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Nation Feature: Gephardt's Sellout

Better late than never: my feature on Dick Gephardt's lobbying from the October 19, 2009 issue of The Nation. Went online September 30, 2009.

Dick Gephardt's Spectacular Sellout

by SEBASTIAN JONES

This article appeared in the October 19, 2009 edition of The Nation.

In March, months after the government gave an unprecedented $85 billion to AIG, the insurance giant released a list of counterparties, exposing some of the world's top financial institutions as the real recipients of the bailout. First among its peers, Goldman Sachs got a whopping $12.9 billion, despite having claimed in September to be insulated from AIG's troubles. Based on these revelations, Maryland Democratic Congressman Elijah Cummings, who had dogged the financial industry since the crisis began, told his staff to prepare a letter calling for an investigation.

Two Congressional staffers familiar with the matter told The Nation that a draft was circulated to House members on March 23. Within hours, Cummings's office had received a phone call from a lobbying firm hired by Goldman Sachs, making an "insistent but polite" request for a meeting. Cummings, intending to send the letter regardless, granted the audience, and so it was that top Goldman executives like president Gary Cohen and CFO David Viniar arrived the next day. They brought someone else too, a big-name Democratic politician with serious populist credibility: Dick Gephardt.

Fringe Festival

I report on the 9-12 tea party for The Nation. Full story below:

The Right's Fringe Festival

by SEBASTIAN JONES

September 16, 2009

This Saturday, some 70,000 people marched through downtown Washington, DC. Organizers of the "Taxpayer March on DC" crowed on their website that "thousands of local organizers and grassroots Americans" took to the streets because they've had "enough of the out of control spending, the bailouts, the growth of big government and soaring deficits." Pretty straightforward, bread-and-butter economic conservatism, right?

So imagine my surprise when, having just arrived at the march, I saw a thin, tall, bearded fellow with a boonie cap jogging up Pennsylvania Avenue shouting "White Power!" A few people looked around awkwardly, not sure how to react, but mostly the crowd just moved along. Why wouldn't they, after all, when just a few paces down the road an elderly man was showing off his "McCarthy Was Right!" sign, or when numerous placards compared the president to various genocidal tyrants, or when the most common mass-produced poster (courtesy of an antiabortion group) demanded that we "Bury Obamacare with Kennedy"?

This was only a sampling of the hateful language on display at the rally, which was only tangentially about taxation. More accurately, the event was a FreedomWorks-organized, corporate-funded, Fox News-fueled celebration of every conservative political and cultural cause of the past fifty years. Milling around the crowd, it was impossible to miss the references to issues as disparate as blocking investigations of CIA torture, promoting assault weapons and God "judging" America for homosexuality. Confederate flags were flown, Obama was told to "go back to Kenya," and so forth and so on. The crowd itself was almost exclusively white--and its members had come to get their country back.

Democrats Go to Bat for Big Pharma

[Originally posted at The Nation's Capitolism blog on 7/30/2009]:

At a North Carolina town hall yesterday, the President went out of his way to mention a brewing legislative battle on Capitol Hill: the fight over how long to grant drug manufacturers monopolies on a new class of drugs called biologics and when to allow cheaper, generic alternatives.

The current proposed legislation--HR 1427 introduced by Representatives Waxman (D-CA) and Deal (R-GA)-- would grant biologics the same 5-year period of exclusivity traditional pharmaceuticals receive now and would limit a manufacturer's ability to get an extension of that monopoly, requiring, for example, a "significant therapeutic advance."

However, Representatives Eshoo (D-CA), Inslee (D-WA) and Barton (R-TX) are planning to introduce an amendment which tows the brand-name industry line that a 12-year monopoly is needed and waters down the criteria for a given biologic's period of exclusivity to be extended. The practice of getting extensions for small tweaks to the original product--things like shifting the delivery method from a pill to an injection or changing the dosage from twice a day to once a day--has been labeled "evergreening" by consumer groups. This month, the European Union's antitrust regulator said she would begin to monitor the practice closely.

In a copy of the amendment obtained by The Nation, the conditions under which a drug's exclusivity may be renewed are numerous and strikingly vague:

"A change…that results in a new indication, route of administration, dosing schedule, dosage form, delivery system, delivery device or strength; or a modification to the structure of the biological product that does not result in a change in safety, purity, or potency."

This essentially grants big drug manufacturers the ability to wait until the 11th hour to make slight adjustments and receive a substantial extension.

These prolonged monopolies, preventing the production of generics and keeping drug prices high in a healthcare system fraught with increasing costs, might explain why the President has expressed concern about the issue.

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Full text of the Eshoo, Inslee and Barton Amendment is below. Also, for more information on the biologics issue, check out this recent editorial from the Post.

Fact Checking Obama on Transparency

[Originally posted at The Nation's Capitolism blog on 7/23/2009]:

During last night's primetime press conference, Christi Parsons of the Chicago Tribune asked President Obama a pointed question about the transparency his administration had often promised during the campaign and seemingly failed to deliver once in power. The President's response, short and direct, was also relatively misleading. Examining the record, we fact-check his remarks.

1) Meeting Health Care Executives

Obama: "Well, on the list of health care executives who've visited us, most of the time you guys have been in there taking pictures, so it hasn't been a secret. And my understanding is we just sent a letter out providing a full list of all executives. But frankly these have mostly been at least photo sprays where you could see who was participating…"

Fact-Check: Until yesterday, that the Obama administration was having meetings with health care executives and lobbyists at the White House as early as February 4th was not public knowledge. When Citizens for Responsibility and Ethics in Washington (CREW) filed a freedom of information request last month for records pertaining to visits by 18 industry executives and lobbyists, their request was denied. An earlier FOI request in May for information on Coal industry executives and their White House visits was similarly denied, both using the same legal arguments that the Bush administration employed to keep Dick Cheney's energy task force meetings out of the public eye. CREW has filed suit in both cases.

Also worth noting is that yesterday's letter released by the White House did not affirm (or satisfy) the FOI request from CREW, but rather was an "exercise of [presidential] discretion"--basically the White House saying that while they believe the public is not necessarily entitled to this information, they'll provide it anyway.

2) Putting Health Care Negotiations on C-SPAN

Obama: "With respect to all the negotiations not being on C-SPAN, you will recall in this very room that our kickoff event was here on C-SPAN, and at a certain point you start getting into all kinds of different meetings--Senate Finance is having a meeting, the House is having a meeting. If they wanted those to be on C-SPAN then I would welcome it. I don't think there are a lot of secrets going on in there."

Fact-Check: Regarding C-SPAN, Obama told a crowd at an August 11, 2008 town hall, "What we'll do is, we'll have the negotiations televised on C-SPAN so that people can see who is making arguments on behalf of their constituents, and who are making arguments on behalf of the drug companies or the insurance companies." With regards to there not being "a lot of secrets going on" in congressional meetings, this article from today's Roll Call describing the secrecy surrounding Sen. Max Baucus' bipartisan talks would suggest otherwise.

3) TARP transparency

Obama: "And the last question with respect to TARP. Let me take a look at what exactly they say we have not provided. I think that we've provided much greater transparency than existed prior to our administration coming in. It is a big program. I don't know exactly what's been requested. I'll find out and I will have an answer for you."

Fact-Check: Testifying before congress the day before the President's presser, TARP Special Inspector General Neil Barofsky told lawmakers that "although Treasury has taken some steps towards improving transparency in TARP programs, it has repeatedly failed to adopt recommendations that…are essential to providing basic transparency."

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For a comprehensive list of Obama White House transparency short-comings, check out this post from Glenn Greenwald.

Health and Wealth

My contribution to the June 24 issue of The Nation:

HEALTH AND WEALTH: 

As the White House begins a push for healthcare reform, it starts at a significant disadvantage, perhaps as large as $1.38 billion. According to the Center for Responsive Politics, a nonpartisan group that tracks campaign contributions and lobbying expenditures, that's the sum that five industries--pharmaceuticals/ health products, insurance, health services/HMOs, hospitals/nursing homes and health professionals--spent lobbying lawmakers from 2007, the first full year Democrats controlled Congress, to the most recent first-quarter filings for 2009.

In fact, starting in 2006 healthcare interests have spent even more than the financial services industry to sway lawmakers. Since 1998, three of the top ten lobbying spenders have sought to influence healthcare policy; the American Medical Association's $204 million in the past decade was second only to the perennial top lobbyist, the US Chamber of Commerce. Beyond lobbying, hundreds of millions have been spent by healthcare interests in campaign contributions in the past two election cycles alone.

So what does all this money buy? According to Nate Silver, renowned number-cruncher and blogger atFiveThirtyEight.com, a whole lot. Silver crafted a method to measure how lobbying might be shaping Democratic senators' votes on a healthcare bill with a public option--which 76 percent of Americans support, according to a recent NBC/Wall Street Journal poll--and concluded that the low sum of $60,000 in campaign contributions over the past six years would cut in half the odds of a centrist Democrat supporting the plan.   SEBASTIAN JONES