This is a story about how far politicians will go to get a president re-elected. No digging up dirt in a foreign country required, just old-fashioned arm twisting, a few ethical lapses and a talent for drama in the nighttime.

It’s also about how politicians might not have needed to cry crocodile tears over high prescription drug prices now if they hadn’t been so recklessly partisan 16 years ago.

Forbes magazine called it “one of the most extraordinary events in congressional history.” The New York Times called it “the largest expansion of the welfare state since the creation of Medicare in 1965.”

All because President George W. Bush needed more senior votes to be re-elected in 2004. The Republicans had a dandy idea: Give Medicare recipients prescription drug coverage for the first time. The idea had been in the works for months, but the end was tawdry. This is how it went.

Speaker Dennis Hastert brought up the bill in the wee hours of the night, first turning off C-SPAN’s cameras. (It has passed the Senate 55-45, with votes from Maine’s Republican Sens. Susan Collins and Olympia Snowe.) Even though the Republicans controlled Congress, they didn’t have the House votes for the bill. Medicare was already in financial trouble. Fiscal hawks weren’t sure this was a good idea.

After the usual 15-minute vote, it was losing 209 to 194, so Hastert kept the board open for hours so his team could twist arms; he impressed upon them the urgency of getting the bill passed. “We must forget about ideological absolutes,” he said.


The Republicans twisted arms for hours, and when the final vote came at 5:52 a.m., the bill passed 216-215. (Maine’s Democratic Reps. Tom Allen and Mike Michaud voted against it.)

It was one of the most expensive bills ever to come before Congress, but it had no funding source whatsoever. The entire cost went straight to the deficit. “We didn’t have the votes to pay for it,” Sen. Orrin Hatch said later.

The Republicans even kept the cost secret to get the bill passed. Medicare’s chief actuary, Richard S. Foster, knew the bill would cost $534 billion over 10 years though congressional budget resolutions had capped the cost at $400 billion. Foster’s boss, Thomas A. Scully, told Foster he would fire him if he told Congress the truth. The inspector general later threatened Scully with an ethics violation but he quit before the ink had dried on the bill. Majority Leader Tom DeLay was reprimanded for his arm-twisting.

Turns out this was a bill for the drug industry, not for seniors. More than 900 people signed up to lobby for it. “The pharmaceutical lobbyists wrote the bill,” Rep. Walter Jones, a North Carolina Republican, told “60 Minutes.”

Here’s the relevance for today’s drug price debate, as politicians scurry to get into the act: The bill prevented the government from negotiating with drug companies and from importing cheaper drugs. Would drug prices be lower now if those provisions hadn’t been included back then?

Seniors weren’t impressed. Days after Bush signed the bill, a poll showed 47 percent opposing and 26 percent approving the changes. Some members of Congress of both parties said seniors might actually be worse off with the bill.


Mark Serafini wrote in the National Journal: “(T)he group that should have come out on top – America’s seniors – was reeling at the prospect of limited help, while watching industry groups count their bounty.”

Louisiana Republican Rep. Billy Tauzin, the bill’s chief House architect, became a lobbyist for the drug industry afterwards. For five years, as president and CEO of the Pharmaceutical Research and Manufacturers of America, he successfully fought Congressional efforts to lower drug prices.

Bush was re-elected.



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