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CNN: Obama Backroom Deal with Pharm Lobbyist

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Has the president of the United States cut a deal with the pharmaceutical companies that is good for them, but maybe not so good for you as a taxpayer? And will Congress challenge that deal? What is it? Well, it seems to be the type of deal that this president railed against, ironically enough, when he was campaigning. (BEGIN VIDEO CLIP) SENATOR BARACK OBAMA (D-IL): In the Medicare prescription drug bill, for example, the Congress specifically exempted Medicare from being able to negotiate for the cheapest available price. And -- and that was a profound mistake. (END VIDEO CLIP) SANCHEZ: All right, so here's what happened now. The White House needs an industry friend to help it pass health care reform. Most who follow that would say, that's fair. It got in touch with PhRMA, which is the lobbying arm of the drug manufacturers, and, by the way, the biggest donor of campaign cash in all of American politics. PhRMA, by the way, is run by this guy. That's Billy Tauzin. He's the well-connected former member of Congress who left politics for lobbying, the same Billy Tauzin singled out in this ad by, yes, presidential candidate Barack Obama. (BEGIN VIDEO CLIP) SENATOR BARACK OBAMA (D-IL): The pharmaceutical industry wrote into the prescription drug plan that Medicare could not negotiate with drug companies. And you know what, the chairman of the committee who pushed the law through went to work for the pharmaceutical industry making $2 million a year. UNIDENTIFIED MALE: Imagine that. OBAMA: Imagine that. That's an example of the same old game playing in Washington. I don't want to learn how to play the game better. I want to put an end to the game plan. (CROWD APPLAUSE) (END VIDEO CLIP) SANCHEZ: Who was the presidential candidate speaking to there? Billy Tauzin, the man candidate Obama was just talking about. He gets invited to the White House recently. He agrees last month to $80 billion in drug cost savings over the next ten years, $80 billion. Sounds pretty good, right? But guess what? Congressional estimates show that savings on drugs could be twice that much. And the deal Tauzin got precludes further cuts down the road. In other words, it's locked in. You get it? So, really you could argue that you and me as taxpayers are going to be out the other half, $80 billion, right? Because the White House needs a powerful industry ally to help it pass health care reform. Seems curious. Joining us now is CNN chief business correspondent Ali Velshi, who's been looking into this for us. He's in the CNN Express this hour, by the way. He's going all over the country, going to these meetings where Americans are discussing what's going on with health care. Ali, you're going to be touring the country meeting people at all these town halls. Look, let me ask you about this thing. Putting aside for now that we're living in a completely overmedicated society when it comes to pharmaceuticals -- we'll tackle that in just a moment -- why are the pharmaceuticals doing a back room deal, or what appears to be a back room deal, with the president of the United States, and should we as taxpayers be worried about this? ALI VELSHI, CNN ANCHOR: You know, you sort of outlined it very well, Rick. The issue is this. The White House wanted a few industry groups, they wanted some people on side to say that they're going to deal with two problems. One is health insurance, which we're talking about right now, and the other one is simultaneously reducing the cost of health care. And what they did was get PhRMA, the health care -- the pharmaceutical company industry on side with an agreement that they would be pressed to cut about $80 billion in health care costs. And if they were on side to do that, the White House would protect them from legislatively being forced to cut more. So basically, it was a tradeoff. The pharmaceutical industry says fine, we'll cut our costs, we'll contribute to a trimming of $80 billion in costs to the health care system, and after that everybody leaves us alone. Congress is saying we're not bound by this. Why were there even back room deals done. SANCHEZ: That's my point. SANCHEZ: Ali, that's the point. We've been told all along that Congressional Democrats as well as Republicans are shepherding this deal through, trying to come up with something that will be good for all Americans. And now we learn that while they're doing that, and our eyes are on that and the things that you're covering with all these people fighting and bickering back and forth, there's something else going on over here that nobody else is paying attention to. Shouldn't Congressional Democrats, if nothing else, go to their president and say, hey, what are you doing, Mr. President? VELSHI: I think there's an issue with transparency here, Rick. I think the bottom line is this is not only a complicated issue, but it really inflames passions, as we have seen from the town halls. I think everybody needs to know what's on the table, what's being negotiated. If there's a deal that's been made with the pharmaceutical industry, it was important, I think, for people to have all that information, and I think a lot of Americans are going to say yes, they would like Congress to be able to make those rules. But again, we don't know, because people really are split on this issue. So should we be happy that the White House extracted $80 billion in concessions from the pharmaceutical industry in order to get them on side so they're not fighting the White House, because that's a very, very well-funded lobby, or should we be mad that they made a deal that everybody didn't know about and could prevent them from getting Congress to take further action, saving double the amount of money? This is a tricky one, Rick. It's hard to know where you should stand on this. Should I be happy that we're saving $80 billion or unhappy that we're not going to be able to save $160 billion? SANCHEZ: It's a deal with lobbyists, and, you know, it's always tough when you look at those. You know what they say about dealing with the devil.

Video Details

Duration: 5 minutes and 40 seconds
Country: United States
Language: English
Producer: KramerDSP
Director: KramerDSP
Views: 226
Posted by: kramerdsp on Aug 11, 2009

CNN's Rick Sanchez reports on President Obama's backroom deal with a Pharm lobbyist. I wonder why this hasn't gotten more play.

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