an attempt to ensure sufficient quantities of certain products are available for domestic consumption. Since the outbreak of COVID-19, about 70 countries have imposed export restrictions on certain medical supplies.55 Unfortunately, WTO rules largely work to restrict only import protectionism, not export protectionism, both of which tend to proliferate during crises and economic downturns.

For these reasons, the United States should be leading the 163 other countries in the WTO to create new rules that prohibit restricting exports of pharmaceuticals and medical supplies during outbreaks.56 Such a move is not unprecedented; in April 2020, the agriculture ministers of the G-20 countries, including the United States, issued a pledge to prohibit food and agricultural export restrictions during the COVID-19 pandemic.57 Likewise, during the financial crisis of 2008, the United States and the other G-20 members issued a pledge that for the next year, they would “refrain from raising new barriers to investment or to trade in goods and services, imposing new export restrictions, or implementing World Trade Organization (WTO) inconsistent measures to stimulate exports.”58

If multilateral WTO negotiations to prohibit export restrictions of medical equipment and pharmaceuticals during emergencies are too difficult, too time consuming or face intractable opposition from, say, China, the United States could pursue plurilateral negotiations with some, but not all, WTO members. The United States would likely find willing partners with close allies like Australia, the European Union, Mexico, Canada, Japan, the United Kingdom, Taiwan, Israel and India. Such a group of close U.S. allies could agree not to impose export restrictions and other protectionist measures on medical supplies and pharmaceuticals during emergencies such as pandemics and natural disasters.

Outside the WTO context, the United States should include similar prohibitions on export restrictions during emergencies in future free-trade agreement (FTA) negotiations and consider narrowly revising existing FTAs to include such language.

Another possibility would be for the United States to rejoin the Trans-Pacific Partnership (TPP), a promising trade pact between Pacific Rim nations that President Trump abandoned.59 A primary goal of the TPP was to establish better and more reliable trading relationships with a number of Asian countries in China’s orbit. Rejoining the TPP would therefore strengthen Asian supply chains and provide an alternative to reliance on China. As part of rejoining the TPP, the United States could insist on a provision that would prohibit export restrictions on pharmaceuticals and other medical supplies. It could also look to expand the trade bloc by negotiating accession with countries like India and Taiwan. All of these options are consistent with existing WTO obligations and are preferable to crude attempts to re-shore the entire pharmaceutical supply chain.

Offer full expensing for manufacturing facilities

However, if the goal is to re-shore some of the pharmaceutical supply chain, there are positive steps policymakers can take. As part of the Tax Cut and Jobs Act (TCJA) passed in late 2017, Congress provided temporary full expensing of short-lived investments through 2022, which will phase out entirely by 2026.60 This means that when a firm makes a short-term investment, it can write off the full value of the investment from its tax liability in the year of the investment, rather than phasing it out as the asset depreciates. In order to qualify for full immediate expensing, the asset must have a cost-recovery period of 20 years or less.61

In order to make the United States a more attractive and competitive country in which to produce pharmaceuticals and APIs, policymakers should consider making full expensing permanent and applying it to long-term investments like non-residential structures or manufacturing facilities. This would provide an incentive for pharmaceutical manufacturers to open production facilities in the United States or to move facilities from overseas. Recent legislation was introduced in the House of Representatives that would provide this type of tax treatment to medical supply companies and pharmaceutical manufacturers for their non-residential real-property investments.62 Such a tax change is vastly superior to protectionist Buy American schemes.

Improve tax treatment of research and development costs

Currently, when an American firm makes investments into research and development (R&D), it can deduct those costs from its tax liability during the year in which they occur. This is the right policy. But under the TCJA, Congress mandated that beginning in 2022, firms making R&D investments must amortize those expenses over a five-year period. As the National Taxpayers Union Foundation has noted:

The policy will raise the cost of investments in research and development, meaning companies will be less likely to do R&D. That means less innovation and new technologies for the U.S. economy, leading to lower levels of productivity, lower wages, and a smaller economy.63

In order to incentivize more domestic production of pharmaceuticals and APIs, Congress should correct the TCJA’s treatment of R&D expenses. Full, immediate expensing is vastly preferable to an amortized approach, given the time-value of money.

Deregulate

The regulatory review process for building a pharmaceutical manufacturing facility can be cumbersome, time consuming and costly. If policymakers decide it is important to re-shore some portion of the pharmaceutical supply chain, the FDA should expedite and streamline the approvals of such facilities in order to eliminate costly delays and duplication.

Stockpile essential medicines

In addition to the measures already suggested, the federal government should identify and stockpile essential medicines in a deliberate and careful manner. A recent study by the Mercatus Center argues that policymakers should be utilizing the Defense Production Act to establish purchase guarantees for certain medical equipment necessary to combat COVID-19—along with targeted deregulation—in order to bolster production.64 A similar approach could be used to secure sufficient quantities of essential drugs.

By providing purchase commitments for the essential pharmaceuticals at above-market prices for a sustained period of time, the federal government can provide the proper marketbased incentives to significantly increase the supply of such drugs. Admittedly, the shelf-life of pharmaceuticals is probably shorter than protective masks, but the drugs could be purchased on a more regular basis than other medical equipment. Alternatively, companies could hold the extra stock and cycle in and out of their supplies. In other words, the government would be paying companies to have a rolling surplus of those pharmaceuticals that are deemed essential.

CONCLUSION

The simple reality is that the United States cannot—and should not—produce all pharmaceuticals domestically. Importing finished pharmaceuticals and APIs helps keep costs down. Existing pharmaceutical supply chains are diverse and produce benefits that accrue to American consumers. Exploiting the COVID-19 pandemic to haphazardly undo these supply chains would be a grave mistake that could result in higher prices or shortages of various drugs.

At the same time, if policymakers are concerned that the United States is too dependent on China for pharmaceuticals and APIs, there are steps they can take to lessen that dependence without resorting to costly pharmaceutical autarky or aggressive protectionism. The United States could go a long way toward ensuring a secure supply of pharmaceuticals by exerting global leadership through trade negotiations with like-minded allies. Likewise, policymakers can bolster

FOOTNOTES

1. Gary Clyde Hufbauer and Zhiyao (Lucy) Lu, “The Payoff to America from Globalization: A Fresh Look with a Focus on Cost to Workers,” The Peterson Institute for International Economics, May 2017. https://piie.com/system/files/documents/pb17-16.pdf.

2. Pablo D. Fajgelbaum and Amit K. Khandelwal, “Measuring the Unequal Gains from Trade,” The Quarterly Journal of Economics 131:3 (August 2016), pp. 1113-80. https://academic.oup.com/qje/article-abstract/131/3/1113/2461162?redirectedFrom=fulltext.

3. See, e.g., Tom Hamburger, Carol D. Leonnig, and Zachary A. Goldfarb, “Obama’s record on outsourcing draws criticism from the left,” The Washington Post, July 9, 2012. https://www.washingtonpost.com/business/economy/obamas-record-on-outsourcing- draws-criticism-from-the-left/2012/07/09/gJQAljJCZW_story.html; Patrick J. Buchanan, “Is Free Trade Falling Out of Fashion,” Buchanan.org, Feb. 18, 2004. https://buchanan.org/blog/pjb-is-free-trade-falling-out-of-fashion-578.

4. Robert E. Lighthizer, “The Era of Offshoring U.S. Jobs is Over,” The New York Times, May 11, 2020. https://www.nytimes.com/2020/05/11/opinion/coronavirus-jobs-offshoring.html.

5. Chris Wallace, “Interview with Donald Trump,” Fox News Sunday, Oct. 18, 2015. https://www.youtube.com/watch?v=aXqEcU0W5JI.

6. Jeff Desjardins, “These are the world’s biggest exporters,” World Economic Forum,June 25, 2018. https://www.weforum.org/agenda/2018/06/these-are-the-worldsbiggest-exporters.

7. Scott Lincicome, “The Truth about Trade,” National Review, April 4, 2016. https://www.nationalreview.com/2016/04/trade-jobs-free-trade-hurting-american-economy.

8. Laura Beth Harris, “Manufacturing Output Hits All-Time High, Signaling Industry’s Strength,” National Association of Manufacturers, July 29, 2019. https://www. nam.org/manufacturing-output-hits-all-time-high-signaling-industrys-strength-5546/?stream=workforce.

9. Michael J. Hicks and Srikant Devaraj, “The Myth and the Reality of Manufacturing in America,” Ball State University, April 2017. https://conexus.cberdata.org/files/Mfg-Reality.pdf.

10. Olivia Beavers, “Momentum grows to change medical supply chain from China,” The Hill, April 5, 2020. https://thehill.com/policy/national-security/491119-momentum-grows-to-change-medical-supply-chain-from-china.

11. Marco Rubio, “We Need a More Resilient American Economy,” The New York Times, April 20, 2020. https://www.nytimes.com/2020/04/20/opinion/marco-rubio-coronavirus-economy.html.

12. Ana Swanson, “Coronavirus Spurs U.S. Efforts to End China’s Chokehold on Drugs,” The New York Times, March 11, 2020. https://www.nytimes.com/2020/03/11/business/economy/coronavirus-china-trump-drugs.html.

13. Economists’ Letter to President Trump, Speaker Pelosi and Leader McConnell, May 2020. https://www.ntu.org/library/doclib/2020/05/economist-letter-2-.pdf.

14. Robert Lighthizer, “The Era of Offshoring U.S. Jobs is Over,” The New York Times, May 11, 2020. https://www.nytimes.com/2020/05/11/opinion/coronavirus-jobs-offshoring. html.

15. Ibid.

16. Sen. Elizabeth Warren et al., Letter to Mark T. Esper, Dec. 5, 2019. https://www.warren.senate.gov/imo/media/doc/2019.12.05%20Letter%20to%20DoD%20re%20pharmaceutical%20product%20supply%20chain.pdf.

17. Ibid.

18. Eric Boehm, “Why You Shouldn’t Trust Anyone Who Claims 80 Percent of America’s Drugs Come From China,” Reason, April 6, 2020. https://reason.com/2020/04/06/why-you-shouldnt-trust-anyone-who-claims-80-percent-of-americas-drugs-come-from-china.

19. Ibid.

20. See, e.g., “Food and Drug Administration: Improvements Needed in the Foreign Drug Inspection Program,” U.S. General Accounting Office, March 17, 1998, p. 1. https://www.gao.gov/assets/230/225564.pdf; “Drug Safety: FDA Has Improved Its Foreign Drug Inspection Program, but Needs to Assess the Effectiveness and Staffing of its Foreign Offices,” U.S. General Accounting Office, Dec. 16, 2016, p. 1. https://www.gao.gov/assets/690/681689.pdf.

21. Jacqueline Varas, “U.S. Dependence on Chinese Pharmaceuticals is Overstated,” American Action Forum, May 20, 2020. https://www.americanactionforum.org/insight/u-s-dependence-on-chinese-pharmaceuticals-overstated.

22. Ibid.

23. Statement of Janet Woodcock, “Safeguarding Pharmaceutical Supply Chains in a Global Economy,” House Committee on Energy and Commerce, Subcommittee on Health, Committee on Energy and Commerce, U.S. House of Representatives, 116th Congress, Oct. 30, 2019. https://energycommerce.house.gov/sites/democrats.energycommerce.house.gov/files/documents/Testimony-Woodcock-API_103019.pdf.

24. Ibid.

25. Ibid.

26. Ibid.

27. International Trade Administration, “2016 Top Market Report: Pharmaceuticals,” U.S. Dept. of Commerce, 2016, p.3. https://legacy.trade.gov/topmarkets/pdf/Pharmaceuticals_Executive_Summary.pdf.

28. “U.S. Biopharmaceutical Goods Export Volume from 2002 to 2018,” Statista, lastaccessed June 8, 2020. https://www.statista.com/statistics/215814/us-biopharmaceutical-export-volume.

29. U.S. Bureau of Labor Statistics, “May 2019 National Industry-Specific Occupational Employment and Wage Estimates: NAICS 325400 – Pharmaceutical and Medicine Manufacturing,” U.S. Dept. of Labor, May 2019. https://www.bls.gov/oes/2019/may/naics4_325400.htm.

30. Sébastien Mirodout, “Resilience Versus Robustness in Global Value Chains: Some Policy Implications,” Richard Baldwin and Simon Evenett eds., COVID-19 and Trade Policy: Why Turning Inward Won’t Work (CEPR Press, 2020), p. 123. https://voxeu.org/content/covid-19-and-trade-policy-why-turning-inward-won-t-work.

31. Christian F. Durach et al., “Antecedents and Dimensions of Supply Chain Robustness:A Systematic Literature Review,” International Journal of Physical Distributionand Logistics Management 45:1 (2015), pp. 125-32.

32. Ibid.

33. U.S. Food and Drug Administration, “Coronavirus (COVID-19) Supply Chain Update,” Press Release, Feb. 27, 2020. https://www.fda.gov/news-

34. Ibid.

35. Yasmeen Abutaleb and Erica Warner, “Trump’s support for bipartisan Senate drug pricing bill may not be enough to push it into law,” The Washington Post, Feb. 18, 2020. https://www.washingtonpost.com/health/2020/02/18/trumps-support-bipartisan-senate-drug-pricing-bill-might-not-be-enough-push-it-into-law.

36. Sally C. Pipes, “Proposed ‘Buy American’ Requirements Would Hurt Patients and the Economy,” Pacific Research Institute, April 2020, p. 6. https://www.pacificresearch. org/wp-content/uploads/2020/04/BuyAmerica_F.pdf.

37. “Pathway to Global Product Safety and Quality,” U.S. Food and Drug Administration, 2011, p. 20.

38. Ibid.

39. Richard Franki, “Top-selling drugs going to patients with diabetes,” MDEdge, March 12, 2018. https://www.mdedge.com/cardiology/article/160612/diabetes/topsellingdrugs-going-patients-diabetes.

40. David J. Neal, “Diabetes medicine recalled for having too much of a carcinogen. More recalls are likely,” Miami Herald, May 29, 2020. https://www.miamiherald.com/news/health-care/article243081016.html.

41. U.S. Food and Drug Administration, “FDA Alerts Patients and Health Care Professionals to Nitrosamine Impurity Findings in Certain Metformin Extended-Release Products,” Press Release, May 28, 2020. https://www.fda.gov/news-events/pressannouncements/fda-alerts-patients-and-health-care-professionals-nitrosamineimpurity-findings-certain-metformin.

42. Ibid.

43. “2019 Annual Report,” U.S.-China Economic and Security Review Commission, Nov. 14, 2019, p. 248. https://www.uscc.gov/annual-report/2019-annual-report.

44. Ibid., p. 249.

45. See, e.g., H.R. 5982, Safe Medicine Act, §3, 116th Congress.

46. CARES ACT, Sec. 3101.

47. See, e.g., H.R. 6049, Medical Supply Chain Security Act, §2(a)(5), 116th Congress.

48. S. 3432, Securing America’s Medicine Cabinet Act of 2020, 116th Congress.

49. Office of Sen. Tom Cotton, “Cotton, Gallagher Introduce Bill to End U.S. Dependence on Chinese-Manufactured Pharmaceuticals,” Press Release, March 18, 2020. https://www.cotton.senate.gov/?p=press_release&id=1342.

50. Office of Sen. Marco Rubio, “Rubio, Colleagues Introduce the Strengthening America’s Supply Chain and National Security Act,” Press Release, March 19, 2020. https://www.rubio.senate.gov/public/index.cfm/2020/3/rubio-colleagues-introducethe-

51. Section 3101 of Public Law 116-136.

52. See, e.g., Lauren L. Rollins and Clark Packard, “Trump is Trying to Dismantle the WTO. That Can’t Happen,” The Bulwark, April 26, 2019. https://thebulwark.com/trump-is-trying-to-dismantle-the-wto-that-cant-happen; Clark Packard, “Trump’s Real Trade War Is Being Waged on the WTO,” Foreign Policy, Jan. 9, 2020. https://foreignpolicy.com/2020/01/09/trumps-real-trade-war-is-being-waged-on-the-wto.

53. See, e.g., Clark Packard, “Crisis and Opportunity: The Multilateral Trading System at a Crossroads,” R Street Policy Study No. 167, March 2019. https://www.rstreet.org/wp-content/uploads/2019/03/Final-167.pdf.

54. Bryce Baschuk, “Europe Seeks to Abolish Tariffs in $597 Billion Medical Trade,” Bloomberg, April 16, 2020. https://www.bloomberg.com/news/articles/2020-04-16/europe-seeks-to-abolish-tariffs-in-597-billion-medical-trade.

55. Jason Douglas, “As Countries Bar Medical Exports, Some Suggest Bans May Backfire,” The Wall Street Journal, April 4, 2020. https://www.wsj.com/articles/ascountries-bar-medical-exports-some-suggest-bans-may-backfire-11585992600.

56. Dr. Mona Pinchis-Paulsen, “Thinking Creatively and Learning from COVID-19—How the WTO can Maintain Open Trade on Critical Supplies,” OpinioJuris, April 2, 2020. https://opiniojuris.org/2020/04/02/covid-19-symposium-thinking-creatively-andlearning-from-covid-19-how-the-wto-can-maintain-open-trade-on-critical-supplies.

57. Agriculture Ministers, “Ministerial Statement on COVID-19,” G-20, April 21,2020.https://g20.org/en/media/Documents/G20_Agriculture%20Ministers%20Meeting_Statement_EN.pdf.

58. Chad P. Bown, “COVID-19 Could Bring Down the Trading System,” Foreign Affairs, April 28, 2020. https://www.foreignaffairs.com/articles/united-states/2020-04-28/covid-19-could-bring-down-trading-system.

59. Note: the TPP moved forward without the United States. It is now called the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.

60. Erica York and Alex Muresianu, “The TCJA’s Expensing Provision Alleviates the Tax Code’s Bias Against Certain Investments,” Tax Foundation, Sept. 5, 2018. https://taxfoundation.org/tcja-expensing-provision-benefits.

61. Ibid.

62. H.R. 6690, The Beat China Act, 116th Cong.

63. Nicole Kaeding, “Correcting the TCJA’s Mistreatment of R&D Costs,” National Taxpayers Union Foundation, Oct. 8, 2019. https://www.ntu.org/foundation/detail/correcting-the-tcjas-mistreatment-of-rd-costs.

64. Caleb Watney and Alec Stapp, “Masks for All: Using Purchase Guarantees and Targeted Deregulation to Boost Production of Essential Medical Equipment,” Mercatus Center, April 8, 2020.https://www.mercatus.org/system/files/watney_and_stapp_-_policy_brief_-_covid_series_-_masks_for_all_-_v1.pdf.

U.S. Rep. McSally Supports Landmark Increase in Defense Spending

Martha McSallyWASHINGTON, D.C. – U.S. Representative Martha McSally today released the following statement after voting in support of the Bipartisan Budget Act:

“Today I voted with President Trump and Secretary Mattis to halt sequestration and increase defense spending. My vote is for our men and women in uniform who are relying on this boost in defense resources to carry out their mission and to keep us safe. Eight years’ worth of anemic defense budgets and neglect under President Obama’s defense sequester have thrown our military into a full-blown readiness crisis—and Secretary Mattis has made it very clear that, unless we pass a budget and fund the troops they will not have the resources to maintain their operations and deter war. That’s why, from the outset, I demanded that this bill include $700 billion this year and $716 billion next year for our troops to fulfill our military’s request—and it does.

This bill also dismantles another pillar of Obamacare: The ‘Independent Payment Advisory Board’—also known as the Death Panels and tasked with rationing Medicare.

We cannot hold our military hostage while we tackle other long-term spending and move towards fiscal responsibility. This landmark increase in defense spending will finally start to give our troops what they need to keep us safe.”

Congressman Andy Biggs Speaks Out on US National Debt

Thank you Congressman Andy Biggs for this statement:

Washington, D.C. – Today, Congressman Andy Biggs commented on the U.S. national debt passing twenty trillion dollars:

“Late last week, the U.S. national debt topped twenty trillion dollars for the first time in history. Instead of debating how Congress could take action to reduce the risk of default and substantial payments our grandchildren will inherit, Congress continues to encourage reckless spending and unaccountable taxpayer-funded programs. Rather than making the hard choices now, we are forcing Americans into an even tougher situation in the future because of this rising debt.

“It will take courage to cut government spending in order to deal with our national debt. If we are to follow through with our commitment to reduce expenditures and create economic stability for our future, we must immediately take action. The time for words is over.”

Jeff Flake Releases New Ad

Senator Jeff Flake released a political ad on Thursday touting his longstanding consistent conservative credentials.

In the ad, he references Vice President Mike Pence who arrived in Congress at the same time as Flake.

Both freshmen congressmen were ready to take on the establishment but also willing to speak out against their own party’s addition to bigger government and more spending.

The ad is a clip from an interview with Fox News’ Bill Hemmer in which Flake calls out those in the Republican Party who have lost their way and continue the trajectory of more government.

Arizonans Call for Defunding of Planned Parenthood

This past Saturday, approximately 5,000 Arizonans joined in protests at six Planned Parenthood locations across the state. These protests were in response to the gruesome videos exposing Planned Parenthood’s harvesting and selling of baby body parts.

At 342 protests across the country, tens of thousands stood for life and against Planned Parenthood’s barbaric actions towards innocent life in the womb.

Here in Arizona, we organized these protests to highlight what is happening inside of Planned Parenthood clinics, to call attention to the federal taxpayer dollars that are allocated to Planned Parenthood, and to encourage the media to bring to light the atrocities that have been covered up for too long by the abortion lobby. Any taxpayer dollars to Planned Parenthood for any services helps to support their position as the state’s largest abortion provider.

These peaceful protests featured many pro-life community leaders, religious leaders and elected officials as speakers. Thousands of women, men, children, mothers and fathers, and grandparents came together to present an alternative to abortion, and to communicate the beautiful narrative of life’s preciousness.

Most of the protesters left their locations Saturday, vowing to continue the fight for the preborn. For many, Saturday’s protests marked the first time they have participated in the pro-life movement. The winds of change are swirling in this country, and Saturday’s protests highlighted that fact.

We’d like to thank all the members of law enforcement who protected our First Amendment rights to peaceably protest and for all those who rallied together for life.

Christine Accurso
Lisa Blevins
Linda Rizzo
Vanessa Tedesco
Anita Usher

Don’t Embrace Big Federal Government, Support the Compact for a Balanced Budget

By Nick Dranias

Yes, it’s true. The handful of folks who still oppose states organizing behind the Compact for a Balanced Budget to advance and ratify a powerful federal Balanced Budget Amendment embrace big federal government. Of course, they may not mean to do so. But the truth is that by hugging and holding the political status quo, the Balanced Budget Amendment fear-mongers are in a death embrace with the things they claim they oppose.

Why is that? Simply put, we no longer enjoy the form of federal government the Founders originally created. This is because the Constitution as it currently exists has three fatal flaws, which will inexorably lead to tyranny unless they are fixed with a constitutional amendment.

The first is the federal government’s unlimited borrowing capacity. This enables politicians to promise at no immediate cost anything it takes to get elected. That’s like handing liquor and car keys to a teenager. It guarantees a system crash propelled by mindless spending.

The second is unlimited direct taxation authority courtesy of the 16th Amendment. This empowers politicians to make 49% of the nation pay for anything the 51% want; and also to impose complete economic destruction on political enemies and disfavored policy ideas. If this flaw persists, what the IRS did to conservative groups two years ago is just a small taste of what the future holds.

The third is the unlimited concentration of power over national policy making in Washington, DC courtesy of the 17th Amendment. This amendment removed the states from a position of control over the U.S. Senate. It has enabled the federal government to ratify treaties and laws, as well as populate the federal judiciary and federal agencies, without any respect for state sovereignty. And it allows a growing distant political class in Washington, DC to easily leverage overwhelming national power to crush dissent and policy diversity in the heartland.

These three flaws will cause the federal government to gradually accumulate and centralize all political power over time. Over time, these three flaws will make it impossible for limited government and freedom-oriented elected officials to outcompete elected officials who favor big federal government for votes. Consequently, hugging and holding this fatally flawed system is doomed to produce the opposite of freedom. To mix metaphors, voting people in or out of the federal government under these conditions is like rearranging deck chairs on the Titanic.

Only a constitutional amendment can fix the three fatal flaws of the Constitution as it currently exists. Nothing else will.

But it is irrational to expect two-thirds of each house of Congress to propose the necessary reform. The numbers did not add up in the 1980s, 1990s, or 2000s, and they just do not add up today. Instead, especially after the last election, there is a much more plausible pathway; that pathway involves organizing three-fourths of the states and simple majorities of Congress behind the necessary reform amendment in a targeted fashion. It means supporting the Compact for a Balanced Budget.

Simply put, the Balanced Budget Amendment advanced by the Compact for a Balanced Budget gives us the best shot of addressing each of the Constitution’s three fatal flaws with fundamental reforms.

To fix the flaw of unlimited federal borrowing capacity, the Amendment imposes an initially-fixed constitutional limit on available borrowing capacity. This limit gives the federal government an additional 5% in borrowing capacity above the outstanding federal debt upon ratification. This 5% cushion allows for a 1 to 2 year transitional period to responsible budgeting and fiscal planning. And there is no doubt the amendment will focus the mind during that transitional period. This is because the debt limit is coupled to a mandatory spending impoundment requirement that kicks-in when 98% of the debt limit is reached. Spending will be limited to available tax and fee cash flow if the debt limit is hit. There is no exception except for the referendum process described below. This one reform guarantees that Washington politicians will immediately lose the ability to promise anything at no immediate cost to get elected.

To fix the flaw of the unlimited centralization of national policy making in Washington, the Amendment empowers a majority of state legislatures to veto any increase in the federal government’s constitutionally-fixed borrowing capacity. To get any additional borrowing capacity above the initial constitutional baseline, simple majorities of Congress will have to refer-out a measure proposing the increase. The proposal will be deemed denied unless it is approved by at least twenty-six state legislatures within 60 days of the referral. With the federal government borrowing nearly half of discretionary spending, this referendum process divides power over national policy making between the states and the federal government in a big way.

Finally, to fix the flaw of unlimited federal taxation authority, the Amendment imposes a tax limit requiring two-thirds of each house of Congress to approve any new or increased income or sales tax. The current constitutional rule allowing for tax increases with simple majorities will be restricted to measures that would completely replace the income tax with a consumption sales tax, eliminate tax loopholes, or impose new or increased tariffs and fees. The reform will divert the pressure for new revenue to the places where special interest pushback will be the strongest, further ensuring that deficits are closed by spending reductions first.

National polling shows that each one of these policy fixes are supported by supermajorities of the American people. With Alaska and Georgia already on board, and at least ten states looking to join the Compact this session, the Compact for a Balanced Budget is an eminently plausible route to the reforms we need to save and restore the Republic.

Indeed, with demographic change threatening the supermajorities needed to get the job done, the Compact for a Balanced Budget may be our last best shot at preventing the federal tyranny that will otherwise inevitably result from the Constitution’s three fatal flaws of unlimited debt, unlimited taxation, and unlimited centralization of power in Washington.

Nick Dranias is President and Executive Director of the Compact for America Educational Foundation. Please visit their website at www.CompactforAmerica.org.

Will Kyrsten Sinema Support Obama’s Job Destroying Cap-and-Trade Scheme?

NRCC

Kyrsten Sinema Will Have to Choose Between Saving Jobs or Backing her Friends in D.C.

WASHINGTON – Is Kyrsten Sinema going to listen to Arizona voters and save American jobs, or will she fall in line with her Democrat allies and support President Obama’s latest cap-and-trade scheme that could cost the U.S. economy $50 billion a year and eliminate an estimated 224,000 jobs?

A recent study, issued by the United States Chamber of Commerce, found that President Obama’s new cap-and-trade edict will force more than a “third of the coal-fired power capacity to close by 2030.”

“Not only will this new Obama regulation cost billions of dollars for taxpayers, but it will limit American energy production and spike electricity prices – hurting families across America,” said NRCC Communications Director Andrea Bozek. “Arizona families deserve a Republican leader in Congress that will stand up to President Obama and his Administration’s job-destroying regulations.”

Will Kyrsten Sinema Support Obama’s Job Destroying Cap-and-Trade Scheme.
(Michael Bastasch, EPA To Unilaterally Push Cap And Trade On Carbon Emissions, The Daily Caller, 5/27/14)

“President Obama’s climate rule change will force more than a “third of the coal-fired power capacity to close by 2030.”
(Mark Drajem, Chamber Study Predicts Obama Climate Rule Will Kill Jobs, Bloomberg, 5/28/14)

Cost nearly $50 billion and eliminate an estimated 224,000 jobs
(Energy Institute Report Finds That Potential New EPA Carbon Regulations Will Damage U.S. Economy, U.S. Chamber of Commerce, 5/28/14)

It will limit American energy production and spike electricity prices.
(Ralph Vartabedian, U.S. electricity prices may be going up for good, LA Times, 4/25/14)

ELECTRICITY: “U.S. electricity prices may be going up for good. There is a growing fragility in the U.S. electricity system, experts warn, the result of the shutdown of coal-fired plants, reductions in nuclear power, a shift to more expensive renewable energy and natural gas pipeline constraints. … ‘We are now in an era of rising electricity prices,’ said Philip Moeller, a member of the Federal Energy Regulatory Commission…” (Los Angeles Times)

HEALTH CARE: “More employees are getting hit with higher health insurance premiums and co-payments, and many don’t have the money to cover unexpected medical expenses, a new report finds. More than half of companies (56%) increased employees’ share of health care premiums or co-payments for doctors’ visits in 2013, and 59% of employers say they intend to do the same in 2014, according to the annual Aflac WorkForces Report.” (USA TODAY)

FOOD: “Rising food prices bite into household budgets. Prices are rising for a range of food staples, from meat and pork to fruits and vegetables, squeezing consumers still struggling with modest wage gains.” (USA TODAY)

FLYING, THE MOVIES, OIL CHANGES, AND MORE: “David Rosenberg, chief economist and strategist at Gluskin Sheff, said other areas beyond food and energy … are getting costlier as well. ‘Airline fares are on the rise,’ he said in his morning note Tuesday. ‘Movie tickets and other such recreational services are on the rise. Repair service fees are on the rise. Shelter costs in general are on the rise. Tuition costs are on the rise. Medical service prices are on the rise.’” (NBC News)

Americans for Prosperity: Congress and the President are shortening the fuse

By Christine Harbin Hanson and Tom Jenney

Imagine paying an extra $15,000 a year in taxes. For 50 working years.

That is the burden Washington is placing on our children and grandchildren.

America’s unfunded government liabilities over the next 75 years are between $100 trillion and $200 trillion, depending on how you crunch the numbers. Those are the spending promises our politicians have made through Medicare, Medicaid, Social Security, the Pension Benefit Guaranty Corp. and other federal programs, including “Obamacare.”

According to realistic estimates by the Congressional Budget ­Office, the unfunded liabilities in Medicare alone are $89 trillion.

Let’s take a midway total liability estimate of $150 trillion. If we divide by the 90 million children in this country who are under the age of 18 (and who did not vote for the politicians who made the spending promises), it comes to more than $1.5 million per child over their lifetimes — above and beyond what they are currently scheduled to pay in taxes.

Over a 50-year working lifetime, that’s $30,000 a year. Lucky for them, financial markets will put some of that burden on those of us who are currently working adults. But if they absorb half of the burden, that would be an average of $15,000 a year in extra taxes per child or grandchild.

Of course, any attempt to actually collect that much extra revenue from American workers or their employers would create massive, long-term structural unemployment and destroy economic growth by causing even more capital and jobs to move overseas.

Unfortunately, Congress and the president are doing nothing to defuse America’s gigantic bankruptcy bomb; instead, they are shortening the fuse.

These past few months were a critical time for conservative members of Congress to stand firm behind their promises to get runaway government spending under control. Congress considered two of the biggest spending bills of the year, the Ryan-Murray budget deal and the farm bill ­conference report.

The first disappointing vote was on the budget resolution in October. Crafted by House Budget Chairman Paul Ryan and Senate Budget Chairman Patty Murray, the deal boosted discretionary spending to a whopping $1 trillion a year for each of the next two years. Worse, the plan shattered previously agreed-upon spending caps for fiscal year 2014 by $45 billion — an alarming increase and a broken promise.

The deal also further nickel-and-dimed American families by hiking airline ticket taxes and making changes to military pensions.

Most alarming is the fact that the Ryan-Murray deal traded higher spending now in exchange for the promise of $28 billion in cuts in 2022 and 2023. American taxpayers deserve spending cuts now, not promises to cut spending in the future.

The second vote was the farm bill conference report in February. This legislation authorized $1 trillion in spending over the next decade. Passed under the false guise of helping small farmers, the bill expanded a number of corporate welfare programs such as crop insurance, massive taxpayer subsidies and revenue guarantees for politically connected farmers.

It also neglected to make any meaningful reforms to ballooning food-stamp spending, which has more than doubled since President Obama took office and is rife with abuse.

Americans for Prosperity urged legislators to vote against both bills, and we will include these votes in our next congressional scorecard.

We are grateful to report that a number of Arizona’s legislators stood up for American taxpayers and voted against both of these bloated bills. House members who voted the right way included Trent Franks, Paul Gosar, Matt Salmon and David Schweikert.

On the Senate side, Jeff Flake also voted correctly. AFP applauds these members for standing up against more government handouts and higher spending.

A number of Democratic legislators voted against the bills, but for much different reasons. Some Democrats overwhelmingly felt that the budget resolution and the farm bill conference report didn’t spend enough.

Worse, a disappointing number of Republican legislators cast a “yes” vote for both the Ryan-Murray budget deal and the farm bill conference report, signaling their support of higher federal spending. Remember: This is the party that claims to support controlling spending and limiting the size of government.

Meanwhile, the fuse continues to burn on America’s bankruptcy bomb.

Americans for Prosperity is committed to defusing that bomb and securing a bright fiscal future for our children and grandchildren.

Tom Jenney is director of Americans for Prosperity’s Arizona chapter. Christine Harbin Hanson is federal issues campaign manager for Americans for Prosperity. More information: www.americansforprosperity.org.

Hear 5-Minute Stump Speeches from 29 Arizona GOP Candidates!

uvs140316-001Here’s a chance to see and hear from no less than 29 Arizona elected-office candidates, all in one place. It’s like speed-dating for politicians(!).

On March 15, 2014, the Sun City West Republican club sponsored a well-run Candidates Forum in which each candidate packed all he/she could in a 5-minute appeal to Arizona voters.

The full article and videos are at this link.  You can hear them all or use time sliders to pick the candidates of your choice. Included, in order of appearance, are:

Michael Jeanes, candidate, Arizona Clerk of Courts
Sandra Dowling, candidate, Maricopa County Board of Supervisors
Clint Hickman, candidate, Maricopa County Board of Supervisors
Elbert Bicknell, candidate, Maricopy Country Health Care District #4
Jean McGrath, candidate, Marcopa County Community College District #4
John Heep, candidate, Marcopa County Community College District #4
Bonnie Katz, candidate, Arizona Corporation Commission
Lucy Mason, candidate, Arizona Corporation Commission
Diane Douglas, candidate, AZ Superintendent of Public Instruction
Jeff Dewit, candidate, Arizona State Treasurer
Randy Pullen, candidate, Arizona State Treasurer
David Livingston, candidate, AZ Representative LD22
Phil Lovas, candidate, AZ Representative LD22

Judy Burges, candidate, AZ Senate LD22
Clair Van Steenwyk,
candidate, US House of Representatives
Trent Franks,
candidate, US House of Representatives
Tom Forese,
candidate, Arizona Corporation Commission
Mark Brnovich,
candidate, AZ Attorney General
Tom Horne,
candidate, AZ Attorney General
Michele Reagan,
candidate, AZ Secretary of State
Justin Pierce,
candidate, AZ Secretary of State
Christine Jones,
candidate, AZ Governor
Al Melivn,
candidate, AZ Governor
Alice Lukasik,
candidate, AZ Governor
John Molina,
candiate, AZ Governor
Frank Riggs,
candidate, AZ Governor
Scott Smith,
candidate, AZ Governor

For the full article, click here.

Expanding the Blue Dog Democrat Franchise in Arizona

lapdogYou know you’re in real trouble when the Blue Dog Democrat Caucus invites you into its midst in an effort to give you political protection.

That’s what just happened to Arizona Representatives Ron Barber and Kyrsten Sinema (Why not Ann Kirkpatrick?) as the mid-term election cycle kicks off.

According to the Washington Post, “In danger of losing even more clout, the leading Blue Dogs are regrouping and rebuilding. They are adding four members to their ranks this week — Reps. Ron Barber (Ariz.), Cheri Bustos (Ill.), Kyrsten Sinema (Ariz.) and Nick J. Rahall II (W.Va.).”

Ron Barber can’t be called a moderate by any stretch of the political definition. He supports Obamacare, voted for Nancy Pelosi and even a plan to balance the federal budget.

This is nothing more than political duck and cover as the midterm elections approach.

Ron Barber is not a Blue Dog Democrat. If anything, he’s one of Nancy Pelosi’s loyal lap dogs.