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How the White House's Deal With Big Pharma Undermines Democracy
I'm a strong supporter of universal health insurance, and a fan of the Obama administration. But I'm appalled by the deal the White House has made with the pharmaceutical industry's lobbying arm to buy their support.
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. 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 health-care 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 health care. It's also spending a 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.
I want universal health insurance. And having had a front-row seat in 1994 when Big Pharma and the rest of the health-industry complex went to battle against it, I can tell you first hand how big and effective the onslaught can be. So I appreciate Big Pharma's support this time around, and I like it that the industry is doing the reverse of what it did last time, and airing ads to persuade the public of the rightness of the White House's effort.
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.
I don't want to be puritanical about all this. Politics is a rough game in which means and ends often get mixed and melded. Perhaps the White House deal with Big Pharma is a necessary step to get anything resembling universal health insurance. But if that's the case, our democracy is in terrible shape. How soon until big industries and their Washington lobbyists have become so politically powerful that secret White House-industry deals like this are prerequisites to any important legislation? 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.
- Posted in
47 Comments so far
Show AllWonderful article by Robert Reich,
The Right Wing protectors of capitalism are in a total panic. They view themselves as great Patriots, holding their finger in the dike to prevent the onslaught of socialism. This is the great lie of capitalism that the present Democratic Administration refuses to acknowledge.
Rather than the present Obama proposal, we need real Socialized Medicine that eliminates the participation of the Insurance Companies and Big Pharma. Socialized medicine will not destroy America. It will be America's first step to directly confront the greed of capitalism. It will be nothing less than America's breakthrough to a higher level of social consciousness.
Americans should be taking to the streets on this issue.
Very true Steven,we can socialize Wall Street losses,coddle drug profiteers,but try to give all the people health care and the right screams Socialism.I think that Mr. Reich really knows better than to call the U.S. a "democracy "though! peace
I'm not buying this democracy losing ground thesis. Democracy disappeared decades ago.
The US government has more fascist characteristics than democratic characteristics. How else do you explain Obama being more right wing than Republican Presidents Eisenhower, Nixon and Ford ? It is naive to think that this is the first deal that an industry has cut with the executive branch.
The last sentence in the second paragraph about the details not being made public is one more example of the almost daily examples we have seen of Obama's failure to make government more transparent (one of Obama's frequently repeated campaign promises that he keeps breaking).
Sioux
RAY: There was an excellent article on the march to fascism posted on yesterday's TRUTHOUT.org and I found the comments deeper than usual (on that site). Worth a read.
You lost me in the first paragraph.........
"I'm a strong supporter of universal health insurance, and a fan of the Obama administration. But I'm appalled by the deal the White House has made with the pharmaceutical industry's lobbying arm to buy their support."
Personally, when something appals me, that pretty much puts a damper on my fanhood and supporting the team. BUT, I imagine we all have different standards, eh?
Easydoesit, your right, my point was confusing and I have clarified it with a revised posting. Thanks to CD for the ability to edit.
From the article:
"I'm a strong supporter of universal health insurance, and a fan of the Obama administration."
Well, okay if you say so. But if you're a fan of universal health CARE, supporting O'Bummer is shooting yourself in the foot.
Or is the author using the words "care" and "insurance" interchangeably to reinforce the boneheaded notion that the latter guarantees the former?
Achieving universal health insurance by criminalizing the uninsured and criminalizing businesses that refuse to submit to insurance industry extortion will further empower the insurance industry and assure that their license to steal has no expiration date.
This is not new. Where was Mr. Reich when our boy Bill was cutting the same deals for NAFTA and WTO? And we've already seen how Republicans do it--just like Dems do it.
"Perhaps the White House deal with Big Pharma is a necessary step to get anything resembling universal health insurance."
Perhaps? More like obviously. The ugly truth is that Big Pharma has the power to stop health care reform dead it its tracks.
It ought to be illegal for corporations and their lobbying groups to engage in the sort of propaganda that so confuses the issues, but as long they are afforded the same free speech protection as individuals this will continue.
My conclusion? Obama had no choice but to cut a deal.
How long is it going to take this country to realize that we are living in a country that is run for the Big companies..?
Obomba is just a better lier than Mr. Bush...and so on...
It is time to wake up and get that Obama bumper sticker off the bus..
Who in their right mind can vote against universal single payer insurance. This has got to be the dumbest country in the world...
Is it possible that a guy as smart as Robert Reich, after 4 years in the Clinton Regime and about 25 in academia, still doesn't understand or acknowledge the way things actually work in America. Of course the Obama/Big Pharma deal is an open assault on democracy! Of course we have led ourselves to believe that we need Big Pharma to spend 150 million on TV commercials supposedly on our behalf in order to get universal health care! Of course the Dems have conveniently forgotten that the corporadoes have reneged on every promise since the Chrysler bailout (Lee Iaccocca, a Democrat, actually turned the company around and they paid back the loan with interest - since then, we have been burned every time)! Of course Big Pharma isn't going to stop here. They are now headed into the Senate and the House to eviscerate whatever is left of the "healthcare reform" bills and turn them into yet another form of corporatized looting.
Can Obama or Reich not know this? Seems doubtful. It's not too hard to see why Obama would keep up the pretense, but Reich? What for? Does he think he's got a shot at another Exec branch post?
Sorry jareilly, hope this doesn't offend but Reich's a poodle. He's the epitome of "white liberal" as his tenure in academia suggests. That means he will NEVER do anything or say anything that will threaten the privilege of his class. He's here to pat you on the head and say polite and understanding things while you are sodomized to death by Master and his Overseers. This is the role "white liberals" have played for the last 40 years. Master held out two hands, one held the bullet, the other held the gold. You know which one he picked. The trick is that he told himself he didn't make a choice at all because he was in academia and therefore "free" from the marketplace. They have a name for this process. If you wish to see it demonstrated, imagine if you will, R. Reich faced off against Michael Parenti in a moderated forum on any political / economic topic you like. Then you will see the Real Mr. Reich... not pretty. I mean, in the end, the Mob does get what it deserves, right?
"We're on a precarious road -- and wherever it leads, it's not toward democracy."
We are not on the road. We have arrived. We are in a corporatocracy dangerously embracing fascism. The only road out of this darkness must be paved with the war crimes trials of Bush/Cheney war criminals. The road must include campaign finance reform and the removal of corporate personhood.
If these routes are not taken, it is finished.
This is not being talked about at all:
From the Associated Press, 2004:
"...More than half the money needed to create top-selling prescription drugs came from U.S. taxpayers and not industry investment, says a federal report released...by critics of the drug companies.
http://www.whale.to/m/drug.html
** So these rat bastards use taxpayer money to create their best-selling drugs. Then, instead of giving them to us FREE or at a MASSIVE discount they turn around and force us to purchase them a second time at full retail price (i.e. sucker's price).
*** An even bigger insult is that Obama has already conceded the abillity for American's to re-import drugs from Canada. Obama and his coporatist clan have used "free-trade" agreements to exploit poor people in every corner of the world. You could make the case that this is the religion of the Free Traders..."opening up markets". Yet when the Average Joe wants to reimport drugs from Canada they won't let us join their religion! Unbelievable!
Jethro - Thank you, universal INSURANCE does not provide, may even preclude universal CARE.
Too often, a continuation of the current care (practitioners/facilities availability, is assumed under universal insurance.
BUT practitioners may opt out and facilities will be closed.
The law of unintended-consequences is alive and waiting!
Instead of using these innane descriptors of Obama is a "liar", a "corporate stooge", Bush's Third Term...etc, what are people actually doing to hold him to his campaign promises; ending the war, reversing the police-state provisions like the Patriot Act, & pursuing coherent and not muddled corporate approved environmental policies?
Obama said very early on that he needed the same people who voted for him to stand up to HIM and the congress or else policies would drift to the right, corporate lobbists would permate the system and little would change.
The lobbyists don't just give up, the moneyed interest didn't close shop, and the military-industrial complex didn't shut down after the election. Most people who voted for him did though. They went on being wage-slaves, went on watching copious hours of entertainment and faux-news, and expecting things to change without popular agitation.
If people want him to do what they voted him to do, make it clear that there won't be anymore funding or support for ANY democratic party candidates, including him. Politics is about power and power is managed through fear. The question is who is going to be afraid: the people or the politicians?
http://antisense-propaganda.blogspot.com
If one takes Obama at his word as you seem to imply you do, then one should expect Obama's actions would be representative of where people stand on current issues and not where corporations and lobbyist stand. Yet, people were against the Bank Bailout and were against GM Bailout and overall, the stimulus package. And now, a majority of voters show signs of hesitation on the "health care bill/insurance reform" bill....
And yet, as Chomsky mentioned, Obama doesn't represent the popular sentiment (even though often times our sentiment is very well known). Why should one expect to impact Obama after he fails to listen to the people when Obama promised not to listen to the corporations and to the lobbyists?!
Obama drew a distinct campaign line and said he sided with the people over the corporations. People called Hillary Clinton a corporatist --Obama was championed the alternative. He was never supposed to side with the corporations --and yet, you and far too many accept blame for Obama's fake "about-face". And have the gall to accuse the rest of us for being lazy at politics.
He never was listening, nor does he want to be challenged. He expects us to line up and form rank behind him and his agenda. That is the place Obama expects you and me to be --his little minions. And yet, Pharma companies are turning out to be the real winners. Is that worth fighting for today? I don't think Obama holds my interests at heart.
And so the only political recourse we have left today is to protest in the streets and to stall the process --a people's Filibuster as it were-- That isn't the same thing as winning over Obama's WH because we aren't invited. If we "left-wingers" protest and stall "THE PARTY" we better be ready to absorb the scorn of "THE PARTY" which will include being scapegoated and attacked as monkey wrenchers....Imagine jamming "THE PARTY" over its handling in Afghanistan much like we did in 1998/99 when Clinton wanted to invade Iraq (yes, GOP/Lott shuttered Slick Willy's Iraq scheme too... but we (progressive/antiwar) booed Albright at her "town hall meet ups" and she and the WH didn't see it coming)
But screw the scorn. We should be used to these labels by now. We should understand there is only one political option left for us today and it does not come from the WH. Obama was supposed to be the light-of-hope for the people, yet proves to be one more neo-liberal willing to feed off the open hearts of progressives.
Hello Chuk, thank you for the feedback.
You should take him at his word on matters of policy, because he was more-or-less consistently pro-businesss and center-right throughout his campaign. Merely because the plurality of voters failed to realize that during the election or "hoped" otherwise, doesn't make him dishonest; it makes them dumb.
Obama said:
1. he wanted to escalate the conflict in Afghanistan and Pakistan (which he's done)
2. he never claimed to support single-payer health care only that it was a logical option(which is true)if starting from scratch
3. he was for offshore oil drilling and subisidization of corporate energy (he's done that too in terms of policy)
4. he was for clean-coal technology (which his Admin. is pushing)
5. he said the military option would never be taken off the table for Iran, N.Korea, Russia, and Venezuela.
6. he said he would support the 700 Bln bail-out package for the banks before the election!
7. he said he was for "Free-Trade" and his staff even told the Canadian govt' that they had nothing to worry about when he got into office.
All these points were made in the last of the televised debates if you wish to verify.
So to make the claim that he was for the people and not the corporations, may have been a popular meme, but it is an empirically false one. The people voted for all the above items and they got what they voted for.
Here we can agree that if people want change then they have to stand up and be heard. Yet where are the hundreds of thousands who attended Obama rallies and pissed countless dollars into his campaign? Millions also staged rallies and protests across America over the years against the Iraq war; how that end up again?
Most politicans by nature are mediocre, marginally talented hacks, who seek power. If you want real change start by getting redistricting out of the hands of politicans. If you want meaningful debates, demand that elections are completely publicly funded. Eliminate the anti-democratic Electorial college system and the useless Senate. Have corporations subject to the death penalty if they engage in criminal or treasonous activity.
The people have to at some point start accepting blame and not constantly harping, "if only they did what I hoped they would do... everything would be great!"
Great post, lifer! You summarized it perfectly.
Before we end the Afghanistan War, before we institute reform in healthcare, before we pass measures designed to reduce carbon emissions--we have to make this country democratic. Lobbyists have to go. Money has to get out of politics. Elections have to be true choices and not Kabuki theater. This issue trumps all the rest. We should flush these people out over and over again until we get those brave enough to do what has to be done.
Spot on post Lifer, the limiting of corporate "liability" when they have the right of person-hood is the factor which makes them "immortal" and wealthy."have corporations subject to the death penalty if they engage in criminal or treasonous activity"brilliant, immediate charter revocation and prosecution.Of course I am against the concept of capitol punishment however capitol needs to be punished!Pun intended! peace
paraphrased: "Obama is not dishonest. People are dumb."
I see this as an impasse.
Goodbye
I have no problem with predator drone strikes killing innocent civilians in Pakistan, state secrecy regarding show trials and war crimes, $24 trillion in bankster bailouts, or appointing MIC lobbyists to cabinet positions...
But cut a deal with big Pharma...?
It is an outrage...!!!!!!!!!!
Well said. The blind spot some of these writers have is big enough to fly a B747 through. Obviously it's not ignorance. It's contrived.
Sioux Rose
GOLDEN: Well said! Possibly Reich has dreams of his own for a political future, so he has to do the party two-step that he not step on toes needed later.
I propose an online voter initiative and referendum to ban lobbying and all political "contributions".
I propose a second online voter initiative to nationalize our public airwaves.
I remember when Robert Reich was booted off the Clinton Team (Excuse me, officially Reich left "...the department to spend more time with his sons....").
What I don't understand is why he feels the need to kiss the Party hand and praise Obama. Does he still think he's influencing Democratic policy when he effectively argues there isn't a sliver of difference between the Bush and Obama administration when it comes to Pharma companies?
But why stop there? What's the difference between Obama and Bush on Oil, MIL, Insurance, NAFTA, EDU?
Reich should fight to stall the "Insurance Reform" bill Obama panders, and fight to secure single-payer, citizen-based health care.
Imagine if the progressives and independents actually stalled the insurance reform bill instead of the advertised "scary right-wing lynch mobs" Party Line Democratic politicians tell us are blocking "our"(?)path from getting "nationalized health care"...
We can stand to fight for single-payer, citizen-based. We don't have to accept neo-liberals like Obama. We don't have to continue to accept crumbs. Obama intentionally creates an artificial 'urgency of now' to exploit our ability to reason. And Pharma, et al are signed up to win big if the bill goes through.
Sioux Rose
CHUK-IT: Well-said. I can't stand his pandering attitude or nod to the insurance companies, either. The rest of the article is fairly solid.
Coffee, Mr. Reich?
0 fans should ask themselves what they want. If -
- you don't like the deal with Big Pharma,
- you don't like the deal with Big Insurance,
- you don't like the deal with the military-industrial complex,
- you don't like the deal with Honduran coup-istas,
- you don't like the deal with coal miners,
- you don't like the deal with nuclear interests,
- you don't like the deal with Columbian narcotrafficers,
- you don't like the deal with Wall Street crooks,
- you don't like the deal with factories going abroad to break unions,
-----------and oh, the list's too long to put together -------
what do you imagine 0bama offers?
touche!
And as for democracy, In order to undermine democracy, you have to HAVE a democracy. We don't have any such animal in the USA.
Ezeflyer - Nationalizing assumes programing you would approve of?
What if you didn't like the content? After all there isn't dimes worth difference between Buch, Clinton, Bush, Obama.
Thank your whatevers that we didn't have to suffer thru Gore or Keary that surely would have been end of hte Republic.
Nationalizing assumes whatever We the People want through referendums.
The scum-dogs will continue to consume one another along with the citizens of this country until "We The People" demand accountability from the crooks in DC.
"Last week, after being reported in the Los Angeles Times, the White House confirmed it has promised Big Pharma that any health care legislation will bar the government from using its huge purchasing power to negotiate lower drug prices."
The thing that gets me is that not being able to negotiate prices is not only undemocratic but contrary to capitalism. There is no free trade or open markets with that kind of deal-it's even worse than a monopoly.
If the the government could negotiate or, better yet, buy medical drugs from other countries, the cost of medicine would plummet. Trillions of dollars would be saved. That's what we need(and privately insured Americans should be allowed to buy drugs from Canada or anywhere else they choose.) That is called capitalism.
If we can't have socialism at least let us have capitalism.
This is not being talked about at all:
From the Associated Press, 2004:
"...More than half the money needed to create top-selling prescription drugs came from U.S. taxpayers and not industry investment, says a federal report released...by critics of the drug companies.
http://www.whale.to/m/drug.html
** So these rat bastards use taxpayer money to create their best-selling drugs. Then, instead of giving them to us FREE or at a MASSIVE discount they turn around and force us to purchase them a second time at full retail price (i.e. sucker's price).
*** An even bigger insult is that Obama has already conceded the abillity for American's to re-import drugs from Canada. Obama and his coporatist clan have used "free-trade" agreements to exploit poor people in every godforsaken country in the world. You could make the case that "opening up markets" is the religion of Free Traders. Yet when an Average Joe wants to reimport drugs from Canada they won't let us join their religion! Unbelievable!
Well said.
At his New Hampshire town hall Obama said the "donut hole" would be cut in half. As if this were some sort of victory for the consumer.
Is Big Pharma that much of a danger to "change" that they have to be bought off, in any manner? One still guaranteeing them huge profits? For why else would they agree to this "compromise" if they didn't believe they were getting a bargain?
If Big Pharma is scared why not confront them full on and pull the for-profit rug out from under them? For by making this deal Obama has only proven he himself is scared. Or, giving him the benefit of the doubt, that he believes he had to make this deal in order to get his universal package passed.
Worse yet, what if Obama is in the pockets of Big Pharma? Yet he still wants to get his universal healthcare reforms passed. And he himself saw this deal as a beneficial compromise to assuage his corporate/pharmaceutical backers?
This is the point that should always be made. Instead of snarling about free markets, people should laugh at them. Ha, ha, ha you call that a free market? If we had free markets people would buy drugs where the price is lowest, etc, etc. Same when Bush said no S-Chip because it would interfere with free markets. What a joke. There is NO free market in health care.
Cygnus (6:27 pm) has also made the point that we paid for a large percentage of research costs. This point was made by Republicans who opposed the prescription drug scam of 2004 (Vin Weber of MN for one)--didn't hear it from Dems, altho that doesn't mean it wasn't said.
Today, during his New Hampshire "meeting" President Obama stated publicly that the pharmaceutical industry had promised $ 80 billion savings but did not mention his promise not to demand the power to negotiate drug prices.
How much deeper can this dissembler sink before he hits bottom?
Mr. Reich you will be sorry very soon.
Next, a multi-billion dollar deal with Halliburton and Blackwater, who in return will pay for multi-million dollar ads in support of the War in Afghanistan (/sarcasm).
Hey! Obama got a good deal by getting the pharmaceutical companies to promise that they'll cut $80 billion off their drug prices in the next ten years. All they have to do is raise their prices $160 billion dollars, and then deduct the $80 billion savings, and it'll only cost us $80 billion. And we've saved $80 billion. Is that a good deal or not? (Can't find that xxxxx sarcasm icon!)
I'd like to know what cocktail of pharmaceuticals that Barak Obama is on...
I mean... If he " cut a deal with Big Pharma"... What did Owebama get out of it...?
Money...? A lifetime supply of oxycotin and Ritalin...?
Sounds to me like someone switched up his prescription without letting him in on it...
How else can you explain his complete about-face between the campaign and inauguration..?
Of course! What do you think is going to happen with national healthcare? What about our energy program and handouts to oil and nuke? What about farm programs and subsidies of GE foods and corporate foods? What about the FCC and corporate media consolidation?
Where did you get the idea that national healthcare would be anything but a huge handout to big pharma? Why would this be any different than any other govt program in history going back the the East India Company and the original Boston Tea Party?
Big corporate insurance might not be the best system but big gov is hardly going to be a solution and will most likely be worse and if you think somehow for once we miraculously will get a good govt program that isn't a handout to the bad guys we were trying to beat in the first place then I have a bridge to sell you, actually better yet, I have a tunnel, it's in Boston and is kind of falling apart, sometimes stuff falls off the roof and kills people but it is govt build expensive as heck just the way you like it.
And furthermore, anyone who says it works in these nice little countries, I've got news for you I've lived outside the US and everything works better, public and private. Just because we have a similar program to theirs doesn't mean it is going to work like it does for them, also people aren't suddenly going to get thinner and smarter either, nor are the women going to stop dressing like lesbians or tarts and start having some style and sophistication. Because we are not them and our culture and system are much different.
Mr Reich is someone I have great admiration for and enjoy his writing . When Mr Obama stepped in the oval office the leader of the Senate stepped up to the microphone and proclaimed that the President was not going to push him around and the Senate is an equal branch of the government . That was a line in the sand for the new President to know that if he wanted to do anything he had to get permission from his majesty and his minions . Mr Obama unlike the previous President who promised to be a "unitor" wants to keep his promises and as we all know Washington is where deals are made on a "really big" scale . This President was made an offer he could not refuse . $150 million in ads for his program or $150 million in ads against his program . As long as the insurers are the target and not the providers Big Pharma has no problem with that .
That's what the Obama team says about reform of any kind--we have to work with these corrupt self serving interests because they have the power and there is nothing we can do about it..The rage you see both on the right and the left is a reaction to this indifference to our interests. As for the righties that shout down others at town meetings-- I think they are correct to know that the present government is screwing us, (Thom Hartmann) but they don't know who to blame and the only ones they can vent at are politicians. A more cynical view is that absorbing the rage, and being the front man is just part of the role that politicians play in return for corporate money-- get mad and tell off your Congressman or Senator-- he's laughing all the way to the bank. Be mad at him but don't look at who is bankrolling him. Such a transparent strategy-- but soo effective.
Dear Mr Robert Reich..
does the names "Donald rumsfeld connected to Searle pharma"
ring a bell??
if you have a good memory..here it is:
http://www.sourcewatch.org/index.php?title=Donald_Rumsfeld
has been connected for many, many years..I have a few more.
ezeflyer -
representative gvt is a "referendum" process
"I'm a fan of the Obama administration" and "I really appreciate Big Pharma's support this time around" ?! With this kind of corporate-whore bootlicking, who needs the right wing? Democrats don't seem to realize they've been defanged and declawed--as long as they got a big, clean litterbox. Single Payer, anyone? Sheesh.