Friday :: Feb 25, 2005

Democrats Should Adopt The Mantle Of Reformers - Go After Drug Companies And Tax Shelters


by Steve

Since we now know that the pharmaceutical industry is bankrolling the GOP front group USA Next in its efforts to smear the AARP, and since we know that the White House turned the Medicare drug benefit bill into a budget busting exhibit of corporate welfare by removing price controls from the final bill to line the pockets of the same pharmaceutical industry, why don’t Democrats go on the attack against this industry? It’s not like the industry is that popular with the public.

The public’s concerns about prescription drug prices and drug company profits translate into support for many proposals to control drug costs. For example, in 2005, almost two-thirds (65%) of the public say there should be more government regulation of prescription drug prices, and 70% of these people (or 46% of all adults) continue to support more regulation of prices even it leads to less research and development of new drugs.
And, in November 2004, nearly three-quarters (73%) of adults supported the idea of allowing Americans to buy prescription drugs imported from Canada and eight in ten (80%) favored changing the law to allow the government to use its buying power to negotiate lower drug prices for people on Medicare. The argument that these policies would lead drug companies to do less research and development does not resonate with most Americans: 70% disagree that importing drugs and 64% disagree that negotiation would affect development of new medications.
The public views pharmaceutical companies as major contributors to rising health care costs. In 2004, seven in ten (69%) adults say that high profits made by drug companies are a “very important” reason behind rising health care costs, and almost a quarter (24%) say drug company profits are the most important reason, ahead of malpractice lawsuits (20%) and greed and waste in the system (20%).
Most of the public do not believe that research and development drive the cost of prescription drugs, instead three-quarters (74%) say drug company profit margins or marketing costs are the largest contributors to the price of prescription drugs and eight in ten (81%) say that drug costs are not justified because companies charge more for medications than necessary.

We already know that there are GOP senators like Judd Gregg who want to change the drug benefit now in order to put in place the price controls that should have been there in the first place. We already know that Bush refuses to change the bill, saying that he wants to get it implemented next year before any changes are considered. Yet there is a bipartisan acknowledgement that the Medicare program has a fiscal solvency problem which dwarfs that of Social Security, a problem that was only exacerbated by Bush’s insistence on a final bill that had no price controls in it in order to pay back his corporate check writers in the drug and HMO industries.

We also know that the Democrats can score major points in their effort to regain parity in one or both houses of Congress next year by assuming the mantle of a reform party. According to this Kaiser Family Foundation poll released yesterday, going on the attack against drug companies by demanding that the Medicare drug benefit be fixed now to include price controls and even means-testing would be a huge step for the party. Not only would the Democrats be able to argue this case as a party of reform, but also as a party of fiscal responsibility and anti-corporate welfare. It’s not like the drug companies are going to penalize the Democrats too much anyway for this, since they give the majority of their money to Bush and the GOP anyway.

But the idea of a reform agenda has the potential to carry the Democrats a long way next year. In an effort to benefit from being the party out of power fighting against a corrupt and entrenched GOP machine, the Democrats can push an agenda that paints the White House, Bill Frist, and Tom DeLay as tools used by Corporate America for private gain over public interest. Demanding that the corporate welfare provisions of the Medicare drug bill be removed now can be just the first step in such a reform agenda, and the Kaiser poll shows that there is widespread popular support for taking on Bush on this, even within his own party.

While they are at it, Democrats can use the just-released findings of a GAO study to call for the closing of corporate and individual tax shelters that cost the federal government on average almost $25 billion a year in lost revenue. Since Bush is proposing $18 billion in discretionary domestic spending cuts in the upcoming Fiscal Year, and many billions more between now and 2010, and since his own party is against the proposed cuts in farm aid, law enforcement, anti-drug programs, border security, and human services programs, Democrats should also push reforms that close these tax shelters and use this recaptured revenue to reduce the deficit without cutting needed programs. Make Bush argue that closing tax shelters is a tax increase. As a party out of power portraying itself as reformists, the Democrats would score a major victory by putting Bush and the GOP in that position.

Steve :: 10:31 AM :: Comments (30) :: Spotlight :: Digg It!