6 ms·

Who is actually paying for all of this? America is giving away doses, but for some reason I can’t fathom the drug companies doing this out of the goodness of th

Who is actually paying for all of this? America is giving away doses, but for some reason I can’t fathom the drug companies doing this out of the goodness of their hearts. If there’s all this money laying around for COVID doses, ad everybody gets a shot no questions asked, maybe they could put that same energy behind insulin!

nradov 5y ago
The US federal government is purchasing doses from drug companies at pre-negotiated prices and then giving them away to foreign countries. https://www.wsj.com/articles/u-s-says-it-has-shared-110-million-covid-19-vaccine-doses-overseas-11627981201 https://www.wsj.com/articles/u-s-says-it-has-shared-110-mill...
- underseacables 5y ago
  Interesting! Both that and the pre-negotiated part. IIRC, the was not allowed to negotiate for lower drug prices for medicare, but that may have changed.
  - lokar 5y ago
    Medicare did not pay. Also, the deal was worked out before they were done, and they would have been paid even if the drugs did not work.
cdot2 5y ago
Theyre printing money to pay for everything which is causing massive inflation.
- fzzzy 5y ago
  So basically everyone with a current cash position is paying for it.
  - mensetmanusman 5y ago
    Yes, but it is also an investment, albeit a forced one. For example, if we didn’t do this the economy would crater and everyone would be poorer.
    - revnode 5y ago
      There are a lot of assumptions in that statement.
  - adventured 5y ago
    Primarily the people holding the ~$137 trillion in US household assets are paying for it (along with the share of all USD-priced assets being held by foreigners). Very little of that value is held in cash. Anything priced in dollars is affected, not just USD cash positions. US housing is priced in dollars, as one example. If they 'print' large sums to fund the forever budget deficits, it also debases the value of US stocks as well (it debases the sales/earnings of the businesses (to the extent their earnings are USD-related), and their share prices). In the case of stocks, there's a chance the businesses can outrun or keep up with the debt monetization destruction to an extent (varying by the growth of the company in question). Cash savings on the other hand, which is presently yielding next to nothing, that takes a near full shot from any loss of value by the dollar. The present consumer inflationary pressure will recede as US growth implodes back toward mediocrity (this decade the US will struggle to average above 1.5-2.3% annual GDP growth). Then we'll be back to a scenario not dramatically different from much of 2010-2019 (where perma low interest rates and huge budget deficits did not spur dramatic traditional inflation). To keep inflationary pressure elevated in the face of mediocre economic growth, they'll have to keep sending people stimulus checks constantly and there will have to be persistent global supply chain problems. Otherwise you end up with the Japan scenario, where they ran extraordinary budget deficits far beyond anything the US has done so far (relative to the economy in question), and still couldn't spur traditional inflation. That's because the debt being accumulated at low yield rates acts as a heat sink, it essentially eats the capital (the capital goes into the freezer, yields jack squat, and never comes back out; an ever greater share of the nation's supposed wealth ends up in the freezer yielding eg 0.5% per year, it's basically dead at that point) that would otherwise be out there in the economy sloshing around spurring far worse inflationary problems.
- seanmcdirmid 5y ago
  They aren’t. It’s just a bit more debt for them. What is causing massive inflation are the super low interest rates that we’ve been dependent on for the last 6 years (or even 20 years if we look long term). When Trump claimed the economy couldn’t boom without low interest rates, they should have been a huge alarm bell for everyone.
- plebianRube 5y ago
  Officially it's less. But you simply just keep stripping out items from the CPI basket when they make it move it too much.
rsynnott 5y ago
Both the US and particularly the EU over-bought. In particular, the EU increased Pfizer/Biontech orders after the AZ delays became apparent, but the committed AZ is still arriving (just late) and is now largely useless.
- hadrien01 5y ago
  The EU was always going to over-buy, even without the AstraZeneca fiasco, to give to countries in need: https://apnews.com/article/europe-health-coronavirus-pandemic-2893e2935eabcd902a154fee1b9c7cbc https://apnews.com/article/europe-health-coronavirus-pandemi...
f6v 5y ago
The federal government seems to be paying the bill in Germany.

nradov 5y ago

The US federal government is purchasing doses from drug companies at pre-negotiated prices and then giving them away to foreign countries. https://www.wsj.com/articles/u-s-says-it-has-shared-110-million-covid-19-vaccine-doses-overseas-11627981201 https://www.wsj.com/articles/u-s-says-it-has-shared-110-mill...

underseacables 5y ago
Interesting! Both that and the pre-negotiated part. IIRC, the was not allowed to negotiate for lower drug prices for medicare, but that may have changed.
- lokar 5y ago
  Medicare did not pay. Also, the deal was worked out before they were done, and they would have been paid even if the drugs did not work.

cdot2 5y ago

Theyre printing money to pay for everything which is causing massive inflation.

fzzzy 5y ago
So basically everyone with a current cash position is paying for it.
- mensetmanusman 5y ago
  Yes, but it is also an investment, albeit a forced one. For example, if we didn’t do this the economy would crater and everyone would be poorer.
  - revnode 5y ago
    There are a lot of assumptions in that statement.
- adventured 5y ago
  Primarily the people holding the ~$137 trillion in US household assets are paying for it (along with the share of all USD-priced assets being held by foreigners). Very little of that value is held in cash. Anything priced in dollars is affected, not just USD cash positions. US housing is priced in dollars, as one example. If they 'print' large sums to fund the forever budget deficits, it also debases the value of US stocks as well (it debases the sales/earnings of the businesses (to the extent their earnings are USD-related), and their share prices). In the case of stocks, there's a chance the businesses can outrun or keep up with the debt monetization destruction to an extent (varying by the growth of the company in question). Cash savings on the other hand, which is presently yielding next to nothing, that takes a near full shot from any loss of value by the dollar. The present consumer inflationary pressure will recede as US growth implodes back toward mediocrity (this decade the US will struggle to average above 1.5-2.3% annual GDP growth). Then we'll be back to a scenario not dramatically different from much of 2010-2019 (where perma low interest rates and huge budget deficits did not spur dramatic traditional inflation). To keep inflationary pressure elevated in the face of mediocre economic growth, they'll have to keep sending people stimulus checks constantly and there will have to be persistent global supply chain problems. Otherwise you end up with the Japan scenario, where they ran extraordinary budget deficits far beyond anything the US has done so far (relative to the economy in question), and still couldn't spur traditional inflation. That's because the debt being accumulated at low yield rates acts as a heat sink, it essentially eats the capital (the capital goes into the freezer, yields jack squat, and never comes back out; an ever greater share of the nation's supposed wealth ends up in the freezer yielding eg 0.5% per year, it's basically dead at that point) that would otherwise be out there in the economy sloshing around spurring far worse inflationary problems.
seanmcdirmid 5y ago
They aren’t. It’s just a bit more debt for them. What is causing massive inflation are the super low interest rates that we’ve been dependent on for the last 6 years (or even 20 years if we look long term). When Trump claimed the economy couldn’t boom without low interest rates, they should have been a huge alarm bell for everyone.
plebianRube 5y ago
Officially it's less. But you simply just keep stripping out items from the CPI basket when they make it move it too much.

rsynnott 5y ago

Both the US and particularly the EU over-bought. In particular, the EU increased Pfizer/Biontech orders after the AZ delays became apparent, but the committed AZ is still arriving (just late) and is now largely useless.

hadrien01 5y ago
The EU was always going to over-buy, even without the AstraZeneca fiasco, to give to countries in need: https://apnews.com/article/europe-health-coronavirus-pandemic-2893e2935eabcd902a154fee1b9c7cbc https://apnews.com/article/europe-health-coronavirus-pandemi...

f6v 5y ago

The federal government seems to be paying the bill in Germany.