Frank Pallone

Mr. PALLONE

Mr. PALLONE. Mr. Chairman, I listened to what the gentleman from Connecticut said and the gentleman from Virginia said and, again, just as on the previous amendment that we discussed today, there are a lot of important issues here, but it does not belong on an appropriations bill. The Wolf amendment is before the Committee on Resources. We should have a hearing. We should have an opportunity for all sides to be heard, not bring it up today in this debate in the context of the appropriations bill. I just want to remind those who are opposed to this amendment that the law is clear that Indian nations are sovereign. They make a decision, just like a State makes a decision, about whether they want to have gambling or what kind of gambling they want to have; and as long as States are allowed to have it, they should be allowed to make those decisions as well. A lot of sovereign Indian nations have decided they do not want gambling, but a lot of them have decided that they do want it because they know that it is a way for them to achieve economic self-sufficiency. Now, I do not hear any proposal here to say to, for example, a State or even my own State, well, why do you not have a Federal body that is going to look into gambling and see whether it is a good thing or not? This is only being imposed on tribes. That is not fair. There is no indication, as the gentleman from Virginia said, that somehow Indian gambling is corrupt versus gambling in other aspects. In fact, we have had many, many studies that have shown, in fact, that that is not the case; that it is well regulated; that it is not in any way a victim of corruption. In fact, there may be corruption in other types of gambling, but where is the indication that it is strongly or in any way significantly influences Indian gambling? There is not any. I know that the gentleman from Virginia (Mr. Wolf) is well intentioned. I have seen him stand up for press people, and I know that he is not influenced by any special interests. But let me tell my colleagues, not him, but a lot of the people that are making the allegations about corruption in Indian gambling is because they resent the competition from Indian gambling. These media interests that are being cited here that are criticizing Indian gaming, they are not operating with clean hands. They represent special interests. So do not impose this on Indian nations and not talk about it in terms of other States or other groups that do the gambling. If someone is opposed to gambling, then look at it in general, but do not pick on Indian tribes, once again.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I come to the House floor this evening to express my strong opposition to H.R. 5002, a bill to include Turkey in the Qualified Industrial Zone, allowing duty-free goods from Turkey to enter the U.S. markets. This bill is not only an inappropriate and fiscally irresponsible back-door approach to establishing a free trade agreement with Turkey, but also rewards a country that has illegally occupied 37 percent of Cyprus for the last 28 years. On July 20, 1974, Turkey invaded Cyprus, and to this day continues to maintain an estimated 40,000 heavily armed troops on the island. Nearly 200,000 Greek Cypriots, who fell victim to a policy of ethnic cleansing, were forcibly evicted from their homes and became refugees in their own country. This bill would send the wrong message to countries that are seeking access to our trade markets. It sends the presumably unintended message that violating international laws can be rewarded. Mr. Speaker, I believe a discussion by this Congress to grant Turkey substantial trade benefits cannot take place until a settlement has been achieved in Cyprus and Turkish troops have vacated the island. The Turkish government must exert pressure on Turkish Cypriot leader Denktash to put aside his unreasonable and unacceptable demands, and negotiate in good faith with Cyprus President Clerides. International officials were hoping for a breakthrough in negotiations by the end of June, but once again the Turkish side refused to budge and move closer to a peace agreement within the framework provided by the United Nation's Security Council. I am also very concerned by reports that the Turkish government sent more than 5,500 Turkish soldiers to the Turkish-occupied section of Cyprus over the last month. Cypriot leaders and officials from the European Union see this action as a deliberate attempt on Turkey's part to create tension and negatively impact peace negotiations. Once a peace settlement is reached, all political and social restrictions on the enclaved Greek Cypriots must be lifted, and any transfer of property that has taken place over the last 28 years in the occupied area should not be recognized. I also believe that our federal courts should be granted jurisdiction to hear the cases of U.S. citizens who have been excluded from their real property in occupied Cyprus. I believe each of these five conditions must be met before any discussion of extending trade with Turkey can begin. Turkey has also not been a good neighbor to Greece in questioning the established maritime boundary of the two countries in the Aegean Sea. This boundary has been established through several treaties dating back to 1923. The U.S. cannot now support expanded trade with Turkey while Turkey refuses to abide by provisions in the 1947 Paris Peace Treaty that once again established the Aegean boundary. The United States was one of the nations that signed that historic document, and therefore must publicly state that it accepts the demarcation of the maritime borders in the Aegean Sea as final. Mr. Speaker, I am concerned that this legislation not only reflects poorly on the United States' moral authority in trade policy, but also represents dangerous fiscal policy; in effect subsidizing a politically unstable and economically backwards country. Two weeks ago, 34 members of Prime Minister Bulent Ecevit's ruling party resigned in protest of the Prime Minister's refusal to step down as ruler of Turkey. Then, last week, two of the highest-level Ministers resigned: Economic Minister Kemal Dervis and Foreign Minister Ismail Cem, triggering calls within Turkey for new elections as early as September. Minister Dervis is widely recognized as the architect of the colossal International Monetary Fund bailouts of Turkey, which saved Turkey from immediate financial disaster, but has put Turkey in debt to the IMF for a staggering 31 billion dollars. The nine billion dollars that were made available for release this year have not made any impact on the rapidly shrinking economy and massive unemployment. We should not reward Turkey and put our own economy in further jeopardy without radical reform of Turkey's economic and trade policy. Mr. Speaker, it is time to stop making special concessions for Turkey. Their blatant disregard for international norms--whether it be trade policy or their abysmal human and minority rights record--can no longer be ignored.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I rise today in opposition to the rule and to express my strong opposition to certain provisions included in the interior bill that impact American Indians. Specifically, Mr. Speaker, I have concerns regarding the language on the Commission on Native American Policy, American Indian trust fund reform, and the Cobell v. Norton litigation. These provisions were not developed in consultation with Indian country. Rather, they were directly included in the House interior appropriations bill. This language will erode the legal rights of tribal governments and block the goals they seek to attain, and these provisions violate House rule XXI, which prohibits legislating on appropriation measures. Mr. Speaker, in this day and age, the tactic of ignoring tribal government input and advice on initiatives that impact their lives and systems of government is really unacceptable. Congress should set the example for how adequate and meaningful consultation should occur between the Federal Government and tribal governments. The Commission on Native American Policy would mandate that tribal governments engaged in gaming be subjected to additional federally imposed examination and possibly more regulation. I believe these provisions were put in by Members of Congress who oppose Indian gaming. But tribal governments, similar to State and Federal governments, are democratic systems of governance. If some tribal governments decide to pursue gaming activities as a means of securing economic self-sufficiency, Congress should not stand in their way. The proposed commission will also divert Federal funds from other badly needed Federal Indian programs. And, in fact, millions of dollars have already been spent studying the need for more regulation of Indian gaming. We do not need to waste money on another study. Mr. Speaker, I mentioned earlier that I also oppose two other provisions in the bill, one that will reform the American Indian trust fund strategy and the other dealing with the Cobell v. Norton litigation. These provisions will limit a historical accounting of trust funds to the period from 1985 to 2000, which will assume all records before 1985 are correct, and in addition would not provide an accounting for funds held in an account closed as of December 31, 2000. The tribal governments and representatives involved in the trust fund and litigation procedures are demanding an accounting of their trust funds dating back to the 1800s. Why in the world are some Members of Congress attempting to deny these account holders a full accounting of their trust funds? I have no idea. These provisions not only serve to undermine existing Federal law, requiring a full accounting of all trust funds, but they also deny a Federal court decision requiring an accounting of all funds regardless of the date deposited. Why are we trying to go counter to a Federal court action and contrary to the existing Federal law that is simply asking for an accounting for funds that are owed to tribes? It makes no sense whatsoever. Basically, Mr. Speaker, these provisions in the bill are clearly moving in the wrong direction. They do not serve to meet the needs or strengthen the rights of Indian country. They are taking away the rights of Indian country. They are being done without consultation. It sets a terrible precedent on an appropriations bill that we do this without any opportunity for a hearing or any opportunity for consultation with American Indians. For these reasons, I oppose these provisions, and I oppose the rule. I would ask my colleagues to support two amendments that the gentleman from Michigan (Mr. Kildee), the gentleman from Arizona (Mr. Hayworth), and other Members of the Native American Caucus are going to offer later that would strike these very bad provisions, in my opinion, that impact Indian country in a very negative way.

Mr. PALLONE

Mr. PALLONE. Exactly.

Mr. PALLONE. We do not because we have a monopoly. Basically, the patent structure is giving a particular company a monopoly for that particular drug for a period of time. Unless we allow generics or others to come in, which they obviously try to prevent, as my colleague, the gentleman from Ohio, mentioned, we essentially have a monopoly for a period of time and do not have competition. The thing that was amazing to me, too, is this whole idea that they are going to create competition among the private insurance companies, but the private insurance companies do not even offer the insurance. How can there be any competition? That is the competition they are talking about with the private insurance companies.

Mr. PALLONE. Mr. Speaker, I have to say until I saw this latest information about the level of funding that was going to United Seniors Association and how much money they were spending on this ad campaign, I still was under the belief that some of our Republican colleagues did not like the Democratic proposal and liked the private insurance option because ideologically they did not like Medicare, they thought Medicare was not a good program, they did not like government, and they had a hard time supporting a government program like Medicare, even if it works, because it is a government program. But I am becoming more cynical now as I see the level of funding that is being spent on these ad campaigns and how it is just targeting Republicans, and particularly Republicans that are vulnerable. If we talk about a $100 million ad campaign divided over some of the most seriously contested seats, it will be almost as much money as some of the candidates will spend on their own campaigns. I think the support on the other side is linked to the money, is linked to the fact that PhRMA and the drug companies are putting all this money out to promote Republican campaigns. I am so glad that the gentleman raised the value issue. That is what this is about. This is about some greedy people who want to make more profit and do not care about the consequences for the average senior. Last week, last Thursday I believe, there was a bus load of about 50 seniors that came from New Jersey. They did not go to Canada; they were highlighting that they were taking a bus to come to Washington instead of Canada. The gentleman from Maine knows about all of the people that go over to Canada because of the cheaper drug prices. We had 15 buses that went the week before to Canada from all of the border States. All the seniors from New Jersey were talking about was the price, how the price of prescription drugs keeps going up, and it is so unaffordable to them. I do not understand how these brand-name drug companies can spend $100 million on ad campaigns which are going to do nothing more than prevent these senior citizens from getting the medicine that they need. It is pathetic. It really is.

Mr. PALLONE. Mr. Speaker, I see that the gentleman from Ohio (Mr. Strickland) is here joining me. I know he was there at the Committee on Commerce markup the day that we had to adjourn so that the chairman, the Republican chairman of the committee and other Republican members could go to the big fundraiser; and at the end, at 5 o'clock, because we knew that the clock was getting close to 5 and they had to leave for the fundraiser, we were sort of kidding them and hoping that they would stay for an extra half hour or hour; but boy, they certainly did not want to do that; they were determined to get out of there by 5 o'clock, no matter what. I mean, I laugh, and it really is not funny, because we have talked about the consequences in terms of seniors. But there is no question about what they were up to that night.

Mr. PALLONE. So what the gentleman is saying is that there may be one or two companies that see the benefit if they can get a larger volume; but overall, the trade group PhRMA does not see it that way, and they would rather keep their prices artificially high.

Mr. PALLONE. Mr. Speaker, I wanted to spend the time this evening talking about the need for a Medicare prescription drug program and also highlight the fact that more and more of my constituents, and I know this is true all over the country, are concerned about the price of prescription drugs and their inability to buy the medicine or prescription drugs that they feel that is necessary. I have been to the floor, to the well here many times over the last 2 years, basically saying that we need on the one hand a benefit, a Federal benefit under Medicare to provide prescription drug funding for seniors through Medicare, through the Federal Government and through the Medicare program. But at the same time I have said that we need the coverage that would come from a Federal benefit, we also need to deal with the issue of price because prices continue to go up. I know that many times during the debate that we had a few weeks ago over prescription drugs, when the Republican leadership would talk about their initiative, their bill that ultimately passed the House, and compare it with the Democratic proposal, which they did not allow to come to the floor, that there had been a hot and heated discussion about the differences between the two bills. Of course, I have been very critical of the Republican proposal because it is not Medicare. It does not provide a guaranteed benefit, and it does not address the issue of price; and essentially, what the Republicans did when they passed a prescription drug bill a few weeks ago is that they decided to give some money to private insurance companies to essentially subsidize private insurance companies in the hope that they would offer drug-only or medicine-only policies to seniors that the seniors would find affordable. My major concern over the Republican proposal is that like HMOs, which are private health insurance, that these private insurance companies simply would not offer a prescription drug plan, that there would be many areas in the country where there would be no coverage or even if there was a private insurer that decided to provide a prescription drug-only policy, that it would not be affordable and that essentially we would be passing a program that would never work and no one would be able to take advantage of as a senior citizen, or at least the average senior citizen. I contrasted that and I continue to with the Democratic proposal, which, as I said, the Republicans never allowed us to bring up; but the Democratic proposal was simply an expansion of Medicare. We have a great Medicare program that almost all seniors participate in, covers their hospitalization, covers their doctors' bills. And what the Democrats said is we would simply add another plank, or provision, to Medicare so that seniors could pay $25 a month in a premium. After the $100 deductible, would get 80 percent of their prescription drug costs paid for by the Federal Government under Medicare, and after $2,000 out-of-pocket expenditures for these seniors with higher drug bills 100 percent of the costs would be paid for by the Federal Government under Medicare. It is a very simple process, expansion of Medicare. The price issue was addressed by the Democrats, unlike the Republicans, because the Democrats said that the Secretary of Health and Human Services, who basically administers the Medicare program now, would have the bargaining power of 30 to 40 million American seniors under Medicare, and he would be mandated by the Democratic bill to negotiate to reduce prices substantially, maybe 30, 40 percent. So we had a price provision in there, too. The Republican bill, of course, could not do that kind of negotiation essentially with the Republican bill because it is with private insurance companies. It is not Medicare, and all the seniors would not be covered; but just in case there was some concern about trying to reduce price, the Republican bill specifically had a noninterference clause that said that the administrator of the program could not set up a price stricture or negotiate lower prices. So we know the Republicans were not seeking to address the price issue. They wanted to make sure, in fact, that it was not addressed at all. During this whole debate, a lot of my colleagues said to me, even some constituents said to me, why would the Republicans want to put forth this sham? Why would the Republicans want to pretend that they are putting forth a prescription drug plan that no private insurance company will offer or that no senior would be able to take advantage of? And why do they not want to address the issue of price? The answer to that is fairly simple, and that is because of the special interests, because the brand-name companies do not want a Medicare benefit. They are afraid that if there is a Medicare prescription drug benefit like the Democrat's proposal and they are afraid that if there is an effort to address price, that somehow they will lose profits. I do not believe that because I think if they cover everybody under a universal program, they will be selling more medicine and they will make more money. Even if the price does come down individually for the senior, the overall fact that so many more seniors are in the program should make the drug companies happy. But they do not feel that way. They are opposed to the Democratic proposal, and they are doing whatever they can financially to make sure that the Republican proposal passes and the Democratic proposal does not. They have been taking out ads, they have been financing a huge ad program, they have been giving a lot of money to Republican candidates, Congressmen, and Senators, but I will go into that as part of this special order this evening a little later. What I really want to point out is that this effort on the part of these large pharmaceutical brand name companies to do this, in my opinion, is very much linked to the overall problem we have in this country that has been highlighted in the last few weeks of corporate irresponsibility. We know that many of the corporations, and I do not have to go through the list, Enron, WorldCom, there are so many out there now, that basically doctored the books at the request of certain CEOs or financial officers, used accounting systems to basically doctor the books and show that they had profits when they were actually operating at a net loss or at a lot less profit than they reported. And so nationally, and here in the Congress, in the House of Representatives, we are getting a lot of my colleagues on both sides of the aisle coming up and talking about the need for corporate responsibility; the need for companies, large corporations, to be responsible in their actions. I would suggest to my colleagues that the effort of the prescription drug industry to mask what they are doing, to give large contributions to candidates, to run massive ad campaigns where they did not even indicate they are paying the cost of them in order to support candidates or to support the Republican bill, is another example of what I call corporate irresponsibility. They need to be held to task. Now, I want to talk a little tonight, if I could, Mr. Speaker, about some of the things that these pharmaceutical companies have been doing to promote the Republican proposal and to oppose the Democratic alternative. As we know, the other body, this week or next, will be taking up a prescription drug bill. And since the other body is dominated by the Democrats, the proposals that are out there are Medicare prescription drug programs, very much like the House Democratic bill. So we will probably have the opportunity at some point in conference to see the House Republican version and the Democratic version from the other body. So these efforts by the pharmaceutical companies to kill the House Democratic bill will obviously extend over the next few weeks in an effort to kill the Democratic majority bill in the other House as well. During the course of the debate that we had in the Committee on Energy and Commerce on the Republican proposal here in the House, we actually had to end our debate and our committee hearing one night in the middle of the markup of the bill because Republicans had to go to a fund-raiser that was being given by the National Republican Committee that was being paid for, in large part, or in significant part, by the pharmaceutical companies. I want to give a little flavor of that and then I want to talk about the ad campaign, because I see one of my colleagues has joined us tonight and I certainly want to yield to him. But regarding the debate a few weeks ago in the Committee on Energy and Commerce, there was an article in the Washington Post, and I just want to read a little bit from it, it says, ``Drug Firms Among Big Donors at GOP Event. Pharmaceutical companies are among 21 donors paying $250,000 each for red carpet treatment at tonight's GOP fundraiser gala starring President Bush, 2 days after Republicans unveiled the prescription drug plan the industry is backing, according to GOP officials.'' Not Democrats, but GOP officials. ``Drug companies, in particular, have made a rich investment in tonight's event. Robert Ingram, Glaxo-Smith-Klein PLC's chief operating officer, is the chief corporate fundraiser for the gala. His company gave at least $250,000. Pharmaceutical Research and Manufacturers of America, a trade group funded by the drug companies, kicked in $250,000, too. PhRMA, as it is best known inside the beltway, is also helping underwrite a TV ad campaign touting the GOP's prescription drug plan. Pfizer contributed at least $100,000 to the event, enough to earn the company the status of a vice chair for the dinner. Eli Lilly and Company, Bayer, AG and Merck each paid up to $50,000 to sponsor a table. Republican officials said other drug companies donated money as part of the fund-raising extravaganza.'' Then it says, ``Every company giving money to the event has business before Congress. But the juxtaposition of the prescription drug debate on Capitol Hill and drug companies helping underwrite a major fundraiser highlights the tight relationship lawmakers have with groups seeking to influence the work before them. A senior House GOP leadership aide said yesterday that Republicans are working hard behind the scenes on behalf of PhRMA to make sure that the party's prescription drug plan for the elderly suits drug companies.'' Now, we had an editorial from the New York Times Saturday, June 22, and I just want to read a certain section where it says: ``House Republicans, who regard traditional Medicare as antiquated, would provide money to private insurance companies, a big source of GOP campaign donations, to offer prescription drug policies. The idea of relying on private companies seems more ideological than practical. Even with Federal subsidies, it is unclear that enough insurance companies would be willing to participate and provide the economies that come from competition.'' So the bottom line is, and the reason why this scam, the reason why this Republican proposal, which relies on private insurance companies and does not address the price issue is out there and passed the House is because of the contributions from the drug companies. And just today, and there is so much more I could talk about, but I want to hear from my colleague from Maine, just today, Public Citizen issued a report and basically unmasked the ad campaign that PhRMA and the other drug companies have been conducting, which started, I guess, about a month ago and continues. Basically, what PhRMA and the drug companies are doing is they are contributing money to United Seniors Association, which is the front senior group that is now running these issue ads in various Republican districts, telling people how wonderful Republican Congressmen are because they voted for this Republican bill, this sham bill. It is amazing to me. I had no idea how much money we were talking about here. A few weeks ago we thought it was $2 million, $3 million, or $4 million. Now this report from Public Citizen shows clearly that it is already $10 million, and who knows where it is going, $20 million, $30 million, $40 million, $50 million, maybe $100 million that the drug industry is going to pay to try to promote the Republican bill. I just want to give a little breakdown of some of the things that this report says about United Seniors Association that is fronting the pharmaceutical industry ads. It says today that ``Public Citizen estimates that USA,'' that United Seniors Association, I hate to use the acronym USA for them, but that is what they use, I guess, ``that United Seniors Association has spent $12 million on issue ads during the past 17 months. The lion's share of this spending, $9.6 million, was used to promote President Bush and House Republican leaders' prescription drug plan.'' It is amazing to me, because this talks about how in the 2000 election United Seniors Association joined Citizens for Better Medicare, which was also a drug industry front group created by the brand name drug company's trade association PhRMA, and they spent approximately $65 million on TV advertising, a large chunk dedicated to electioneering issue ads. So I do not know, the sky is the limit. I have to assume that we are probably talking, what, maybe $100 million, if 2 years ago it was 65. Maybe now it will be 100. With inflation and everything, it is probably going to go up. I will not go into all this now because I see my colleague from Maine. But we have to point out, and I want to say to my colleague, who has been the person that has been the most outspoken in this Congress on the issue of price, and how the price of prescription drugs is just making it impossible for so many people, and not just senior citizens but all Americans, to afford their medicine any more. It is just a shame that the reason this is happening is because of the money coming from the brand name drug industry. I said before that we keep talking about corporate responsibility. I think this is the height of corporate irresponsibility that they spend this kind of money to basically back a plan that will help no one, in my opinion. I yield to the gentleman from Maine.

Mr. PALLONE. I want to thank my colleagues. The answer, obviously, is because of what the brand-name pharmaceutical companies are doing to pay for the ads and pay for the campaigns. It is the special interest money.

Mr. PALLONE. Mr. Speaker, reclaiming my time, what I do not understand, it seems to me if we provide a Medicare benefit the way we have proposed as Democrats, and we take in that other half of the senior population, 20 million that are having problems, some of them are not buying the drugs or have difficulty, we are going to increase the volume of sales that the brand-name manufacturers are going to have. If we do some of the other things, like the gentleman has addressed the issue of price, not just in the context of a senior benefit, but we have collectively talked about doing more with generics, like the other body passed the bill last week that would plug up the loopholes and make it easier to move to generics. We have talked about this: I know that in the other body, one of the Members has a bill which I have sponsored here that would eliminate the tax underwriting of advertising for pharmaceuticals. I mean, those are the kinds of things that would make a lot more people, even those who are not seniors, able to buy drugs. Even generics, a lot of the brand- name companies own a lot of the generic companies too, so it is not like there is this huge division between generics and brand names. A lot of the brand-name companies manufacture generics too. So why is it that they do not see the increased volume that would come with that with many more Americans purchasing the drugs, even at a reduced price, as basically lifting their sales and their profits as well? That is what I do not understand.

Mr. PALLONE. Mr. Speaker, I want to thank the gentleman because he brought up so many good points on this issue. But particularly when the gentleman was talking about the roadblocks, if you will, that the brand-name companies put up to try to prevent generics from coming to the market, I think that is so significant. As the gentleman mentioned earlier, the other body last week actually passed out of committee a bill that would close a lot of these loopholes with the generics, and particularly this idea that once they file suit, it is up to 30 months that they can prevent the generic from coming to market. Thirty months? We are talking about almost 3 years, 2\1/2\ years, which is absolutely crazy, when we know all these seniors that are out there that are suffering. In fact, they passed that bill before they even passed the benefit bill. They are probably going to attach the benefit structure to that bill. I have to say that the other body, I think in large part because they have a Democratic majority, has been trying to address this price issue even before, in a sense, they have addressed the benefit issue, because they realize how important the price issue is. The gentleman could argue, and I do not agree with that, but the gentleman could argue that if we addressed the price issue effectively, that that would go far toward solving the problem. I still think we need the benefit; but we need both, essentially. I just find that so often the issue of price, though, is what people talk about, as my colleague, the gentleman from Maine, knows. That is what our constituents are constantly bringing up when we have a town meeting or when we see them on the street. That is what they talk about: how to address the price issue. The Republicans here in the House did absolutely nothing to address that issue. They had that noninterference clause. I actually brought it with me, because it is amazing. The gentleman will remember, in the Committee on Commerce markup, they never even mentioned it. They sort of suggested they were going to have discounts through competition. I remember the Republican chairman kept saying, well, we are going to have discounts. I think the gentlewoman from Connecticut (Mrs. Johnson) on the floor said there was going to be a discount because of competition between the private insurance companies. But they have right in the bill, I am just going to read it, that ``the administrator may not institute a price structure for the reimbursement of covered outpatient drugs, or interfere in any way with negotiations between the sponsors and Medicare+Choice organizations and drug manufacturers'' that relate to price. In other words, they cannot bring up the price issue in the course of negotiations. It is just amazing to me how, on the one hand, they suggest that somehow these private insurance companies are going to compete with each other, but that has to be totally on their own. That cannot be anything that the administrator of the Medicare program does. They cannot interfere in any way to try to bring the price down.

Mr. PALLONE. Mr. Speaker, if the gentleman will remember specifically, they actually went the opposite direction, because they wanted to eliminate the Medicaid, not Medicare, but the Medicaid price structure, if you will. And actually they did vote to do that at one point and suggested that somehow it was something that the pharmaceutical industry opposed; that somehow the pharmaceutical industry did not want to eliminate the pricing structure that existed under Medicaid. That is just not true. That was another thing that was a bone, basically, to the pharmaceutical industry. And then I remember the biggest affront to me is when, I think it was our colleague, the gentleman from Michigan (Mr. Stupak), who introduced a couple of amendments that would basically use the negotiating or price structure, the price negotiations that we use now for the VA and I guess maybe for military, as well, and we just wanted to take that and use it for seniors. They said no, no, we do not want that; we cannot do that for seniors. We can do it for the military and the veterans, but we cannot do it for the seniors. It was amazing. Mr. Speaker, I yield to the gentleman from Maine (Mr. Allen).

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I come to the House floor today to express my strong opposition to H.R. 5002, a bill to include Turkey in the Qualified Industrial Zone, allowing duty-free goods from Turkey to enter U.S. markets. This bill is not only an inappropriate and fiscally irresponsible back-door approach to establishing a free trade agreement with Turkey, but also rewards a country that has been illegally blockading Armenia, also a U.S. ally in the war against terror, for the past 9 years. This bill would send the wrong message to countries that are seeking access to our trade markets. It sends the presumably unintended message that violating the Humanitarian Trade Corridor Act will not be punished but instead rewarded for conducting internationally recognized illegal activity. Since 1993, Armenia has suffered from the coordinated, dual blockades by its neighbors to the west and east. Turkey and Azerbaijan have largely choked off the transportation of goods from Armenia, eliminating a major east-west shipping route in the Caucuses and contributing to the destabilization of the regime. These illegal blockades are in direct violation of the Humanitarian Corridors Act, passed by both the House and the Senate in 1995. The act states that, and I quote, ``recipients of U.S. assistance should not hinder or delay the transport or delivery of United States humanitarian assistance to other countries.'' Unfortunately there is also language in this bill that gives the President the authority to waive sanctions if the country that is guilty of prohibiting U.S. assistance to reaching a third country is deemed vital to the United States' national security. Turkey has flagrantly disregarded international trade norms because of this waiver that effectively gives them a free pass to act without fear of consequences. This proposed bill represents seriously flawed trade policy and sends the message that some countries do not have to honor international norms in U.S. law as long as such countries fill a national security need. This bill would not only reflect poorly on the United States' moral authority in trade policy, Mr. Speaker, but also represents dangerous fiscal policy; in effect subsidizing a politically unstable and economically irresponsible regime. Last week 34 members of Prime Minister Ecevit's ruling party resigned in protest of the Prime Minister's refusal to step down as ruler of Turkey. Just yesterday two of the highest-level ministers resigned, economic Minister Kemal Dervis and Foreign Minister Ismail Cem, triggering calls within Turkey for new elections as early as September. Minister Dervis is widely recognized as the architect of the colossal International Monetary Fund bailouts of Turkey, which saved Turkey from immediate financial disaster but has put Turkey in debt to the IMF for a staggering $31 billion. The $9 billion that were made available for release this year have not made any impact on the rapidly shrinking economy and massive unemployment in Turkey. We should not reward Turkey and put our own economy in further jeopardy without radical reform of Turkey's economic and trade policy. Mr. Speaker, the U.S. and international community may pour as much money into Turkey directly through fiscally careless legislation or indirectly through massive unprecedented IMF loans, but there will be minimal net benefits to the citizens of Turkey, and there are fundamental changes that are necessary. Mr. Speaker, it is time to stop making special concessions for Turkey. Their blatant disregard for international norms, whether it is trade policy or their abysmal human and minority rights records, no longer can be ignored. I do not dispute that Turkey has been one of our closest allies in the war on terrorism, but that fact alone should not give them carte blanche to operate outside the boundaries of the American and European ideals that Turkish officials profess to honor.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I just wanted to mention that I just introduced H.R. 5092 along with my cosponsors, the gentleman from New Jersey (Mr. Andrews) and the gentleman from New Jersey (Mr. Holt), and the purpose of this legislation is to put in place as a matter of law a restriction on ocean dumping off the coast of New Jersey, actually at a site about 6 miles off the coast of my hometown in the 6th Congressional District, where several years ago myself and the two senators from New Jersey, Mr. Torricelli played a major role in this as well, worked out an agreement with the Federal Environmental Protection Agency that ocean dumping of toxic dredge materials would cease being dumped at this site called the mud dump site off the Jersey shore and that henceforth the site would be closed and the only thing that could be placed there would be clean fill material in order to remediate the site and serve as a cap for the toxic dredge materials that had been dumped there for so many years. I was very disappointed last week when the EPA announced they were going to allow dredging once again of toxic materials from the Earl Naval Weapons Depot in my district in Leonardo, New Jersey, to be dumped at this site, contrary to this agreement that had been worked out. The agreement specifically said that nothing could be used as remediation material and dumped at the mud dump site that exceeded what was called a standard or guideline of 113 parts per billion in terms of PCBs. We know that PCBs are very damaging to human health, particularly when they get into the marine life, and they ultimately pass up through the food chain, and we had all agreed pursuant to this understanding several years ago that this standard or guideline of 113 would be the standard for any kind of materials that would have to be placed at the mud dump site. Unfortunately, last week the EPA decided to give a waiver so that the Navy at Earl could dump materials that exceeded the 113 at the site, and yesterday, pursuant to a court action that was taken by U.S. Gypsum Company, the Federal court in New York ruled that because the EPA had not properly promulgated the 113 standard, that it could not be applied any more for ocean dumping, and now there is some concern about whether U.S. Gypsum and other companies would be able to dump again off the coast of New Jersey. So this legislation is necessary in order to guarantee that ocean dumping does not continue. Myself, the two Senators from New Jersey and other Members of Congress have called upon the administrator of the EPA, Mrs. Whitman, our former governor, to put the 113 standard into regulation as a matter of law, and hopefully she will do that, but at the same time, in order to back that up, I think it is necessary for us to introduce legislation in the House that would accomplish the same goal, and that is what this legislation would attempt to do. Mr. Speaker, I do not have to tell my colleagues how important it is that we not continue to dump any kind of toxic material off the coast of New Jersey or anywhere else in the country. New Jersey's number one industry is tourism, and particularly now in July, after the July 4 holiday, there are so many people using the beaches, coming down to the Jersey Shore, both from New Jersey as well as New York and the State of Pennsylvania and even other States. If people do not feel or do not have the guarantee that the ocean water will be clean, obviously they are not going to swim and they should not swim. The issue of ocean dumping does not just affect bathers. It affects marine life. It affects people who eat fish. It affects so many things along the coast of New Jersey and around the country, and I think it really is imperative that we stick to this standard of 113 parts per billion to make sure that human health is safeguarded and that we do not go back into the trend that we had so many years ago of continuing to dump everything in the ocean with the theory that somehow nobody would know about it and it would not make a difference. It does make a difference. We have to have clean water, and this legislation hopefully will move quickly. It is being sponsored and introduced in the Senate today by Senators Torricelli and Corzine from New Jersey, and hopefully we will get a lot more support for it and we can move it quickly so that it becomes law.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, it is not my intention this evening to use the full 60 minutes. I am more likely to use about 20 minutes, but I did want to take the opportunity this evening to talk about an issue which I think was sort of left dangling when we left here a week ago before the July 4th recess. My colleagues know that in the middle of the night, I guess it was about 2 a.m., we finally voted on the Republican prescription drug plan; and I was extremely disappointed, to say the least, over the fact that there was no opportunity to debate and bring up the Democratic substitute, the Democratic proposal. Mr. Speaker, for at least 2 years, if not longer, I have been talking about the need for this House to debate the prescription drug issue, and I was glad to see that the Republicans finally did bring their bill to the floor. Although I do not agree with their bill and I do not think it will accomplish the goal of providing a prescription drug benefit, I was at least pleased to see that they were willing to bring it up. But bringing the bill up also means debating the bill and allowing an alternative by the minority, the Democrats in the House, to debate and argue their alternative as well. It is the first time in my memory, and I have been here 14 years, that on an important issue like this, that the minority, in this case the Democrats, were not allowed to have their alternative, their substitute, be considered by the full House. I think it was a grave mistake, a major error. I think it portends, clearly, that the Republican leadership in this House is not serious about passing a prescription drug bill. If they really felt they had the votes and they were able to strongly pass their bill and send it over to the other body and then eventually send it to the President, they would not have had any problem in letting the Democratic alternative come up. And the reason they did not allow it to come up, I am firmly convinced, is because they felt it would probably pass. As it was, I think we had eight Republicans who voted against the Republican proposal, we had eight Democrats that I think voted for the Republican proposal, so it was clearly the case that the votes were very narrow there. And it is very likely if a Democratic substitute had been allowed and considered, it would have carried the day and it would have been the bill that passed this House. I do not want to spend an hour tonight talking about why I think the Republican bill is a failure and why the Democratic alternative would have been a success. The issue now, of course, goes over to the other body, and the other body will be taking up a prescription drug bill fairly soon, within the next few weeks before the August break. But I will say that the major differences between the Republicans here and the Democrats in the House and the way in which the Democratic bill in the other body reflects the Democratic bill here, is that the Democrats are in favor of expanding Medicare to include a prescription drug benefit. We have been saying fairly simply that Medicare is a good program; that it works. Whether we like it ideologically or not is not the issue. It works. It provides hospital care, it provides doctor care, and it should provide prescription drug benefits as well. And every senior or disabled person who is covered under Medicare should have the option as well of having a prescription drug benefit. The Democratic proposal is very similar to what we provide now for doctor bills. In other words, under part B of Medicare now every senior can opt into a Medicare program that covers their doctor bills. They pay, I think, about $45 a month for the benefit. Eighty percent of their costs are paid for by the Federal Government. The deductible is $100, and after they have paid $2,000 out of pocket for the 20 percent copay, all their bills are paid for by the Federal Government. More than 99 percent of the seniors and those who are eligible for Medicare take advantage of the part B benefit and pay the premium and get the benefit. As Democrats, we are simply saying do the same thing, establish a prescription drug benefit under Medicare. Everyone who is in Medicare is eligible for it. They would pay $25 a month for a premium, have a $100 deductible, and 80 percent of the cost of their drug bills would be paid by the Federal Government. After they paid $2,000 out of pocket for the 20 percent copay, all their bills, 100 percent, would be paid for by the Federal Government. Very simple. Very easy to understand. The Democrats also are determined to deal with the issue of price, because we know that the biggest problem facing seniors is that the price of prescription drugs is going up. It is not just for seniors, it is for all Americans. So we say, well, bring this prescription drug program under the umbrella of Medicare and we will have 30 to 40 million Americans who now are under the auspices of the Secretary of Health and Human Services, who runs the Medicare program, and he or she would have the bargaining power of those 30 or 40 million seniors, Americans, and would be able to go to the drug companies and say, look, I have 30 or 40 million people; if you want me to buy your drugs, you have to give me a big discount. That discount might be as much as 30 percent across the board. That is a huge savings not only for the Federal Government, which is paying 80 percent of the cost, but also for the seniors who are paying the 20 percent copay. The problem is, from what I see, that the Republicans in the House do not want any part of this because they do not believe in Medicare. They do not like it. It is a government program. But more than anything else, they do not want to expand Medicare to provide a prescription drug benefit. So what the bill does that passed the House of Representatives a week ago, the Republican bill, is really to further their goal, I think, the Republican goal, of privatizing the Medicare program. What the Republican bill does is to create a program of subsidies to HMOs and private insurance companies to offer drug-only insurance policies to seniors. Some money in the form of a subsidy, a payment, goes to private insurance companies in the hope they will provide prescription drug coverage, or drug insurance policies, to whatever seniors want to buy them. It does not guarantee any benefit plan. There are going to be areas of the country, just like with HMOs, where these private insurance companies are not going to be offering the prescription drug plan. We do not know what the premiums will be. We do not know what kind of benefits they will offer. That is all up in the air. And, of course, the insurers have already said they do not want any part of the drug-only policies. In fact, if there was an ability right now for insurance companies to offer drug-only policies they would be offering them. So it makes no sense, in my opinion, to instead of doing what the Democrats do, which is to say we are going to have a Medicare program to cover prescription drugs and guarantee a benefit for everyone, simply hope that the private insurance companies will somehow provide these kinds of policies. Now, I do not want to just talk myself, because I think some might say, well, okay, here is another Democrat that is saying this will not work, the Republican plan will not work, but every one of the major newspapers, every major media outlet in the country has come out and said this Republican proposal, these drug insurance policies, will not work. I just want to go over a few of them tonight and highlight some of the things that have been said in the last few weeks, just to point out again that there are third-party validators, major newspapers, major insurance companies, executives, or insurance company trade officials who are saying these drug-only policies will never be offered. This was in The New York Times. It was an editorial on Saturday, June 22, and I will read part of it. It says: ``House Republicans, who regard traditional Medicare as antiquated, would provide money to private insurance companies, a big source of GOP campaign donations, to offer prescription drug policies. The idea of relying on private companies seems more ideological than practical. The pool of elderly Americans who will want the insurance is likely to consist of those who have the most need for expensive medicine. Even with Federal subsidies, it's unclear that enough insurance companies would be willing to participate and provide the economies that come from competition.'' So The New York Times is saying this will not work; nobody is going to offer these policies, essentially. But we have another article in The New York Times a week earlier, this was from Sunday, June 16, which was giving comments from other insurance people, or people familiar with the insurance business, and the title of this article from June 16 says ``Experts Wary of G.O.P. Drug Plan: Some Say `Drug Only' Coverage Isn't Affordable for Insurers.'' Keep in mind that the Republican proposal is a voluntary proposal. Nobody has to offer it. No insurance company has to offer these drug- only policies. Again, I will just read some of the highlights of this article in this Sunday New York Times, June 16. ``Under the proposal, Medicare would pay subsidies to private entities to offer insurance covering the cost of prescription drugs. Such `drug only' insurance does not exist, and many private insurers doubt whether they could offer it at an affordable price. `I am very skeptical that `drug only' private plans would develop,' said Bill Gradison, a former Congressman,'' and I will add Republican Congressman, ``who was President of the Health Insurance Association of America from 1993 to 1998. Representative Bill Thomas, the California Republican who is chairman of the Ways and Means Committee, insisted: `We should rely on private sector innovation in delivering the drug benefit. The private sector approach offers the most savings per prescription.' However, John C. Rother, Public Policy Director of AARP, which represents millions of the elderly, said, `There is a risk of repeating the H.M.O. experience' with any proposal that relies heavily on private entities to provide Medicare drug benefits.'' I do not want to go on, Mr. Speaker. I just want to point out that in the same way that we relied on HMOs to provide medicine coverage for seniors and found so many of them basically dropping out of the market, offering it maybe for 6 months and then telling seniors that they could not provide the coverage any more, and so many areas of the country that do not have HMOs offering any kind of HMO, the same problem is going to exist with these drug policies that the Republicans are proposing. There are going to be huge areas of the country where no policies are offered. And if they are offered, they are likely to be so expensive in terms of the premium that seniors just will decide it is not worth paying for them; not worth buying them. So I think the promise or the commitment that the Republicans say they are making by passing this bill last week saying they are going to provide some prescription drug coverage is really a hollow one. None of this is going to be offered. None of this is going to happen. There was an article, an op-ed on June 18 in The New York Times, by Paul Krugman, and he basically explained why insurance companies would not offer these kinds of policies. I think he did it very well, and I just wanted to read a little bit from that, if I could. He says, ``The House Republican plan has a bigger flaw. Instead of providing insurance directly, it will subsidize insurance companies to provide the coverage. The theory, apparently, is that competition among private insurance providers would somehow lead to lower costs.'' Some of my Republican colleagues said this during the debate, that because of competition between insurance companies, drug prices would come down. But the problem is, there will not be any competition because nobody is going to offer them. What Mr. Krugman says in The New York Times on June 18 is, ``In fact, the almost certain result would be an embarrassing fiasco because the subsidy would have few, if any, takers. The trouble with drug insurance from a private insurance point of view is that some people have much higher drug expenses than the average, while others have expenses that are much lower, and both sets of people know who they are. This means that any company that tries to offer a plan whose premiums reflect average drug costs will find the only takers will be those who have above-average drug costs.'' What Krugman is basically saying is that drug insurance is not like traditional insurance. If we think of auto insurance, where maybe there is 100 people insured and one person has an accident, all the others are paying into a pot of money and that one accident is paid for with the pot. But the insurance company is making money because they are only paying out maybe for one accident out of the hundred people. But in the case of a drug insurance or medicine, every senior needs medicine. Every senior has an opportunity to have the need for some kind of prescription during the course of the year. So it is really a benefit. It is not something you are insuring for a risk of because everybody is going to take advantage of it. So seniors that have very high drug costs, $2,000 or $3,000, they may be willing to buy a drug policy that they have to pay $75 or $85 a month premium, but someone who does not have a huge drug cost is not going to do that and pay that huge cost. So we will have a situation where the insurance companies will say why would I want to provide this kind of coverage; I cannot make any money. Again, I do not want to just rely on what I am saying. There are a whole bunch of quotes here, and I can just give some about where insurance industry executives are commenting on the Republican plan and saying it will not work. We have Mr. Don Young, President of Health Insurance Association of America, April 24 this year in Congress Daily. He says, ``We caution Congress against relying on drug-only insurance as the mechanism to deliver a benefit.'' We have Charles Kahn, President of the Health Insurance Association of America in The New York Times in February of last year. He says, ``I don't know of an insurance company that would offer a drug-only policy like that or even consider it.'' We have him again saying, ``We will withhold judgment on the House Republican proposal until we see it in details. Nevertheless, we continue to believe that the concept of so-called drug-only private insurance simply would not work in practice. Private drug-only coverage would have to clear insurmountable financial, regulatory, and administrative hurdles simply to get to market.'' Mary Lehnhard, senior vice president, Blue Cross and Blue Shield says, ``It is exceedingly unlikely that any of our plans would offer a stand-alone prescription drug policy in their service areas. The reason is affordability. The absolute cost of an annual rate of increase in the cost of prescription drugs would make a drug-only benefit package so expensive that only those who expect to have very high use of the benefit would initially buy a policy. The package would not appeal to the majority of seniors that have relatively low drug costs. Plans would experience tremendous adverse selection, which would escalate premiums.'' I could go on, but I am not going to. It is clear that every major insurance executive and trade association is saying the same thing, that these drug policies will never be offered. Mr. Speaker, we might ask, the Republican leadership is not badly motivated. They are not bad people. Why are they going in this direction? What is the reason why they would try to pass something in the House on a strictly partisan vote, pretty much, that has no chance of passing the other body; or even if it did become law, have any real impact on seniors in terms of something that they would actually be able to buy or would want to buy. I think one of the answers is that the real goal behind the Republican bill is not to offer a prescription drug coverage, but rather to take one more step towards privatizing Medicare. I do not know what other conclusion I can come to. The other conclusion is, somehow they feel it is necessary to come up with something before Election Day so they can say that they passed something, and they will simply go out on the hustings and say we tried to pass something, and hope that Americans do not pay attention to what it is. Of course, some of my colleagues on the Democratic side, including myself, have cited the fact that the Republican Party in the House is getting huge campaign contributions from the prescription drug industry, and so maybe they want to do something like this bill in order to pretend that they are providing a prescription drug benefit, but do not want to alienate the insurance company by actually doing something that might make a difference. I will go back to that when I talk about the price issue. I want to talk a little bit about why I think the Republican bill is a bad bill even if it was available. In other words, I do not think anybody is going to sell these policies. I do not think that they are going to be offered anywhere where the premium is going to be affordable; but let us assume for 1 minute that I am Mr. Smith, a senior in New Jersey, and somehow this bill passes and there is an insurance company in my area that offers a drug-only insurance policy. Think about the reasons why I would not want to buy it, even if it was available, and there are many. First of all, if we look at the Republican proposal, it is basically going to cover less than 20 percent of prescription drug costs. The Democratic proposal guarantees that 80 percent of your costs are paid for by the Federal Government. The Republican proposal, even if it was available, and I do not think it will be, will probably cover less than 20 percent of the costs. Why would I say that? Well, first of all, there is a huge hole or gap in coverage. Let us say you pay the premium, whatever it is. For the first $1,000, they estimate that the insurance company would probably offer to pay 80 percent of the cost, and for the second $1,000, they estimate the insurance company would pay 50 percent. They estimate that, they do not guarantee it. From the $2,000 out of pocket to $3,700 out of pocket, they estimate that the Republican plan will pay no part of the cost. The average senior citizen, 47 percent of the seniors end up with prescription drug bills that fall into that gap, between $2,000 and $3,700 out of pocket. Again, I would ask, even if this coverage was available, and it will not be, but even if it was, why would seniors want to pay a premium that for a good percentage of their cost is going to pay absolutely nothing by the Republicans' own calculations? We can look at the bill in many ways, but the most ridiculous thing about it at all, frankly, is that there is this gaping hole where there is no coverage at all for 47 percent of the seniors who incur costs over $2,000 a year. I have already talked about the Democratic proposal and what it would do, so I am not going to go into that anymore this evening. But I did want to spend a little time on the issue of price because I think it is so important. We know, and we do not need statistics, because constituents have come up to Members over the past year and said the price of prescription drugs just keeps soaring, I cannot afford it. The week before last when we were meeting and we finally voted on the bill, Families U.S.A., which is a health care consumer group, came out with a report on prices for prescription drugs. They basically pointed out very dramatically that for the most popular prescription drug medicines, prices rose three times the rate of inflation last year. I am going to go over some of the highlights from their press release of June 24. It says, ``The prices of the 50 most prescribed drugs for senior citizens rose on average by nearly three times the rate of inflation last year according to a new report released today by Families U.S.A. The study analyzed price increases for the 50 most commonly prescribed drugs for seniors for the last year, January 2001 through January 2002, and then for the past 5 years and the past 10 years.'' The report found that last year nearly 36 out of 50 of these drugs rose at least one-and-a-half times the rate of inflation while over one-third, 18 out of 50, rose three or more times the rate of inflation. Then they go into the specific drugs. It shows dramatically in the report how bad the price situation is and why these prescription drugs are increasingly not affordable. Well, what is the Republican House leadership's answer to that? I have discussed the problem of the basic bill, and the gaping hole where almost 50 percent of the seniors would not get any benefit above a certain amount of money that they would have to put out of pocket. But just to ensure in the Republican bill that the price issue could not be addressed in any way by the Federal Government, by the Secretary of Health and Human Services, by the administrator of the program which the Republicans put forward, the Republicans put in the bill a clause that they call the noninterference clause, based on published reports in Congress Daily; and this was put in by the CATS, the Conservative Action Team, a group of conservative Republican Members in the House. And this noninterference clause, and this is in the bill that passed a week ago, it says that the administrator of the Republican program may not require or institute a price structure for the reimbursement of covered outpatient drugs, and the administrator may not interfere in any way with negotiations between PDP sponsors and Medicare+Choice organizations and drug manufacturers, wholesalers or other suppliers of covered outpatient drugs. What this noninterference clause essentially says is that we do not want the administrator of this prescription drug program, the Federal program, to in any way try to negotiate or interfere with any pricing. Now, how outrageous can this be? I mentioned before the whole goal of the Democratic alternative was not only to put prescription drugs under Medicare and guarantee that every senior and every disabled person under Medicare had a prescription drug benefit, and the same benefit throughout the country, but that because of the fact that now 30 or 40 million Americans were now under the auspices of Medicare for their prescription drugs, that the Secretary of Health and Human Services would have the power to negotiate price reductions because he represented all those seniors and disabled people. The Democrats actually put in the bill, in their alternative, a clause that mandates that the Secretary negotiate price reductions on behalf of those 30-40 million Americans. And we know it can be done. It is done by the Veterans Administration, by the military. It is done by other branches of the Federal Government in order to achieve major price reductions, 30-40 percent. Not only do the Republicans not put their program under Medicare and do all of the other things that I have mentioned, but they specifically put in the bill that there cannot be any negotiations on price by the administrator of their program. Again, people say why would they do this? Why would well-meaning people insist that there be no negotiations over price in whatever program they are trying to set up? I have no other answer than to say it is because they are essentially in the pockets of the pharmaceutical industry. The pharmaceutical industry insists that the Republican leadership not address the issue of price because they do not want to see any loss of profits. I do not think that they would lose any profits because the bottom line is, all of a sudden now the prescription drug industry, the brand name pharmaceutical industry, is going to have all these seniors who they would be selling prescription medicine to that are not getting it now. The volume of their sales would skyrocket, but they are so afraid that there is going to be some negotiation over price that would reduce prices and somehow they would be negatively impacted, that they insist that there be a noninterference clause on price. Mr. Speaker, Members do not have to believe me. I have backup information. The Washington Post, the day that the Republican bill was being considered in the Committee on Energy and the Commerce, of which I am a member, we had to break early at 5 p.m. and not finish the bill until the next day because the Republican National Committee was having a major fund-raiser; and a big part of it was being financed by the pharmaceutical industry. This was an article that appeared the next day in the Washington Post. It says, ``Drug Firms Among Big Donors at GOP Event. Pharmaceutical companies are among 21 donors paying $250,000 each for red-carpet treatment at tonight's GOP fund-raising gala starring President Bush, 2 days after Republicans unveiled a prescription drug plan the industry is backing, according to GOP officials.'' Skipping down in the article, ``Drug companies, in particular, have made a rich investment into tonight's gala. Robert Ingram, GlaxoSmithKline PLC's chief operating officer, is the chief corporate fund-raiser for the gala. His company gave at least $250,000. Pharmaceutical Research and Manufacturers of America, a trade group funded by the drug companies, kicked in $250,000, too. PhRMA, as it is best known inside the Beltway, is also helping underwrite a television ad campaign touting the GOP's prescription drug plan. Pfizer, Inc., contributed at least $100,000 to the event, enough to earn the company the status of a vice chairman for the dinner. Eli Lilly, Bayer AG and Merck & Company each paid up to $50,000 to sponsor a table. Republican officials said other drug companies donated money as part of the fund-raising extravaganza. ``Every company giving money to the event has business before Congress. But the juxtaposition of the prescription drug debate on Capitol Hill and drug companies helping underwrite a major fund-raiser highlights the tight relationship lawmakers have with groups seeking to influence the work before them. ``A senior House GOP leadership aide said yesterday that Republicans are working hard behind the scenes on behalf of PhRMA to make sure that the party's prescription drug plan for the elderly suits drug companies.'' I am not going to continue to read. But in conjunction with all of this, what is the Republican leadership hoping for? They passed the bill. They are going to go over now to the other body and the other body is going to start the debate, and I hope that the other body comes up with a Medicare plan. But what we are going to see over the next few months, and it has already started, is a huge ad campaign financed primarily by the pharmaceutical industry, to try to convince the American public through TV and other media outlets that the Republican plan is the best bill. It has already started. The United Seniors Association which is basically a senior group that is put together by PhRMA, the pharmaceutical trade group, they launched a $3 million ad campaign before the debate touting the House GOP prescription drug plan which is based on, as I said, private insurers offering prescription drug coverage. PhRMA spokeswoman Jackie Cottrell admitted they had recently given United Seniors Association an unrestricted grant. According to the Associated Press, several Republican officials speaking under condition of anonymity said they understood that the Pharmaceutical Research and Manufacturers of America have provided the funds for the commercials. Again, this is all in black and white. This is all easily documented. And I just think it is very sad. I think it is very sad that we ended up passing a Republican bill that is nothing more than a sham, something put out by the prescription drug industry so that the Republican leadership can say they have done something. We are talking about a Republican bill that will not work. Even if it did, the benefit is clearly inadequate, and I just think it is very sad that we are here now; and after 2 years of myself and other Democrats talking about the need for a prescription drug plan that all we ended up with was something that is basically a bone for the prescription drug industry and which is probably going nowhere because it will not be taken seriously by the other House and never become law. But I think we have to continue to speak out; we have to continue to point out that this is a major issue, that the price of prescription drugs will continue to rise, that more and more seniors will not be able to buy their prescription drug medicine and that something needs to be done that is real that is going to make a difference for them. And I would hate to see this just become a campaign issue. I would much rather that this were an issue that was resolved and that actually ended up with a benefit that passed both Houses and that went to the President and was signed into law. But I do not see that happening. So, Mr. Speaker, I will conclude tonight, but I do intend to continue to bring this up over the next few weeks or the next few months because I think it is important that my colleagues understand that those of us on the Democratic side have not given up in trying to provide a real prescription drug benefit for seniors under Medicare and that as much as there may be ads and paid advertisements telling the American public that the Republican plan will accomplish something, that there needs to be voices here in the House of Representatives that say it will not and that it is just paid-for ads for a meaningless proposal and that at some point we will get together on a bipartisan basis and pass a meaningful prescription drug benefit that will actually provide a difference for America's seniors.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I listened to the chairman of our committee from Louisiana, and it bothers me because he is not looking at the bill. He is not talking about the Republican bill that is on the floor of this House. This is not a Medicare bill. This is not a Medicare program. There is nothing in this bill that is going to help the average American senior. If you look at it, first of all, we know that it does not provide Medicare coverage, no guarantees. What it does is to give some money and throw some money to private insurance companies in the hope that somehow they are going to provide a Medicare benefit. The insurance companies have said they are not going to provide the benefit. If they were providing the benefit, we would not need a Federal program. Let us imagine that somewhere, somehow, I do not believe it, but somewhere, somehow some private insurance company is willing to provide the plan the way the chairman describes. Why in the world would anybody buy into such a plan? Look at some of the figures that we have. First of all, if I could use this chart, it shows very dramatically that the senior citizen is only going to get about 22 percent of their coverage paid for by the Federal Government, compared to the Democratic plan which was significantly more. Look at this so-called doughnut hole in coverage. In the beginning you are going to get, if it is even available, you will get some money in the very beginning, up to $1,000 and then up to $2,000 out of pocket. But then after that there is no coverage. For 40 percent of the beneficiaries, the average senior citizen, they are going to get no coverage during this interim period. If you are going to be in a situation, either there is no plan at all, you do not have the advantage of a plan because the private insurance companies do not provide it, or, secondly, the premium is so high, the deductible is so high or it costs so much over the course of the year that it is not even worth buying. Who in the world would want to buy the coverage even if it was available? The answer is nobody. That is the reality of this bill. The other thing that really bothers me here is I have heard some of my colleagues on the Republican side tonight talk about how there is going to be a 30 percent discount. I asked the gentlewoman from Connecticut (Mrs. Johnson), where is this in the bill? There is nothing in the bill that provides any discount here. She is assuming that there is going to be some competition to provide it, but they put a noninterference clause in the bill that prevents any price reduction. They do not want price reduction.

Mr. PALLONE. Mr. Speaker, some of the comments that are being made by my colleagues on the other side, both on the floor and in the Committee on Rules, have been very upsetting to me. I rise in opposition to the rule, but I heard the gentlewoman from Virginia just say that the rule was fair because it allows an up-or- down vote on what is the only good bill dealing with prescription drugs. That is not what fairness is about. That is not what democracy is about. I asked this morning in the Committee on Rules that the Democratic substitute and three other amendments that would lead to price reductions and another amendment that would provide a guaranteed Medicare benefit be placed in order. All were denied. My colleague may not agree with me, but the gentlewoman from Virginia should not suggest that the only thing that should be considered is what they think is the right thing. That is not the way a democracy operates. The other thing that upset me was that I heard the gentlewoman from Connecticut say that we should just read the bill. Let me tell my colleague, I read the bill. We have not had a lot of time to read the Republican bill, but I read it. There is nothing in it. It is not a Medicare benefit. It does not guarantee any benefit. It does not tell us what the premium is going to be. It does not tell us what the deductible is going to be. It does not tell us anything about whether it is going to be available anywhere, and there is no price reduction. The gentlewoman from Connecticut mentioned the passage of Medicare, but she was very proud of the fact this morning in the Committee on Rules that this was not a Medicare bill and that it operated through private insurance and through market competition and was not part of Medicare because she said that Medicare oftentimes does not work now and we need to change it. Then the gentleman from Georgia actually said in response to the gentleman from Massachusetts (Mr. McGovern) when I spoke about how we wanted a Medicare guarantee and we wanted this to be under Medicare, the gentleman from Massachusetts (Mr. McGovern) said it is unfortunate that the gentleman from Georgia (Mr. Linder) made a reference to the Medicare prescription drug program as a Soviet-style model program, and the gentleman from Georgia (Mr. Linder) said, well, it is; and he said it several times. The problem is that the Republicans do not like Medicare. They do not want this to be a Medicare program because they never liked Medicare, and they want it to wither on the vine, and they do not want to provide any benefit for senior citizens in this country.

Mr. PALLONE. Mr. Speaker, I demand a recorded vote.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I rise today to introduce the Enhanced Protection of Our Cultural Heritage (EPOCH), Act of 2002. The legislation that I am introducing today will increase the maximum penalties for violations of three existing statutes that protect the cultural and archaeological history of the American people, most notably, American Indians. This bill also includes language that will make any attempt to sell Native American human remains a criminal act The United States Sentencing Commission recently recommended the statutory changes contained in this bill and these changes complement the Commission's strengthening of Federal sentencing guidelines to ensure more stringent penalties for criminals who steal from public and tribal lands. I am pleased that my colleagues, Representatives Hayworth and Representative Mark Udall have joined me in cosponsoring this important bill. Looting of cultural remains is not a new problem but it has developed into a professional business. Today, the casual hiker who lifts an arrowhead or a potshard has become less of a problem because of increased awareness about the impact of removing such items. Instead, we are witnessing carefully planned and prepared theft by well-equipped professional looters. Professional looters have devastated individual Indians and tribal communities. These communities can do little but sit by and watch as their culture is erased, site by site as professional looters steal anything that may have value on the black market-- including ancestral remains. The lack of severity in the current laws does little to deter these individuals from looting over and over again. The three statutes that this bill amends currently impose a 5-year maximum sentence, and each includes a lower maximum for a first offense of the statute and/or a violation of the statute involving property of less than a specified value. This bill would create a 10-year maximum sentence for each statute, while eliminating the lower maximums under ARPA and NAGPRA for first offenses. Such maximum sentences would be consistent with similar Federal statutes. For example, the 1994 law proscribing museum theft carries a 10-year maximum sentence, as do the general statutes punishing theft and the destruction of government property. Moreover, increasing the maximum sentences will give judges and the Sentencing Commission greater discretion to impose punishments appropriate to the amount of destruction a defendant has done. Making these changes will enable the Sentencing Commission's recent sentencing guidelines to be fully implemented. The Commission increased sentencing guidelines for cultural heritage crimes, but the statutory maximum penalties contained in current law will prevent judges from issuing sentences in the upper range of the new guidelines. Those new guidelines have the enthusiastic support of the Justice and Interior Departments, the Society for American Archeology, the National Trust for Historic Preservation, numerous Native American nations, and many others. Congress must take the steps necessary to see that the guidelines take full effect. The professional looters who pillage the rich cultural heritage of this Nation and its people are committing serious crimes. The artifacts stolen from both tribal and public lands are the legacy of all Americans and should not be robbed and sold for personal gain. Passage of this legislation would demonstrate Congress' commitment to preserving our Nation's history and our cultural heritage. I urge my colleagues to support this much-needed legislation. I would ask that the text of this legislation be printed in the Record.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, we are supposed to have an idea within the next 5 or 10 minutes about whether or not the Committee on Rules is going to consider the Republican bill and then whether or not they will consider a Democratic alternative. I hope, as the gentleman said, we do have an option to vote on the issue and debate the issue over the next few days, and in the context of that we do have the Democratic alternative or other options, certainly. Mr. Speaker, if I can spend a little time talking about some of the reasons that we have seen in the media over the last 24 hours why there may be as many as 20 or 30 of our colleagues on the Republican side who are not willing to vote for this Republican bill. I think we sort of articulated already the general reason, which is that this Republican bill is not a Medicare benefit. It is not guaranteed to anyone because it basically operates through private insurance companies, and they may not offer it at all, or in various parts of the country. But there were other specific things that came up today, and again I am looking at Congress Daily this morning that has an article, ``House GOP Still Shy of Majority To Pass Prescription Bill.'' The Republican bill does not address the issue of cost, does not do anything to reduce prices for prescription drugs. In fact, there was a reference that was pretty clear where one Member specifically said if the bill did not address the price of prescription drugs, what good is it, because how can we ever afford it if there are no price reductions. I go back to the fact that this bill was largely written by the pharmaceutical industry, and the major issue that we could see when we had the markup in the Committee on Energy and Commerce, not only were Republicans unwilling to vote for the Democratic substitute and make this a Medicare substitute, but, more than anything else, they were not willing to vote for any amendment or measure proposed by the Democrats that addressed the issue of price reduction. We had a series of amendments which they refused to consider. Of course, the Democratic substitute, as the gentleman knows, says that because this is a Medicare benefit and all 30 to 40 million seniors are part of the program and get the benefit, that we mandate under the Democratic bill that the Secretary of Health and Human Services negotiate prices for those 30-40 million seniors that would lead to reductions in price and lower cost. Because there is this huge insurance pool now, we know that he would be able to reduce prices significantly, just as we have with the VA or the Federal Supply Schedule or some of the other Federal programs where they have reduced prices 30-40 percent because of the negotiating power of having so many people. The one thing that was interesting to me was not only was every amendment on price struck down by the Republicans, but during the markup we realized that they had actually put in a section in the bill that was entitled noninterference. I am not going to read all of it, but this title specifically says, in carrying out the administrator of the prescription drug program's duties, it says that, ``The administrator may not require or institute a price structure for the reimbursement of covered outpatient drugs; 2, interfere in any way with negotiations with regard to the prescription drug sponsors or Medicare+Choice organizations, drug manufacturers, wholesalers or other suppliers of covered outpatient drugs.'' Not only have they not put something in affirmatively to address price, but the Republican bill does not allow the administrator of the program to do anything to affect price. So they clearly, totally go down the road of what the pharmaceutical companies say and do not deal with the price issue at all. Mr. Speaker, I yield to the gentleman from Connecticut.

Mr. PALLONE. Mr. Speaker, let me say to the gentleman from California that I listened very carefully to what he said in analyzing that Federal court opinion that came down today; and I do agree with him that the opinion does not make any rational sense and that the use of the term ``in God we trust'' does not in any way violate the Constitution. I wanted to take to the floor this evening, however, as I have so many times in the last couple of months, and talk about the need to pass a prescription drug benefit and also to give a little status report, if I can, about where I think we are on this, because I am very concerned from some of the statements that I have been hearing today and some of the reports in the media, as well as some of the things I am hearing tonight, leading up possibly to Committee on Rules action or inaction, that there is a real possibility the Republicans will not bring up their prescription drug bill for a vote before we recess for July 4, for the Independence Day celebration. I say that because for several months now I have been asking that the Republicans bring up this bill because I think that the issue of prescription drugs for seniors and the issue of increasing high drug prices is one of the major issues that the Congress needs to address. When I go home to New Jersey, to my district in New Jersey, many seniors and even people in general, not just seniors, complain to me constantly about drug prices, about their inability to buy prescription drugs and the consequences that fall to their health because of their inability to buy the prescription drugs, the medicines that they need. So I was rather happy a couple of months ago when the Republican leadership announced that they would bring a prescription drug bill to the floor before the Memorial Day recess, and I was disappointed when we went home for Memorial Day and that had not happened. I was once again hopeful when after the Memorial Day recess in early June we heard the Republican leadership once again say they were going to bring a prescription drug bill to the floor before the July 4 recess. Last week, we actually did have the Republican bill unveiled; and we had a 3-day and all-night marathon in the Committee on Energy and Commerce, where I serve, where the bill was discussed and the Democratic alternative was discussed. Although I think that the Democratic bill is the only really meaningful bill, and I will discuss that in a minute, I was at least happy to see that we did have the opportunity in committee to discuss medicines or prescription drugs for seniors. So I would be extremely disappointed and very critical of the Republican leadership once again if we find out tonight or tomorrow that they still do not intend to bring this bill up. I am not surprised because I have said many times that the Republican bill is basically a sham. It does not provide any benefit for seniors. It has no real hope of providing any kind of prescription drug benefit for seniors. It does not even try to reduce price, the price of drugs, but at least if we had the opportunity to have this bill on the floor tomorrow or Friday we could then offer our Democratic substitute and see which side gets the most votes. I am actually here tonight, Mr. Speaker, because I understand that within the next half hour or so we will be hearing from the Committee on Rules as to whether or not they will be considering the Republican bill tonight, either at 10:00 or 10:30 or 12 o'clock or possibly tomorrow morning. If we hear that they are not, then that is a very good indication that the bill will not come to the floor for a vote. So I am waiting here, Mr. Speaker, to see what the Committee on Rules is going to do, hoping that they will allow this bill to come up and we will have a debate on probably one of the most important issues facing this country. I am still hopeful, although I have less and less reason I suppose to be hopeful, given some of the comments that have been in the media today. Let me explain why the Republicans may not bring the bill up. The reason they may not be able to bring the bill up is because they do not have the votes. The talk this afternoon around the House of Representatives was that they were shy 20 or 30 votes on the Republican side; and, of course, they are getting practically none, if any, Democratic votes. Some of the reasons that were articulated today in Congress Daily, in the lead story, says, House GOP still shy of majority to pass prescription bill, and it mentions about three or four reasons why different Members were having problems with the Republican bill, which I think go far to explain why the bill is a bad bill. So I would like to mention some of these reasons. It says lawmakers, this is the Republicans now, variously want more money for home State hospitals and rural health care, more attention to drug costs rather than coverage and guarantees to protect local pharmacies. The GOP leadership aides conceded that these groups of Republicans, in the face of the very few Democrats expected to cross party lines on a vote for the GOP bill, have left the measure short of the 218 votes needed to pass it. Let us talk about some of these issues that some of my Republican colleagues, rightfully so, believe are wrong or do not justify their voting for the Republican bill. Maybe before I do that I should say that I am very happy to see that there might be 20 or 30 colleagues on the other side of the aisle, on the Republican side, who would be willing to say to their leadership that they do not want to vote for this bill, because I have said many times, and again, I will give some third party documentation, that this bill is nothing more than a boon to the pharmaceutical drug industry. In other words, the reason why the Republicans have put forth a bad bill and one that will not work is because they are beholden to the brand-name drug industry. If my colleagues doubt what I say, let me mention that last week when we had a markup in the Committee on Energy and Commerce of the Republican bill, last Wednesday, a week ago today, they actually had to adjourn, the chairman adjourned the markup, the committee markup at 5 o'clock, because the Republicans had to go to a fund-raiser that was primarily being underwritten by the prescription drug industry. So lest there be any doubt about what they were doing, it is all laid out here in the Washington Post. This is the Washington Post from that day, which says, ``Drug Firms Among Big Donors at GOP Event. Pharmaceutical companies are among 21 donors paying $250,000 each for red-carpet treatment at tonight's GOP fund-raising gala starring President Bush, two days after Republicans unveiled a prescription drug bill the industry is backing, according to GOP officials. ``Drug companies, in particular, have made a rich investment in tonight's event. Robert Ingram, GlaxoSmithKline PLC's chief operating officer, is the chief corporate fund-raiser for the gala, and his company gave at least $250,000. Pharmaceutical Research and Manufacturers of America, a trade group funded by the drug companies, kicked in $250,000, too. PhRMA, as it is known inside the Beltway, is also helping underwrite a television ad campaign touting the GOP's prescription drug plan. Pfizer Inc. contributed at least $100,000 to the event, enough to earn the company the status of a ``vice chairman'' for the dinner. Eli Lilly and Co., Bayer AG and Merck & Co. each paid up to $50,000 to ``sponsor'' a table. Republican officials said other drug companies donated money as part of the fund-raising extravaganza. Every company giving money to the event has business before Congress. But the juxtaposition of the prescription drug debate on Capitol Hill and drug companies helping underwrite a major fund-raiser highlights the tight relationship lawmakers have with groups seeking to influence the work before them. A senior House GOP leadership aide said yesterday that Republicans are working hard behind the scenes on behalf of PhRMA to make sure the party's prescription drug plan for the elderly suits drug companies. I am glad to see that they did not work hard enough, because as of this afternoon and maybe tonight we will see, once the Committee on Rules decides what they are going to do, there were about 20 or 30 Republicans that were not willing to go along with this sham proposal so maybe PhRMA has to work a little harder so that they can make sure that this Republican bill that is basically written by the pharmaceutical companies does come to the floor. Again, as I say, Mr. Speaker, I am not saying I do not want it to come to the floor. I wish they would bring it up because I think we can defeat it and we can pass a good bill, which is the Democratic substitute. I see my colleague from Connecticut is here tonight. He has been here before to talk about this bill, and I appreciate his coming, and I would like to yield to him at this time.

Mr. PALLONE. I want to thank the gentleman for joining me tonight. We probably can find out as soon as we yield back our time what is the situation with the Rules Committee. But, again, I agree with you. We just want this to be brought up, we want to have a debate, we want to have an opportunity for the Democratic position to be considered side by side with the Republican. And it is not, at least I do not think for most of us it is really an issue that is partisan or even ideological. I just think the problem is we know that Medicare works. We have seen it work. We know that before the 1960s when Medicare came into being that it was virtually impossible for senior citizens to buy any kind of insurance policy that was affordable, that would pay for their hospitalization or their doctor bills. That is why Medicare started, because the private sector did not provide that opportunity. This has been a very good government program. It is a government program, so maybe some of our colleagues on the other side of the aisle have a problem with Medicare ideologically. I am sure some of them do. But you have to throw that aside and look at what is practical and what works for the American people. The Democrats are simply saying Medicare works; and the best way to provide this prescription drug benefit, really the only way in the system that we have, is for the government to expand Medicare to include prescription drugs, which is what we are advocating. Again, I do not know whether it is the ideology or, maybe going back to what I said at the beginning, it is just the money from the prescription drug industry that prevents the Republican leadership from going ahead with a Medicare program and addressing the issue of price because that makes sense. I have to believe it is the money from the drug companies that is really behind the effort to stop a Medicare program.

Mr. PALLONE. Mr. Speaker, I am going to just mention one more Republican because I cannot praise them too much here. It is interesting to see that some are standing up to their leadership. This one is the gentleman from Pennsylvania (Mr. Peterson) who said he absolutely would vote against the measure unless more money is included for rural hospitals. He said once pharmacy is a part of Medicare, there will be no extra cash any more. What he is referencing is the problem for rural areas because, as the gentleman knows, just like with the HMOs that do not offer, do not have benefits, we do not have HMOs in a lot of rural areas, the same problem will exist here because you do not have a guaranteed Medicare benefit. It is unlikely in a lot of rural areas there would be any kind of private drug policy offered, which is what the Republicans are saying. The concern is that rural areas will be left out, and there will be no insurance policies for them to buy. The other thing is with regard to the pharmacies, particularly in rural areas. What would happen with a private insurance plan, just like with HMOs, they will decide what vehicle to use to dispense the drugs. They may use a large chain or may decide to do it through mail order and not through the local pharmacy. There is a real problem with those in rural areas, our colleagues who are concerned about whether any benefit would be available at all because an insurance company would not sell in those areas. Or, secondly, if there is one, it will operate like an HMO and will exclude any kind of dispensing of medicine from the local pharmacy. Of course, we in our bill do the opposite. We say this is a Medicare- guaranteed benefit, and you can go to any pharmacy or any outlet to buy the medicine. Mr. Speaker, I yield to the gentleman from Connecticut (Mr. Larson).

Mr. PALLONE. Mr. Speaker, this says at the same time the gentlewoman from Missouri (Mrs. Emerson), who supports the amendment of the gentleman from Minnesota (Mr. Gutknecht), and wants to add a measure she is sponsoring to make it more difficult for brand-name drug companies to delay the market entry of generic medications. Again, that is something that is in the Democratic substitute. As the gentleman knows, if there is a patent exclusivity for a period of time, then of course the company that developed and gets the patent has an exclusive right. To be honest, something like 50 percent of the brand-name drugs are under patent right now, exclusivity, and therefore we cannot bring a generic to market. That basically inflates the price of the prescription drug. What happens is when those patents run out, the pharmaceutical companies use all kinds of gimmicks to try to delay the generic coming to market. That is what the gentlewoman is trying to eliminate. I know that the gentleman from Ohio (Mr. Brown) has a bill, and some of that language is included in our Democratic substitute that would close those loopholes. Again, this is a pricing issue. Because if we bring generics to market, we reduce the cost of prescription drugs.