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Retirees Launch Campaign to Protect Medicare from Privatization

Washington, DC – Alarmed by the House Congressional Leadership’s plans to dismantle Medicare, the Alliance for Retired Americans today kicked off a grass roots campaign to block any attempts to cut or convert guaranteed, earned health benefits into a voucher or privatized scheme. Speaker Paul Ryan and Rep. Tom Price, whom President-elect Trump will nominate to be Secretary of Health and Human Services, both said that they were moving to “reform” Medicare in the next Congress.  

“Alliance members will use all the tools at our disposal to stop any plan to replace our guaranteed earned Medicare benefits with a system of ‘Coupon-care’ vouchers,” said Richard Fiesta, executive director of the Alliance. 

Today the Alliance joined allies in delivering more than one million petitions against the Republican plan to cut and privatize Medicare to House Speaker Ryan and Senate Majority Leader Mitch McConnell.

Before delivering the petitions, Fiesta spoke at a Capitol Hill news conference with Senate Democratic Leader Chuck Schumer, House Democratic Leader Nancy Pelosi, Sen. Bernie Sanders and Representatives Jan Schakowsky and Ted Deutch. Representatives from several other advocacy groups also spoke against cuts to Medicare. 

Alliance members will be directly lobbying members of Congress and Senators in Washington and in their home districts and stating their opposition to efforts to gut Medicare and Medicaid. More than 100 meetings have been planned so far, and the organization expects to reach 200 offices over the next few weeks.

The Alliance will also campaign online and feature dozens of personal stories about why Medicare’s guaranteed benefits are so important on its website, www.retiredamericans.org, and social media.

 “Our members are irate. They paid into the Medicare system for decades, and heard President-elect Trump repeatedly promise to protect their earned health care benefits. We will fight tooth and nail to protect Medicare from all those who try to turn the earned benefits of Medicare into Coupon-care,” said Fiesta. “Medicare must be protected, preserved and expanded for future generations, not dismantled.”

Governor Maggie Hassan Endorsed By National Committee to Preserve Social Security and Medicare

CONCORD – Today, Governor Maggie Hassan was endorsed by the National Committee to Preserve Social Security and Medicare at an event at Havenwood Heritage Heights Senior Living Center.

(Governor Hassan and NCPSSM President and CEO Max Richtman)

(Governor Hassan and NCPSSM President and CEO Max Richtman)

“I am honored to have earned the endorsement of the National Committee to Preserve Social Security and Medicare,” said Governor Maggie Hassan. “Here in New Hampshire we know that our seniors deserve a high quality of life with access to the full benefits that they have earned, and as Governor, I have made it a priority to support seniors in our state. That approach is in stark contrast to Senator Ayotte’s Washington record of standing with special interests like the Koch Brothers and voting to undermine Medicare and Social Security. In the Senate, I will always fight for Granite State seniors and protect Social Security and Medicare for years to come.”

“The National Committee to Preserve Social Security and Medicare is proud to endorse Governor Maggie Hassan for Senate, because we know she will fight to protect benefits for seniors,” said Max Richtman, President and CEO of the National Committee to Preserve Social Security and Medicare. “While Maggie Hassan stands with New Hampshire’s seniors, Kelly Ayotte has supported a special interest agenda in Washington that would cut the benefits that seniors earned throughout their careers. Governor Hassan will bring her bipartisan approach and commitment to problem solving to the Senate, and she will always fight to protect and strengthen Social Security and Medicare.”

Governor Maggie Hassan has a proven record of supporting seniors in New Hampshire. As Governor, Maggie signed a law that strengthened protections for seniors by making financial exploitation of elderly, disabled or impaired adults a criminal offense and another law requiring the state to develop an educational program on Alzheimer’s disease and provide training to law enforcement on Alzheimer’s. She also signed into law a seniors bill of rights, and required it to be posted in housing establishments for the elderly. And Governor Hassan signed the CARE Act, which improves patient care and supports caregivers who help make it possible for seniors to live independently at home. In 2015 the AARP honored Maggie as a Capitol Caregiver for her efforts.

As Senator, Maggie Hassan will fight to protect Social Security and Medicare, and strengthen these programs for years to come. She will stand up to those trying to turn Medicare into a voucher program, and she will fight any attempt to privatize or cut Social Security. She will also work to enhance Social Security by ensuring that caregivers can get credit toward their Social Security benefits when they take time off or reduce working hours to care for family members.

In Washington, Senator Kelly Ayotte has stood with her corporate special interest backers like the Koch Brothers – who she voted with nearly 90% of the time her first four years in office – in working to undermine Social Security and Medicare. Senator Ayotte cosponsored a bill opposed by AARP that would have cut $859 billion from Medicare and $1.3 trillion from Social Security, increasing out of pocket costs for those on Medicare and slashing Social Security benefits by nearly 20%. Senator Ayotte has voted to cut Medicare by turning it into a private voucher system, while also voting against protecting Social Security from benefit cuts. And Ayotte has voted to increase the retirement age for Medicare, and has signaled her openness to doing the same for Social Security.

Clinton-Kaine is an Excellent Fit for Retirees

Ticket is Ultimate Antidote to Worries that Trump-Pence would cut Social Security, Medicare

Robert Roach, Jr., President of the Alliance for Retired Americans, released the following statement regarding Hillary Clinton’s selection of Virginia Senator Tim Kaine as her Vice Presidential nominee:
Alliance For Retired Americans

“Senator Tim Kaine is a superb choice to be Vice President. The Alliance for Retired Americans was already energized about a Hillary Clinton presidency, and Senator Kaine is the icing on the cake. His 93% lifetime score from the Alliance for his pro-retiree votes is proof that he is the right person for the job.

“Secretary Clinton has been a champion for retirees throughout her distinguished career, and Senator Kaine has been throughout his. As a Governor and as a Senator, he has always had retirees’ best interests in mind. He has stated plainly that ‘we shouldn’t embrace radical reforms like the Ryan Plan or the privatization of Social Security,’ and that is music to our ears. Senator Kaine clearly opposes efforts to cut, privatize or shift Medicare costs to retirees.

“If you go down the list of what retirees want the most, Tim Kaine checks all the boxes. He has pledged to protect Social Security. Like Secretary Clinton, he would rein in prescription drug costs by allowing the Medicare program to negotiate with pharmaceutical companies for better prices, just as the Department of Veterans Affairs does.

“His life’s work exemplifies the Alliance’s mission to enhance the quality of life for all Americans. He will protect our traditional pension plans from attack.

“On the other hand, Donald Trump’s choice of Governor Mike Pence as his running mate locked in place a team that endangers the things that retirees care about the most: the protection and expansion of their earned Social Security and Medicare benefits. The contrast could not be starker. We are confident that the Clinton-Kaine team will give us the retirement security we need.

“The Alliance’s 4.4 million members and 1600 chapters will do all they can before Election Day to educate seniors on the differences between the Trump-Pence plans for seniors and the Clinton-Kaine plans. We look forward to working with a Clinton-Kaine Administration to expand our earned Social Security benefits.”

Kelly Ayotte’s Misleading New Seniors Ad Features State Legislators Who Voted to Privatize Social Security, Cut Medicare Protections and Alzheimer’s Program Funding

Ayotte releases new ad to buffer her credentials on Social Security, Medicare, and Alzheimer’s research support, but instead features two NH State Representatives who supported privatizing Social Security, dismantling Medicare, and cutting funding for an Alzheimer’s caregiver respite program

photo of Sen. Kelly Ayotte by Gage Skidmore via Flickr Creative Commons

Concord, NH – Sensitive to a recent TV ad critical of her votes to dismantle key programs for seniors, Kelly Ayotte has released a misleading response ad intended to buffer her credentials on Social Security, Medicare, and Alzheimer’s research support. The ad, however, features two New Hampshire State Representatives who are in lockstep with efforts to dismantle key programs.

NH State Representatives Mary Griffin (R) and Walter Kolodziej (R) – along with Kolodziej’s wife and one other individual – claim that Ayotte has protected seniors despite an ample vote record that shows Ayotte voted to turn Medicare into a voucher program and raise the eligibility age. The ad and copy also attempt to bolster Ayotte’s record in other areas, such as Alzheimer’s research funding. However, the voting records of Ayotte and those she trusts on senior issues would harm seniors on issues regarding Medicare, Social Security, and Alzheimer’s support:

  • Ayotte effectively voted for FY 2012 Ryan Budget, which replaced Medicare with a premium support plan. The plan would more than double out-of-pocket costs for the average Medicare enrollee. (Center on Budget and Policy Priorities, 4/7/11; Wall Street Journal, 4/4/11)
  • Ayotte effectively voted for the FY2013 Ryan Budget, which replaced Medicare with a voucher program, increased the eligibility age, reopened the donut hole, and repealed the Affordable Care Act. (Center on Budget and Policy Priorities, 3/28/12; AARP, Letter to Congress, 3/21/12)
  • Ayotte voted for FY 2014 Ryan Budget plan which would “replace Medicare’s guarantee of health coverage with a premium-support voucher.” (Senate Vote 46, 3/21/13; Center on Budget and Policy Priorities, 3/15/13)
  • Ayotte voted for FY 2011 budget with deep cuts to agencies responsible for Alzheimer’s research. In congressional testimony on March 11, 2011, HHS Secretary Kathleen Sebelius said that the proposed cuts would mean that “about half of the hundred largest clinical studies including those on cancer and Alzheimer’s would probably be canceled.” (Vote 36, 3/9/11; Politifact, 4/15/11)
  • Ayotte surrogates Kolodziej and Griffin voted for urging Congress to privatize all aspects of Social Security. Privatizing social security puts at risk benefits for New Hampshire’s current and future retirees. (HCR39, Roll Call #190, 3/21/2012)
  • Ayotte surrogates Kolodziej and Griffin voted for an Interstate Health Care Compact that sought to allow New Hampshire to opt-out of Medicare and other programs, and eliminate all federal minimum benefit guarantees and protections for New Hampshire seniors and others. (HB1560, Roll Call #87, 2/15/2012)
  • Ayotte surrogates Kolodziej and Griffin voted for suspending funding for the Alzheimer’s disease and related disorders (ADRD) program. The program provides temporary respite services to family members, partners and other informal caregivers who are caring for an individual diagnosed with Alzheimer’s disease or other related dementia. (HB2, Roll Call #143, 3/30/2011; DHHS, Accessed 21.16)

“Kelly Ayotte’s votes hurt Granite State seniors,” said Zandra Rice Hawkins, executive director of Granite State Progress. “Kelly Ayotte’s decision to feature individuals who support privatizing all aspects of Social Security and undermining protections for New Hampshire seniors and their caregivers sends a strong message regarding where her priorities sit.”

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 Granite State Progress is a progressive advocacy organization that addresses issues of immediate state and local concern. Granite State Progress works as a communications hub for the progressive community to provide a strong, credible voice in advancing progressive solutions to critical community problems.

Full Fact Check Citations

Ayotte effectively voted for FY 2012 Ryan Budget, which replaced Medicare with a premium support plan. According to the Center on Budget and Policy Priorities, “CBO also finds that this beneficiary’s [a typical 65-year-old] annual out-of-pocket costs would more than double — from $6,150 to $12,500. In later years, as the value of the voucher eroded, the increase in out-of-pocket costs would be even greater.” [Center on Budget and Policy Priorities, 4/7/11] The Wall Street Journal wrote that “The plan would essentially end Medicare, which now pays most of the health-care bills for 48 million elderly and disabled Americans, as a program that directly pays those bills.” [Wall Street Journal, 4/4/11]

Ayotte effectively voted for the FY2013 Ryan Budget, which replaced Medicare with a voucher program, increased the eligibility age, reopened the donut hole, and repealed the Affordable Care Act. “The budget resolution developed by House Budget Committee Chairman Paul Ryan (R-WI) would make significant changes to Medicare. It would replace Medicare’s current guarantee of coverage with a premium-support voucher, raise the age of eligibility from 65 to 67, and reopen the “doughnut hole” in Medicare’s coverage of prescription drugs. Together, these changes would shift substantial costs to Medicare beneficiaries and (with the simultaneous repeal of health reform) leave many 65- and 66-year olds without any health coverage at all.” (Center on Budget and Policy Priorities, 3/28/12) AARP CEO Barry Rand said: “ … the proposal is likely to simply increase costs for beneficiaries while removing Medicare’s promise of secure health coverage — a guarantee that future seniors have contributed to through a lifetime of hard work.” (AARP, Letter to Congress, 3/21/12)

Ayotte voted for FY 2014 Ryan Budget plan which would “replace Medicare’s guarantee of health coverage with a premium-support voucher.” According to the Center on Budget and Policy Priorities, “The Medicare proposals in the 2014 budget resolution developed by House Budget Committee Chairman Paul Ryan (R-WI) are essentially the same as those in last year’s Ryan budget.  Once again, Chairman Ryan proposes to replace Medicare’s guarantee of health coverage with a premium-support voucher and raise the age of eligibility for Medicare from 65 to 67.” The vote was largely along party lines; Ayotte voted with Senate Republican leader Mitch McConnell. (Senate Vote 46, 3/21/13; Center on Budget and Policy Priorities, 3/15/13)

Ayotte voted for FY 2011 budget with deep cuts to agencies responsible for Alzheimer’s research. In congressional testimony on March 11, 2011, HHS Secretary Kathleen Sebelius said that the proposed cuts would mean that “about half of the hundred largest clinical studies including those on cancer and Alzheimer’s would probably be canceled.” (Vote 36, 3/9/11; Politifact, 4/15/11)

Ayotte surrogates Kolodziej and Griffin voted for urging Congress to privatize all aspects of Social Security. Privatizing social security puts at risk benefits for New Hampshire’s current and future retirees. (HCR39, Roll Call #190, 3/21/2012)

Ayotte surrogates Kolodziej and Griffin voted for an Interstate Health Care Compact that – with permission from Congress – would give participating states the authority to opt out of all federal health care protections and programs, including Medicare, Medicaid and the Affordable Care Act. This would have taken away not just all federal oversight, but all federal minimum benefit guarantees and protections for New Hampshire’s most vulnerable populations: states could drop seniors from Medicare coverage, eliminate our Medicaid and CHIP protections for vulnerable children, end Medicaid-sponsored long-term care services for elders and people with disabilities, terminate protections for children with pre-existing conditions, and stop the enforcement of laws protecting medical privacy. A compact state would be free to replace any and all of these previous federal programs and protections with risky and/or inadequate state-based schemes or, if a state so chose, not replace them at all. (HB1560, Roll Call #87, 2/15/2012)

Ayotte surrogates Kolodziej and Griffin voted for suspending funding for the Alzheimer’s disease and related disorders (ADRD) program. The program provides temporary respite services to family members, partners and other informal caregivers who are caring for an individual diagnosed with Alzheimer’s disease or other related dementia. (HB2, Roll Call #143, 3/30/2011; DHHS, Accessed 7.21.16)

The Alliance For Retired Americans Blasts Paul Ryan’s “Better Way” Plan

(HTTP://ABETTERWAY.SPEAKER.GOV)

(HTTP://ABETTERWAY.SPEAKER.GOV)

Ryan’s “Better Way” for Health Care Would be Dangerous for Seniors and Inferior to Current Medicare System

Seniors Would Have to Wait Until 67 for Coverage 

The following statement was issued today by Richard Fiesta, Executive Director of the Alliance for Retired Americans, in response to House Speaker Paul Ryan’s release of “A Better Way” health care plan: 

“U.S. House Speaker Paul Ryan calls his health care plan ‘A Better Way,’ but it is far inferior to the current system and dangerous for Americans.

“Seniors should not be misled. The Speaker wants to raise the Medicare eligibility age to 67 and change the program away from guaranteed benefits to a system of ‘premium support.’

“Premium support is a paltry substitute for the earned health care benefits that Americans have paid into throughout their lives and which they have a right to once they turn 65. 

“Ryan also wants to double down on one of the weakest parts of the current Medicare system. He would have Medicare adopt the so-called ‘competitive structure proven successful by Medicare Part D.’ Of course Part D has done nothing to rein in skyrocketing prescription drug prices for taxpayers or retirees and includes unnecessary giveaways for private insurance companies.

“If the Ryan plan were to be adopted, seniors would pay through the nose – with both their physical health and their financial health.”

Social Security And Medicare Report Shows We Need To Rein In Pharmaceutical Costs

2016 Social Security and Medicare Trustees Reports Highlight Need to Expand Social Security and Rein in Out of Control Pharmaceutical Corporations

Today the Social Security and Medicare Trustees released their annual report. The report showed some things we already knew, the Social Security trust fund is holding steady and will continue to pay full benefits for almost 20 more years.  They also showed that big pharma is fleecing Americans with out of control prescription drug prices.

“Both Social Security and Medicare face long-term financing shortfalls under currently scheduled benefits and financing. Lawmakers have a broad continuum of policy options that would close or reduce the long-term financing shortfall of both programs,” wrote the Social Security Administration. “The Trustees recommend that lawmakers take action sooner rather than later to address these shortfalls, so that a broader range of solutions can be considered and more time will be available to phase in changes while giving the public adequate time to prepare. Earlier action will also help elected officials minimize adverse impacts on vulnerable populations, including lower-income workers and people already dependent on program benefits.”

Richard Fiesta, Executive Director of the Alliance for Retired Americans, issued the following statement:

 “The Social Security Trustees reaffirmed that Social Security can pay full benefits until 2034. After that, it can pay three-quarters of benefits. This is unchanged from last year’s report.

“The Medicare Trust Fund for hospital care has sufficient funds to cover its obligations until 2028, two years sooner than projected last year.

“The message we must take is that it’s time to expand Social Security. There are several bills already pending in Congress that would expand Social Security benefits and adopt a more accurate formula for determining cost-of -living increases. Economists, public opinion surveys and our members’ own experiences all indicate that Social Security benefits are becoming a larger portion of Americans’ retirement income. The minimum benefit will need to be increased to keep most retirees out of poverty.

“We can also significantly strengthen Medicare by tackling skyrocketing prescription drug prices, which are increasing at more than twice the rate of inflation. Medicare and its beneficiaries spent $103 billion on pharmaceuticals in 2013. We need to stop the profiteering and monopolistic behavior by pharmaceutical corporations to save both retirees’ and the taxpayers’ money.

“Nothing in today’s reports justifies Paul Ryan and the Republican Congressional leadership’s stated goal of cutting Social Security or Medicare by privatizing the systems or raising the retirement or eligibility age.”

AFL-CIO President Richard Trumka took the opportunity to show that Hillary Clinton is “committed to strengthening Social Security,” while Donald Trump “can’t be trusted to protect” Social Security and other programs.

Today’s reports provide reassuring news for retired and disabled workers, their families and all Americans working toward a secure retirement. But fully funding Social Security’s modest benefits into the indefinite future in the face of a growing retirement income crisis is not enough; and the Medicare report establishes the precipitous growth of prescription drug prices as a major driver of healthcare costs. These represent some of the most important issues at stake for working people in this election.

Hillary Clinton is committed to strengthening and expanding vital programs working people rely on while Donald Trump can’t be trusted to protect them. We will stand with leaders like Hillary Clinton so together we control the cost of prescription drugs and improve benefits to ensure that future generations get the retirement security they need and deserve.

The New Book, Nation On The Take, Shows The Real Corruption In Washington

The New Book Show Just How Corrupt Washington Has Become, How Corporations Are Fleecing American Taxpayers, And What We Must Do To Take Our Democracy Back.

Our system of government has been corrupted by money. This corruption goes much deeper than just funneling millions of dollars into election campaigns from Super PACs and billionaires like the Koch Brothers.

A new book, “Nation on the Take,” takes an in-depth look at how big money has stolen our democracy.

The real corruption lies in how legislation gets tanked or amended by Congressmen at the will of the corporations.

nation-on-the-take-issue-oneThis could be something as simple as, naming a specific manufacturer in the proposed legislation, thereby guaranteeing that all the money from the government contract goes directly to them.

Or, it could be something much larger.

Lobbyists convinced Congress (with campaign donations) to include language in the Affordable Care Act that would prevent Medicare from negotiating prescription drug prices. This small amendment to the ACA allows Big Parma to continue to price gouge the American taxpayer for years to come.

In 2013, the U.S. paid “40% more than Canada” on prescription drugs and “twice as much as many European countries including France and Germany.”

Healthcare is not area of the government that lobbyist have bought and paid for legislation to protect their profits or steamroll the American people.

Wendell Potter and Nick Penniman, the authors of Nation on the Take, show examples ranging from Wall Street reform, climate change, and EPA health regulations.

“This marriage of great wealth and political influence has strangled the political process, leaving us unable to address our most pressing problems as a nation, from climate change to the wealth gap. It defines the terms of our daily concerns: from the cars we drive to the air we breathe, even to the bodies we occupy.”

Just when you have read enough to take the book and toss it across the room in disgust, Potter & Penniman sweep in with solutions on how we can take our government back.

Republicans, Democrats, and Independents all agree that our government has been hijacked by Big Money and it is time for us to take it back. It is not going to be easy but nothing worth doing is ever easy. It will take time and dedication if we want to take back our democracy.

 

You can read an excerpt and pick up, Nation on the Take: How big money corrupts our democracy,  by going here.

 

Watch Out! Now Marco Rubio Is Coming For Your Social Security Too

Cutting Social Security would push millions of seniors into poverty.

The Republican presidential candidates claiming that we need to cut the Social Security and make Medicare a voucher program, giving more money to private insurance companies who are already raking Americans over the coals for coverage, just added another member.

Yesterday in Henniker, Marco Rubio said he wants to cut Social Security and privatize Medicare. 

Watch the video by clicking here.

We’ve been down this road before. Jeb Bush, in Manchester, said that he’d “phase out” Medicare, while John Kasich wanted to cut Social Security and once told a voter that “you’d get over” the cuts. Marco Rubio is just following the GOP tune of cutting Social Security benefits that over 200,000 Granite Staters currently depend on.

Social Security is not going bankrupt as Rubio and other talking heads claim.

Currently the Social Security Trust Fund holds a $2.7 trillion dollar surplus and is fully funded for the next 20 years. After those 20 years Social Security will continue to pay out at 77% of the current benefit rate for eternity.

By law Social Security cannot add anything to our national debt and is fully paid for by payroll taxes. Because Social Security is funded through payroll taxes if workers wages were to rise – say by raising the minimum wage – then more money would be invested in the program strengthening the system.

Social Security is an earned benefit that we have been paying for since the day we entered the workforce.

 

“Democrats believe that Social Security is a pledge to our seniors, but Marco Rubio and Republicans want to make it harder for those who have worked their entire lives to get what was promised to them,” said Lizzy Price, New Hampshire Democratic Party Communications Director. “Granite Staters deserve someone willing to fight to keep their benefits, not claim that Social Security and Medicare have ‘weakened us as a people.’”

Cutting Social Security will push millions of seniors who are currently living on the edge of poverty over that edge.  In 2013, over 63 million people collected their earned benefit from Social Security with a national average of about $14,000 dollars a year.

For too many, Social Security is the only thing they have to live on. The sad fact is that 1 in 3 seniors collecting Social Security rely on their Social Security check for 90% or more of their monthly income.

The two leading Democrats in the presidential primary have plans to ensure that seniors will be protected now and for future generations to come.

Former Secretary of State Hillary Clinton vowed to protect Social Security and Medicare from any Republican privatization scheme.

“I will also defend Social Security and Medicare from the efforts of the Republicans to privatize both of them….As your president, I will defend it. I will not let anybody think that they can privatize it. But we’re going to have to make sure that we shore it up so that it is there not just for those who are currently recipients but for generations to come.”

Senator Sanders also wants to strengthen Social Security and increase benefits by lifting the cap on the payroll taxes that fund it.

“By lifting this cap so that everyone who makes over $250,000 a year pays the same percentage of their income into Social Security as the middle class and working families. This would not only extend the solvency of Social Security for the next 50 years, but also bring in enough revenue to expand benefits by an average of $65 a month; increase cost-of-living-adjustments; and lift more seniors out of poverty by increasing the minimum benefits paid to low-income seniors.”

Eliminating Social Security will push many seniors into poverty and allow politicians like Rubio, Bush and Kasich to steal the trillions of dollars in our hard earned money under the guise of reform.

We must not let them take our hard earned benefit away.

 

(Featured image by Gage Skidmore)

Pfizer Jacks Up Drug Costs, Pays Billions to Stockholders

Prescription Prices Ver5

Photo by Chris Potter via Flickr

Ever wonder why prescription drug costs are so high? Take a few minutes and read Bill Lazonick’s piece on Pfizer.

From January 2001 through September 2015, Pfizer paid out [to stockholders] $95.5 billion in buybacks and $87.1 billion in dividends.

That’s $182.6 billion paid to stockholders… compared to $37.1 billion paid in corporate taxes over the same time frame. Do the math. That’s almost five times more money paid to stockholders than paid in taxes.

Now, stop and think about this. Why are stockholders getting all that money? When shares are bought and sold on the stock exchange, none of that money goes back to the corporation. Instead, the money goes to the previous owner of the stock – who may have owned that stock for less than a second. (Read more about “high frequency trading” here.)

And yet, most corporations pay lots of money to their stockholders. For what? Passing stock from one owner to another isn’t investing in the corporation’s future. So far in 2015, Pfizer has paid more than twice as much to stockholders as it has invested in R&D.

Why are stockholders getting all that money?

— — — —

tieby Unsplash via PixabayPaying money to stockholders benefits corporate executives who are “paid for performance.” (How this works, using Verizon as a case study, is a previous NHLN post.) In the case of Pfizer’s CEO, “75% of his long-term equity awards are earned based on relative and absolute total shareholder return.” In other words, the CEO’s compensation depends on Pfizer paying money to shareholders. If stockholders don’t get enough money, the CEO doesn’t get that compensation. And it’s not just the CEO. All of Pfizer’s top corporate executives are paid according to whether they meet “shareholder return” targets.

Back to Bill Lazonick’s piece:

In 2014, [Ian C.] Read as [Pfizer] CEO had total direct compensation of $22.6 million, of which 27 percent came from exercising stock options and 50 percent from the vesting of stock awards. The other four highest-paid executives named on Pfizer’s 2015 proxy statement averaged $8.0 million, with 24 percent from stock options and 41 percent from stock awards.

Remember, a good chunk of that compensation was based on the amount of money paid to stockholders. Which probably explains why Pfizer is paying so much more to stockholders than it’s spending on R&D.

— — — —

dollar by TBIT via PixabayWhere does all that money come from, anyway?

From Bloomberg:

Pfizer Inc., the nation’s biggest drugmaker, has raised prices on 133 of its brand-name products in the U.S. this year, according to research from UBS, more than three-quarters of which added up to hikes of 10 percent or more. … In a note Friday, analysts at Morgan Stanley said Pfizer’s net prices grew 11 percent a year on average from 2012 to 2014.

The Wall Street Journal documented Pfizer’s three-year market research campaign to decide the price of a new breast cancer drug.

“[I]ts process yielded a price that bore little relation to the drug industry’s oft-cited justification for its prices, the cost of research and development. … Staff members put together a chart estimating the revenue and prescription numbers at various prices… The chart showed a 25% drop in doctors’ willingness to prescribe the new drug if it cost more than $10,000 a month.”

Two years ago, AARP investigated the pricing strategy for another Pfizer drug, with an expiring patent:

[T]he manufacturer of the popular anti-cholesterol drug Lipitor employed an unusually aggressive strategy — including a pay-for-delay agreement, a coupon program, and a substantial price increase — to try to maintain revenue and market share after Lipitor’s patent expired. … Several major U.S. retailers have filed lawsuits against Pfizer and Ranbaxy that accuse them of violating antitrust laws by striking a deal that kept generic versions of Lipitor off the market… Pfizer’s chief executive reported that they maintained three times more market share than what is traditionally seen when blockbusters lose patent protection, “add(ing) hundreds of millions of dollars of profitability to the company.”

And a bunch of Pfizer’s profits come from government spending. There isn’t a lot of available research into government spending on pharmaceuticals, but what I’ve found is enlightening. As of 2010, Pfizer’s Lipitor – in varying strengths – represented three of the top-20 drugs prescribed under both Medicare and Department of Defense health programs. As of 2003, Medicaid was spending almost $650 million a year just on Lipitor.

That’s a lot of taxpayer money going to Pfizer.  While the corporation is paying twice as much to shareholders as it’s spending on R&D. While it’s paying five times as much to shareholders as it’s spending on corporate taxes. While Pfizer is trying to use the US corporate tax rate to justify off-shoring profits through a merger with Allergan.

While Pfizer’s CEO is receiving millions in compensation based on the amount of money the corporation pays to stockholders.

— — — —

hands by Gaertringen via PixabayAnd where else does that money come from?

If you have family or friends on Medicare, you probably know that the price of prescription drug coverage is going up significantly next year – even though there will be no Social Security COLA.

If you’re a State of New Hampshire retiree, you know that your cost of drug coverage is going up significantly next year – even though there hasn’t been a retirement COLA for the past six years.

The billions being paid to Pfizer stockholders are coming out of a lot of pockets… including the pockets of people who are spending their “golden years” choosing between medicine and food.

One more time: why are stockholders getting all that money? What have they done to deserve it?

Speaker Ryan Has Three Goals: Destroy Social Security, Medicare And The USPS

Paul Ryan (FLIKR CC Starley Shelton)

Paul Ryan (FLIKR CC Starley Shelton)

Koch Brothers darling Multi Millionaire Congressman Paul Ryan is leaping back on to the national stage as Speaker of the House of Representatives. Mr Ryan was initially hesitant citing family concerns (despite the fact he is an opponent of paid leave for ordinary Americans)  but eventually was swayed by other GOP leaders to take the job. Ryan, who seems fixated on reducing retirement benefits for both the American public and especially federal workers, will have a larger platform to try to make these cuts a reality. Clearly these ideas are unpopular to many but as Paul Krugman brilliantly stated, Ryan is “the best con man they got.”  Republicans are using him to sell their treasure trove of unpopular policies to the apathetic American Public

Ryan was an architect of George Bush’s  failed plan to partially privatize  Social Security in 2005. More recently Ryan has teamed up with Congressman Darrell Issa to push the idea of reducing Federal Employee Retirement System (FERS) benefits for Federal Workers. In a letter to the Congressional Budget Office they emphasized that the CBO should consider “different options for reforming FERS, based on changes made in recent years to other large pension plans, both public and private. The report should include, but not limit itself to, adjusting the retirement contributions of federal employees, altering the formula for computing pension benefit payments, and expanding the defined contribution component while reducing the defined benefit component.” This sounds quite ominous for Federal Workers. The intent is crystal clear.

As outlined in The New Yorker Ryan believes the only reason privatization failed in 2005 was because of the way it was marketed.

“The Administration did a bad job of selling it,” he told me. Bush had campaigned on national-security issues, only to pitch Social Security reform after reelection. “And . . . thud,” Ryan said. “You’ve got to prepare the country for these things. You can’t just spring it on them after you win.” The lesson: “Don’t let the engineers run the marketing department.”

 

Here is where the job of being an elite con man comes into play.

10404189_10153548324976418_913827613849190064_nAfter repeatedly emphasizing he did not want the Speaker’s job he abruptly changed his mind and accepted it. Publicly he worried that “its a job for a empty nester” not a person with young children.  “I cannot and will not give up my family time,” he told reporters before abruptly changing his mind.  Curiously Ryan has been a staunch opponent of paid family leave despite the fact the United States is the only industrialized country in the world that does not offer paid family leave.  Astonishingly this country ranks last in government supported time off for new parents.

“Paul Ryan is rightly concerned about his job’s impact on his spouse and children,” said Judy Conti, federal advocacy coordinator at the National Employment Law Project. “Yet [he] isn’t willing to guarantee that all workers… have the necessary tools to balance their work and family obligations.”FT_13.12.11_parentalLeave

“For workers without paid family leave, taking time off to care for a new baby or a seriously ill loved one can have devastating long-term financial consequences, ranging from racking up credit card debt to raiding savings to bankruptcy,” Dina Bakst, co-founder and co-president of A Better Balance, told ABC News. “Paid family leave would provide a critical safety net for these working families in their times of need.”

Make no mistake Speaker Ryan will be pushing an agenda that is quite friendly to Multi Millionaires children at the expense of working families.  “My greatest worry is the consequence of not stepping up, of some day having my own kids ask me, ‘When the stakes were so high, why didn’t you do all you could? Why didn’t you stand and fight for my future when you had the chance?'” Ryan said to reporters. His children do not have to worry he will make life easier for children of the wealthy at every turn.

Speaker Ryan will try to dismantle the three of most popular parts of the federal government to continue the GOP fixation of shrinking government.

Speaker Ryan accepts millions of dollars from individuals and groups that will profit by turning medicare/medicaid into a voucher scheme and by the privatization of Social Security.  He targets for “reform” include vital government services like the US Postal Service, Social Security Administration, and Medicare/Medicaid all services that benefit ordinary Americans.  The wealthy have no need for a safety net. They want to profit by its demise.

Speaker Ryan will now play the role of con man daily on a national scale. He surely will be selling day for night.  We all must call him out on his continued  hypocrisy before our countries safety net vanishes.  Ryan and his fellow multi millionaire politicians are in politics for the wrong reason. They want to accelerate the wealth of the few at the expense of the many.

 

 

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