Lenin, the Wall Street Journal and a task in Economics

Step number one. Read:

       “Monopoly capitalist combines—cartels, syndicates, trusts—divide among themselves, first of all, the whole internal market of a country, and impose their control, more or less completely, upon the industry of that country. But under capitalism the home market is inevitably bound up with the foreign market. Capitalism long ago created a world market. As the export of capital increased, and as the foreign and colonial relations and the “spheres of influence” of the big monopolist combines expanded, things “naturally” gravitated towards an international agreement among these combines, and towards the formation of international cartels.” (“Imperialism, the highest stage of capitalism,” by V.I. Lenin)

      Step number two: Read an article in the April 27^th Wall Street Journal by Jonathan D. Rockoff and Ed Silverman entitled “Pharmaceutical Companies Buy Rivals’ Drugs, Then Jack Up the Prices”

       “On Feb. 10, Valeant Pharmaceuticals International Inc. VRX -3.99 % bought the rights to a pair of life-saving heart drugs. The same day, their list prices rose by 525% and 212%.

Neither of the drugs, Nitropress or Isuprel, was improved as a result of costly investment in lab work and human testing, Valeant said. Nor was manufacture of the medicines shifted to an expensive new plant. The big change: the drugs’ ownership.

“Our duty is to our shareholders and to maximize the value” of the products that Valeant sells, said Laurie Little, a company spokeswoman. “Sometimes pricing comes into it, sometimes volume comes into it.”

More pharmaceutical companies are buying drugs that they see as undervalued, then raising the prices. It is one of a number of industry tactics, along with companies regularly upping the prices of their own older medicines and launching new treatments at once unheard of sums, driving up the cost of drugs.

Since 2008, branded-drug prices have increased 127%, compared with an 11% rise in the consumer price index, according to drug-benefits manager Express Scripts Holding Co. Needham & Co. said in a June 2014 research note there were as many as 50% drug-price increases during the previous 2½ years as there were in the prior decade."

          Step number three: Answer the following questions.

1)   Does Lenin’s article help understand the report in the Wall Street Journal and if so in what way?

2)   Why do the prices for pharmaceutical drugs undergo such dramatic increases?

3)   Is it true that giant corporations attempt to control the markets or is that just fables invented by leftists like Lenin?

4)   What is the real goal of the process of globalization?

5)   Would it be useful or possible to control the process of monopolization of production, still being carried out on a world scale?

We would be happy to receive your answers!