Repealing an effective policy without immediate replacement? Good idea?

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In June, the secretary of education, Betsy DeVos, announced plans to dismantle a set of Obama-era policies devised to protect students and taxpayers from predatory for-profit colleges. However, data released in the final days of the previous administration shows that the existing rules were more effective at shutting down bad college programs than even the most optimistic backers could have hoped.

Questions:
1. What rules does Ms. De Vos want to repeal?
2. What does analysis of the more than 500 failing programs identified by the Obama Administration show?
3. How would you evaluate the gainful employment test? Should they be repealed, given the evidence in the article?
For Questions 4: Consider what risks and potential frauds could be in play.
4. What do you think will happen during the two years it will take for the Department of Education to write and set into effect new gainful employment rules?
5. Is repeal without replacement a good idea? Discuss.

Source:
Carey, K. (2017). DeVos Is Discarding College Policies That New Evidence Shows Are Effective. The New York Times, June 30 (Retrievable online at https://www.nytimes.com/2017/06/30/upshot/new-evidence-shows-devos-is-discarding-college-policies-that-are-effective.html?hpw&rref=education&action=click&pgtype=Homepage&module=well-region&region=bottom-well&WT.nav=bottom-well)

The new CFPB rule

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On July 10, the Consumer Financial Protection Bureau (CFPB) issued a controversial rule to prevent companies from using arbitration clauses to stop litigation over customer complaints.
Questions:
1. Many of these clauses have been related to credit card or banking customer contracts. If consumers don’t agree with the arbitration, why haven’t they filed class action suits?
2. What does the new CFPB rule require?
3. When does the rule take effect?
4. Do you agree with the rule or think it needs to be reversed? Discuss.

Source:
Lane, S. (2017). Arbitration Clauses. The Hill, July 10 (Retrievable at http://thehill.com/policy/finance/341313-consumer-bureau-releases-rule-to-prevent-banks-credit-card-firms-from-blocking)

Don’t order the chicken

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The first known shipment of cooked chicken from China reached the United States last week, after a very publicized trade deal between the Trump administration and China. But consumer groups and former food-safety officials are warning that the chicken could pose a public health risk.

Questions:
1. What are the health risks?
2. What are the problems with the labeling on the Chinese chicken?
3. What are some of the current risks to public health, noted in the article?
4. Which companies are selling the chicken?
5. What did the U.S. get out of this trade deal?
Source:
Dewey, C. (2017). The dark side of Trump’s much-hyped China trade deal: It could literally make you sick. The New York Times, July 7 (Retrievable online at https://www.washingtonpost.com/news/wonk/wp/2017/07/07/the-dark-side-of-trumps-much-hyped-china-trade-deal-it-could-literally-make-you-sick/?tid=hybrid_content_1_na&utm_term=.6bdb55b4791f)

Will this new strategy work?

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McDonald’s stock raced toward an all-time high Monday, June 19. What was the trigger? Wall Street reacted to the news that the burger giant was upgrading its technology, including kiosks, to meet on-demand orders.

Questions:
1. Which product has anchored the McDonald’s menu for decades?
2. How is McDonald’s going to change its process of preparing food?
3. How does the average wait at a McDonald’s drive-thru compare to Wendy’s and Starbucks?
4. Do you think that McDonald’s new strategy will regain customers? What is your opinion and why?

Source:
Heath, T. (2017). Is McDonald’s made-fresh quarter pounder worth the extra minute wait? Washington Post, June 21 (Retrievable online at https://www.washingtonpost.com/business/economy/is-mcdonalds-made-fresh-quarter-pounder-worth-the-extra-minute-wait/2017/06/21/276d1cc4-5696-11e7-b38e-35fd8e0c288f_story.html).

New Math: 1 + 1 = $455M

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An Ireland-based company, Horizon Pharma, makes a drug called Vimovo. The drug combines the two over-the-counter drugs of Nexium and Aleve and you won’t believe what they charge for it!

Questions:
1. According to the article, how much does it cost to buy the new drug. Compare Vimovo’s price to the $40 for a month’s supply of the over-the-counter drugs. What percentage increase is this in the price?
2. What techniques has Horizon used to make sure that doctors will write for Vimovo?
3. According to the article, what barriers has Horizon eliminated in order to cash in on the combination drug? Do you think that any of these are deceptive? Why or why not?
4. Go to Horizon’s annual reports for 2015 & 2016. Find the section that describes why Vimovo and Duexis as better solutions than the over-the-counter components taken separately. What are the benefits they tout?
5. How much did Horizon make in sales of each drug, as shown in the 2016 annual report? Were either of these their top money maker? If not, what was the top selling product and what does it do?

Source:
Allen, M. (2017). How Two Common Medications Became One $455 Million Specialty Pill. ProPublica and The Atlantic, June 20 (Retrievable online at https://www.propublica.org/article/horizon-pharma-vimovo-common-medication-455-million-specialty-pill)

A New Way to Raise Money

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Interestingly, some entrepreneurs are following a new path, which avoids venture capital pitches or crowd funding. In this quest, before they even have a working product, they are creating their own digital currencies and selling so-called coins on the web, which sometimes raises them tens of millions of dollars in a matter of minutes.

Questions:
1. What are some of the names of these currencies?
2. What are some of the abuses of these currencies that you can identify?
3. Typically, what types of products or services are being financed in this way?
4. What are some of the reasons or ways in which these new currencies may violate U.S. laws or regulations?

Sources:
Popper, N. (2017). Easiest Path to Riches on the Web? An Initial Coin Offering. The New York Times, June 23 (Retrievable online at https://www.nytimes.com/2017/06/23/business/dealbook/coin-digital-currency.html)

Not good for Walmart

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A report released Thursday by a workers’ advocacy group says Walmart, the nation’s largest private employer, routinely refuses to accept doctors’ notes, penalizes workers who need to take care of a sick family member and otherwise punishes employees for lawful absences.

Questions:
1. According to the accusations, what Acts has Walmart violated?
2. The article talks about a group known as The Better Balance. What is this group?
3. According to the article, what is wrong with the written policies and procedures for how managers and supervisors should respond to employees who need help because of medical issues?
4. What are the eligibility requirements for employees to be protected by the Family and Medical Leave Act?
5. Go to the specifics of the lawsuit filed by the two former Walmart employees by clicking on the hyperlink in the article. Who did the two women file discrimination complaints with?
6. At this point, what type of disclosure (if any) do you think Walmart should include in the notes to its financial statements regarding the suit?

Source:

Abrams, R. (2017). Walmart Is Accused of Punishing Workers for Sick Days. The New York Times, June 1 (Retrievable online at www.nytimes.com/2017/06/01/business/walmart-workers-sick-days.html).

More from the Glass Ceiling…..

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While women account for 57 percent of college enrollees as of the fall of 2016, the most recent data from the Department of Education indicates that they hold close to two-thirds of the $1.34 trillion in outstanding student debt in the U.S.(according to a report released by the non-profit American Association of University Women).

Questions:
1. Explain whether this situation has worsened over time and why.
2. What are some of the reasons for this disparity?
3. What is your opinion about giving women a grant for college or increasing financial aid? Discuss some of the issues.

Source:

O’Neal, L. (2017). Women Have More College Debt Than Men And Take Longer To Pay It Off. IBT, May 24 (Retrievable online at http://www.ibtimes.com/women-have-more-college-debt-men-take-longer-pay-it-2542797).

A New Ruling May Have Implications for the Technology Owner and User

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The Supreme Court dealt a blow to patent law use by corporations, saying that companies can only be sued for patent infringement in the places they actually do business.

Questions:
1. What was the name of the case and what did it deal with?
2. What is the practical question of the case in reference to an automobile, for example?
3. Describe how you see this ruling impacting digital goods, like streaming subscriptions.
4. What impact could this have on accounting for intangible assets?

Source:
Funk, B. (2017). How a Supreme Court ruling on printer cartridges changes what it means to buy almost anything. The Washington Post, May 31 (Retrievable online at https://www.washingtonpost.com/news/the-switch/wp/2017/05/31/how-a-supreme-court-ruling-on-printer-cartridges-changes-what-it-means-to-buy-almost-anything/?hpid=hp_hp-more-top-stories_switch-lexmark-1125am%3Ahomepage%2Fstory&utm_term=.29eb83312ae4)

You can’t take it with you!

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While Bloomberg indicates that younger generations aren’t saving enough, older Americans are sitting on top of unprecedented piles of assets built through stock market and real estate booms.

Questions:
1. What does a new study find about many U.S. retirees?
2. What are the financial statistics for American households and nonprofits according to the article?
3. What are some of the ideas you would suggest about training people to spend?
4. Why is the situation for wealthier older Americans different than that facing younger generations?

Source:
Steverman, B. (2017). Rich Retirees Are Hoarding Cash Out of Fear.Bloomberg, May 16 (Retrievable online at https://www.bloomberg.com/news/articles/2017-05-16/rich-retirees-are-hoarding-cash-out-of-fear)