Why We Can't Have Nice Things-- Plus The Demise Of The Lincoln Project

I've told this story before but let me mention again that as the president of a Time Warner division, I was contactually entitled to the best private health insurance on the market. Not knowing any better, I feared being "dumped" into Medicare after retirement. What a pleasant surprise that Medicare turned out to be better-- not just as good; BETTER-- than the best private insurance! Except for a couple of things: Conservatives have managed to keep dental insurance out of Medicare and the drug plan, Medicare Part D (Republican healthcare, passed in the House with no Democratic votes), sucks to the extreme.

Yesterday, the Congressional Budget Office (CBO) released a report at Bernie's request that compared drug prices among federal programs. The conclusion was... well, what I just said: Medicare Part D sucks to the extreme. The CBO report states that "The federal government is a major purchaser of prescription drugs, both directly through federal agencies, such as the Department of Defense (DoD), and indirectly through federal health insurance programs, such as Medicare Part D. In this report, the Congressional Budget Office describes how the prices of brand-name prescription drugs are determined in different federal programs and compares drug prices among those programs in 2017. The main analysis focuses on the prices (net of applicable rebates and discounts) of 176 top-­selling brand-name drugs in Medicare Part D. CBO computed the average price of those drugs per standardized prescription-- a measure that roughly corresponds to a 30-day supply of medication.

• The average price ranged from $118 in Medicaid to $343 in Medicare Part D. The much lower net prices in Medicaid are the result of higher manufacturer rebates in that program than in Medicare Part D.

• The Department of Veterans Affairs (VA) and DoD each paid average prices that were between the average prices paid in Medicaid and Medicare Part D.

CBO also compared the prices of specialty drugs (from the sample of top-selling drugs), which treat chronic, complex, or rare conditions, frequently have high prices, and may require special handling or patient monitoring. The average price of specialty drugs ranged from $1,889 in Medicaid to $4,293 in Medicare Part D."

On average Medicare Part D pays nearly three times more for brand-name drugs purchased at retail pharmacies than Medicaid. Bernie:

“There is no rational reason why Medicare pays nearly three times more than Medicaid and about twice as much as the VA for the same exact medicine. Negotiating directly with pharmaceutical companies will substantially reduce the price of prescription drugs, and it is a national embarrassment that the Secretary of Health and Human Services is prohibited from doing that on behalf of the more than 40 million Americans who get their prescription drug coverage from Medicare Part D. It is time for Congress to take on the greed of the pharmaceutical industry and require Medicare to negotiate lower drug prices."

You already know why the system is stuck-- campaign finance which is more accurately described as legalized bribery. Politicians pass laws allowing corporate PACs to bribe them and finance their careers in return for... systemic rigging of the system in their favor, just like Medicare Part D.

Just as super-corrupt congressional Democrats led by Steny Hoyer-- with cooperation from super-corrupt congressional Republicans led by Kevin McCarthy-- are about to reinstitute earmarks, David Winston has another (even more toxic) way to view this mess. He's no liberal do-gooder. The president of the Winston Group, which advises Fortune 100 companies, foundations, and nonprofit organizations on strategic planning and public policy issues, Winston is a longtime adviser to congressional Republicans and previously served as the director of planning for Newt Gingrich when he was Speaker. This week he penned an OpEd for Roll Call, In our political rewards system, fundraising tops accountability. That has to change. "Money," he wrote, "has always played a major role in politics, and that’s not likely to change. But over the last decade, something significant has changed. The political class-- consultants, donors, political committees and the media-- have come to see money not as a resource but as an outcome. The political reward system has created a model that works for consultants, the media and super PACs that dominate the political environment, but it is failing candidates, the donors who fund campaigns and those who value civil political discourse and democracy. And it’s dividing the country in the process."

Winston is all worked up because the campaign model we've drifted into in the last couple of decades-- he blames the combination of the McCain-Feingold law and the Citizens United decision for our current predicament-- "produces money for campaign consultants, whether they win or lose"... minimizing the role of the parties and candidate campaigns and making PACs and super PACs the dominant power in many campaigns for one simple reason: "That’s where the money is. Many times, you won’t find top strategists or ad people working directly on major campaigns these days. They operate independently, legally restricted from any interaction with the candidates and campaigns they are supporting and often serving up background information for the media. But most importantly, they employ a circular model to attract donors by offering them a way to have a bigger impact on the election and its outcome."

He targets the Lincoln Project, a GOP scam outfit that figured out how to make millions from Democratic donors who weren't paying close attention. Of the $90 million the Lincoln Project collected-- overwhelmingly from naive Democrats-- $30 million was spent on ads and most of the rest went into the pockets of the people founded and ran the operation. "I suspect," wrote Winston, "Democratic donors are coming to grips with that hard reality." Not the ones I;'ve talked with. They still don't get it and are not eager to admit that they were scammed.

The Lincoln Project operationally seemed the perfect embodiment of the political rewards system. It’s founders understood that a market existed-- in this case, for anti-Trump donors. So, they designed a vehicle, a super PAC, that would attract mostly Democratic donors by portraying themselves as heroic “Never Trumpers.”

They created harsh, personal negative ads that, I’m guessing, thrilled donors and raised millions of dollars.

The media, enthralled with the tough ads, gave them a platform, constantly touting their latest eye-popping fundraising totals. Negative campaign ads can raise money, so that’s where they targeted their efforts, reaching out to their donors through more appeals for money to get them on air, regardless of the actual success of the ads.

Whatever their original intentions, they all made lots of money. Mission accomplished.

The political reward system encourages a reliance on negative ads with hyperbolic appeals to donors, sometimes concocting campaign polls designed to gin up money. It depends on an often symbiotic relationship with the media, with its insatiable appetite for explosive ads and with fundraising numbers as the metric of success.

One thing that the political rewards system almost never does is demand accountability for campaign performance. Hundreds of millions of dollars are raised from often unsuspecting donors and spent on negative ad campaigns with no data to show whether those ads had any impact.

Michael Bloomberg spent more than a billion dollars trying to win the 2020 Democratic presidential nomination and then to help Joe Biden take Florida. Bloomberg lost the primary, and Biden lost Florida by a wider margin than Hillary Clinton.

Another Democrat, Tom Steyer, spent $350 million in the 2020 primaries, much of it on ad buys. He didn’t make it to March.

South Carolina Senate candidate Jaime Harrison raised $130 million, only to lose to Sen. Lindsay Graham by 10 points. Nothing personal, but Harrison wasn’t named to head the Democratic National Committee because of his electoral success. It was for his fundraising prowess and name ID. That’s what gets rewarded in politics today-- money and media coverage.

Likewise, the Republican candidates and outside groups spent hundreds of millions of dollars on the Georgia Senate runoffs, and we all know how all that movie ended.

John D. Rockefeller, a man who knew something about the value of money, once said, “How much money does it take to make a man happy? Just one more dollar.”

But in politics, one more dollar is never enough.

Our political rewards system demands more money but not more accountability. It’s time to trade this broken system for one that actually values accountability. One that creates benchmarks that matter. Does a negative ad buy actually move voters or just get eyeballs on social media to attract donors? Do social media ads even work?

Donors have to stop funding efforts that make them feel good and must demand the kind of results they expect from their brokers and their boards of directors. Small donors can do the same and should.

To restore their own credibility, the media must return to reporting on politics rather than being central participants in a system that is failing the country.

Good people on both sides are burning out on the entire system. Most members of Congress didn’t come to Washington to get rich. Spending time 24/7 dialing for dollars instead of pushing their issues and ideas wasn’t how they saw the job.

If we want to keep the country’s best in Congress, something has to change. A good place to start is with the two parties and their political committees setting new accountability standards to reform a political rewards system that only works for the connected few.