Intellectual property like pharmaceutical patents is one reason so many people face a long wait for COVID-19 vaccines says Dean Baker. GPEnewsdocs

TRANSCRIPT

LYNN FRIES: I am delighted to have Dean Baker joining us today. He’ll be talking about policy choices in an area where the stakes are especially high when it to comes to arresting an alarming trend in inequality. That area is US policy for the financing of drug and vaccine development. Specifically, patent and IP [intellectual property] monopoly financing. This is a matter of concern not only in US domestic rule making but globally as US trade policy effectively implements US type IP standards as international standards in the rules based system of world trade.

Dean Baker is a Senior Economist at the Center for Economic and Policy Research, CEPR. Prior to this, he was co-director of CEPR which he co-founded in 1999. Dean Baker has authored numerous books and is a prolific commentator. His most recent book is Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich Richer. The renowned CEPR blog,  Beat the Press is home to Dean Baker’s commentary on economic reporting. Welcome Dean.

DEAN BAKER: Thanks for having me on.

FRIES: Let’s open with some thoughts on inequality as a policy choice.

BAKER: The reason why we have people like Bill Gates and Jeff Bezos and the others with incredible amounts of wealth; the reason that they became so wealthy was that we have more inequality before tax income.

If we look at the share of income, that's gone to the top 1%, it's more than doubled. So if we go back to the 1970s it was around 8%, 9% and again before tax income. Now it's currently over 20%. It's even a little higher if you count capital gains. I tend not to, for reasons that don't want to go into.

But in any case, their share of income has more than doubled. And basically that's money that would have been otherwise in the hands of people at the middle and bottom. So that's a huge, huge amount of money.

These are policy choices. We could structure the market any number of different ways. And the way we've chosen to structure it has very much benefited those at the top and been to the detriment of the bulk of the population.

So what I'm arguing is we should think about the way we structure the market. Look to structure it differently so that we don't send so much of the income to those at the top.

FRIES: Dean, you’ve examined how rules on trade and on patents, copyrights, corporate governance, and macroeconomic policy were rigged to make income flow upward and so make the rich richer.

I wanted to focus on patent and copyright rules as you point out that that’s where the most money is at stake. So. first comment on that. And then later I’d like to ask you to connect the dots to what’s going on with the COVID-19 healthcare crisis. So first comment on the huge amount of money at stake in patent and copyright monopolies and most notably prescription drugs.

BAKER: These are quite explicit policies. I mean, they're in place to promote innovation, promote creative work. And of course they do that but these are policies that could be altered. They could be shorter. They could be weaker. We could structure those any way we like.