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Bush Promotes Corporate, Anti-Consumer Agenda in State of the Union

Public Citizen’s Response to Bush on Legal Rights, Energy and Trade

President Bush’s State of the Union address will provide the nation another opportunity to examine and understand a radical domestic agenda that, if enacted, will curtail consumer, civil rights and environmental protections, take away the legal rights of citizens defrauded or harmed by corporations and medical providers, and further erode democratic principles.

“President Bush’s heartless agenda is a blueprint for stomping out a century of reforms that have made this nation more prosperous and brought cleaner air and water, less poverty and more basic fairness for the people who do the everyday hard work to keep our country running,” said Public Citizen President Joan Claybrook. “Bush cynically views government as an agent for the very rich, particularly his campaign contributors. Born to great wealth and prominence and helped along every step of the way by wealthy benefactors, he remains sorely out of touch with the concerns and problems that Americans encounter in their daily lives – and sadly, his actions indicate he just doesn’t care.”

Below are Public Citizen’s responses to several specific issues:

Bush’s Assault on the Legal Rights of Citizens

Bush falsely claims there is a “crisis” in the civil justice system and is pushing Congress to enact sweeping changes that would dramatically curtail the rights of citizens to seek redress in court when they are defrauded or otherwise harmed by corporations or injured by doctors.

Specifically, Bush is backing S. 5, the business class action bill, which is expected to be voted on by the Senate during the week of Feb. 7-11. This bill would move most class action lawsuits of any significance out of state courts – which have traditionally heard these suits – to the already-overburdened federal courts. Because federal courts rarely certify nationwide class actions based on state consumer-protection laws (and there are no comparable federal laws that can be enforced by citizen lawsuits), most class actions involving market abuses – such as overcharges by insurers, selling defective products, predatory lending scams targeting seniors and the poor – would be blocked.

“This bill, unless amended, creates a classic Catch-22 for consumers,” Claybrook said. “Congress says, ‘You must go to federal court.’ But the federal courts will lock consumers out. It’s the perfect scenario for businesses seeking to avoid accountability, and the most likely outcome is that we will see a surge in corporate misbehavior.”

Also on Bush’s agenda is legislation to place a nationwide $250,000 cap on non-economic damages that juries can award to patients who are injured by negligent or incompetent doctors, drug companies, HMOs, nursing homes, hospitals and other health care providers. Such limits would apply to even the most horribly disfigured, crippled or brain-damaged victims.

Bush claims that “frivolous lawsuits” are out of control and that such lawsuits are making malpractice premiums for doctors unaffordable, but there is scant evidence to support Bush’s dubious contentions. Malpractice premiums are driven by economic cycles that affect insurance industry investments (and profitability), not payouts to malpractice victims. In fact, just 5 percent of doctors nationwide are responsible for about half of all malpractice payouts – but Bush is offering nothing to weed out these repeat-offender doctors.

“Once again, as he did with weapons of mass destruction in Iraq and as he is now doing with Social Security, Bush has created a bogus crisis so that he can rally support for a special interest agenda that is bad for America,” said Frank Clemente, director of Public Citizen’s Congress Watch division.

Bush’s Corporate Welfare for Energy Corporations

Bush likely will call for energy legislation that will reward energy companies and investment bankers that now own power plants and natural gas pipelines. Despite the lessons learned from the massive fraud and market abuse by Enron and other energy companies in recent years, Bush advocates further deregulation of the energy sector. This includes the repeal of the Public Utility Holding Company Act, a staple of consumer protection enacted to stem the type of abuses that helped cause the Great Depression. This law protects utility customers from unjustified rate hikes and service disruptions by limiting the ability of executives to use ratepayer profits to embark on risky business ventures unrelated to their core utility business.

The administration also wants to deliver billions in taxpayer dollars to energy companies in the form of subsidies and tax breaks, a clear reward for the more than $8.5 million contributed to his re-election campaign by the energy and investment sectors, not to mention the $3.7 million donated to his second inauguration and the additional $7 million to the Republican National Committee.

In addition, Bush advocates nuclear power as a promising and “renewable’ energy source, while ignoring the massive nuclear waste problem and urging taxpayer subsidies to fund the next generation of nuclear reactors. Tax dollars already are subsidizing half the cost – estimated to be as much as $87 million each – of the new U.S. Nuclear Regulatory Commission “early site permit” application process in Illinois, Mississippi and Virginia, as well as combined operating and construction licenses for several huge consortia.

“Bush’s energy policy does nothing to help consumers, stem global warming or help clean up the environment,” said Wenonah Hauter, director of Public Citizen’s Critical Mass Energy and Environment Program. “It utterly fails to set a course that will sustain our country over the next century. It is the exact opposite of visionary.”

Bush’s Stubborn Insistence on Expanding Failed Trade Policy

Bush wants to expand the corporate globalization model – as embodied by the North American Free Trade Agreement (NAFTA) – to six more countries through the proposed Central America Free Trade Agreement, known as CAFTA. This model of trade relations has led to the largest U.S. trade deficit in history – a projected $600 billion by year’s end. The trade deficit, which is 5.5 percent of national income, is also the largest as a share of our national economy in the post-World War II period. Trade agreements have contributed to growing income inequality in the United States and stagnant economic performance in less-developed countries.

“The Bush administration insistence on pushing to extend the colossal failures of the NAFTA model to the poor countries of Central America, which have suffered for decades from the fallout of civil war, economic stagnation and natural disasters, is morally unconscionable,” said Lori Wallach, director of Public Citizen’s Global Trade Watch. “We join with the major U.S. and Latino civil rights and immigrant rights groups in opposing this offensive push.

“It is increasingly clear that no one is safe from the negative effects of these trade liberalization policies, which are leading to increased off-shoring of high-paying professional jobs and more risks to hard-won consumer protections and social programs. Bush’s plan to experiment with the privatization of Social Security, for example, could put the nation’s most popular social program at the mercy of World Trade Organization rules, which might make the experiment more difficult to reverse when it predictably fails to generate promised benefits.”