Trade Rules Put Affordable Medicine At Risk

A lot of people learn the hard way: it pays to read the fine print. Any complex agreement has pages of it, and there are always things hidden in there that you wouldn't sign up to if they were obvious.

The United States is currently finalizing a host of trade agreements with a lot of fine print, and if Americans knew what our government was signing on their behalf they might not like it. Those agreements risk making our health care more expensive, less available, and less responsive to the needs of ordinary people.

International trade agreements are like contracts that countries sign, promising to change their behavior. And like any contract, they are enforceable- in this case, by the World Trade Organization's dispute resolution panels. If a country signs a contract that is bad for its citizens, its position in front of those judging it is no different from somebody who bought a rip-off car with a high payment: sorry, sucker.

But do Americans know what kinds of contracts George Bush's trade bureaucrats are negotiating on our behalf? Do you know what is in our trade deals with Colombia or Peru? Probably not. Trade policymaking is an undemocratic world of lobbyists, lawyers and bureaucrats whose orders are to do what the lobbyists suggest. This is a perfect environment for the special interests who benefit from the current health care system and would see their profits cut if all Americans were to have the health care they need. And they are working out how to bend trade policy to their goal of keeping the health care system profitable for them.

Take, for example, medicine and the right of American states to negotiate affordable drug prices for their citizens. This has become an issue in a number of states that are struggling to deal with ever increasing health care costs. America's drugs are the most expensive in the developed world, and it is possible for states and individual Americans to benefit by forcing drug companies with equivalent products to compete, bringing down prices to an affordable level. The drugs are the same, safety is not compromised, and Americans get the drugs that they need.

Big pharmaceutical companies' profits come from their ability to restrict supply and sell at high prices. And they defend their right to high prices with all the political weapons they can muster. If you run one of the world's most profitable companies, you can afford to fight policies that reduce those profits.

So when American states began to take action to reduce drug prices and give senior citizens a better deal, the pharmaceutical companies fought back. Their lobby group PhRMA filed suits in three states, claiming that the states' programs were illegal. They lost. Game over, right? The elected government of those states decided on a program and the courts decided the program was legal.

No. The pharmaceutical companies struck back through trade law. At the time the United States was negotiating a free trade agreement with Australia. PhRMA and the drug companies got provisions written into the US-Australia free trade agreement that undermine states' ability to negotiate cheaper drugs.

This works for drug companies. They can work in the shadows, quietly inserting provisions into these complex, technical, and frankly, boring agreements.

It also works for service providers, insurance companies and everybody else who benefits from the health care system. A new report by the Americans for Democratic Action Education Fund, Trading Lives, shows how importation of medicines, state health reforms and many presidential candidates' plans might violate provisions that are being inserted into global trade agreements such as the General Agreement on Trade in Services (GATS).

In other words, the United States is already signing agreements that will make it harder to buy affordable medicine. It will soon be signing vague statements that will make it harder to make sure every American can get health care.

The Bush administration doesn't seem to mind, strangely enough. Pharmaceutical companies, insurance companies, and some private health care companies think this sounds all right. Should ordinary Americans mind? Well, ask yourself. Would you like to make sure that American health care becomes more driven by greed, harder to get, and more expensive for ordinary people? If so, you'll like the trade policy agenda in health.