All posts by MuniCourts

Education, Politics, Race

The made-up crisis behind the state takeover of Houston’s public schools

by Domingo Morel, Rutgers University Newark

If the state of Texas had its way, the state would be in the process of taking over the Houston Independent School District.

But a judge temporarily blocked the takeover on Jan. 8, with the issue now set to be decided at a trial in June.

The ruling temporarily spares Houston’s public school system from joining a list of over 100 school districts in the nation that have experienced similar state takeovers during the past 30 years.

The list includes New York City, Chicago, Boston, Philadelphia, Detroit, New Orleans, Baltimore, Oakland and Newark. Houston is the largest school district in Texas and the seventh largest in the U.S.

While the state of Texas claims the planned takeover is about school improvement, my research on state takeovers of school districts suggests that the Houston takeover, like others, is influenced by racism and political power.

States fail to deliver

State governments have used takeovers since the late 1980s to intervene in school districts they have identified as in need of improvement. While state administrations promise that takeovers will improve school systems, 30 years of evidence shows that state takeovers do not meet the states’ promised expectations. For instance, a recent report called Michigan’s 15-year management of the Detroit schools a “costly mistake” because the takeover was not able to address the school system’s major challenges, which included adequately funding the school district.

But while the takeovers don’t deliver promised results, as I show in my book, they do have significant negative political and economic consequences for communities, which overwhelmingly are communities of color. These negative consequences often include the removal of locally elected school boards. They also involve decreases in teachers and staff and the loss of local control of schools.

Despite the highly problematic history of state takeovers, states have justified the takeovers on the grounds that the entire school district is in need of improvement. However, this is not the case for the Houston takeover because by the state’s own standards, the Houston school system is not failing.

Low threshold for state intervention

Following a 2015 law, HB 1842, the state of Texas was granted authority to take over a school district if a single school in that district fails to meet state education standards for five or more years. The bill was passed by the Republican controlled state legislature with Democratic support. However, Democratic state lawmakers representing Houston argue that the law was a mistake and urged for it to be revised.

Although the state has given the Houston Independent School District a B rating, it plans to take over the Houston schools because one school, Wheatley High School, has not met state standards for seven years. According to state law, the state can take over a school district or close a school if it fails to meet standards for five years.

The Houston Independent School District has 280 schools. The district serves over 200,000 students. It employs roughly 12,000 teachers. Wheatley High School serves roughly 800 students and has roughly 50 teachers.

So why would a state take over a school district that has earned a B rating from the state? And why base the takeover on the performance of one school that represents fewer than 1% of the district’s student and teaching population?

In order to understand the logic of the planned state takeover of the Houston schools, it pays to understand the important role that schools have played in the social, political and economic development of communities of color. Historically, communities of color have relied on school level politics as an entry point to broader political participation. School level politics may involve issues like ending school segregation, demanding more resources for schools, increasing the numbers of teachers and administrators of color, and participating in school board elections.

The process of gaining political power at the local level – and eventually state level – often begins at the schools, particularly the school board. For instance, before blacks and Latinos elect members of their communities to the city councils, the mayor’s office, and state legislatures, they often elect members to the school board first.

Political representation at stake

In Texas, communities of color are politically underrepresented. Although blacks, Latinos, and Asians represent nearly 60% of the population in Texas, their political power at the state level is not proportional to their population. Whites make up 64% of the state legislature. The Republican Party controls the governorship, state House of Representatives and state Senate, but only 4% of all Republican state legislators are of color. Communities of color in Texas have filed lawsuits arguing that they have been prevented from gaining political representation at the state level by Republicans through racial gerrymandering and voter identification laws that disenfranchise black and Latino voters.

However, despite years of systematic exclusion of people of color, the political landscape is changing in Texas. Texas is increasingly urbanizing as a result of population growth in the state’s cities. Since urban voters are more likely to vote Democratic, the growth in the urban population may potentially alter political dynamics in the state. Also, while African Americans have solidly identified with the Democratic Party in Texas, Latinos have not. But that, too, is changing. Polls show that Latino support for Republican presidential candidates in Texas went from a high of 49% during George W. Bush’s reelection in 2004, to 35% for McCain in 2008, 29% for Romney in 2012, to a low of 18% for Trump in 2016.

Houston, as the largest urban center in Texas, is at the forefront of this challenge to the Republican grip of state power in Texas. The Houston schools, in particular, are representative of the state’s demographic and political future. The nine-member Houston school board is reflective of the community it serves. It has four Latinos, three African Americans, one Asian and one white. This, in my view, is what has put the Houston public school system and school board at the forefront of a battle that is really about race and political power.

The Houston public school system is not failing. Rather, Republican Gov. Greg Abbott, Education Commissioner Mike Morath and the Republican state legislature are manufacturing an education crisis to prevent people of color in Houston from exercising their citizenship rights and seizing political power.

Republished with permission under license from The Conversation.

History, Race

What everyone should know about Reconstruction 150 years after the 15th Amendment’s ratification

by Tiffany Mitchell Patterson, West Virginia University

I’ll never forget a student’s response when I asked during a middle school social studies class what they knew about black history: “Martin Luther King freed the slaves.”

Martin Luther King Jr. was born in 1929, more than six decades after the time of enslavement. To me, this comment underscored how closely Americans associate black history with slavery.

While shocked, I knew this mistaken belief reflected the lack of time, depth and breadth schools devote to black history. Most students get limited information and context about what African Americans have experienced since our ancestors arrived here four centuries ago. Without independent study, most adults aren’t up to speed either.

For instance, what do you know about Reconstruction?

I’m excited about new resources for teaching children, and everyone else, more about the history of slavery through The New York Times’ “1619 Project.” But based on my experience teaching social studies and my current work preparing social studies educators, I also consider understanding what happened during the Reconstruction essential for exploring black power, resilience and excellence.

During that complex period after the Civil War, African Americans gained political power yet faced the backlash of white supremacy and racial violence. I share the concerns many writers, historians and other scholars are raising about the shortcomings of what schoolchildren traditionally learn about Reconstruction in school. Here are some suggestions for educators, parents and others interested in learning more about that time period.

Reconstruction amendments

As most students do learn, the U.S. gained three constitutional amendments that extended civil and political rights to newly freed African Americans following the Civil War.

The 13th, ratified in 1865, banned slavery and involuntary servitude except for the punishment of a crime.

The 14th, ratified three years later, granted citizenship and equal protection under the law to all people born in the United States, as well as naturalized citizens – including all previously enslaved individuals.

Then, the 15th Amendment asserted that neither the federal government nor state governments could deny voting rights to any male citizen.

The year 2020 marks the 150th anniversary of the ratification of the 15th Amendment on Feb. 3, 1870. The anniversary is a good opportunity to learn about how the amendment was supposed to guarantee that the right to vote could not be denied based on “race, color, or previous condition of servitude.”

African Americans celebrated the 15th Amendment’s ratification. Smithsonian National Museum of African American History and Culture

African American politicians

What few history and social studies classes explore is how these changes to the Constitution made it possible for African American men to use their newfound political power to gain representation.

Hiram Rhodes Revels, the first African American senator, represented Mississippi in 1870 after the state’s Senate elected him. He was among the 16 black men from seven southern states who served in Congress during Reconstruction.

Revels and his colleagues were only part of the story. All told, about 2,000 African Americans held public office at some level of government during Reconstruction.

White supremacist groups like the Ku Klux Klan also formed following the Civil War. These terrorist groups engaged in violence and other racist tactics to intimidate African Americans, people of color, black voters and legislators. They thus made the accomplishments of African American politicians even more impressive as they served as public officials under the constant threat of racial violence.

The first African American members of Congress were elected after the Civil War. Currier and Ives via the Library of Congress

Black activist women

African American women technically gained the right to vote in 1920, when the 19th Amendment passed. However, their constitutional right was limited in many states due to discriminatory laws.

Mary Church Terrell, an educator, fought for the rights of women of color. National Archives Docs Teach collection

Many black women were activists and women’s suffrage movement leaders. Through public speaking, prolific writing and developing organizations dedicated to racial and and gender equality, they fought for equal rights and dignity for all.

Among the black women who were activists during Reconstruction were the five Rollins sisters of South Carolina, who fought for female voting rights; Maria Stewart, an outspoken abolitionist before the Civil War and suffragist once it ended; and Mary Ann Shadd Cary, the first black woman in North America to edit and publish a newspaper, one of the first black female lawyers in the country and an advocate for granting women the right to vote.

Other women of color who played key roles in the suffrage movement included Ida B. Wells, the journalist and civil rights advocate who raised awareness of lynching, and Mary Church Terrell, founder of the National Association of Colored Women.

Higher education

Before the Civil War, many states made teaching enslaved individuals to read a crime. Education quickly became a top priority for black Americans once slavery ended.

While northern, largely white philanthropists and missionary groups and the U.S. Bureau of Refugees, Freedmen, and Abandoned Lands, better known as the Freedmen’s Bureau, did help create new educational opportunities, the African American public schools established after the Civil War ended were largely built and staffed by the black community.

Many new institutions of higher education, now called Historically Black Colleges and Universities or HBCUs, began to operate during Reconstruction.

These schools trained black people to become teachers and ministers, doctors and nurses. They also prepared African Americans for careers in industrial and agricultural fields.

Public and private HBCUs founded during Reconstruction and still operating today include Howard University in Washington, D.C., Hampton University in Virginia, Alabama State University, Morehouse College in Georgia and Morgan State University in Maryland. These colleges and universities train a disproportionate share of black doctors and other professionals even today.

Morehouse graduates from the class of 2013 celebrated in the rain when President Obama delivered their commencement address. Official White House Photo by Pete Souza

Historical experiences

Storytelling, multimedia experiences and trips to historic sites and creative museums help get people of any age interested in learning about history.

Depending on where you live, you may want to embark on a family outing or school field trip.

The National Constitution Center in Philadelphia has a new permanent exhibit on the Civil War and Reconstruction.

The National Museum of African American History and Culture, which opened in Washington, D.C. in 2017, contains artifacts from the Reconstruction era. It’s also making the records of the Freedmen’s Bureau, including the names of formerly enslaved individuals following the Civil War, available online.

Another option is the Reconstruction Era National Historic Park in Beaufort County, South Carolina.

I also recommend watching the PBS documentaries about Reconstruction by the scholar and filmmaker Henry Louis Gates Jr. and reading the young adult book Gates co-authored with children’s nonfiction writer Tonya Bolden about the era. Gates has also compiled a Reconstruction reading list for adults.

In addition, the organization Teaching for Change curates a booklist on Reconstruction for middle and high school students. And the Zinn Education Project Teach Reconstruction Campaign offers a variety of resources including readings, primary sources and even lesson plans.

Henry Louis Gates Jr.‘s documentary series delves into the history of what happened in America after the Civil War.

An incomplete transition

As the renowned black scholar W.E.B. DuBois observed, racist laws and violent tactics in many states actively limited black freedom.

“The slave went free; stood for a brief moment in the sun; then moved back again toward slavery,” he explained.

This was by no means voluntary. Intimidated and threatened by black enfranchisement and excellence in the era of Reconstruction, white supremacists attempted to enforce subordination through violence, such as lynching; and in systemic ways through Jim Crow laws. African Americans continued to assert their civil and constitutional rights as activists, politicians, business owners, teachers and farmers in the midst of white supremacist backlash.

With the latest voter suppression efforts restricting access to the ballot box for voters of color and the resurgence of racist violence and vitriol today, DuBois’ words sound eerily familiar. At the same time it’s reassuring to recall how quickly formerly enslaved African Americans made their way to schoolhouses and public offices.

Republished with permission under license from The Conversation.

Taxes

IRS Reforms Free File Program, Drops Agreement Not to Compete With TurboTax

The changes come after ProPublica’s reporting showed how TurboTax maker Intuit tricked customers into paying for tax prep they could have gotten for free.

by Justin Elliott and Paul Kiel

Finding free online tax filing should be easier this year for millions of Americans.

The IRS announced significant changes Monday to its deal with the tax prep software industry. Now companies are barred from hiding their free products from search engines such as Google, and a years-old prohibition on the IRS creating its own online filing system has been scrapped.

The addendum to the deal, known as Free File, comes after ProPublica’s reporting this year on how the industry, led by TurboTax maker Intuit, has long misled taxpayers who are eligible to file for free into paying.

Under the nearly two-decade-old Free File deal, the industry agreed to make free versions of tax filing software available to lower- and middle-income Americans. In exchange, the IRS promised not to compete with the industry by creating its own online filing system. Many developed countries have such systems, allowing most citizens to file their taxes for free. The prohibition on the IRS creating its own system was the focus of years of lobbying by Intuit. The industry has seen such a system as an existential threat. Now, with the changes to the deal, the prohibition has been dropped.

The addendum also expressly bars the companies from “engaging in any practice” that would exclude their Free File offerings “from an organic internet search.” ProPublica reported in April that Intuit and H&R Block had added code to their Free File pages that hid them from Google and other search engines, diverting many users to the companies’ paid products.

“The improved process will make Free File stronger and give taxpayers another reason to consider this valuable software option,” IRS Commissioner Chuck Rettig said in a statement. The agency hopes the changes will make the free option more accessible for taxpayers in the 2020 filing season, he said.

Under the new rules, participating companies also have to standardize the naming convention of their Free File version as “IRS Free File program delivered by [product name].” In the past, many tax filers reported being confused by the difference between, for example, TurboTax Free and TurboTax Free File.

In a blog post on the Intuit website, the company said, “Intuit strongly supports these changes to the Free File program and associated Free File offerings because they increase the focus on the taxpayer experience.”

Intuit faces multiple ongoing lawsuits and investigations into whether the company deceived customers. The company has said such accusations are baseless.

Republished with permission under license from ProPublica.

 

Uncategorized

World’s 500 Richest People Gained $1.2 Trillion in Wealth in 2019

"In the U.S., the richest 0.1% control a bigger share of the pie than at any time since 1929."

by Jake Johnson

The 500 richest people in the world, all of whom are billionaires, gained a combined $1.2 trillion in wealth in 2019, further exacerbating inequities that have not been seen since the late 1920s.

List of 2018 top 10 richest people in the world

That's according to a new Bloomberg analysis published Friday, which found that the planet's 500 richest people saw their collective net worth soar by 25 percent to $5.9 trillion over the last year.

"In the U.S., the richest 0.1 percent control a bigger share of the pie than at any time since 1929," Bloomberg noted. "The 172 American billionaires on the Bloomberg ranking added $500 billion, with Facebook Inc.'s Mark Zuckerberg up $27.3 billion and Microsoft Corp. co-founder Bill Gates [rising] $22.7 billion."

According to the Bloomberg Billionaires Index, eight of the 10 richest people in the world are from the U.S.

Amazon CEO Jeff Bezos lost nearly $9 billion in wealth in 2019, according to Bloomberg, but he will still likely end the year as the richest man in the world with a total net worth of $116 billion.

The analysis comes as 2020 Democratic presidential candidates, particularly Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.), have made tackling inequality a key component of their policy platforms.

Warren has proposed an annual two percent tax on assets over $50 million and a three percent tax on assets above $1 billion.

Sanders, who has said he does not believe billionaires should exist, is calling for a wealth tax that would slash the fortunes of U.S. billionaires in half over 15 years, according to his campaign.

"A small handful of billionaires should not be able to accumulate more money than they could spend in 10 lifetimes," Sanders said in September, "while millions of Americans are living in poverty and dying because they can't afford healthcare."

Republished with permission under license from CommonDreams.

Civil Rights, Education, Housing, Military, Race

GI Bill opened doors to college for many vets, but politicians created a separate one for blacks

By Joseph Thompson, Mississippi State University

When President Franklin Roosevelt signed the GI Bill into law on June 22, 1944, it laid the foundation for benefits that would help generations of veterans achieve social mobility.

Formally known as the Servicemen’s Readjustment Act of 1944, the bill made unprecedented commitments to the nation’s veterans. For instance, it provided federal assistance to veterans in the form of housing and unemployment benefits. But of all the benefits offered through the GI Bill, funding for higher education and job training emerged as the most popular.

More than 2 million veterans flocked to college campuses throughout the country. But even as former service members entered college, not all of them accessed the bill’s benefits in the same way. That’s because white southern politicians designed the distribution of benefits under the GI Bill to uphold their segregationist beliefs.

So, while white veterans got into college with relative ease, black service members faced limited options and outright denial in their pursuit for educational advancement. This resulted in uneven outcomes of the GI Bill’s impact.

As a scholar of race and culture in the U.S. South, I believe this history raises important questions about whether subsequent iterations of the GI Bill are benefiting all vets equally.

Tuition waived for service

When he signed the bill into law, President Roosevelt assured that it would give “servicemen and women the opportunity of resuming their education or technical training … not only without tuition charge … but with the right to receive a monthly living allowance while pursuing their studies.” So long as they had served 90 consecutive days in the U.S. Armed Forces and had not received a dishonorable discharge, veterans could have their tuition waived for the institution of their choice and cover their living expenses as they pursued a college degree.

This unparalleled investment in veteran education led to a boom in college enrollment. Around 8 million of the nation’s 16 million veterans took advantage of federal funding for higher education or vocational training, 2 million of whom pursued a college degree within the first five years of the bill’s existence. Those ex-service members made up nearly half of the nation’s college students by 1947.

Colleges scrambled to accommodate all the new veterans. These veterans were often white men who were slightly older than the typical college age. They sometimes arrived with wives and families in tow and brought a martial discipline to their studies that, as scholars have noted, created a cultural clash with traditional civilian students who sometimes were more interested in the life of the party than the life of the mind.

Limited opportunities for black servicemen

Black service members had a different kind of experience. The GI Bill’s race-neutral language had filled the 1 million African American veterans with hope that they, too, could take advantage of federal assistance. Integrated universities and historically black colleges and universities – commonly known as HBCUs – welcomed black veterans and their federal dollars, which led to the growth of a new black middle class in the immediate postwar years.

Yet, the underfunding of HBCUs limited opportunities for these large numbers of black veterans. Schools like the Tuskegee Institute and Alcorn State lacked government investment in their infrastructure and simply could not accommodate an influx of so many students, whereas well-funded white institutions were more equipped to take in students. Research has also revealed that a lack of formal secondary education for black soldiers prior to their service inhibited their paths to colleges and universities.

As historians Kathleen J. Frydl, Ira Katznelson and others have argued, U.S. Representative John Rankin of Mississippi exacerbated these racial disparities.

Racism baked in

Rankin, a staunch segregationist, chaired the committee that drafted the bill. From this position, he ensured that local Veterans Administrations controlled the distribution of funds. This meant that when black southerners applied for their assistance, they faced the prejudices of white officials from their communities who often forced them into vocational schools instead of colleges or denied their benefits altogether.

Mississippi’s connection to the GI Bill goes beyond Rankin’s racist maneuvering. From 1966 to 1997, G.V. “Sonny” Montgomery represented the state in Congress and dedicated himself to veterans’ issues. In 1984, he pushed through his signature piece of federal legislation, the Montgomery GI Bill, which recommitted the nation to providing for veterans’ education and extended those funds to reserve units and the National Guard. Congress had discontinued the GI Bill after Vietnam. As historian Jennifer Mittelstadt shows, Montgomery’s bill subsidized education as a way to boost enlistment in the all-volunteer force that lagged in recruitment during the final years of the Cold War.

Social programs like these have helped maintain enlistment quotas during recent conflicts in the Middle East, but today’s service members have found mixed success in converting the education subsidies from the Post-9/11 GI Bill into gains in civilian life.

This new GI Bill, passed in 2008, has paid around US$100 billion to more than 2 million recipients. Although the Student Veterans for America touts the nearly half a million degrees awarded to veterans since 2009, politicians and watchdogs have fought for reforms to the bill to stop predatory, for-profit colleges from targeting veterans. Recent reports show that 20% of GI Bill disbursements go to for-profit schools. These institutions hold reputations for notoriously high dropout rates and disproportionately targeting students of color, a significant point given the growing racial and ethnic diversity of the military.

In August 2017, President Trump signed the Forever GI Bill, which committed $3 billion for 10 more years of education funding. As active duty service members and veterans begin to take advantage of these provisions, history provides good reason to be vigilant for the way racism still impacts who receives the most from those benefits.The Conversation

Republished with permission under license from The Conversation.

Drugs, Health

Over 700 Doctors Who Were Paid More Than a Million Dollars by Drug and Medical Device Companies

Back in 2013, ProPublica detailed what seemed a stunning development in the pharmaceutical industry’s drive to win the prescription pads of the nation’s doctors: In just four years, one doctor had earned $1 million giving promotional talks and consulting for drug companies; 21 others had made more than $500,000.

Six years later — despite often damning scrutiny from prosecutors and academics — such high earnings have become commonplace.

More than 2,500 physicians have received at least half a million dollars apiece from drugmakers and medical device companies in the past five years alone, a new ProPublica analysis of payment data shows. And that doesn’t include money for research or royalties from inventions.

More than 700 of those doctors received at least $1 million.

“Holy smokes,” said Dr. Walid Gellad, an associate professor of medicine and health policy at the University of Pittsburgh, where he leads the Center for Pharmaceutical Policy and Prescribing. It is “quite striking” how much money doctors were earning from “other activities aside from patient care,” he said.

To identify the latest pharma millionaires and other spending trends, ProPublica analyzed more than 56 million payments made from 2014 to 2018 — the first five full years of the federal Open Payments initiative, which requires companies to publicly disclose the payments as part of the 2010 Affordable Care Act.

Prescription Drugs With Top Spending on Doctor Payments

Here are the drugs for which pharmaceutical companies spent the most money paying doctors, per year, excluding research and royalty payments. The list does not include payments to teaching hospitals. Data for 2014-2016 is from a prior release of Dollars for Docs and any subsequent updates are not reflected.

Credit: Moiz Syed/ProPublica. Source: ProPublica analysis of Open Payments data from the Centers for Medicare and Medicaid Services.

Some academics and physicians predicted that the exposure might cause companies to rethink making payments and doctors to rethink taking them. A flurry of studies matched the payment data with doctors’ prescribing choices and found links between the payments and the products doctors chose.

But ProPublica’s new analysis shows that the public reporting has not dampened the enthusiasm of the drug and medical device industry for having doctors deliver paid dinner talks and sponsored speeches or paying them to consult on products.

In fact, there has been almost no change in how much the industry is spending. Each year from 2014 to 2018, drug and medical device companies spent between $2.1 billion and $2.2 billion paying doctors for speaking and consulting, as well as on meals, travel and gifts for them. (These figures do not include research spending, but they do include royalties.)

Roughly the same number of doctors — more than 600,000 — received payments in any given year.

That consistency, some academics say, is conspicuous.

“It makes me wonder whether patients are using this information or whether physicians are even aware this information is out there,” said Dr. Joseph Ross, a professor of medicine and public health at Yale who has studied pharmaceutical marketing. “It’s almost like it’s not happening.”

Holly Campbell, a spokeswoman for the Pharmaceutical Research and Manufacturers of America, defended company payments to doctors. “It is not necessarily a negative that the numbers have remained generally flat over the past five years,” she wrote in an email. “That statistic appears to be consistent with companies’ belief that their interactions with physicians have been and remain legitimate, even when subjected to sunshine.”

ProPublica first delved into the world of drug company promotional campaigns in 2010 when it gathered the payments made by seven companies that were required to make them public as part of settlements in whistleblower lawsuits. The payments were published in a database called Dollars for Docs, which allowed anyone to look up a doctor and see if he or she received a payment.

ProPublica updated Dollars for Docs with the latest data from the federal government on all payments.

Among their findings:

Consistency Breeds Familiarity

Over the course of five years, 1 million doctors, dentists, optometrists, chiropractors and podiatrists received at least one payment, most often a meal, from a company. Of those practitioners, more than 323,000 received at least one payment every year. About 240,000 received a payment in only one year. And the rest received payments in more than one year but in fewer than five.

For context, there are about 1.1 million doctors in the United States.

Dr. Aaron P. Mitchell, a medical oncologist and health services researcher at Memorial Sloan Kettering Cancer Center, said his research has shown that when doctors interact more consistently with a drug company they are more likely to prescribe that company’s cancer drug. The drug industry, Mitchell said, “knows that they need to cultivate relationships over more time, so that’s what they’re really trying to do. It’s not just one drug meal. It’s consistency.”

Some Drugs Are Promoted Heavily Year After Year

Of the top 20 drugs with the most annual spending on doctors from 2014 to 2018, six made the list in each of the years: Invokana to treat type 2 diabetes, the blood thinners Xarelto and Eliquis, the antipsychotic Latuda, the immunosuppressive drug Humira and the multiple sclerosis drug Aubagio. Another three drugs were on the list for four years: Victoza to treat type 2 diabetes, psoriasis treatment Otezla and the cholesterol-lowering drug Repatha. (Research funding and royalties are not included.)

Xarelto topped the list in spending for four years, totaling more than $123 million in payments from 2014 to 2018. In March, its makers, Johnson & Johnson and Bayer AG, agreed to pay $775 million to settle about 25,000 lawsuits claiming that the companies had failed to warn patients that Xarelto could cause fatal bleeding.

In statements, J&J and Bayer have said that the allegations lacked merit and that Xarelto is safe and effective. They noted that six cases that went to trial were decided in their favor.

Many drugs on the list are in categories where there is fierce competition. For example, seven of the top 20 in 2018 treat diabetes. And in most of the drug classes on the list, “there are more than one available drug — sometimes all with the same mechanism of action — indicated for the same condition selling for very high prices,” Dr. Aaron Kesselheim, a professor of medicine at Harvard Medical School, said in an email.

According to GoodRx, a drug discount website, the average cash price of a month’s supply of diabetes drugs Invokana, Jardiance and Farxiga is more than $600.

“Promotional spending is a major way that manufacturers in these situations distinguish themselves from each other — not by conducting comparative studies or by engaging in substantial price reductions,” Kesselheim said.

ProPublica and a number of researchers have examined the types of drugs that prompt the highest payments. Ross, of Yale, and a colleague published an analysis in the British Medical Journal in 2017 that found that the “top promoted drugs were less likely than top selling and top prescribed drugs to be effective, safe, affordable, novel, and represent a genuine advance in treating a disease.”

“Our findings suggest that pharmaceutical promotion should be met with healthy skepticism,” the analysis concludes.

Prosecutors Say the Payments by Some Drug Companies Are Kickbacks, Despite the Transparency of Open Payments

There is a perception among many physicians, including some in academia, that drug company payments are fairly benign — a moonlighting gig that educates other doctors about important medications. But since ProPublica began looking at physician payments, one drugmaker after another has paid tens, or even hundreds, of millions of dollars to resolve allegations of improper, or illegal, marketing tactics.

In fact, drug company whistleblowers and federal prosecutors have said explicitly that in some cases the payments were actually bribes and kickbacks. And this behavior has continued despite tools like Dollars for Docs.

Here are some recent examples:

  • Insys Therapeutics

    Spending: In 2014, the payment data shows, Insys Therapeutics spent $7.5 million promoting Subsys, a fentanyl spray for advanced cancer pain, making it one of the drugs with the most spending that year. Through 2018, the company’s total spending on the drug had reached $17.6 million.

    Prosecutors say: Insys paid doctors to speak about Subsys to other physicians during “educational lunches and dinners,” according to a Justice Department press release, from August 2012 to June 2015. The meals “were actually used as a vehicle to pay bribes and kickbacks to targeted practitioners in exchange for increased Subsys prescriptions to patients and for increased dosage of those prescriptions.”

    Penalty: This June, Insys agreed to plead guilty to five counts of mail fraud, pay a $2 million fine and forfeit $28 million. It also agreed to pay $195 million to settle a separate whistleblower case. At least eight company executives have now been convicted of crimes relating to the illegal marketing of the drug. Insys has said it completely restructured its operations, hired new leaders and has filed for bankruptcy protection.

  • Avanir Pharmaceuticals

    Spending: From 2014 to 2018, Avanir spent nearly $22 million on its drug Nuedexta, which treats pseudobulbar affect, or uncontrollable laughing or crying.

    Prosecutors say: An Avanir employee reported that one doctor at a long-term care facility, who was also a paid speaker for Nuedexta, put “entire units” of patients on Nuedexta. Another doctor at the facility, which had a number of dementia patients, routinely stopped the Nuedexta, only to have the first doctor restart it, according to a Department of Justice press release.

    Penalty: In September, the company agreed to pay more than $108 million to resolve criminal and civil allegations that it paid kickbacks to doctors and marketed the drug for unapproved uses, including behaviors associated with dementia. In a statement, Avanir said it fully cooperated with investigators “and engaged in extensive remedial measures. The individuals listed in the resolution agreements are no longer Avanir employees.”

Though relationships between drug companies and doctors continue, seemingly with little change, Kesselheim, of Harvard, said that the transparency “helps bring into light an area of the field that was in the shadows.

“Now we need to figure out what to do with this.”

Republished with permission under license from ProPublica.

Police, Race

Cities with more black residents rely more on traffic tickets and fines for revenue

By Akheil Singla, Arizona State University 

I’ve been thinking a lot lately about the last time I got a speeding ticket. It was nearly a decade ago and it’s a pretty unremarkable story: I was on my way back to Columbus, Ohio, from a friend’s wedding and was going something like 15 mph over the speed limit. An officer pulled me over, asked me if I knew why he did, walked back to his squad car and returned with a ticket for US$90.

At the time, I didn’t think much about it. I was 22, I was speeding, and that is what happened when you got caught. I didn’t consider the motives of the officer, his law enforcement agency or the financial status of the city he worked for. And I definitely didn’t consider the fact that I was a brown man driving through rural Ohio.

But now that I’m a scholar of public finance, it’s all I can think about. My recent research – and that of others – shows that communities with more residents of color are more likely to rely on revenue coming from traffic tickets and other minor fines.

Fines as revenue

Local governments on average don’t rely all that much on revenue from things like traffic citations, termed fines and forfeitures.

According to data from the Census of Governments, the average city generated about $21 per person from fines in 2012, the last year for which there is national data. For reference, the average city generated about $150 per person from sales taxes at the time.

But there is a lot of variation: Some cities get more than 10% or 20% of their revenue from fines.

Why might some communities rely on fines way more than others do? One reason could be higher incidences of crime. Another might be that certain governments make a strategic choice to target passersby via speed traps. It could be a response to budgetary shortfalls or fiscal stress. And still another might be the race of the population or law enforcement agency.

If it’s not clear how or why this could involve race, you should take a look at the Department of Justice report on in Ferguson, Missouri. After Michael Brown, a black man living in a majority-black community, was shot and killed by a white police officer serving in a majority-white police force, the department investigated.

It found that officers in Ferguson were focused on revenue generation, a practice known as “policing for profit.” Police aggressively fined residents, primarily black residents, without much consideration of whether doing so enhanced public trust or safety.

According to the report, “The harms of Ferguson’s police and court practices are borne disproportionately by African Americans, and there is evidence that this is due in part to intentional discrimination on the basis of race.”

But was Ferguson an isolated case? And, more generally, what explains the variation in city use of fines? My colleagues – Charlotte Kirschner and Samuel B. Stone, also scholars of public finance – and I set out to find out.

Who relies on fines

In our study, we looked at a representative sample of 93 California cities from 2009 to 2014 to determine what affects how much cities fine residents and rely on fines for revenue.

We examined how fines were affected by levels of crime and public safety, city financial health and budgetary stress, and the racial composition of both the population and the law enforcement agency serving it.

We found no relationship between crime or budgetary stress and fines. However, we did find that cities with larger black populations fine residents more on a per capita basis and are more reliant on fines.

All else equal, our results showed that a 1% increase in black population is associated with a 5% increase in per capita revenue from fines and a 1% increase in share of total revenue from fines.

Furthermore, the cities seemingly most reliant on fines are the ones with the highest percentages of black residents being served by law enforcement that is whiter than its community.

Take Inglewood: In 2010, it was 43% black and 23% white, but its law enforcement agency was flipped, at nearly 40% white and 16% black. The city generated nearly 5% of its revenues from fines, more than double the average city in California.

Despite the similarities to Ferguson, it is really important for me to emphasize that our research isn’t accusing anyone of being racist or intentionally discriminating against minorities – though, to be fair, our results don’t preclude this explanation either. Rather, I’m just highlighting that even seemingly colorblind policies, like a $90 traffic citation for speeding, can have outcomes that are very much not colorblind.

Fixing the problem

Unfortunately, I wasn’t very surprised by our results. Even setting aside the Ferguson case, there’s a lot of research that points in this direction.

First, policing for profit via civil asset forfeiture and traffic tickets is, unfortunately, a documented phenomenon that alters police behavior.

Second, studies persistently find that minority residents and communities of color are more common recipients of law enforcement action and punishment.

And third, government agencies that are more representative of their communities along gender and racial dimensions have been demonstrated to reduce unfavorable outcomes for minority groups across many studies. The only thing we did was show that these things are all connected.

So, how can Americans solve this issue? I think we should start by eliminating the incentives governments might have to fine for revenue generation. Do this by pooling money from fines at the state level and redistributing it evenly instead of letting local governments make their own decisions.

Then, elect more ethnic and racial minorities to be mayors or serve on city councils and proactively focus on ensuring meaningful representation in the unelected bureaucracy. Our research demonstrates these changes should alter the distribution of fines, but making them so would probably have other beneficial effects for underserved communities as well.

If nothing else, the next time you get pulled over for speeding – especially if it’s for doing 55 in a 54 – you should ask yourself why it’s happening. It might be a lot less about how fast you were going than you’d think.

Republished with permission under license from The Conversation.

Poverty, Taxes

IRS: Sorry, But It’s Just Easier and Cheaper to Audit the Poor

Congress asked the IRS to report on why it audits the poor more than the affluent. Its response is that it doesn’t have enough money and people to audit the wealthy properly. So it’s not going to.

by Paul Kiel​

The IRS audits the working poor at about the same rate as the wealthiest 1%. Now, in response to questions from a U.S. senator, the IRS has acknowledged that’s true but professes it can’t change anything unless it is given more money.

ProPublica reported the disproportionate audit focus on lower-income families in April. Lawmakers confronted IRS Commissioner Charles Rettig about the emphasis, citing our stories, and Sen. Ron Wyden, D-Ore., asked Rettig for a plan to fix the imbalance. Rettig readily agreed.

Last month, Rettig replied with a report, but it said the IRS has no plan and won’t have one until Congress agrees to restore the funding it slashed from the agency over the past nine years — something lawmakers have shown little inclination to do.

On the one hand, the IRS said, auditing poor taxpayers is a lot easier: The agency uses relatively low-level employees to audit returns for low-income taxpayers who claim the earned income tax credit. The audits — of which there were about 380,000 last year, accounting for 39% of the total the IRS conducted—are done by mail and don’t take too much staff time, either. They are “the most efficient use of available IRS examination resources,” Rettig’s report says.

IRS Commissioner Charles Rettig at the Capitol on May 15, 2019, in Washington. Rettig says increasing audit rates of the wealthy depends on whether the IRS budget grows.

On the other hand, auditing the rich is hard. It takes senior auditors hours upon hours to complete an exam. What’s more, the letter says, “the rate of attrition is significantly higher among these more experienced examiners.” As a result, the budget cuts have hit this part of the IRS particularly hard.

For now, the IRS says, while it agrees auditing more wealthy taxpayers would be a good idea, without adequate funding there’s nothing it can do. “Congress must fund and the IRS must hire and train appropriate numbers of [auditors] to have appropriately balanced coverage across all income levels,” the report said.

Since 2011, Republicans in Congress have driven cuts to the IRS enforcement budget; it’s more than a quarter lower than its 2010 level, adjusting for inflation.

Recently, bipartisan support has emerged in both the House and Senate for increasing enforcement spending, but the proposals on the table are relatively modest and would not restore the budget to pre-cut levels. However, even a proposed small increase might not come to pass, because it’s unclear whether Congress will actually pass any appropriations bills this year.

In response to Rettig’s letter, Wyden agreed in a statement that the IRS needs more money, “but that does not eliminate the need for the agency to begin reversing the alarming trend of plummeting audit rates of the wealthy within its current budget.”

Republished with permission under license from CommonDreams.

Health, Race

Racism shortens lives and hurts health of blacks by promoting genes that lead to inflammation and illness

By April Thames, University of Southern California 

Negative social attitudes, such as racism and discrimination, damage the health of those who are targeted by triggering a cascade of aberrant biological responses, including abnormal gene activity. It is not surprising that reports documenting lifespan and causes of mortality have demonstrated a clear pattern: African Americans die sooner and bear a heavier burden of many diseases, including hypertension, heart disease, dementia and late-stage breast cancer.

Scientists have searched for genetic causes to health disparities between blacks and whites but have had limited success. The strongest evidence to date points to social-environmental factors such as poverty, health care inequities and racism.

Our society is plagued by racism and racial inequality which is not fully recognized by all, according to a recent study showing that many Americans overestimate our progress in fixing racial inequality. On the other hand, more Americans (65%) are aware that it has become more common for people to express racist or racially insensitive views, according to a U.S. survey.

Racism is not merely negative attitudes or treatment from one person to another. Racism has deep historical roots in American society, sustained through institutional policies and practices, whereby people of color are routinely and systematically treated differently than whites.

As an African American/white individual, I often experienced comments growing up like “You don’t sound black,” and “What are you?” that made me cringe. In college, I became intrigued by the field of psychology as it was a field that explained how prejudices, stereotyping and racism arise. My research as a clinical psychologist at USC is focused on understanding how societal factors interact with biology to create disparities in health outcomes. A recent study I co-authored showed that racism promotes genes that turn on inflammation, one of the major drivers of disease.

Less overt, but entrenched

Although racism may be less overt today than during the early 20th century, government policies and norms, unfair treatment by social institutions, stereotypes and discriminatory behaviors are sobering reminders that racism is still alive – and contribute to earlier deaths in addition to poorer quality of life.

For example, blacks are more likely than whites to receive drug testing when prescribed long-term opiates even though whites show higher rates of overdose. African Americans have shouldered the burden of racism for decades, creating a level of mistrust for societal systems, be it health care or law enforcement.

Terms such as “driving while black” illustrate how racism and discrimination have been deeply embedded in African American cultural experience. Just imagine trying to buy a home and being turned down because of your race. This is too common of an experience for African Americans. Nearly half (45%) reported experiencing discrimination when trying to find a home and in receiving health care, according to a Robert Wood Johnson survey that was developed by the Harvard T.H. Chan School of Public Health, Robert Wood Johnson Foundation and National Public Radio.

From macro to micro, the effect is widespread

Blacks’ exposure to chronic stress has often been cited as a reason for worse health outcomes. 

Until recently, we scientists did not know the mechanism linking racism to health. The new study from my lab here at USC and colleagues at UCLA shows that the function of genes may explain this relationship. As it turns out, our study showed that genes that promote inflammation are expressed more often in blacks than in whites. We believe that exposure to racism is why.

We previously showed how activating racism, such as asking people to write down their race before taking an exam, in the form of stereotyping impairs brain functions such as learning and memory and problem-solving in African Americans. This may partly explain the higher rates of dementia in African Americans compared to whites.

Researchers have well documented that chronic stress alters the function of brain regions, such as the hippocampus, that are targeted in brain diseases such as Alzheimer’s disease. This work has been expanded through the field of social genomics, largely pioneered by my colleague Steve Cole at UCLA. A relatively new field called social genomics demonstrates how the function of genes – termed gene expression – is influenced by social conditions.

Genes are programmed to turn off and on in a certain manner. But those patterns of activity can shift depending on environmental exposures.

Certain marginalized groups demonstrate abnormal patterns of gene activity in genes responsible for innate immunity. Innate immunity is how the body fights off and responds to foreign pathogens. Dr. Cole named this pattern/sequence of gene activity the Conserved Transcriptional Response to Adversity. It refers to the how genes controlling innate immunity behave under positive or negative environmental conditions.

When environmental stresses like socioeconomic disadvantage or racism trigger the sympathetic nervous system, which controls our fight-or-flight responses, the behavior of our genes is altered. This leads to complex biochemical events that turn on genes, which may result in poor health outcomes.

The Conserved Transcriptional Response to Adversity profile is characterized by increased activity of genes that play a role in inflammation, and decreased activity of genes involved in protecting the body from viruses.

We found that blacks and whites differed in the pattern of which pro-inflammatory and stress signaling genes were turned on. Our findings are particularly important because chronic inflammation ages the body and causes organ damage.

As my colleagues and I pulled this study together, we took into consideration the health disparities such as socioeconomic status, social stress, and health care access. For example, we recruited African Americans and whites with similar socioeconomic status. We also examined racial differences in reports of other types of stress events. Both groups reported similar levels of social stress.

For this particular study, none of these traditional factors explained why African Americans had greater expression in pro-inflammatory genes than whites. However, we found that experiences with racism and discrimination accounted for more than 50% of the black/white difference in the activity of genes that increase inflammation.

So what do these results mean for future health? I believe racism and discrimination should be treated as a health risk factor – just like smoking. It is toxic to health by damaging the natural defenses our bodies use to fight off infection and disease. Interventions tailored toward reducing racism-associated stress may mitigate some of its adverse effects on health. As a society we cannot afford to perpetuate health inequities by undermining or disguising the biological impact of racism.

Republished with permission under license from The Conversation.

Education, Race

HBCUs pay higher fees to borrow money. Research links that premium to racism.

by Clark Merrefield

Historically black colleges and universities looking to raise money for major projects face higher fees than their non-HBCU counterparts, even when agencies that rate credit risk give HBCU-issued bonds their highest scores, according to research recently published in the Journal of Financial Economics.

There’s one big reason for the additional cost, according to the authors: racial discrimination.

Colleges and universities typically issue bonds to pay for big-ticket items, like a new dorm or athletic facility. Bonds are loans, paid back over time with interest. Multimillion dollar bonds are usually split across different investors, but schools don’t track down those investors. Instead, they pay underwriters. An underwriter buys an entire bond and then finds investors to buy chunks of it.

Out of the pool of bonds the authors studied, non-HBCUs pay on average 81 cents of every $100 raised to underwriters. For a $10 million non-HBCU bond, that’s $81,000 in fees going to an underwriter.

But HBCUs pay on average 92 cents per $100 raised to underwriters — about 14% more, the paper finds.

That’s $92,000 in underwriting fees on a $10 million HBCU bond. HBCUs are higher education institutions founded before 1964 primarily to educate black students, many of whom were barred from predominantly white institutions.

“The underlying notion is it’s harder for an [HBCU] underwriter to find a buyer and they pass the cost on to the schools,” says Bill Mayew, professor of accounting at Duke University and one of the paper’s authors. “That’s where the difference comes from.”

The financial premium is even higher for HBCUs in Alabama, Louisiana and Mississippi, where racial animus runs higher than in other states, according to data the authors analyze. In those three states, the cost to HBCUs for bond underwriting is 106 cents per $100 raised. That’s $106,000 going to an underwriter on a $10 million HBCU bond.

Understanding two types of discrimination

Economists point to two things that typically underlie actions a reasonable person could perceive as racist: statistical discrimination and taste-based discrimination.

Statistical discrimination happens when people take actual or perceived aggregate information and apply it to a specific situation. This happens sometimes in labor markets. A hiring manager considering two candidates from two different demographic groups might believe people from one group are less productive on average than people from the other. The hiring manager might argue they are not being racist in relying on stereotypes. They might say they are simply considering the company’s bottom line productivity.

Taste-based discrimination is discrimination based on personal taste. Someone, “simply has a preference for working with one type over the other,” as economists William Neilson and Shanshan Ying wrote in 2016 in a paper on the relationship between these types of discrimination. The hiring manager’s decision is based purely on distaste or preference for a candidate’s skin color.

“When you think of the notion of race discrimination, that’s a taste-based preference,” Mayew says.

Differentiating between statistical and taste-based discrimination is difficult to do, but important toward understanding why people make decisions that might appear discriminatory.

Credit ratings and insurance: disentangling HBCU discrimination

The authors look at a sample of 4,145 tax-exempt bonds issued from 1988 to 2010 from 965 four-year colleges totaling $150 billion. HBCUs, both public and private, issued 102 of those bonds.

Creditworthiness scores make it possible to parse the two types of discrimination. Ratings agencies like Moody’s and Standard & Poor’s rate higher education institutions’ credit risk. They provide a score that tells investors how likely the school is to default on its bond payments. A triple-A rating, the highest possible, means the college or university is practically assured to make their payments on time.

“You might say it’s not that buyers of bonds are racist, it’s they think those bonds are more likely to default,” Mayew says. “It’s really hard in most settings to disentangle those indications. But in the bond market, we can measure that really well with the credit rating so we can dig into and isolate race effects.”

Insurance is another way the authors rule out statistical discrimination. Universities can get bond insurance, so if they default the bond financer still gets paid back. Credit ratings and bond insurance give financers a sense of an institution’s likelihood of defaulting.

Still, the authors find that “identical [fee] differences are observed between HBCU and non-HBCUs with AAA ratings or when insured by the same company, even before the 2007–2009 financial crisis.”

HBCU bonds also take longer and cost more to offload in secondary markets. Those are markets where investors trade bonds that have already been financed. The authors find that HBCU bonds are 20% pricier than non-HBCU bonds to trade in secondary markets. Larger bonds — those over $50,000 — face a 60% premium. HBCU bonds overall linger 25% longer on secondary markets.

“If you’re going to say you’re talking about race discrimination you’ve got to provide a lot of evidence to make that case," Mayew says. "That’s a tough piece of evidence to refute.”

Premiums are much higher in parts of the Deep South

If racism were the main driving factor behind higher HBCU bond fees, then HBCUs in states that are more racist should face even higher fees, according to the authors. Broadly capturing racism is not necessarily straightforward. The authors try to do it using a variety of data to rank racial animosity in the 50 states plus the District of Columbia.

They use survey responses capturing resentment and opposition to affirmative action from the Cooperative Congressional Election Study, a large yearly survey of American adults by county. They also turn to state-level data on racist Google searches, and the percentage of white voters in each state who voted for Barack Obama in 2008 compared with the share of white voters who chose John Kerry in 2004. And they consider geocoded racist tweets just after Obama was reelected in 2012.

Alabama, Louisiana and Mississippi scored highest for racial animosity. Georgia was next, but with a sharp drop-off. Those top-three states for racial animosity account for 4.7% of all bond issuances in the sample studied — but 26% of HBCU issuances. In those states, HBCUs pay about three times as much in bond underwriting fees as non-HBCUs, the authors find.

Tax exemptions limit the size of the market

The U.S. municipal bond market is worth almost $4 trillion. Though higher education bonds are a fraction of the total, that submarket is still big enough that taste-based discrimination shouldn’t matter. Anyone can finance a university bond issuance. If a racist investor doesn’t want to finance an HBCU project, there should be plenty of other investors to pony up capital.

But tax exemptions tend to limit university bond markets to the state a school is in. Interest payments are tax exempt if the bond is issued by an entity in the state where the financer is based. Someone living in Louisiana would receive tax-free interest payments by financing a Xavier University of Louisiana bond but not an Alabama State University bond.

The authors argue that a triple tax exemption — with interest payments on university bonds exempt from federal, state and local taxes — could take racism out of the equation. Triple tax exemption would allow HBCUs to, “tap into a larger market where racial preferences are different,” Mayew says.

Barriers to bonds

There’s no good way to quantify how much higher education institutions pay insurers and credit rating agencies, Mayew says, but those entities need to be paid in addition to underwriters. So there are costs to entering bond markets — and when it comes to underwriting, those costs are higher for HBCUs. That may mean some HBCUs pass up raising money through bonds, potentially forgoing major campus improvements.

“Bond markets should be one of the cheapest forms of capital,” Mayew says. “It’s many individual investors, and schools should be able to raise lots of money. And maybe 25 years ago, an HBCU passed up renovating a dorm. These are the opportunity costs schools face.”

Republish with permission under license from Journalist's Resource.