Last NC meth prescription caused side effects

Last month, a North Carolina legislative panel recommended requiring people to obtain a doctor's prescription in order to purchase over-the-counter cold medicines with pseudoephedrine, an ingredient that can be used to produce methamphetamine. NC already prohibits off-the-shelf sales of cold medicines, limits the number of purchases during a single visit and during a month, requires photo identification for purchases, and requires customers' names to be entered into a central, searchable database. Nevertheless, the legislative panel wants even more onerous and costly restrictions--restrictions that would add the time and expense of a doctor's visit the cost of a cold medicine purchase. The panel cites the continuing rise in meth lab busts as evidence of a worsening meth problem.

What's behind the increase in meth lab busts? Much of the rise can be traced to the very laws that the legislature has already put in place, as NC's Attorney General, Roy Cooper, inadvertently explained in a press release yesterday.

Meth lab busts in North Carolina reached a new high in 2012 as a simpler method for making small amounts of the drug spread statewide. At the same time, electronic tracking of pseudoephedrine buys is helping stop illegal sales and leading law enforcement to more meth labs, Attorney General Roy Cooper said Tuesday.

...State Bureau of Investigation agents responded to 460 meth labs in 2012, compared to 344 meth labs in 2011 and 235 labs in 2010. Approximately 73 percent of the meth labs busted in 2012 used the “one pot” method. One pot labs, also known as shake and bake labs, make smaller amounts of meth than previously seen larger meth labs. Criminals can cook meth in a plastic soda bottle using a small amount of pseudoephedrine, the illegal drug’s key ingredient found in cold medicine.

A new electronic system that tracks purchases of pseudoephedrine is helping to block illegal sales of that key ingredient and lead law enforcement to meth labs, Cooper said. Approximately 54,000 purchases, a total of more than 66,000 boxes of pseudoephedrine, were blocked last year in North Carolina by pharmacies using the system, called the National Precursor Log Exchange (NPLEx). The amount of pseudoephedrine blocked could have been used to make 277 pounds of meth.

Making it harder to get the key ingredient has prevented an increase in the number of larger labs and has forced some criminals to use the one pot method.

There is no evidence that meth production is up. Meth busts have risen because of an increase in enforcement that is tied to last year's law. Also, the vast majority of busts that are being made involve much, much smaller labs than previous years--due also to changes in the law.

The proposed prescription requirement would increase money costs, increase time costs, and generally inconvenience all North Carolininians. The requirement would discourage many, many more legitimate purchases (another cost) than illegitimate purchases. The increase in meth lab busts provides no justification whatsoever for imposing those widespread and very real burdens.

NC Republicans' latest prescription for higher health care costs

North Carolina Republicans latest contribution to spriraling health care costs is ... a proposal to drive up costs some more.

WRAL reports

A legislative panel on Wednesday suggested requiring a prescription for cold remedies containing one of the main ingredients used to make methamphetamine.

Lawmakers in 2005 ordered North Carolina pharmacies to put medicines containing pseudoephedrine behind the counter to make it more difficult for people to use them to cook up meth. Last year, pharmacists began entering customer names into a national database when they buy the medicines to alert them to anyone buying large quantities of the drug.

The changes have done little to stem the proliferation of home labs that produce meth, a potent stimulant that can be made with over-the-counter household products, often leaving behind a toxic mess.

According to the State Bureau of Investigation, law enforcement has busted a record 444 labs statewide so far this year – 100 more than the previous record, set in 2011. Wilkes County, in the mountains in the northwest part of the state, has had the most busts this year at 58, followed by Wayne County in the east at 27.

Each time one of these laws is passed, lawmakers confidently promise the same thing--that this new restriction will turn the tide against meth labs. And each time they are proven wrong. Such an unbroken record of failure should instill some humility or perhaps some consideration of other approaches; instead it only emboldens the drug crusaders and begets more restrictions.

And indeed, proponents are once again saying that this time will be different.

So far only two states--Oregon and Mississippi--have had enough disregard for the well-being of their law-abiding citizens to enact prescription requirements for cold medications. WRAL cites figures that show dramatic decreases in meth lab busts in those states following the enactment of the laws. It later quotes Rep. Rep. Craig Horn, chairman of the House Select Committee on Methamphetamine Abuse, who asks, "Do we just have to have more dead bodies? Or are we going to do something when we know there's an action that works?"

So what exactly do we know? Examinations of those data suggest--not a whole lot.

An analysis earlier this year of the Oregon figures by the Cascade Policy Institute found that nearly all of the drop in meth lab busts occurred before that state's laws took effect and that California and Washington, which didn't enact prescription laws, saw nearly the same percentage drops in meth lab busts.

A look at the Mississippi experience isn't any more encouraging. In 2009, the year that Mississippi enacted its prescription law, the DEA reported 691 meth lab "incidents" in the state; two years later, the DEA reported that the number of incidents fell to 259. The numbers look impressive until you consider that in neighboring Alabama, meth lab incidents fell even more from 614 in 2009 to 177 in 2011. Over the same period, meth lab incidents in Louisiana fell from 80 to 36. Perhaps more disquieting, the DEA figures also indicate that meth incidents in Mississippi actually increased in the intervening year, rising to 698 in 2010.

While it is difficult to demonstrate the benefits of these laws, we do know the costs. The laws that moved cold medicines "behind the counter" inconvenienced millions of sick people and increased costs for all pharmacies. The most recent law in North Carolina, requiring the registration of all cold medicine purchases, increased costs further and created a massive invasion of privacy.

The proposed restrictions would go even further. Monetary costs would go up even more--either through doctor's fees, insurance copayments, or the cost to insurers. Time costs would also increase. Cold medicine might be out of reach for the poor and uninsured who can't afford a doctor. Costs for drug stores would also rise, as pharmacists have to read and process prescriptions. These are non-trivial costs. Worse, they are repeated over and over for all law-abiding North Carolinians.

Toyota's woes

While many American's might be tempted to cheer Toyota's quality, recall, and now production and sales woes, they might want to think again.

Toyota announced last week that it was recalling 2.3 million vehicles in the U.S. because of suspected problems with the gas pedals becoming stuck in those cars. However, other than identifying that problem might exist, Toyota does not appear to have a strategy for fixing it.

Yesterday, Toyota announced that it was suspending production and sales of the affected vehicles while it determines the exact cause of the problems.

Toyota's problems would seem to be good news for the Big-Three American automakers--GM, Ford, and Chrysler--which have struggled for years against Toyota's reputation for high-quality manufacturing. In time, Toyota's problems could give the U.S. automakers a boost. If nothing else, consumers will be considering a wider range of cars than they would have before the recall.

However, Toyota's problems are bad news for the struggling U.S. economy. The suspension in sales hurts owners and employees at U.S.-based dealerships.

Worse, Toyota will be suspending production at several North American plants. From yesterday's announcement

Toyota is expected to stop producing vehicles on the following production lines for the week of February 1 to assess and coordinate activities. The North America vehicle production facilities affected are:

• Toyota Motor Manufacturing, Canada (Corolla, Matrix, and RAV4)
  
• Toyota Motor Manufacturing, Indiana (Sequoia and Highlander)
  
• Toyota Motor Manufacturing, Kentucky – Line 1 (Camry and Avalon)
  
• Subaru of Indiana Automotive, Inc. (Camry)
  
• Toyota Motor Manufacturing, Texas (Tundra)

These shutdowns won't help the economic or employment recovery. The communities in Indiana, Kentucky, and Texas certainly aren't cheering.

Americans tend to think of foreign-owned corporations as the enemy. However, when those corporations invest and produce in the U.S., Americans benefit. Toyota's current problems are more than just Toyota's concerns.

So many foreclosures, so little time

You would think that with all of the underwater and distressed properties around, banks wouldn't be terribly eager to foreclose on extra properties. Sadly, you'd be wrong, as ABC News reports

Some 2.8 million homeowners faced the threat of foreclosure last year, but it wasn't supposed to happen to Charlie and Maria Cordoso. In 2005, the New Bedford, Mass. couple paid in full -- in cash -- for a house in Springville, Fla., and rented it out with plans eventually to use the home as a retirement getaway.

They said they were shocked to learn earlier this month that Bank of America had locked them out and removed their clothing and furniture from the property.

The story goes on to report that BofA is being sued for foreclosing on other properties on which it did not hold or service mortgages.

You know that the mortgage system is stacked against homeowners when a company can foreclose on any property at all. In this case, BofA appears to have padlocked the property, removed possessions, and shut off the utilities. And all this appears to have occurred after BofA was informed that it was targeting the wrong property.

All in a day's work for BofA--it will probably even pay a bonus for the entrepreneurial forecloser.

What's not in my wallet

I got home last night to find a letter from Sears kindly informing me that the interest rate on my seldom-used Sears card was going up to "the U.S. Prime Rate plus 21.99%." Effectively, that was going to make the interest rate just a bit over 25% and well into usury territory, so much for the "softer side of Sears."

I can take a hint. I cancelled the card shortly thereafter.

This morning CNN.money reports

One in four consumers plan to pay with cash this holiday season, according to a new survey by the National Retail Federation. That's up 9.1% from a year ago.

That's not too surprising considering both credit card companies and consumers have reined in usage during the Great Recession.

Another 42.5% of holiday shoppers plan to use primarily debit or check cards, a 2.5% increase from last year, the survey found.

Credit card usage, meanwhile, is expected to fall by 10.1% to 28.3%.

The story doesn't mention changes in rates but does mention that "credit usage will remain weak until unemployment starts to fall, economists say." Credit usage will also remain weak while interest rates are sky high.

Many other card customers will see notices like this as a result of the Credit Card Accountability, Responsibility, and Disclosure Act of 2009, which bans some types of rate increases and "gotcha" fees. Issuers are rushing to raise rates before the provisions kick in this winter (or sooner if Congress gets its way).

It just goes to show that these types of regulations are like squeezing on a balloon. Squish down on one fee and another pops out. At least the new rules have the benefit of simplifying card provisions and making usurious rates easier to spot.

Protection racket

In the musical version of Les Miserables, Monsieur Thenardier, the innkeeper, sings about the creative extras he charges his guests

Charge 'em for the lice, extra for the mice
Two percent for looking in the mirror twice
Here a little slice, there a little cut
Three percent for sleeping with the window shut
When it comes to fixing prices
There are a lot of tricks he knows
How it all increases, all them bits and pieces
Jesus! It's amazing how it grows!

Bank executives seem to share Thenardier's billing philosophy.

The New York Times reported yesterday on automatic overdraft protection that is included with many debit cards.

When Peter Means returned to graduate school after a career as a civil servant, he turned to a debit card to help him spend his money more carefully.

So he was stunned when his bank charged him seven $34 fees to cover seven purchases when there was not enough cash in his account, notifying him only afterward. He paid $4.14 for a coffee at Starbucks — and a $34 fee. He got the $6.50 student discount at the movie theater — but no discount on the $34 fee. He paid $6.76 at Lowe’s for screws — and yet another $34 fee. All told, he owed $238 in extra charges for just a day’s worth of activity.

Mr. Means, who is 59 and lives in Colorado, figured employees at his bank, Wells Fargo, would show some mercy since each purchase was less than $12. In addition, a deposit from a few days earlier would have covered everything had it not taken days to clear. But they would not budge.

Banks and credit unions have long pitched debit cards as a convenient and prudent way to buy. But a growing number are now allowing consumers to exceed their balances — for a price.

Overdraft coverage is essentially a loan from the debit card issuer. When the customer attempts to "overdraw" an account (take more money out than is there), the card issuer has two options: to reject the payment or let the customer run a negative balance. Overdrafts are temporary negative balances, usually for limited amounts.

Some banks, such as ING, simply charge the going interest rate for the negative balance. Most banks, however, charge a fee for initially making each overdraft (in Mr. Means' case, $34) AND charge daily fees for continuing the overdraft.

There are other forms of overdraft protection. For example, some banks will let you link your debit card account to a savings account or a credit card. If you overdraw the debit card account, the bank will move funds from the linked account--usually for a fee.

Overdraft coverage can be useful, as it allows customers to make necessary purchases that they might not otherwise be able to make.

However, this convenience usually comes at a cost--the high fees that most banks charge. For a customer with a credit card, the interest rate on that card is typically much lower than the overdraft fee.

Also, debit card users with automatic overdraft coverage are seldom informed that they are about to overdraw their accounts. They only find out when they are contacted about the fee.

Worse, the Times article points out that banks will rearrange the sequence of transactions to maximize their fees.

Ralph Tornes, who lives in Florida, is pursuing a lawsuit against Bank of America for charging him nearly $500 in overdraft fees in 2008 after it rearranged his purchases from largest to smallest. In May 2008, for instance, Mr. Tornes had $195 in his account when he made two debit purchases for $8 and $13; the bank also processed a bill payment of $256.

He claims that Bank of America took his purchases out of chronological order and ran the biggest one through first. So instead of paying $35 for one overdraft fee, he was stuck with three, for a total of $105.

The fees have become a huge source of revenue for the banks.

In all, $27 billion in fee income flows from covering overdrafts from debit card purchases, A.T.M. transactions, checks and automatic payments for bills like utilities; an additional $11.5 billion arrives from bounced checks and other instances in which banks refuse to pay overdrafts...

Because of this, banks are fighting reasonable regulations on this activity.

The most sensible regulation is to give consumers the explicit choice to elect this coverage on their accounts. At that time, consumers would be informed of the fees and limits associated with the service. If the feature is as convenient and useful as the banks claim, people should be glad to sign up for the service.

Another sensible regulation would be to require banks to book purchases and withdrawals chronologically.

Ultimately, however, caveat emptor. Consumers are in the best position to avoid these fees by making sure that they have adequate balances before using their cards. They should also shop around for banks and credit unions that don't charge these fees.