1. SOCIAL SECURITY

… Each year, $7 billion is paid into Social Security by undocumented immigrants, even though they do not receive benefits. This is 10 percent of the estimated Social Security surplus. (Time, April 25, 2005) …

During the 2000 presidential campaign, George W. Bush boasted that he would revise the Social Security system. However, his proposals to revamp the system were left rather murky. He endorsed the position held by the Clinton-Gore administration, opposing the transfer of trillions of general revenue dollars into Social Security after 2011 without first restructuring the program.

Projections in November 2004 indicated that the government would have to begin drawing on general tax revenue to pay benefits to retirees in 2018. That would be the first year in which scheduled benefit payments would exceed revenues from the payroll tax dedicated to the retirement system. By 2042, the government would have exhausted the Social Security trust fund. That was a legal obligation to pay back to the retirement system the temporary surplus in payroll tax revenues that the government borrowed over several decades to subsidize the rest of the budget. After 2042, Social Security would be able to pay only about three-quarters of promised benefits. (New York Times, November 28, 2004)

In August 2001, the Bush administration made an accounting change involving Social Security. It freed $4.3 billion that Congress could have used for cutting taxes or spending. However, $5.6 billion was actually credited to Social Security. (New York Times, August 16, 2001)

Bush indicated that he favored building around a 12.4 percent payroll tax that would be paid equally by employers and workers and placed in a trust fund and employers pay in Social Security taxes. Though he said that participation in private investments would be voluntary, Bush’s aides hinted that the amount to privately invest could be around two percent.

A portion of the retirement benefit would be guaranteed and a portion would fluctuate with the performance of the investment account. If that were the case, Social Security revenues over a span of 10 years would deplete $1 trillion from the system. Bush would preserve the system’s current provision to pay benefits to widows, widowers, and the disabled.

Bush’s promises contained a number of weaknesses and flaws.

1. The big problem for privatization was the huge deficit that would be created in Social Security, a pay-as-you-go system, if even part of current payroll taxes were funneled into private accounts. One proposal, for example, would put a third of an individual’s taxes into private accounts. This partial privatization would drain around $200 billion a year from the system.

2. Several analysts indicated that his economic assumptions were wrong. Bush was unable to set aside nearly as much funding for Social Security and health care as Al Gore had proposed, since he proposed a tax cut that he estimated would cost $1.3 trillion over ten years.

3. According to the Social Security Board of Trustees Report published in 2000, the year 2014 was targeted as the time when payments to Social Security recipients for the first time would exceed payroll tax receipts coming into the fund. If the program were to continue at its present rate, the trust fund would be empty by 2020. The cost of providing benefits would exceed taxes and interest in 2025, forcing trust fund to begin liquidating its bond holdings to cover obligations. The year 2037 was projected as the year that the trust fund would be exhausted.

4. Social Security trustees predicted that economic growth was slowing along with the aging work force in the United States. Olivia Mitchell, professor of insurance and risk management at the Wharton School, said that there was “no chance” of Americans making the kind of returns envisioned by the Bush team. She said that the burden of paying off the $9 trillion owed to present and future beneficiaries was so great that it cut into the returns that personal accounts could generate.

5. Bush’s proposal hinged on a continuing bullish market similar to its successes in the 1990s. Investment markets would be risky and not do as well in the future as Bush had suggested. Privatizing part of one’s earnings could jeopardize one’s investments.

6. Privatizers pointed to the fact that during the 1900s, stocks increased in value over the long term at about seven percent a year. However, there were two reasons to doubt whether the future would reflect the past. Statistics indicated that the market would be flatter in the future. Projections showed that by the mid-2000s, economic growth would slow to less than 2.5 percent annually. (Boston Globe, July 8, 2001)

7. Bush’s “privatization” plan presented the possibility of individuals making bad investment decisions, particularly in a bear market. Even in a severe recession, Social Security had been recession-proof. As long as one lived, he or she had been guaranteed Social Security checks. The system had always been indexed for inflation, and it also had insured against the early death of the recipient. (Boston Globe, July 8, 2001)

8. Bush failed to mention that baby boomers -- no matter how well they invested -- would collect retirement benefits almost certainly no greater than they presently received and likely much lower. The problem would arise when the baby boom generation -- the 76 million Americans born from 1946 to 1964 -- retired and had to rely for support on the smaller generation that would follow. In 2000, experts foresaw 2037 as the year when payroll tax revenue, coupled with the Social Security system’s currently building surpluses, would no longer cover the costs of promised benefits.

9. According to the 2001 Social Security trustees’ report, Bush’s program would begin running a cash deficit in 2007, nine years earlier than envisioned. By 2015, the deficit would be 16 percent of projected benefits. By 2035, 37 percent. (Newsweek, July 2, 2001)

Democrats charged that the costs associated with setting up personal accounts would make Social Security’s financial problems worse, and that the United States could scarcely afford to add to its rapidly growing national debt. The estimated cost to the government for Bush’s privatization plan was between $1.2 and $3.4 trillion. (New York Times, November 28, 2004)

Just days after his reelection in November 2004, Bush said Social Security reform was a top priority. Democrats on Capitol Hill immediately mobilized to oppose the centerpiece of Bush’s proposal. In January 2005, the Democratic Leadership Council, the party’s leading centrist organization, and Third Way, a new group working with moderate Senate Democrats, officially opposed Bush’s plan to divert part of the Social Security payroll tax into accounts that individuals could invest in the stock market. In addition, the AFL-CIO and the NAACP also joined the opposition. Opponents of the privatized plan claimed it would cost taxpayers $2 trillion over 10 years. (New York Times, December 20, 2004; New York Times, January 5, 2004)

In January 2005, Bush crossed the country, trying to sell his privatization plan to America. He claimed over and over again that Social Security was broken. Social Security was not broken. The most successful safety net program in human history had $1.7 trillion in reserve funds and faced a possible shortfall for decades. Minor corrections to the program could be prevented. . (Los Angeles Times, March 8, 2005)

For the average American over 65, Social Security made up nearly 40 percent of income, according to the American Association of Retired Persons. For about 20 percent of retirees, it was their only income. (Los Angeles Times, March 8, 2005)

Bush’s drive to abolish Social Security opened wedges within the Republican Party. In March 2005, GOP Senate Majority Leader Frist announced that Social Security would not come to a vote in 2005. But Frist was obviously under pressure from the White House. The next day, he announced that Social Security would be put to a vote in 2005.

At a press conference on April 28, 2005, Bush proposed deep Social Security benefit cuts for middle-class Americans. He formally backed a specific plan to reduce future benefits for tens of millions of Americans. Bush presented the idea of progressive indexation -- a change in law that will give workers less money by tying their benefits to inflation instead of wage growth. He described it as a system “where benefits for low-income workers will grow faster than benefits for people who are better off.” (Washington Post, April 29, 2005)

If the Bush’s plan would solve as much of the system’s funding problem as the White House claimed, then it would mandate benefit cuts or increases in the payroll tax. But Bush presented his proposal in a way that suggested it involved neither of those two options. Not only did he not acknowledge the sweeping cuts that would be made under his plan, but his definition of a “high wage earner” was equally as misleading. A worker making $58,000 a year -- who would see his or her benefits cut by 42 percent under the president’s plan -- certainly could not be considered “affluent.”

Bush proposed changing Social Security so low-income Americans would never have to retire into poverty. He also claimed that his plan would guarantee that “future generations (would) receive benefits equal to or greater than the benefits today’s seniors get.” (Washington Post, April 28, 2005)

2. HEALTH CARE

PRESIDENT CLINTON AND THE ONE-PAYER PLAN. In the 2000 campaign, the $100-billion-a-year pharmaceutical industry contributed $4.4 million to Bush and the Republican Party. Once the drug sector helped get Bush elected, pharmaceutical companies pressed the administration to select one of their own to head the Federal Drug Administration (FDA).

As a presidential candidate, Bush called health care access for all working families “a goal worthy of our nation.” He reneged on his promise to provide health insurance to the nation’s poor. The administration promised to set aside $28 billion to help the nation’s 40 million-plus uninsured by expanding a program for children in low-income families. (Los Angeles Times, August 24, 2001)

During Campaign 2000, Bush pledged to bring Democrats and Republicans together by enacting a bipartisan “Patient’s Bill of Rights.” He reneged on his promise. He objected to the high caps on lawsuits and the full right to sue HMOs. He wanted to cap damages for pain and suffering at $500,000, allowing no punitive damages to be awarded, and he demanded that virtually all cases heard in federal court.

During his first term, Bush raked in more than $418,000 from the pharmaceutical industry, and listed many drug industry executives and lobbyists as his top fundraisers. (“Paybacks: Prescription Drugs,” Public Campaign, August 20, 2004)

MEDICARE AND MEDICAID. According to the Congress’ Government Accountability Office in December 2004, Medicare funds would be exhausted by 2019. That was more than 20 years before Social Security was forecast to slide into the red. The government’s unfunded promises to future retirees under Medicare amounted to a staggering $27.7 trillion through 2080. That dwarfed the $3.7-trillion liability over the same period for Social Security. (New York Times, December 20, 2004)

In August 2001, the Bush administration proposed to roll back some of the protections for Medicaid recipients that President Clinton had put in place on the day before he left office in January 2001. The new rules set standards gave Medicaid recipients many of the same rights guaranteed to people in private health plans under legislation passed. Patients had a right to emergency care whenever and wherever the need arose. They had direct access to certain medical specialists. Medicaid recipients could file an appeal for the denial of care or coverage by an HMO. While Clinton said such appeals must be resolved within 30 days, Bush allowed 45 days. In urgent situations, the Clinton set a 72-hour deadline for HMOs to rule on appeals, while Bush allowed three working days. (New York Times, August 16, 2001)

The new rules set standards gave Medicaid recipients many of the same rights guaranteed to people in private health plans under legislation passed. Patients had a right to emergency care whenever and wherever the need arose. They had direct access to certain medical specialists. Medicaid recipients could appeal the denial of care or coverage by an HMO. While Clinton said such appeals must be resolved within 30 days, Bush allowed 45 days. In urgent situations, the Clinton set a 72-hour deadline for HMOs to rule on appeals, while Bush allowed three working days. (New York Times, August 16, 2001)

In October 2001, Bush approved requests from the governors of six states to expand health care to cover adults. However, he never set aside money to help struggling states afford the expansion. On the contrary, he actually proposed taking $11 billion out of the existing children’s program and using it to provide health coverage to workers displaced by the September 11 terrorist attacks. (Los Angeles Times, January 18, 2002)

In January 2002, Bush promoted competition in Medicare to improve the program for 76 million baby boomers and, more importantly, to posture himself for the 2004 election. (New York Times, January 3, 2002; Washington Post, January 17, 2003)

Bush’s proposed Medicare + Choice resembled an HMO. Under this plan, federal funds would be used for prescription drugs. A GAO study in 2000 found that Medicare + Choice cost the government more than if members were treated under the regular Medicare program. Another Bush plan, Enhanced Medicare, was available for affluent seniors. The government would provide funds for a preferred-provider organization (PPO) that would provide prescription drugs. (Newsweek, June 9, 2003)

The Bush administration also authorized “experiments” in six metropolitan areas, where private insurers subsidized by the government could lure healthy seniors away from traditional Medicare. However, past experiments with Medicare HMOs demonstrated that they were inefficient. Consequently, the sickest patients returned to traditional Medicare. (Boston Globe, November 20, 2003)

Cheney charged that “medical liability reform” was the key to “control the cost of health care.” However, several independent studies concluded that there was no such evidence. (Observer-Reporter, July 4, 2004)

1. The Congressional Budget Office reported that costs from malpractice lawsuits represented less than 2 percent of the nation’s total health care spending, and the tort reform legislation pushed by Bush would reduce health insurance premiums by less than one-half of one percent. (Congressional Budget Office, January 8, 2004)

2. A study by the Harvard University School of Public Health “did not find a strong relationship between the threat of litigation and medical costs.” (www.factcheck.org, January 29, 2004)

3. A study in the Journal of Health Economics compared medical costs in states with limits on lawsuits to states without limits and found only tiny savings -- less than three-tenths of one percent. (www.factcheck.org, January 29, 2004)

The nation’s uninsured rate increased in 2002. Almost 47 million Americans, or 15.2 percent of the country, lived without health insurance, a number that jumped 6 percent from 2001 as more people lost their jobs and insurance premiums continued to rise. In 2001, about 41.2 percent or 14.6 percent of the population was uninsured. (San Francisco Chronicle, September 30, 2003)

In May 2003, the Bush administration dropped a proposed rule that would have required hospitals to install facilities to protect workers against tuberculosis. Hospitals and other industry groups had lobbied against the change, saying that it would be costly and that existing regulations would accomplish many of the same aims. (New York Times, August 14, 2004)

But workers unions and public health officials argued that the number of tuberculosis cases had risen in 20 states and that the same precautions that were to have been put into place for tuberculosis would also have been effective against SARS. (New York Times, August 14, 2004)

Bush won a major victory in mid-2004. In June, the Supreme Court ruled that patients could not sue HMOs under state law, even if their HMOs refused to pay for doctor-recommended medical care. The decision affected millions of patients and invalidated an important part of patient rights laws in several states. As a result, patients could fight for their rights only in federal court, where HMOs were protected from having to pay punitive damages and where cases are more restricted. (Washington Post, June 22, 2004)

Because Congress and the White House have refused to pass a federal patients bill of rights, the Supreme Court was forced to rely on a federal pension benefit law that predated the rise of managed care. (Washington Post, June 22, 2004)

The Texas Health Care Liability Act that was struck down was the first state law to give patients the right to sue HMOs for denying “appropriate and medically necessary treatment.” The state passed the law in 1997 to prevent HMOs “from padding their bottom lines through abusive denials of coverage by holding HMOs to a professional medical standard of ordinary care.” Nine states since followed Texas’ lead and enacted similar legislation. (Washington Post, June 22, 2004)

Bush won a major victory in mid-2004. In June, the Supreme Court ruled that patients could not sue HMOs under state law, even if their HMOs refused to pay for doctor-recommended medical care. The decision affected millions of patients and invalidated an important part of patient rights laws in several states. As a result, patients could fight for their rights only in federal court, where HMOs were protected from having to pay punitive damages and where cases are more restricted. (Washington Post, June 22, 2004)

Because Congress and the White House have refused to pass a federal patients bill of rights, the Supreme Court was forced to rely on a federal pension benefit law that predated the rise of managed care. (Washington Post, June 22, 2004)

The Texas Health Care Liability Act that was struck down was the first state law to give patients the right to sue HMOs for denying “appropriate and medically necessary treatment.” The state passed the law in 1997 to prevent HMOs “from padding their bottom lines through abusive denials of coverage by holding HMOs to a professional medical standard of ordinary care.” Nine states since followed Texas’ lead and enacted similar legislation. (Washington Post, June 22, 2004)

Between 2001 and 2003, national spending for prescription drugs increased 14 percent. Employees were increasingly being left to find coverage on their own. Nearly 50 percent of all small businesses no longer provided health care for their workers.

Employee contributions for health care increased 126 percent between 2000 and 2005, compared to a 76 percent increase for employers. (Employer Health Benefits, 2005; Health Care Expectations, November 17, 2004; CBS News, January 26, 2006)

In 2004, spending for doctors’ services shot up 15 percent. Premiums for beneficiaries increased to $89 a month in 2006, up $11 from 2005. According to the White House, one reasons was that doctors began billing Medicare for longer, more intensive office visits, more laboratory tests, more frequent and complex imaging procedures, and more prescription drugs given to patients in their offices. (New York Times, April 1, 2005)

PACS. Senators who raised millions of dollars in campaign donations from pharmaceutical interests secured industry-friendly changes to a landmark drug-safety bill. In the spring of 2007, Congress gave the Food and Drug Administration broad new authority to monitor the safety of drugs after they are approved. It addressed some shortcomings that allowed the painkiller Vioxx to stay on the market for years after initial signs that it could cause heart attacks. (USA Today, May 14, 2007)

The 49 senators who voted against drug importation received about $5 million from industry executives and political action committees since 2001 - nearly three quarters of the industry donations to current members of the Senate. (USA Today, May 14, 2007; Center for Responsive Politics; PoliticalMoneyLine)

GOP Senator Pat Roberts said he demanded removal of language that would have allowed the FDA to ban advertising of high-risk drugs for two years because it would restrict free speech. Roberts raised $66,000 between 2001 and 2007. (USA Today, May 14, 2007)

GOP Senator Judd Gregg claimed authorship of a change that reduced the FDA’s power to require post-market safety studies. He said he wanted to target drugs only if there was evidence of harm. Gregg raised $168,500 from drug executives and PACs between 2001 and sided with them in four key votes. (USA Today, May 14, 2007),?p>

The bill’s chief sponsors - Democrat Edward Kennedy and GOP Mike Enzi agreed after consultations with industry officials and others to modify a proposal that all clinical drug studies be made public. Under the change, only those studies submitted to the FDA would be available. Enzi took in $174,000 from drug interests since 2001; Kennedy, $78,000. Their spokesmen said the money did not influence them. (USA Today, May 14, 2007)

PRESCRIPTION DRUGS. During the 2000 campaign, the $100-billion-a-year pharmaceutical industry contributed $4.4 million to Bush and the Republican Party. Once the drug sector helped get Bush elected, pharmaceutical companies pressed the administration to select one of their own to head the Food and Drug Administration. Bush promised free prescription drugs to the nation’s elderly who earned under $10,000 annually. He proposed spending $12 billion in each of the four years in his administration. That amounted to $48 billion in grants to the states for drug coverage.

Pharmaceutical companies began jacking up prices for popular drugs ever since Bush first floated the Medicare drug card proposal in 2001. The companies offering cards included Advance PCS. The CEO of Advance PCS was David Halbert, a close friend of Bush who helped bail him out of trouble with the SEC when Bush was CEO of Harkin Oil. Halbert invited Bush to be an original investor in Advance PCS -- a transaction that netted the president over $1 million. Bush returned the favor by allowing Halbert to be deeply involved in crafting the administration’s drug card program. (Boston Globe, December 12, 2003; Global Action on Aging, March 24, 2004)

Bush reneged on his promise for free prescription drugs to the nation’s elderly who earned under $10,000 annually. He proposed spending $12 billion in each of the four years in his administration. That amounted to $48 billion in grants to the states for drug coverage. In March 2001, Bush unveiled a plan to provide billions of dollars to the states to help nearly only 25 percent of the 39 million Medicare beneficiaries buy prescription drugs. Subsidized drug coverage would be offered to people with annual incomes up to 75 percent above the poverty level. Yet, one-third of all Medicare recipients had no coverage for prescription drugs. (New York Times, January 31, 2001)

Bush insisted on more generous drug benefits for enrollees in private plans, especially the preferred provider organizations that steer patients to certain doctors and hospitals. The Congressional Budget Office (CBO) reported that fewer than 10 percent of the 40 million Medicare beneficiaries would join a preferred-provider plan under a system where prescription drug benefits would be the same as for those people enrolled in traditional fee-for-service Medicare plans. (New York Times, June 9, 2003)

In July, Bush announced his plan to provide prescription drug discount cards. He claimed the cards would only cost the elderly a dollar or two a month. However, his proposal was merely an empty gesture, providing no real relief to America’s seniors. He tried to sell his proposal by claiming the cards would only cost the elderly a dollar or two a month. He did not intend to -- or he was unable to -- allocate any federal dollars to improving medical care, since funds had just been earmarked for his $1.35 trillion tax cut and he was lobbying for increasing the Pentagon’s budget.

Nearly two years later -- in a major policy shift in June 2003 -- Bush said he would accept equal prescription drug benefits for people in the traditional Medicare program and those who joined private health plans. The basic Medicare program served 88 percent of seniors. Bush’s plan would include a discount card that might reduce the price of prescriptions by 10 to 25 percent. (Newsweek, June 9, 2003)

In the summer of 2003, the Senate Finance Committee approved adding a prescription drug benefit to the Medicare package. This paved the way for the substantial involvement of private insurance companies in the program that provided health coverage to 40 million senior and disabled Americans. The changes cost $400 billion over 10 years and would represent the most significant reform of Medicare in its 38-year history. The House committee wrote legislation calling for even more free-market competition in its plan. (Los Angeles Times, June 13, 2003)

David Halbert, a longtime friend and contributor to several of Bush’s campaigns, helped craft the portion of the Medicare bill that allowed seniors to buy discount drug cards. Halbert’s company, Irving, Texas-based AdvancePCS, was one of the nation’s largest pharmacy benefit management companies that was lined up to compete for Medicare’s endorsement to issue the discount cards. (Boston Globe, December 12, 2003)

Two weeks later, the Senate (76-21) and the House (216-215) passed their versions of the bill. According to the House legislation, there would be government subsidies for preferred-provider organization plans on the bids submitted by private insurers by 2010. This plan would replace the cost of providing the services included in traditional Medicare. (Boston Globe, June 28, 2003)

The House plan also called for prescription drug benefits to begin in 2006, with Medicare covering 80 percent of drug costs up to $2,000 after a deductible of $250. Premiums would be about $35 per month and annual out-of-pocket expenses would be capped at $3,700. The plan offered catastrophic coverage for drug costs that exceed $3,500. The House bill forced enrollees to pay all of the drug costs from $2,000 to $3,500, a $1,500 “doughnut hole.” Additionally, the bill included an incentive for enrollees to take their Medicare drug benefit with them to a private plan.

The Senate plan covered half of up to $4,500 in drug costs after a deductible of $275. Premiums and the out-of-pocket caps would be the same as in the House plan. Medicare would cover 90 percent of costs beyond $3,700. Both the Senate and House bills changed drug patent law to make it harder for brand name drugs to stave off competition from cheaper generic medicine.

In June, the two houses passed different versions of a Medicare bill. The Senate’s plan covered 50 percent of drug costs up to $4,500 a year. However, when they would reach $4,500, the benefits would stop, but be picked up again when they would reach $5,800. At that point Medicare would cover 90 percent of the costs. In the House version, 80 percent of drug costs would be covered up to $2,000 a year. Then nothing would be covered up to $4,900. For all costs over $4,900, Medicare would pay 100 percent. (Village Voice, July 23, 2003)

In May 2004, seniors could begin purchasing the new Pharmacy Care Alliance Card. The drugs purchased with the cards were dramatically more expensive than the same drugs purchased in Canada. For example, a month’s supply of the ten most popular brand-name drugs cost $1,046 using the card -- but just $596 in Canada. The average Medicare card studied offered prices 72 percent higher than prices available in Canada. Yet, the Bush administration continued to block seniors from obtaining affordable drugs from Canada. (Center for American Progress, February 24, 2004)

HHR Secretary Tommy Thompson said the cards would “pool the purchasing power of Medicare beneficiaries to drive down the prices they pay for prescription drugs. But the corporations offering drug cards are not required to pass savings onto seniors. (New York Times, May 4, 2004)

The Bush administration estimated that employers would reduce or eliminate prescription drug benefits for 3.8 million retirees when Medicare offered such coverage in 2006. That represented one-third of all the retirees with employer-sponsored drug coverage. (New York Times, July 14, 2004)

Bush promised Americans that he would provide seniors with a drug discount card that saved them 10 to 25 percent off the cost of all drugs, so they could start seeing savings immediately on their medications. But, the cards did not guarantee seniors any savings at all. (Hartford Courant, April 25, 2004)

1. Seniors had difficulty choosing a discount company, since they had to choose between 40 national and 33 regional drug cards, each offering different prices for different drugs.

2. Medicare beneficiaries could only choose one card even if enrolling in two or more programs would save them more money.

3. Once they enrolled, seniors were locked in and could not change cards until 2005.

4. The card sponsors to change their prices on a weekly basis, thus never guaranteeing any benefit at all.

5. Corporations offering drug cards are not required to pass savings onto seniors. Corporations offering drug cards could change their prices -- up or down -- every week. (Wichita Eagle, December 11, 2003; Washington Post, April 29, 2004; The Guardian, May 3, 2004; New York Times, May 4, 2004)

While Bush pushed for his senior prescription plan, he was actually working to create an incentive for employers to cut off seniors from existing coverage. The administration quietly added a little-noticed provision to the bill that allowed companies to severely reduce -- or almost completely terminate -- their retirees’ drug coverage without losing out on the new subsidy. (www.misleader.com, January 8, 2004)

In doing so, Bush actually acted to reward companies who cut off their retirees with a lavish new tax break. The companies that lobbied for the provision donated almost $140,000 in hard money and $2.5 million in soft money to Bush and his party since 2000. (www.misleader.com, January 8, 2004)

The Bush administration deceived Congress about the true costs of its changes to Medicare. Knowing the prescription-drug bill was a poor plan. The White House hid the real costs of the bill in order to quell concerns among skeptical Republicans and Democrats prior to passage. Only after Congress passed the bill -- breaking rules to extend voting and employing threats and bribes to change lawmaker’s votes in the process -- did the Bush administration reveal the true costs and implications of its legislation. (Talking Points, March 15, 2004)

The Bush administration used tens of millions in taxpayer money to promote the cards through television ads.

1. The television ads were misleading. Bush promised that the drug cards would save seniors money. Some of the ads even used fake reporters in an effort to trick viewers into thinking they were watching objective news. (ABC News, March 15, 2004) The GAO concluded that the ads contained “notable omissions and errors.” (Miami Herald, March 19, 2004)

2. The GAO found that the Bush administration engaged in illegal, covert propaganda when it produced fake news segments about the new Medicare law and distributed them to local television stations. The segment featured individuals purporting to be Washington reporters who were, in fact, “paid with federal funds through a contractor to report the message.” (GAO Report, May 19, 2004)

3. The GAO found that the news segments were “not strictly factual news stories as the Department of Health and Human Service contended. The GAO also found that the advertising campaign contained “notable omissions and weaknesses.” (GAO Report, May 19, 2004)

The Bush administration was not forthright in peddling the drug prescription package to the American people:

1. The American public was told that the bill would cost $400 billion over 10 years. But tax breaks for businesses and individuals would drive the $400 billion figure higher. CBO director Douglas Holtz-Eakin told lawmakers it would cost between $1.7 trillion and $2 trillion in the second decade after the baby boomers start to retire in 2011. (USA Today, November 20, 2003; Boston Globe, November 20, 2003)

According to the Bush administration’s 2006 budget, the Medicare prescription drug bill would cost $913 billion from 2006 to 2015. In his 2003 State of the Union, Bush assured the nation his plan would cost just $400 billion.

Immediately after his legislation was rammed through a reluctant Congress, in a classic bait-and-switch, the administration admitted the cost would be closer to $534 billion from 2005 to 2014, although it never offered a detailed breakdown of that estimate.

2. The legislation gave billions to the drug industry and insurance companies. Altogether, the corporate overpayments totaled $269 billion over 10 years, almost half the Medicare actuary’s estimate of the legislation’s total cost of $549 billion. The CBO estimated the 10-year cost of the bill to be $394 billion. Corporations that paid health benefits to retirees received new tax breaks worth $18 billion. (Boston Globe, November 20, 2003; The Centers for Medicare and Medicaid Services (CMS); Office of the Actuary, January 14, 2004; F.A.I.R., April 28, 2004)

3. The legislation prevented the importing of high-quality prescription drugs from Canada, where price controls held costs down to dramatically lower levels than in the United States. The lower prices available in Canada offered a tremendous savings over United States retail prices -- as much as 80 percent for some medicines. (USA Today, November 20, 2003; Madison Capital Times, November 20, 2003)

4. The Bush administration refused to confront the pricing power of drug companies. Pharmaceutical companies could sell more drugs at prices they set. As a result, the government would be billed at exorbitant prices, and the new $40 billion a year in benefits would cover only a fraction of consumers’ drug expenses. (Boston Globe, November 20, 2003)

5. It was estimated that drug company profits would increase more than 37 percent: The $17 billion in additional profits a year translated into more than a 37 percent increase in profits for the industry. (Fortune magazine, April 17, 2003)

6. The pharmaceutical industry received $139 billion in additional profits over eight years. The legislation increased the drug industry’s sales volume and profits dramatically. It prohibited Medicare from using the market power of its 41 million enrollees to negotiate lower prices -- even though Medicare traditionally used its market power to establish payment rates and to contain costs. Consequently, many people who signed up for the drug benefit were forced to pay higher prices for their drugs than they would if they bought them in Canada. (Alan Sager and Deborah Socolar, “61 Percent of Medicare’s New Prescription Drug Subsidy Is Windfall Profit to Drug Makers,” October 31, 2003)

7. The legislation gave health plans as much as $130 billion more to provide care to people with Medicare than it would cost to cover the same people under Original Medicare. These overpayments contributed to insurance company profits. While these overpayments also enabled plans to make additional benefits available to their members, only people who lived in areas served by a plan offering additional benefits. Furthermore, the plan would have to best meet their needs if they would benefit. If the overpayments were invested in Original Medicare, which was available to all people with Medicare throughout the country, additional benefits could be provided more equitably. (Congressional Budget Office, 2003; Centers for Medicare and Medicaid Services, 2004)

8. The Centers for Medicare and Medicaid Service (CMS) and the CBO both concluded that private plans were paid more than it would cost to cover the same people under Original Medicare. Therefore, each person who transferred from Original Medicare to a private plan increased Medicare’s costs. CMS and CBO believed that the size of the overpayments per person enrolled was of similar magnitude. CMS estimated $46 billion in overpayments to plans -- $32 billion more that the CBO --because CMS assumed that a larger percentage of people with Medicare would enroll in private plans. (Congressional Budget Office, 2003; Centers for Medicare and Medicaid Services, 2004)

9. Under the formula, if one incurred $3,600 of annual drug costs, the program would cover only $1,285. Then it would cover 95 percent after $3,600. However, many seniors would not participate at all because they could mot afford the upfront costs. (Boston Globe, November 20, 2003)

10. Dr. Quentin Young of Physicians for a National Health Program said that costs for seniors over the next 10 years would total 1.8 trillion. He said, “The most generous estimate of the ‘benefit’ is 400 billion. So it doesn’t cover even 25 percent of the total cost.” (Village Voice, July 23, 2003)

11. The Henry J. Kaiser Family Foundation said seniors would have to pay an extra $1,718 under the Senate version, and $1,760 under the House’s plan. Neither figure counted the $450 annual premium. (Village Voice, July 23, 2003)

12. The system was confusing, with 73 different cards all covering different medications. And once seniors have signed up for a specific card, they were locked into it, even though the drug companies are allowed to change prices as often as once a week.

13. The discount was not guaranteed. In fact, to offset the potential loss in profit, drug companies jacked up the price of medicines over the past year an average of 7.4 percent or more than three times the 2.3 percent rate of general inflation in that period.

A study by AARP showed wholesale prices for popular brand-name prescription drugs rose by an average 7.1 percent in 2004, more than double the nation’s inflation rate. (USA Today, April 12, 2005)

IMPLEMENTING THE MEDICARE PRESCRIPTION PLAN. When the Medicare prescription plan went into effect on January 1, 2006, major glitches in the program prevented 20 percent of the enrollees to obtain their drugs. These people included 6.4 million low-income Medicare beneficiaries who previously had received drug benefits under Medicaid. These people were called “dual eligibles.” They relied on Medicare Part D for their prescriptions. (American Progress Action, January 19, 2006)

UNITED STATES AND CANADIAN DRUG PRICES. HHS Secretary Tommy Thompson said that the safety issue was not addressed to his satisfaction in negotiating the sale of Canadian drugs in the United States. The Associated Press surveyed comparable United States and Canadian prices for 10 popular drugs and found the Canadian prices were 33 percent to 80 percent cheaper. (MSNBC, November 6, 2003)

1. A three-month supply of cholesterol-controlling Lipitor, the world’s best-selling prescription drug, was 37 percent cheaper in Canada.

2. The anti-depressant Paxil cost about half as much as in the United States, while the arthritis drug Vioxx cost 58 percent less.

3. The biggest price difference was for the anti-psychotic drug Risperdal, 80 percent cheaper in Canada.

4. Seniors in Illinois would save about $91 million a year by buying prescription drugs from Canada, according to report commissioned by Governor Rod Blagojevich. The state spent $340 million on prescription drugs for its employees and retirees in 2002, 15 percent more than a year earlier.

The Bush administration and the drug industry claimed Canadian prescription drugs were unsafe. But Dr. Peter Rost, vice-president of marketing for the pharmaceutical company Pfizer, refuted the White House’s argument, saying reimportation “has been proven to be safe in Europe” and that “the safety issue is a made-up story.” (Washington Post, September 14, 2004)

According to the non-profit watchdog Public Campaign, the drug industry contributed to Republican candidates more than $36 million since 1999. Bush raked in more than $418,000 from the pharmaceutical industry, and listed many drug industry executives and lobbyists as his top fundraisers. (“Paybacks: Prescription Drugs,” Public Campaign, August 2004)

While pharmaceuticals were doling out millions of dollars to the GOP, Scientists at the Federal Drug Administration charged that they were pressured into approving new drugs. In a 2002 survey, almost one-fifth of the FDA scientists said they had been pressured to recommend approval of a new drug despite reservations about its safety, effectiveness, or quality. The survey of almost 400 FDA scientists also found that a majority had significant doubts about the adequacy of federal programs to monitor prescription drugs once they were on the market. Over one-third of the FDA scientists said were not particularly confident of the agency’s ability to assess the safety of a drug. (New York Times, December 17, 2004)

A PATIENT’S BILL OF RIGHTS. During Campaign 2002, Bush pledged to bring Democrats and Republicans together by enacting a bipartisan “Patient’s Bill of Rights.” He reneged on his promise. The legislation would have:

*Covered over 160 million Americans who had private health insurance would be covered.

*Set guidelines for HMOs and other insurance providers would be established.

*Granted the insured a right to receive emergency care, visit pediatricians, and other specialists. It would have required an outside review by medical experts of any benefit denials.

*Allowed patients, dissatisfied with the outcome of this review, the right to sue their health insurance providers in state court in cases that entail a “medically reviewable” claim. These suits would be subject to any applicable damage caps under state law. Contractual claims against an HMO would have to be brought in federal court and face a $5 million cap.

*Allowed patients the right to an independent review of decisions by their health plans when treatment is denied. If independent outside experts -- a panel of doctors -- agreed with the patient, the health plan would have to cover the treatments. Patients would have the right to see specialists even if the health plan’s primary care doctor refuses to make a referral. Furthermore, health plans would be required to cover all emergency medical care and ambulance services on a “prudent layperson” standard. (Los Angeles Times, June 15, 2001; New York Times, June 17, 2001)

In June 2001, the White House-backed an alternative measure in the Senate that was sponsored by Bill Frist, Republican of Tennessee, and John Breaux, Democrat from Louisiana. This proposal gave patients many of the same rights, like access to specialty care. However, it limited the rights of the patients. Bush charged that the bill amounted to a boon to trial lawyers, claiming that it would lead to a wave of frivolous lawsuits.

Frist’s proposal was more concerned with protecting the health care industry, a major Republican campaign contributor, than with protecting patients. It allowed patients to sue only in federal court, even when challenging medical decisions, and would ban punitive damages and cap verdicts for pain and suffering at $500,000. Federal courts were already overwhelmed and were generally regarded as more hospitable to defendants than state courts were. (New York Times, June 17, 2001; Washington Post, June 20, 2001)

Amendments to the bill threatened to derail the health insurance measure. By a vote of 57 to 43, the Senate rejected a Republican proposal to provide employers with complete immunity against lawsuits by employees who challenged the denial of their claims for health benefits. Republicans said that the risk of such lawsuits would prompt employers to stop offering coverage. (New York Times, June 27, 2001)

Ultimately, the Senate passed a bill that established a wide range of patients’ rights for more than 200 million Americans with health insurance. The bill set detailed federal standards for private health insurance and allowed patients to file suit, in federal or state court, to enforce their rights. In federal court, there was no limit on damage awards for economic losses or pain and suffering, Plaintiffs could recover up to $5 million in “civil assessments” resembling punitive damages for flagrant violations of their rights. In state court, damages were subject to the limits of state law, if any exist. (New York Times, June 30, 2001)

Bush complained that the Senate had failed to address the danger that excessive, unlimited litigation in state courts would drive up premium costs and cause many American families to lose their health insurance. He offered some concessions that would make it easier for patients to file suits in state courts, which were seen as friendlier to plaintiffs than federal courts, the latter of which were unlikely to award sizable amounts of money. (New York Times, July 28, 2001)

In July, a similar Patient’s Bill of Rights bill was proposed in the House by Georgia’s Republican Congressman Charles Norwood. It passed the Senate in July. It would cap punitive damages at $5 million in federal court, while sending most cases to state courts, where damage claims were not controlled by the federal government.

Bush objected to the high caps on lawsuits and the full right to sue HMOs. He wanted to cap damages for pain and suffering at $500,000, allowing no punitive damages to be awarded. And he demanded that virtually all cases heard in federal court.

Bush persuaded Norwood to capitulate on several critical points, including caps on the amount of money for which patients could sue, and the rules under which those suits could be brought in state courts. Once independent review procedures had been exhausted, HMOs should be held accountable in state courts under traditional state malpractice law. The revised bill involved state courts and overly restrictive federal liability guidelines. It would keep many cases in state court, but under federal “causes of action,” meaning that the states would have to follow federal rules that limit damages. It would give patients the convenience of suing in state court -- but limited damage awards.

The revised bill allowed employers to take steps to protect themselves from liability. Patients could recover damages equal to the full amount of any lost wages or other financial losses. Payments for pain and suffering and other non-economic damages would be limited to $1.5 million. A plaintiff could also recover up to $1.5 million in punitive damages if a health plan refused to provide care ordered by independent medical reviewers. An employer could be sued if it directly participated in a decision to deny claims for health benefits promised to employees. But an employer could protect himself by naming an outside entity known as a “designated decision-maker” to rule on claims and bear the legal liability. (New York Times, August 2, 2001)

The House passed the revised Norwood-Bush bill by a 226-to-203 vote.

THE POOR DIE BECAUSE THEY CANNOT AFFORD DRUGS. The World Trade Organization (WTO) reported that poor people needlessly died because drug companies and the governments of rich countries blocked the developing world from obtaining affordable medicines. (The Guardian, November 14, 2006)

In 2001, the Doha declaration -- that dealt with poor countries with access to cheap drugs -- purchased drugs from poor countries at cheap prices. Even the United States was accused of trying to prevent countries such as Thailand and India, which have manufacturing capacity, from making and selling cheap generic versions so as to preserve the monopolies of the drug giants. (The Guardian, November 14, 2006)

AIDS. The Bush administration made a series of blunders in another area of health care. There were indications that Bush had little interest in seeking a cure for AIDS. He had campaigned on a platform that not only proposed no new initiatives to deal with the AIDS crisis, but he actually attacked the Clinton administration for failing to “to add disease ... to an undiminished set of existing American responsibilities” in the world. In his inaugural address, Bush called on America “to show courage in a time of blessing by confronting problems instead of passing them on to future generations.” (New York Times, February 9, 2001; Washington Post, February 9, 2001)

Chief of Staff Andrew Card announced that the White House would shut down the Office of National AIDS Policy (ONAP), formed in 1994, and the Office on the President’s Initiative for One America, formed in 1997. Card said the offices would be shifted to the domestic policy council and the Office of Public Liaison of the White House. (USA Today, February 7, 2001)

Later in the day, the White House claimed that Card simply “made a mistake” when he said the president would close offices on AIDS and race relations. The Office on National AIDS policy would be altered to include two HHS officials to become “a working group on uniting America,” operating through the White House’s Domestic Policy Council and its office of public liaison. (USA Today, February 8, 2001).

STEM CELL RESEARCH. Stem cell research could lead to treatments that save millions of lives and improve the quality-of-life for millions more. In fact, the benefits were already evident. Yet, Bush vetoed any legislation that could have saved countless lives.

From the outset, Bush made it clear that he opposed stem cell research which could be used in the search for cures to diseases. He falsely claimed that only 60 embryonic stem cell lines were in existence and could be used for adequate research. His assertion was refuted by the American Association for the Advancement of Science, the world’s largest group of scientists. In an August 9, 2001 speech, Bush announced his decision to permit the federal funding of stem cell research that only used stem cells lines that existed before. He said, “This allows us to explore the promise and potential of stem cell research.” (Washington Post, August 18, 2001)

During the 2000 campaign, Bush made it clear that he opposed stem cell research which could be used in the search for cures to diseases such as Alzheimer’s, Lou Gehrig’s, and other fatal or disabling diseases. He reiterated his position once elected to office. But then he began to waffle on the issue, presumably because he would lose votes from various constituencies depending on the position he would take. Several times, the president claimed he was agonizing as he “wrestled with the decision” as to whether federal funds should be used for medical research on stem cells pulled from human embryos.

Scientists affirmed the potential for true medical breakthroughs that could lead to cures for heart disease, Alzheimer’s, Parkinson’s, cancer, and diabetes as well as new, more effective treatments for debilitating brain and spinal injuries. The stem cells most useful for biomedical research had been found in embryos formed just after the human egg and sperm combine. Extracting the cells required that those just-fertilized eggs be destroyed.

In experiments, biologists found that human neural stem cells could become incorporated in a fetal monkey’s brain and could share in its development. The human stem cells were injected into the brains of monkeys in the womb, and helped not only to construct the monkeys’ brains but also to form the reservoir of stem cells from which new brain cells were generated throughout adult life. (New York Times, July 27, 2001)

On July 31, the House voted 265-to-162 to ban all cloning of human embryos. In a second bill, the House voted 249-to-178 to prevent even limited human cloning for research into possible cures. That bill was passed just after the House rejected an amendment that would have allowed the limited creation of cloned embryos dedicated solely to research. (New York Times, August 1, 2001)

In opposing stem cell research, Bush claimed that only 60 embryonic stem cell lines were in existence. His assertion was refuted by the American Association for the Advancement of Science, the world’s largest group of scientists. The association stated that, until scientists were able to study the source and makeup of the cells, it was impossible to “assess the potential values of the cells for research and potential medical advances. … Many of our scientific colleagues have questioned that number, believing it to be much smaller.” (Washington Post, August 18, 2001)

The National Institutes of Health (NIH) said that 10 organizations possessed human embryonic stem cells eligible for use by federally financed researchers. The list included only four organizations in the United States, while six were in Sweden, Australia, India, and Israel. Scientists at the University of Goteborg in Sweden had 19 cell lines.

The NIH said most cells were known to have the right set of proteins, or “markers,” on their surfaces, and to be capable of developing into the three separate tissues of the early embryo. (New York Times, August 27, 2001)

In July 2006, scientists were able to transform embryonic stem cells into immune cells known as T-cells -- offering a way to resume systems ravaged by AIDS and other diseases. Also, a team at Johns Hopkins University in Baltimore transplanted stem cells from mouse embryos into paralyzed rats and herlped them walk again. (Reuters, July 16, 2006)

THE TERRI SCIAVO CASE. In early 2005, the Republican Party intervened in the Terri Schiavo case in an effort to gain support for appointing more conservative federal judges to the bench. Although brain-damaged, she was not in a persistent vegetative state, according to Florida Circuit Judge George Greer. Schiavo was kept alive for over 10 years by a feeding tube, while her husband went through the legal channels to allow her to “die with dignity.”

Led by Senate Majority Leader Frist and House Leader DeLay, the GOP politicized the case. Even Bush flew from Crawford, Texas to Washington to sign a hastily-written bill into law to keep her feeding tube. After watching videotapes of Schiavo, Frist concluded that she had been incorrectly diagnosed and that she was not in a vegetative state.

In April, a memo leaked from the GOP camp, suggesting that Republicans had used the family to play politics. The unsigned memo -- which initially misspelled Schiavo’s first name and gave the wrong number for the pending bill -- included eight talking points in support of the legislation and called the controversy “a great political issue.” (Washington Post, April 7, 2005)

Republicans immediately accused Democrats of concocting the document as a dirty trick. Democrats accused Republicans of trying to duck responsibility for exploiting the dying days of an incapacitated woman. (Washington Post, April 7, 2005)

On April 6, embarrassed Republicans learned the author’s name. The memo had been written by Brian Darling, legal counsel to Florida’s GOP Senator Mel Martinez. Darling admitted that he was the author of a memo. (Washington Post, April 7, 2005)

After refusing to overturn a federal court ruling to remove Schiavo’s feeding tube, Florida Pinellas County Circuit Court Judge George Greer received a number of death threats. Subsequently, he was under 24-hour protection by two United States marshals. (CNN, March 25, 2005)

On March 31, police arrested an Illinois man they said robbed a Florida gun store as part of an attempt to “rescue Terri Schiavo.” The next day, FBI officials took into custody a North Carolina man for placing a $250,000 bounty “on the head of Michael Schiavo” and another $50,000 to murder Judge Greer. (www.citizenscrime.com, April 4, 2005)

After nearly two weeks without food, Schiavo died.

SCHIP: VETOING HEALTH CARE FOR CHILDREN. In his first term, Bush supported a bogus prescription plan for seniors at a cost of $534 billion over ten years. The plan was a boon for the nation’s pharmaceutical industry.

In the fall of 2007, Bush had the opportunity to pass into law a good medical care for children. Compared the senior prescription plan, the State Children’s Health Insurance Program (SCHIP) was very modest. The bipartisan plan adds $35 billion over five years, for a total of about $60 billion over that period. (New York Times, October 11, 2007)

Besides, health care for children was one of those programs that are actually worth running up the national debt. It will bring the country huge returns later on, when we baby boomers have retired and need a healthy work force to pay into our Social Security fund. (New York Times, October 11, 2007

The naïve Bush presumably equated SCHIP with socialized medicine. Yet the majority of Americans wanted affordable health insurance. Bush defended his decision to veto a bipartisan plan to expand SCHIP to cover about 4 million more children, up from the 6.6 million that were covered in 2007. Started during the Clinton years and funded by both the federal government and the states, SCHIP provided low-cost health insurance to children in working-class families. It represented government at its best -- giving people a hand up, not a handout.

Bush’s veto came at a time when fewer jobs had come with the benefit of health insurance. Globalization decimated the United States industrial base, eliminating many of the jobs that gave working people a decent salary, health insurance for the family and a secure pension. Many Americans work hard but still do not make enough money to afford health insurance.

One of the misconceptions about SCHIP, perpetuated by conservatives who opposed it, was that it should cover only “poor” children. On the other hand, it was never intended for the poor. Impoverished children were already covered by Medicaid. SCHIP covered children in families who earned too much to qualify for Medicaid but who still did not earn enough to afford private insurance.

HEALTH CARE LOBBYISTS. There were 17,800 registered lobbyists in Washington D.C. in 2003. Interest groups spent $1.56 billion in an effort to persuade Congress and the executive branch to pass legislation that would benefit them. (Managed Care Magazine, August 2002)

Health care lobbyists comprised the third largest group. They made up 40 percent of Washington D.C.’s lobbyists. The AMA -- the third-largest lobbying group (based on expenditures) -- spent about $17 million in 2000. Health care groups spent $209 million in 2000 to gain passage of bills that benefited their members or to sideline legislation that might harm them. (Managed Care Magazine, August 2002)

Drug Companies hired 623 lobbyists to keep the price of pharmaceutical drugs as high as possible. The largest drug companies and their trade associations employed more lobbyists and spent more on Washington, D.C. lobbying in 2001 than in previous years. The number of lobbyists increased by 30 percent from 2000 to 2001. Drug companies and industry groups spent 16 percent more on Washington, D.C. lobbying in 2001 than the previous year. (Public Citizen)

The drug industry remained by far the most profitable industry in the United States. In one year when overall corporation profits fell 53 percent, the top 10 drug companies saw profits increase 33 percent from $28 billion in 2000 to $37.2 billion in 2001. (Public Citizen, April 18, 2002)

Public Citizen reported:

1. The 10 most active drug companies and industry groups boosted lobbying expenditures from $43 million in 2000 to $49.8 million in 2001. T he number of lobbyists they employed increased from 417 to 541. These top 10 companies and industry groups accounted for two-thirds of all drug industry lobbying expenditures in 2001.

2. Overall, drug companies spent $78.1 million on lobbying in 2001, bringing the total lobbying bill for 1997-2001 to $403,071,467. The companies employed 623 different individual lobbyists in 2001 -- or more than one lobbyist for every member of Congress.

3. Twenty-three of those lobbyists were former members of Congress. In 2000, 21 former members of Congress lobbied for the drug industry.

4. Three hundred and forty of those lobbyists (54 percent) had “revolving door” connections. They previously worked in Congress or another branch of the federal government. In 200, 316 lobbyists had revolving door connections.

5. The lobbyists’ major issues included: Medicare prescription drug benefit, patents, pediatric exclusivity, and prices. In each area, the drug industry succeeded. Congress did not create a Medicare drug benefit; and the industry’s monopoly patent protections were not weakened. The pediatric incentive was granted an extra six months of patent protection if a company tested the safety of its drugs in children. Congress did not authorize consumers access to prescription drugs sold at significantly lower prices in foreign countries. (Public Citizen)

WELFARE REFORM

During the 2000 presidential campaign, Bush insisted on tougher work requirements for the nation’s $16.5-billion welfare program. At the same time, the president denounced the Senate Democrats’ welfare reform bill as “a retreat from success” riddled with “loopholes.”

The Bush administration declared the 1996 welfare reforms a resounding success and called for tougher stringent rules. Health and Human Services Secretary Tommy Thompson argued that the Bush administration planned no increases in the welfare program. The $16.5 billion block grant under Temporary Assistance for Needy Families (TANF), even though caseloads were cut 56 percent. (Washington Post, May 31, 2002; Los Angeles Times, July 30, 2002)

The Center on Budget and Policy Priorities estimated that more than one million working families received services under the program without being counted in the caseload. The services they received were designed to promote self-sufficiency: transportation assistance, child care, and other employment services. By letting funding for the program fall in real terms, the administration could force states to pull money away from the working poor. (Washington Post, May 31, 2002)

The official poverty rate in 2002 rose to 12.1 percent in 2002 from 11.7 percent the year before, bringing to total number of people living below the poverty line to 34.6 million. The median earned income of the nation’s households fell about $500 over the same period, to $42,409. The number of Americans living below the poverty line increased by more than 1.7 million in 2002, even though the economy technically edged out of recession during the same period. The Census Bureau report indicated that the total percentage of people in poverty increased to 12.4 percent from 12.1 percent in 2001 and totaled 34.8 million. At the same time, the number of families living in poverty went up by more than 300,000 in 2002 to 7 million from 6.6 million in 2001. It was also the first time since the early 1990s that there were negative changes in poverty and incomes in two consecutive years. (New York Times, September 26, 2003)

The number of children in poverty rose by more than 600,000 during the same period to 12.2 million. The rate of increase in children under age 5 jumped a full percentage point to 19.8 percent living below the poverty line from 18.8 percent a year earlier. (New York Times, September 3, 2003)

In January 2003, Congress passed a stricter welfare-reform bill that called for tougher work requirements and limits on training, education, and child-care funding. Facing their worst budget deficits in decades, states were forced to cut back the support services designed to remove families from government checks. Thousands of children were cut off from subsidized day care. Millions lost subsidized health insurance. Even job-training programs faced cuts. Nevertheless, Bush called for holding welfare funding stable at $17 billion in the 2004 fiscal year -- the same amount that had been authorized every year since 1996. (Los Angeles Times, January 15, 2003)

The number of Americans living in poverty increased by 1.3 million in 2003, while the ranks of the uninsured swelled by 1.4 million. In addition, 45 million Americans lacked health insurance in 2003, up by 1.4 million from 2002 and 5.2 million from 2000. But the Bush administration attempted to bury the numbers which were released one month early during the August 2004 congressional recess when many reporters and Americans were on their summer vacations. (New York Times, August 26, 2004)