Dean Baker

Recent Articles

Energy Insurance

T he vast majority of scientists who study climate issues now agree that carbon emissions are a potentially disastrous problem. However, economic fears have obstructed even the mildest remedies. Particularly in the United States, voters resist taxes that would raise fuel costs, and there has been little political support for massive investment in new technologies or mass transit systems. Yet there are also some less painful ways to cut greenhouse gases. One is to change how the nation buys its automobile insurance. If people paid for insurance on a per-mile basis, instead of in a lump sum, it would provide a substantial disincentive to drive--about the same disincentive as a $1.50 per-gallon gas tax. This in turn would reduce the number of miles driven by 10-20 percent. Less driving would mean fewer accidents, which would then lower the cost of insurance. So "clean" (pay by the mile) insurance may be the biggest free lunch...

Patent Medicine

A bsurdly high prices have put lifesaving prescription drugs out of reach for millions of Americans and for hundreds of millions of people in developing countries. In large part, patent protection is to blame. The patent system is a trade-off: Consumers pay a monopoly price on a drug for 17 years to provide incentives for firms to undertake research that yields large profits. But the patent system is not the only way to support drug research. Alternatives that have a proven track record of success already exist--specifically, research supported by foundations, universities, and the government. Shortening patent terms and putting most pharmaceutical research in the public domain would cut costs for consumers as well as for government. And contrary to industry propaganda, doing so would not reduce innovation. This idea may sound radical, but look at the numbers. The drug industry currently spends around $18 billion a year on socially useful research. If research spending grows at a real...

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