The Boston Globe reports that big business has recently begun to cooperate with Pres. Obama and his team. The CEO of Dow Chemical praises the president's efforts to control carbon emissions. The healthcare industry is joining Sen. Kennedy to write a healthcare reform bill. The financial services industry is cooperating with representative Barney Frank in regulating banks and other financial institutions.
What a change! In the early 90s Pres. Bill Clinton and First Lady, now secretary of state, Hillary Clinton developed a grand scheme to reform health care for all Americans. The goal was to make sure that everyone had health insurance and that the cost of healthcare would be under control. A coalition of physicians, hospitals, health insurance companies and drug companies mounted a major campaign and shot down that project. With evidence of global warming growing steadily, the government has been trying to regulate carbon emissions and has met with unbending opposition from chemical companies as well as car manufacturers. Banks, mortgage companies, hedge funds have used their access to the then Republican dominated Congress to loosen restraints on the industry. We now experience the effect of this deregulation in the current economic crisis. For a while they made money hand over fist. Now ordinary Americans have to pay the price.
But now Republicans are in the wilderness. The people have spoken against their unquestioning support for big business. The Democrats have a comfortable majority in both houses and businesses are coming around to cooperate with the government.
But hold on there. Let's take a closer look. Businesses supported the recent credit card bill that was intended to extend new protections to holders of credit cards against the banks. If the banks support the so-called “Cardholders Bill of Rights” can you now trust the bank to be on your side? The same bank that has in recent months raised all its fees?
The same issue of the Boston Globe tells the other side of the story. The new “Cardholders Bill Of Rights”will not go into effect for another nine months. That gives the banks and credit card companies ample time to raise all their fees before their ability to raise interest rates will be restricted. What were the banks doing when they cooperated with writing this new consumer protection law for credit card holders? They were looking out for number one and made sure that the new bill would not damage their bottom line.
So maybe we need to take a second look at this new era of harmony between government and big business. Perhaps it is the government, once again, cooperating with large enterprises to put the squeeze on customers and ordinary citizens.
Consider just one example. One of the groups consulting with Sen. Kennedy about the new health-care legislation is the lobbying group for the drug companies. Most countries in the world regulate prices for drugs. Not so in the US where they can charge whatever they please. As a consequence, the costs of medications are significantly higher here than anywhere else. The companies say they need to charge high prices in order to do research for developing new medicines for, so far, incurable diseases. But the truth is that the drug companies spend more money on marketing than they do on research. Drug marketing persuades physicians to prescribe the drugs produced by one pharmaceutical company rather than another, or tries to persuade people to take pills they don't need. The cost of that marketing comes out of your and my pocket. The drug company has its eyes firmly on their bottom line not on whether you are sick or well, alive or dead.
Do you think that the drug companies have turned over a new leaf, that they have seen the error of their ways, repented, and are now determined to give us necessary medications at the lowest possible cost? Or are they perhaps at the table with Sen. Kennedy to make sure that medications will remain more expensive in the United States than anywhere else in the world?
The CEO of Dow Chemical explained the new cooperative attitude of business in this way: “You're either at the table or on the menu.” With large companies like Dow, the big banks, the pharmaceutical companies at the table, it may well be you and I who are you on the menu.