David Dayen

David Dayen is a contributing writer to Salon.com who also writes for The InterceptThe New Republic, and The Fiscal Times. His first book, Chain of Title, about three ordinary Americans who uncover Wall Street's foreclosure fraud, was released by The New Press on May 17, 2016.

Recent Articles

Private Equity: Looting “R” Us

But the new tax law, unintentionally, could put a dent in private-equity scamming.

AP Photo/Julio Cortez A person walks near the entrance to a Toys R Us store in Wayne, New Jersey T he fate of 33,000 Toys “R” Us employees will be sealed in a bankruptcy court this week, as the nation’s last remaining specialty retailer seeks to liquidate all its U.S. stores. It’s a dark moment for the future of retail, and also one to question the business model that drove Toys “R” Us into the grave. After all, it was a leveraged buyout in 2005 that dumped over $6 billion in debt on Toys “R” Us, making it liable for $450 to $500 million annually just in interest payments. Take away that and the company was profitable, with growing operating income the past three years. Last year, it was responsible for 1 out of every 5 toys sold in the U.S.; no company should hit bankruptcy with that market share. But the debt proved too burdensome for Toys “R” Us to survive. In other words, it was a classic private-equity bust-out . The firms in the deal—private-equity giants KKR and Bain Capital...

The Corporate Scam that Even Trump Opposes: PBMs

The administration’s welcome proposal to break up pharmacy benefit managers

(AP Photo/Richard Drew)
(AP Photo/Richard Drew) W hile the media pores over a Trump budget proposal that died before even getting to Congress , another administration document might deserve more scrutiny. Last Friday, the Council of Economic Advisers (CEA) released its blueprint for making prescription drugs more affordable. And one of the biggest proposals would break up the pharmacy benefit manager (PBM) industry, a small group of middlemen that administers drug benefits in health plans, providing dubious assistance on lowering prices while extracting outsized profits. It may strike you as surprising that an administration so devoted to doing the bidding of big business would call for one of the largest and most profitable industries in America to be dismantled. But in context it makes a lot of sense. This report on lowering drug prices scrupulously avoids nearly everything that would lower the pharmaceutical industry’s profits. And drug companies have been pointing to pharmacy benefit managers as a source...

Abusing Drugs

How CVS uses its market power to destroy competing independent pharmacies.

AP Photo/Richard Drew
AP Photo/Richard Drew The CVS Health logo appears above a trading post on the floor of the New York Stock Exchange W hen the CVS drug chain announced its proposed merger with Aetna, some health experts offered a sliver of optimism. Combining elements of the medical supply chain could increase efficiency for patients, they reasoned, and eliminate some of the middlemen that make health care so expensive. But recent allegations about CVS trying to put independent pharmacists out of business should put an end to this happy talk. CVS’s existing combination of a pharmacy (which dispenses drugs) and a pharmacy benefits manager (which reimburses other pharmacists for dispensing drugs) is a disaster for competition and access, particularly in underserved communities. Adding a health insurer like Aetna would further concentrate market power and narrow the networks people depend upon for medical care. As first reported by the subscription-based outlet The Capitol Forum , near the end of October...

The Rehabilitation of Antitrust

Time to overturn the revolution wrought by Robert Bork. We need antitrust more than ever.

AP Photo/Alan Diaz, File
AP Photo/Alan Diaz, File An AT&T logo at a store in Hialeah, Florida L ast week, the Senate Judiciary Committee’s antitrust subcommittee held an extraordinary hearing , challenging an entrenched consensus that has dominated for nearly four decades. Lawmakers and panelists didn’t debate a new law but the interpretation of a century-old one. And in the process, they revealed something about how corruption works in our key institutions. It’s not solely about self-enrichment or looting the treasury on behalf of donors. It’s about closing off debate, building a wall around critical decisions so only they and their friends get to weigh in. This cloistered, pinched, incestuous establishment went on trial last week, and it didn’t fare well. The hearing concerned the “ consumer welfare standard ” for antitrust law, a concept conjured up by Robert Bork and his pals at the University of Chicago in the 1970s. Under this standard, mergers are judged under the Sherman and Clayton Acts based...