Matt Stoller's analyses are usually a mixed bag for me. I generally agree with him that the US needs a focused Industrial Policy but analyses like this one seem

Matt Stoller's analyses are usually a mixed bag for me. I generally agree with him that the US needs a focused Industrial Policy but analyses like this one seem relatively weak. A few things that I feel should be addressed but weren't: 1) If Newport had this huge deal (40,000 ventilators * $3,000 price = $120M), why would Covidien not continue it? What about this would have been against their interest? It seems like if it's both better AND cheaper, they would dominate the market globally. Unless Newport had a novel invention under patent for a few years, presumably competitors could have also done this. Even if they were concerned with significantly decreased margins at the $3k price tag, why not try an $8k price tag using the same, better machine and still steal the global market? It's hard for me to understand why Newport was this advanced but Covidien just destroyed their product and this isn't even questioned in the article. I don't think these are unreasonable questions. 2) Matt talks about a monopoly on purchasing. There's actually a standard term for this, "monopsony". I would love to see Matt write about how unions end up with monopsony power selling their labor and how bad that is. I don't expect it any time soon. That said, he does make interesting points on how monopsony works against producers. The weird contradiction here, though, is that this drives down producer surplus and profit of the exact same big businesses that Matt is usually upset about having too high of producer surplus/profit. This seems to me a bit to be arguing against his general purpose. 3) "The contracting officers in government should have mandated as a part of the contract that Newport Medical give the government all its research and proprietary information on the product, and put in safeguards to ensure that the product would be delivered." I totally agree with the latter half of this statement, ensuring the delivery of the product is a must. However, the first part that Newport hand over its research and proprietary information on the product seems like a huge governmental overreach. What can justify this? Now, it may be that the government funded this research directly (ie a grant or loan to specifically develop the product). If this were the case, then I understand that. However, it seems, according to the article, that the US government was simply contracting to procure the new ventilators. Demanding a company hand over their entire IP portfolio as a part of purchasing their product at market prices seems ridiculous to me. What's to stop the government from then taking that IP to another producer and getting them to produce it for them. That producer has way better margins what with not having to do anywhere near the same load of R&D. Not, that said, I may be misunderstanding this particular case. 4) Matt repeatedly calls the merger illegal. He does a bit of describing his theories for why it should've been found illegal but until a court or someone with the oversight authority makes this determination, this is opinion.