Unintended Consequences

The New York Times has a front-page news article about how drug companies are raising prices in anticipation of ObamaCare. "When we have major legislation anticipated, we see a run-up in price increases," says a professor of pharmaceutical economics quoted by the Times, Stephen W. Schondelmeyer. The newspaper could have done the same story about health-insurance premiums -- I just found out that my family's are increasing 17% next year. The credit-card companies, of course, are doing the same thing, raising rates before legislation takes effect. As we said about the credit cards, left-wingers see this as an argument for swifter, more aggressive regulation. But there's a case, too, that the whole episode is an argument for less regulation, because businesses will find a way to make a profit one way or another, and by imposing regulations that artificially limit profits in one period, the government actions in essence force the businesses to try to make it up all at once before the tougher rules kick in.