FreedomWorks

"The White House deal with Big Pharma undermines democracy"

That's the headline on left-leaning Salon.com on an opinion piece by former Clinton labor secretary Robert Reich.  He published the article last week and is sounding more and more prescient each day.

Since he published the article, first on his own site on August 9, it has been announced that the pharmaceutical lobby PhRMA will spend with its coalition at least $150 million supporting the Obama-Pelosi-Reid health care legislation.

And on August 15 Bloomberg reported that one of the two advertising companies "selected" to handle the ads for this massive campaign is the one founded by top Obama Advisor David Axelrod, AKPD, and that that firm is set to pay Axelrod $2 million, even though he works for the White House, and employs his son.

Today we find out from Politico that the ad buys are "now at $24 million and counting."  That's plenty of PhRMA money to cover Axelrod's $2 million and his son's salary, as they push the president and industry's agenda.

David Axelrod. Photo: AP

I almost never agree with far-left Clinton labor secretary and UC Berkeley professor Reich, but I think these lines from his article are comments all sides can agree on--a rarity on what has been a very divisive health care debate:

Last week, after being reported in the Los Angeles Times, the White House confirmed it has promised Big Pharma that any healthcare legislation will bar the government from using its huge purchasing power to negotiate lower drug prices. That's basically the same deal George W. Bush struck in getting the Medicare drug benefit, and it's proven a bonanza for the drug industry.

[NOTE: For the record, FreedomWorks was a leading opponent of the Bush Medicare Part D/PhRMA bill, too, see this Wall Street Journal op-ed by our chairman Dick Armey, which countered one Newt Gingrich had written in support of the bill the day before.]

Back to Robert Reich's comments:

A continuation will be an even larger bonanza, given all the boomers who will be enrolling in Medicare over the next decade. And it will be a gold mine if the deal extends to Medicaid, which will be expanded under most versions of the healthcare bills now emerging from Congress, and to any public option that might be included. (We don't know how far the deal extends beyond Medicare because its details haven't been made public.)

Let me remind you: Any bonanza for the drug industry means higher healthcare costs for the rest of us, which is one reason why critics of the emerging healthcare plans, including the Congressional Budget Office, are so worried about their failure to adequately stem future healthcare costs. To be sure, as part of its deal with the White House, Big Pharma apparently has promised to cut future drug costs by $80 billion. But neither the industry nor the White House nor any congressional committee has announced exactly where the $80 billion in savings will show up nor how this portion of the deal will be enforced. In any event, you can bet that the bonanza Big Pharma will reap far exceeds $80 billion. Otherwise, why would it have agreed?

In return, Big Pharma isn't just supporting universal healthcare. It's also spending lots of money on TV and radio advertising in support. Sunday's New York Times reports that Big Pharma has budgeted $150 million for TV ads promoting universal health insurance, starting this August (that's more money than John McCain spent on TV advertising in last year's presidential campaign), after having already spent a bundle through advocacy groups like Healthy Economies Now and Families USA.

Reich goes on to say:

But I also care about democracy, and the deal between Big Pharma and the White House frankly worries me. It's bad enough when industry lobbyists extract concessions from members of Congress, which happens all the time. But when an industry gets secret concessions out of the White House in return for a promise to lend the industry's support to a key piece of legislation, we're in big trouble. That's called extortion: An industry is using its capacity to threaten or prevent legislation as a means of altering that legislation for its own benefit. And it's doing so at the highest reaches of our government, in the office of the president.

When the industry support comes with an industry-sponsored ad campaign in favor of that legislation, the threat to democracy is even greater. Citizens end up paying for advertisements designed to persuade them that the legislation is in their interest. In this case, those payments come in the form of drug prices that will be higher than otherwise, stretching years into the future.

He closes by saying:

When will it become standard practice that such deals come with hundreds of millions of dollars of industry-sponsored TV advertising designed to persuade the public that the legislation is in the public's interest? (Any Democrats and progressives who might be reading this should ask themselves how they'll feel when a Republican White House cuts such deals to advance its own legislative priorities.)

We're on a precarious road -- and wherever it leads, it's not toward democracy.

Read the full article here.

It is what we get when so much money and power is concentrated in so few people in Washington.  The mistake partisans on both sides of the political aisle make is thinking that when "their guys" are in power, it will be different.  It isn't--it's always the political class v. the American people, and it is why ideas, not parties and individuals, are what should be supported.  And it is only when the American people stand for themselves that the politicians listen. 

It is also a common misconception that big business is on the side of the free market.  They are not--they are the first to use the power of the government to skew the market in their favor.  This health care debate, with PhRMA's big buy in to support the legislation for their piece of the action, and the health insurance companies pushing for an "individual mandate" to force everyone to buy their product are a perfect example.  Tim Carney does a great job documenting this in his 2006 book, "The Big Rip Off: How Big Government and Big Business Steal Your Money."

Beware the coming compromise that will be everything PhRMA and the health insurance companies want, (no negotiating prices on drugs and extended patents for PhRMA, and either an employer or individual mandate to require purchasing insurance for the insurance companies) and nothing those of us fighting on either side of the debate believe would make the system better (single-payer or public option for those on the left, buying insurance across state lines, tort reform, and patient-driven health care through bigger health saving accounts and equal tax treatment of health care spending for those of on the right).