- The Washington Times - Monday, October 31, 2005

An ‘onerous tax’

Yesterday’s Commentary column by Ernest Christian and Gary Robbins, “Avoid a VAT,” was excellent in presenting arguments against the value-added tax (VAT). The writers omitted, however, a description of what the VAT is, for those who are unfamiliar with the concept, and also omitted one important argument against this onerous tax.

The VAT is described (by Forbes Financial Glossary) as a “method of indirect taxation whereby a tax is levied at each stage of production on the value added at that specific stage.”

The opinion piece also fails to point out that thousands of people are retired with little income other than Social Security and are living off of their savings — money that was fully taxed when it was earned. If the VAT is implemented, each time they purchase something, they would pay an additional tax on their fully taxed savings. That would be double taxation in its purist form.

As someone nearing retirement and in the process of retirement planning, I am depending on a considerably lower tax rate as my income virtually ceases. The higher cost of everything that would result from the VAT would negatively impact my planning.

With the advent of the “baby boomers” nearing retirement, this will not stand politically.

CHRISTOPHER S. MOODY

Gaithersburg

Out of step, again

I am compelled to respond to your one-sided characterization of the Treaty on Cultural Diversity (“Clash of cultures,” Op-Ed, Wednesday). The United States is out of step with the rest of the world once again. It’s a disservice to your readers to simply echo the current U.S. administration line.

I can speak only for Canadians, but I assume that the concerns of France and the rest of the world are similar. We love the best of American culture and wish to have access to it. But, we do not want American cultural products to dominate our media space 100 percent, and wish to retain places to express our own history, stories, concerns and interests. It’s a matter of media ecology. Our movie theaters, TV programming, bookstore shelves and other media outlets are dominated by American cultural products that do not represent or express who we are. The United States would never tolerate such foreign domination of its cultural and artistic spaces.

Columnist Helle Dale might tell her teenage stepson that the reason we don’t make better movies has little to with talent and everything to do with economics. With a huge internal market and investment funds available, the United States can buy its way to producing the best movies. Furthermore, its economic dominance has enabled it to acquire distribution channels in other countries, which exclude indigenous productions. The competitive arena for cultural products is intentionally tilted in favor of the United States.

The reason that Canada has developed such world-class popular music artists as Celine Dion, Shania Twain, Avril Lavigne, Diana Krall and many others has to do with Canadian radio content regulations that allocate about a third of air time for Canadian artists. We need similar content regulations, exempt from World Trade Organization interference, for our movies, books, TV and other media. Presumably, the Treaty on Cultural Diversity will give us that.

This has nothing to do with anti-Americanism and everything to do with having our own media voice and rejecting American cultural domination. A bit of understanding and respect for the rest of the world’s cultural ambitions would go a long way to earning appreciation and respect. There need be no “clash of cultures,” but there will be if the United States tries to dominate the rest of the world culturally, as it does militarily. Cultural domination will be resisted.

ALEXANDER KUSKIS

Hockley Valley, Ontario

Canada

Libby indicted, Wilson ignored

Special prosecutor Patrick J. Fitzgerald took almost two years and more than $20 million to develop charges that I. Lewis “Scooter” Libby lied about when and where he received legitimate information and made legal statements to reporters. Why did this virtuous, though boundless, quest for truth avoid probing the more serious matter: A bipartisan Senate Intelligence Committee, a British Parliamentary Commission and the management of the CIA all found that the underlying charges of administration dishonesty announced to the world by Ambassador Joseph Wilson, and the New York Times, were themselves false and fraudulent?

President Bush himself directly enabled this destructive political and personal firestorm. The British, U.S. and most other intelligence services are still fully confident that Iraq did seek yellowcake from Niger; and, according to the Senate committee, that was basically confirmed in Mr. Wilson’s private report to the CIA. Further, in the only definitive investigation into weapons of mass destruction (WMD), the CIA’s chief weapons inspector, Charles Duelfer, found solid, responsible evidence to reasonably conclude that Iraq did havechemical-biological WMDs, which were moved to Syria just before the war. Mr. Duelfer advised that this needed further investigation, which he could not pursue because of the dangerous security situation in Iraq.

The American people care far less about yellowcake and WMDs than about a weak president in the midst of a dangerous, global war who lacks the grit even to defend himself.

WILLIAM J. O’BRIEN II

Falls Church

Medicaid and generic drugs

I read with interest Robert Goldberg’s views (“May Reagan GOP R.I.P.,” Op-Ed, Wednesday) on the Senate Medicaid proposal regarding brand products that are masquerading as generics, also known as “authorized generics.” To be clear, authorized generics are brand products marketed under a different label by the brand company or a third-party distributor.

Mr. Goldberg is proposing a double standard for the brand industry. On the one hand, he wants authorized generics to be considered generics by the Centers for Medicare and Medicaid Services (CMS) for purposes of the agency’s best price calculation, which is the lowest price at which CMS purchases medicines. On the other hand, he wants authorized generics to be considered brand products so they can bypass the Food and Drug Administration’s rigorous generic drug approval system and take advantage of a loophole in the federal law known as the Hatch-Waxman Act.

One provision in the Senate Medicaid proposal would clarify CMS’ treatment of authorized generics to ensure that the federal government is not overpaying for these medicines. Currently, brand companies obtain a major windfall by not including in their CMS best-price calculation brand products that are dressed up as generics to the detriment of the federal and state government programs. In other words, when it comes to federal reimbursement, the brand company benefits by calling the “authorized generic” a generic product. Mr. Goldberg’s views would indicate that this overpayment is an acceptable practice that taxpayers should embrace.

While there are other issues of concern in the Medicaid bill currently under consideration in Congress, this provision would clarify the inconsistencies in the treatment of these brand products. The brand industry can’t have it both ways.

KATHLEEN JAEGER

President and CEO

Generic Pharmaceutical Association

Arlington

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