- The Washington Times - Monday, June 16, 2003

We read with interest yesterday’s Wall Street Journal editorial on prescription-drug legislation developing on Capitol Hill. From top to bottom, from the theoretical to the practical, Journal editors skewered the Republican direction as bad policy and politics. Their opposition to new entitlements and ever-bigger government is principled — and we agree in large part on their textbook distrust of the welfare state — but the Journal missed the mark on a few aspects of this specific issue. In 2000, George W. Bush campaigned, and in last year’s election a majority of Republican House and Senate candidates promised, to deliver a prescription-drug law. A medicine subsidy for seniors is an example of politicians keeping their promises to voters.

It is important to emphasize that Republican support for a prescription-drug entitlement is not a cynical and expensive attempt to buy votes. The new policy would improve the lives of millions of Americans no longer in the workforce whose budgets are squeezed by the rising price of prescriptions. The median household income of people 65 and over is a mere $23,118. Eighty percent of seniors take a prescription drug every day; more than 4.7 million have medicine costs of more than $4,500 a year; 2.9 million have costs higher than $5,800. Over the past 10 years, the average retail price of prescription drugs has doubled; spending on prescription drugs rose more than 12 percent last year alone. After spending 30 years to pay off a mortgage, many retirees find the same amount of money has to go to pay for drugs.

In the Senate bill, the federal government (which, of course, means federal-tax payers) would pick up half the cost of prescriptions up to $4,500 and 90 percent over $5,800. The House version would cover 80 percent up to $2,000 and 100 percent over $5,100. Both have nominal deductibles around a couple hundred bucks. No matter what compromise is hammered out between the two chambers, seniors are certain to feel relief with the new help. There are also good provisions to guarantee that expenditures go to people who need it most. The House, for example, plans to use means testing to prevent the wealthy from having their drugs subsidized by regular taxpayers.

Contrary to the Wall Street Journal’s assessment that this would be bad politics for Republicans, we share the view of both Republican and Democratic strategists that passing the prescription-drug law will be a powerful political benefit to the GOP. Democrats have promised drug subsidies for years but were unable to deliver a plan that could get enough votes to pass. In the current congressional negotiations, Republicans aren’t trying to win an entitlement bidding war. One of the reasons the GOP is having more success than their colleagues on the other side of the aisle is that it is trying to contain the program to a realistic size — unlike open-ended Democrat plans that set no spending limits at all. As National Republican Senatorial Committee spokesman Dan Allen told us, “The prescription-drug issue is important for seniors and is on the minds of many who take care of or are responsible for seniors. Passing a law clearly gives Republicans another opportunity to prove that we can get things done. It’s part of a pattern that shows Republicans addressing issues important to Americans.”

Seventy-five percent of voters think prescription drugs for seniors are a good use of taxpayer funds. In a country with a representative form of government, that counts for a lot. However, the political machinations do pay off, with good policy in the short-term and promise for real reform down the road. If Republicans pass a prescription-drug bill and win increased seats in Congress, they will have a more solid base that can be used to reinvent the failing health-care system along more market-oriented lines. That promise alone is worth the price of the current legislation.



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