Mr. Speaker, I thank my friend from New Jersey, who has just been dogged in his pursuit of this issue and trying to protect Medicare, trying to write a prescription drug benefit inside Medicare, and not this privatized HMO kind of Medicare…
Mr. Speaker, I thank my friend from New Jersey, who has just been dogged in his pursuit of this issue and trying to protect Medicare, trying to write a prescription drug benefit inside Medicare, and not this privatized HMO kind of Medicare inadequate prescription drug plan that the President signed today.
When you listen to the gentleman from New Jersey (Mr. Pallone), you just keep asking the question, why is it that all this happened this way? Why would such a bill pass the Republican House, pass the Republican Senate, in very close votes, and be signed by the President? Why would they do this?
The answer is pretty clearly the kind of influence that the drug and insurance industries have in this body. The word on the street is that the drug companies, the prescription drug companies, are going to contribute $100 million towards the President's reelection. It is no surprise that nothing passes this Chamber, nothing gets through both Chambers, nothing gets enacted into law and will be signed by the President unless it has the support of the drug companies.
Let me just talk for a moment about that, and then I want to tell a couple of stories. The 10 biggest drug companies in this country had revenue last year of $217 billion, more than the entire GDP, gross domestic product, of the country of Austria. These 10 companies posted profits of $37 billion last year. That is more than the Federal Government spent on the entire VA health care system. It is more than the entire Housing and Urban Development budget for last year.
The drug companies on this year's Fortune 500 list posted profits of more than 17 percent, 5.5 times what the rest of the Fortune 500 profits were. The drug industry led all other Fortune 500 industries on two key profitability indices, return on revenues and return on assets.
Now, I want to get there, even with that, even with the drug industry's iron lock on this institution, the corruption, the incredible influence that
this industry has on this Congress, on Republican leadership, on the President, on the Vice President, on leadership in the other body, in the Senate, even with all that, I think it is important to sort of see how we got here.
At 2:54 in the morning on a Friday in March, this House cut veterans benefits by three votes. At 2:30 a.m. on a Friday in April, in the middle of the night, House Republicans slashed education and health care by five votes. At 1:56 a.m. on a Friday in May, the House passed a leave-no-millionaire-behind tax cut by a couple of votes. At 2:33 a.m. on a Friday in June, House Republicans passed a Medicare privatization and prescription drug bill by one vote. At 12:57 a.m. on a Friday in July, the House Republicans eviscerated Head Start by one vote. Then after summer recess, at 12:12 a.m. on a Friday morning, in the wee hours of Thursday night in October, the House voted $87 billion for Iraq. Always in the middle of the night, always a contentious bill, always after the press had passed their deadlines, always after the American people had turned off the news and gone to bed.
With that track record, and the gentleman from New Jersey (Mr. Pallone) has illustrated this, we should not be terribly surprised that when the House passed legislation that privatizes Medicare, that dramatically changes the 38 years of Medicare as we know it, that the House did it at 5:55 on a Saturday morning. The Republican leadership delivered this 100-page Medicare bill to House Members on Friday morning at 1:46 a.m. We voted on it 25 hours later.
But, Mr. Speaker, in a lot of ways I do not blame my Republican colleagues. If I produced that bill, I would not want people to know a lot about it either, because when Republicans sit down behind closed doors with the insurance industry and the drug industry and write a bill to privatize Medicare, of course they do not want the public to know, because this bill is not a prescription drug bill when we really look at it. We could have agreed bipartisanly. The gentleman from New Jersey (Mr. Pallone) and I and our Republican friends could have written this bill, we could have agreed bipartisanly to deliver a $400 billion prescription drug benefit inside of Medicare, delivered to people the same way that people get their doctor and hospital and get their choice: they send the bill to Medicare and it would work. But this bill is more about Medicare privatization. For that, Republicans have a long history.
Republicans have never much liked Medicare as a Federal program. Turn the calendar 38 years back to the beginnings of this most popular program perhaps in American history. When Congress passed the legislation creating Medicare in 1965, in the spring of 1965, there were 140 Republicans in the House of Representatives. Only 13 out of those 140, less than 1 in 10, fewer than 1 in 10 Republicans in this House voted to support it. Every leading national Republican voted no. Future President Gerald Ford, future Presidential nominee Bob Dole, future legislative leaders Bob Michel, John Rhodes; future Defense Secretary Donald Rumsfeld, every leading national Republican voted against the creation of Medicare.
Now, after that passed and they realized the public liked it, there were no major efforts to try to get rid of it until 1995 when Republicans had their first chance to do it when Republicans captured the majority of the House of Representatives. In 1995, Newt Gingrich, Speaker of the House, immediately during the Contract With America tried to cut Medicare $270 billion to, what do we think, pay for a tax cut for the richest people and the most privileged people in the country. Gingrich in that year, in October of 1995, said, now, we did not get rid of Medicare in round one, we did not think that is politically smart. We do not think that is the right way to go through a transition, but we believe it is going to wither on the vine.
Texas Governor, then Governor George Bush was a strong supporter of that privatization effort. Majority leader Dick Armey, another Texas Republican said, Medicare is a program I would have no part of in a Free World. Bob Dole bragged, I was there fighting the fight against Medicare. The gentleman from Georgia (Mr. Linder), Committee on Rules member, a Republican, told me in a meeting in 2002 at the Committee on Rules, Medicare is a Soviet-style system. It is on and on and on. The gentleman from California (Mr. Thomas) who, with the drug companies and the insurance industry, wrote this Medicare privatization bill this year, said, to those who say that this bill would end Medicare as we know it, our answer is I certainly hope so.
This bill, as the gentleman from New Jersey (Mr. Pallone) went through, it jeopardizes employer-sponsored retiree coverage for the 12 million-plus seniors who have this coverage. Understand, as the gentleman from New Jersey (Mr. Pallone) has said, there are 12 million seniors today who have pretty good prescription drug coverage as part of their retirement plans, retirement packages from their employers. Some, between one-fifth and one-third of those, according to the Congressional Budget Office, will have their employers yank that coverage, and they will then be thrown into this privatized Medicare system.
Now, this bill, in addition to the problems that the gentleman from New Jersey (Mr. Pallone) mentioned, this bill creates a $12 billion slush fund for HMOs to encourage them to provide coverage; it increases drug industry profits by $139 billion, increasing their profits by 40 percent. We could go on and on and on and on. We know, we know about the profitability of the drug companies; we know about how the drug companies have, by and large, written this bill.
We know that the drug companies benefit from this bill way more than everybody else. They have 675 lobbyists in Congress; 675 drug industry representatives walk the halls of these Chambers. There are 1.3 lobbyists per Member of the House, and they spent $91 million in lobbying activities. That is just what they disclose; we do not know what they really spent. They spent $50 million more on everything from ads to direct mail. They spent nearly a half a billion dollars lobbying since 1997. They gave $30 million overall for the 2002 election cycle; about three-quarters of that to Republicans and, as the gentleman from New Jersey (Mr. Pallone) and I have talked, we hear on the street that Mr. Bush and Mr. Cheney are going to receive $100 million in campaign funds from the drug industry.
But let me, before finishing, let me go back to what exactly happened that Friday night, early Saturday morning when the drug bill passed. The vote started Friday at about midnight, the vote on the Medicare privatization bill. The debate started Friday at about midnight. The rollcall began at 3 a.m. Most of us took our vote cards, our little plastic cards, put them in the little box and pushed either the green or the red button. The clock runs out after 15 minutes, but it is usually kept open for another 2 to 5 minutes. Typically, a vote here is often about 20 minutes.
But the Republicans were behind the entire evening; the vote was losing. At 3:30, 4 o'clock in the morning, the vote was 216 to 218. It was defeated. A majority was voting ``no,'' with only one Member, a Democrat, not yet voted. At about 4 o'clock the vote had stayed open for 1 full hour. That is when the assault began. The gentleman from Illinois (Speaker Hastert), the gentleman from Texas (Majority Leader DeLay), the gentleman from Missouri (Republican Whip Blunt), the gentleman from Louisiana (Mr. Tauzin), the chairman of the Committee on Commerce; the gentleman from California (Mr. Thomas), the chairman of the Committee on Ways and Means all were walking the floor, surfing for stray Republicans who were most likely to cave whom they could bully or whom they could brow beat. They surrounded the gentleman from Ohio (Mr. Chabot), trying a carrot and then a stick; but he stood his ground and was defiant. They tried a retiring Republican, the gentleman from Michigan (Mr. Smith), whose son is running to succeed him. They promised support if he changed his vote to ``yes'' and threatened his son's future if he refused. He steadfastly, to his credit, showed his integrity and stood his ground.
Many of the two dozen Republicans who had voted against the bill had left the floor hoping to avoid the onslaught
from the gentleman from Illinois (Speaker Hastert), the gentleman from Texas (Mr. DeLay), the gentleman from Missouri (Mr. Blunt), and the committee chairmen. One Republican that I saw was hiding in the Democratic cloakroom.
By 4:30, the bullying and the brow beating had moved into the Republican cloakroom, out of sight of the television cameras and of the public. The Republican leaders by then had waked up President Bush, and the White House was passing a cell phone from Member to Member in the cloakroom. At 5:55, 2 hours and 55 minutes after the rollcall began, literally twice as long as a vote had ever taken in the U.S. House of Representatives, 2 obscure Western Republicans emerged from the cloakroom, they walked, ashen and cowed down this aisle, I was sitting right there, down this aisle to the front of the Chamber, they picked up a green card to change their votes, they scrawled their names and district numbers on the cards, and they dispiritedly surrendered the cards to the Clerk. Quickly the Speaker gaveled the bill. Medicare privatization had passed.
Now, imagine an election, an election at home when the polls close at 7:30. Everyone has voted. One candidate trails by a few votes, but election officials, just not liking the outcome, decide to keep the polls open for 3 more hours. They brow beat; they bully. They threaten, they offer jobs, they promise goodies for their neighborhood or for themselves. Finally, lo and behold, the election turns out the way they want.
The new rules in this House of Representatives, Yogi Bera might put it tell us, ``It ain't over until the Republicans and the drug companies win.'' It is sort of Florida all in one night. But the American people should expect more. They should expect the House of Representatives conducted in the open. They should expect Members to honestly, straightforwardly, openly cast their ballots; they should expect a drug pricing policy and a Medicare bill that can hold up, not only in the dark of night, but also in the bright light of the morning.
Mr. Speaker, that is exactly right. It is also, if we look at the context of all of this, the context is the huge, enormous influence that the drug industry has on this body. I mean, the drug industry has a strangle hold on the Republican leadership, pure and simple. They give millions of dollars to Republicans, as we have said before, we are hearing as much as $100 million to President Bush's reelection. Nothing in this Chamber, nothing happens without the drug industry saying it is okay. The drug industry puts millions of dollars in campaigns. They hire so many lobbyists, 670-some I believe at last count, well over 600. They run all kinds of television ads and radio ads under the name of something else. They basically launder their money through the United Senior Association, through other groups, these disease advocacy groups that are not really legitimate, with millions of dollars and hide who they are, the drug industry, and try to communicate with the public that way. I mean, they are so powerful and so strong, but at least we ought to keep them off the House Floor. But in that sense, in the wee hours of the morning on Saturday, that Saturday morning, that late Friday night, while Secretary of Health and Human Services Tommy Thompson was on the floor, which is unusual, I do not ever recall seeing a cabinet member on the floor like that, but that is not a violation of the rules and it is not unethical, either. But we could see the influence of the drug industry on the floor of the House of Representatives.
One could almost see these Members of Congress who have depended on drug company money, who are addicted to drug company money, one could see the kind of way that they were pushing
their fellow Republican Members, the Members whom they lead. So it is not a very long jump from there to what they tried to do apparently with the gentleman from Michigan (Mr. Smith) who showed a lot of guts and integrity, as I might add.
And so when there is that much money at stake, the drug industry is slated to increase its profits already for 21 years straight, the most profitable industry in America, when the drug industry already so profitable, increased its profits $140 billion over the next 8 years, 40 percent increase in profits for the most profitable industry in America, not to mention the insurance industry and its impact here. With that kind of money at stake it does not come as a surprise to me that Republican leadership would play that kind of hard ball, do it in the middle of the night, or who knows what.
We do not know what was said to Member after Member after Member to pass this bill. That is not a prescription drug bill; it is a bill that turns the Federal Treasury over to the drug companies and the insurance companies and privatizes Medicare in the bargain. So it is pretty clear to more and more Members of this body and to more and more members of the public that the corruption in this body when it comes to drug money, the corruption is just unbelievable. It has increased every year since I have been here. It is getting to the point that it is almost as if Members have signed their vote card over to the pharmaceutical drug industry lobbying association.
Mr. Speaker, I saw that article. I like Tom Scully. He came to our committee and he spoke. He is a reasonable, decent guy. I do not accuse him of anything untoward. I do wonder about a system, though, where he announced several months ago he was leaving the Department and going into the private sector. And he intimated, he may have said more specifically, that he would be out doing Medicare- type work, but he stays in the Department during the 6 months he is negotiating with various law firms and Wall Street firms, I believe, his future job and then the Medicare prescription drug bill is in the conference committee and he is in these meetings. Somebody gave him a waiver. I do not quite know what a waiver means.
It is okay to be in a conflict of interest but because our administration is so pro-drug company, we give you the waiver? I wish he would answer some questions about what the waiver is all about, because I do not think the people at home understand what the waiver process is. I do not think I understand the waiver process.
How a Department gives a waiver to one guy to do this and not that. I think Mr. Scully is a man of integrity, but I do not think the system is quite right that would allow somebody to look for a job, run this Medicare system that has 40 million beneficiaries, that has got about, I think, about $300 billion roughly running through that system. He runs it. The last 6 months he said he is leaving. He is talking about companies that have a major interest in Medicare while looking for a job, and then he is helping to write the Medicare bill that will affect those companies in the agency he runs. I do not know what the waiver is all about. I hope he comes and tells us sometime.
This goes back to earlier comments that the gentleman from New Jersey (Mr. Pallone) made just about the unseemliness, the conflicts of interest, the huge numbers of dollars that are at stake in this bill. $400 billion in taxpayer dollars is going to be distributed in the next 10 years, $400 billion. Not to mention the amount of out-of-pocket seniors will have, which is a huge amount of money, for their drug cost. So that $400 billion, we are going to see the drug industry is going to make $140 billion more; the insurance industry gets a $20 billion incentive pay, if you will, to write drug insurance. Employers are getting subsidized, so not as many of them, some still will, but not as many employers drop the coverage of their retirees who they have collectively bargained with in many cases.
So there is so much money on the table. The way that the administration has done this has been so untoward, the way that from the minute the bill really was introduced, was written behind closed doors by the drug and insurance industry, to they are not allowing amendments, to speak of, on the House floor, to the conference committee closed out to Democrats who represent in the Senate more than half the population and in the House represent 48 percent of the population; and then all of these kinds of secret deals in the bill with the drug companies and the insurance companies winking and nodding every step of the way.
I think this bill symbolizes the corruption, the sort of pinnacle of the corruption that we have seen in this House of Representatives. We are awash with corporate money, awash with all the kinds of cutting deals and conflicts of interest and billions and billions and billions of dollars available to raid the Federal Treasury. While we cannot probably get this bill repealed in the next year, I think we are going to see this Medicare issue is going to really show what the political parties stand for, what are we going to see in the election next year, where on the one hand Democrats want to see a prescription drug benefit go directly to seniors, Republicans want to run it through the drug industry and insurance industry, enriching their corporate friends and then a little bit of it trickles down to seniors. And thrown into the bargain is a privatized Medicare system.
Then they are going to come back in 10 years and say, see, Medicare does not work. Of course it does not work when the insurance company insures you when you are healthy and then taxpayers and Medicare get you when you are old and sick. Of course it is going to work that way.
That is the irony of all this. I hear my friends on the other side of the aisle over and over tell us that seniors, that the private sector can do it better, that government is this huge bureaucracy, that Medicare is inefficient and bloated, that nimble, quick-on-its-feet Medicare, the private insurance system can do it better. So, okay, if that is the case, why, then, does Medicare have lower administrative costs, why does Medicare have lower marketing costs, lower salaries and all that? But if you accept that they can let them compete, so why are we giving the Medicare HMOs $20 billion and say, yeah, of course one can compete if we give you $20 extra billion, but if the playing field were really level it is clear that the public system wins.
That is why 38 years ago in the end Medicare was created. Because in 1965 when President Johnson and Democratic majorities in both Houses, because, as we said, almost no Republicans in either House voted for this bill to create Medicare, in those days half of America's seniors did not have insurance. Why? Because the private insurance market did not find seniors attractive. They did not find seniors attractive because they are older, they are sicker, and they are poorer.
So, maybe somebody 65 could get private insurance, somebody that walked every day, someone in really good shape, but someone 73 or 74 who was diabetic, who had heart problems, who was arthritic, who was not really able to take care of himself or herself, no one will insure that person. No one will under the Republican privatized Medicare program.
The whole point is a government plan with a universal coverage pool that everybody is in so when you are 65 and healthy you are subsidizing, because your health care expenses are not too high, you are subsidizing somebody who is 85 and not as healthy. And then when you get to be 85, some other 65-year-old subsidizes you. That is what the universality of the insurance pool is all about.
The Republicans want to fracture the universality of the insurance pool. They want to skim off for their insurance industry contributors and all the corruption around this place that comes from that. They want to skim off the most healthy seniors, and they want to insure them at great profit and let the government and taxpayers pick up everybody that is sick and more expensive. It is pretty simple what their plan is.
That is a very interesting point. I think seniors in my district and seniors all over the country, because I was hearing this from colleague after colleague, people were wondering why it was so complicated? Why was it so difficult? Why can Congress just not pass a drug benefit?
People understand how Medicare works. You go to a physician. The bill is sent to Medicare to be paid. You go to a hospital. The bill is sent to Medicare to be paid. There is a copay and a deductible. People understand that. They understand the premium. It is very simple insurance. It is full choice of doctor, full choice of hospital, and why not do the same with a prescription? Then you get the prescription. It is paid for by Medicare. You have full choice of your prescription.
Instead, the Republicans had to make it a lot more complicated. Why? Because they wanted to get their privatization agenda enacted. That means using the insurance companies. It means playing ball with the drug industry. It means a lot of that money, that $400 billion that should go directly to cover prescription drugs, and very little overhead, the 2 percent overhead that Medicare has been able to keep their overhead at 2 percent. Instead of that, the Republicans are seeing all kinds of money wasted through the insurance and the drug companies.
Frankly, it just kind of amazes me because seniors do think it could be simple. The other part of that $400, as the gentleman pointed out, that $400 billion would go a lot further under the Democratic plan because we would do cost controls. We would do various kinds of constraints on costs.
The Canadians, as we have heard many times in this Chamber, the price of drugs in Canada is one-half, one-third, one-fourth of what it is in the United States. Tamoxifen, a breast cancer drug, is one-eighth the cost in France than it is in the United States.
If we could have restrained costs, controlled costs, brought prices down, whatever you want to call it, if we had done that and put this bill into Medicare, put this whole plan into Medicare, a lot less complicated, we could have done it months ago, years ago, we could have done it; and seniors would have a better plan. They would understand what it is about. They would not have all of these questions, but the drug industry and the insurance industry probably would not be so happy, and I guess that is in the end why this body did what it did.