Assignment: Unit 03: Legal Reasoning
Q1. Many companies have taken the position that their products have no GMOs. In the United States, foods that contain ingredients derived from corn, soy, canola, and sugar beets have usually been genetically modified. Sixty-four countries around the world have required that GMO foods be labeled. A 2015 survey from ABC News founds that 93% of Americans believe that GMO foods should be labeled.
On the other hand, many scientists and political leaders have argued that the use of GMOs has permitted the United States to grow more food, food that supplies those who are starving throughout the world. Former Governor Mitch Daniels of Indiana maintains that the intentional starvation of people is callous and cruel, but he also believes that denying the world the benefits of increased food production from GMOs carries no moral distinction in resulting starvation.
There are scientific concerns about the effects of GMOs on the environment and on humans when they ingest the food.
If you were on the board of a company that is faced with using GMO or non-GMO suppliers, discuss what position Milton Friedman might take on this issue.
Q2. Using the facts in question 1, discuss how Edward Freeman would address the issue the company faces.
Q3. Andy Puzder, once a candidate for secretary of labor in the Trump administration, has written, "When a store closes, the minimum wage for your lost job is zero." Mr. Puzder believes that increases in minimum wage destroy jobs and hurt working class Americans. What readings and cases in Unit 3 provide support for Mr. Puzder's view? Which readings and cases would take a different view?
Q4. Who are the stakeholders in those situations in which pharmaceutical companies substantially increase the prices of their drugs?
Q5. What would Milton Friedman say about the pharmaceutical price increases?
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Q1. If I were on the board of a company faced with using GMO or non-GMO suppliers, Milton Friedman would likely take the position that the company should prioritize the interests of its shareholders and maximize profits. Friedman was a strong advocate for free markets and believed that the primary responsibility of a business is to generate profits for its shareholders. Therefore, he would likely argue that the company should choose the option that is most cost-effective and maximizes its competitive advantage, regardless of the GMO/non-GMO debate. Friedman might also argue that labeling GMO foods is unnecessary government intervention and that consumers should have the ability to make their own choices in the market.
Q2. Edward Freeman, a proponent of stakeholder theory, would likely address the issue by considering the interests of all stakeholders involved. He would argue that the company should take into account the preferences and concerns of its customers, including the 93% of Americans who believe GMO foods should be labeled. Freeman would also consider the impact of the company's decision on the environment, human health, and the global fight against hunger. He might encourage the company to engage in open and transparent dialogue with its stakeholders to understand their concerns and work towards finding a mutually beneficial solution.
Q3. In support of Mr. Puzder's view, readings and cases in Unit 3 that discuss the potential negative consequences of minimum wage increases on job loss include "The Effects of the Minimum Wage on Employment" by David Neumark and William Wascher, and the case study on Seattle's minimum wage increase. These readings argue that higher minimum wages can lead to job cuts, reduced working hours, and the substitution of labor with automation.
On the other hand, readings and cases that take a different view on the impact of minimum wage increases include "Raising the Minimum Wage Would Boost Incomes and Reduce Poverty" by David Cooper, and the case study on San Francisco's minimum wage increase. These argue that higher minimum wages can reduce poverty levels, improve workers' well-being, and stimulate economic growth.
Q4. The stakeholders in situations where pharmaceutical companies substantially increase the prices of their drugs include:
1. Consumers/patients: They are directly affected by the price increases as it may lead to unaffordable medications, resulting in limited access to necessary treatments.
2. Health insurance companies: They have to bear the increased costs of medications and may pass on these costs to consumers through higher insurance premiums.
3. Government: Increased drug prices can put a strain on healthcare budgets, especially for public programs like Medicare and Medicaid.
4. Healthcare providers: Higher drug prices can impact their ability to provide affordable care to patients.
5. Shareholders: If pharmaceutical companies' profits increase as a result of price hikes, shareholders may benefit through increased dividends or stock value.
6. Competitors: Other pharmaceutical companies in the market may have to adjust their pricing strategies in response to the price increases.
7. Advocacy groups: Organizations representing patients, healthcare professionals, or public interests may advocate for affordable drug pricing and challenge excessive price increases.
Q5. Milton Friedman would likely argue that pharmaceutical price increases are a result of the free market at work. He would contend that companies have the right to charge whatever prices they believe the market can bear and that excessive government intervention to regulate drug prices would hinder competition and innovation. Friedman believed that the pursuit of profit leads to the best allocation of resources and benefits society as a whole, even if it means some individuals may be unable to afford certain drugs. He would argue that market forces and competition would eventually drive prices down and increase accessibility.
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