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July 10, 2001 
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Progress of Health Care Negotiations


Mike Baroody
National Association of Manufacturers

U.S. Senator Tim Hutchinson (R-AR)


MR. BAROODY: Good morning. Good morning and welcome to another of the NAM's series of issue briefing breakfasts. My name is Mike Baroody. I work at the National Association of Manufacturers.

And Senator, it's sometimes our custom before introducing our guest to the NAM to introduce the NAM to our guest. I know you know us as a trade association, and perhaps you know that we have 14,000 member companies, large, mid-sized, and small, as well as 350 member associations, including the Arkansas State Association, among our membership. But not everyone yet knows that we are also at the NAM proudly 18 million people who make things in America.

As a four-year veteran of the Labor Department in Ronald Reagan's second term, I'm sometimes inclined to add about that number that that's more working Americans than John Sweeney represents, and we believe at the NAM that we represent not just more but better, the real interests of American working men and women and their families through our advocacy of a pro-growth agenda.

That agenda rests on four T's, as we call it: Taxes, trade, technology, and training. But it also rests confidently on the expectation of some R's: Some reforms that will remove obstacles to growth, whether it's tax reform, entitlement reform, legal reform, regulatory reform. And reform, of course, is one of the principal topics we'd like to hear from you this morning on. But I would -- that is to say, efforts in the Congress to reform our health care system.

But I will quickly add that we're interested, Senator, in anything you've got to share with us on the prospects for pro-growth policy generally in this second session of the 106th Congress. I think it was Jefferson who said something to the effect that I hold that a little revolution is good for the soul from time to time.

At the NAM perhaps we're as Jeffersonian as the next trade association, but when it -- we take Jefferson to mean that settled systems sometimes need a little shaking up. But when it comes to the system by which 130 million Americans get their health care, the voluntary employer provision of health care, a little reform may be good a thing, but we don't hold that there's any such thing as a little liability. Given the agility if not the outright elasticity of the American legal mind, a little liability today would surely lead to a lot of liability no later than the day after tomorrow.

And that's our message to you as a conferee on this all important issue to us. We are interested in hearing your message to us not only on what we might expect out of the conference but when we might expect it, and your advice about what we might do about it to make sure that members of Congress in the conference and outside of it hear our message and our concern that that -- that Congress do no harm in a way that will diminish that number, 130 million, who get their health care through the voluntary employer system, and expand the number of 44 million by doing so who don't get -- and who don't currently have health care benefits at all. We are very concerned that we call "Dinglewood" would drive both numbers in the wrong direction.

We look forward to hearing from you on that and any other subjects you'd like to share with us, and before that now an introduction to the NAM of our speaker.

Senator Tim Hutchinson made history as the first Republican ever to be popularly elected to the United States Senate from the state of Arkansas. He was sworn into office in January of 1997 and he brings to us and to the Senate a unique perspective as one of the few members with a background both in small business and in education.

His career in public service began with his election to the Arkansas State House of Representatives where he served eight years from 1985 to 1992. In 1992, Senator Hutchinson was elected to represent Arkansas' Third Congressional District in the U.S. House of Representatives, where he served two terms.

He's a former history teacher at John Brown University located in Siloam Springs, Arkansas, and he also co-owned and managed KBCV radio in Bentonville from 1982 to 1989, where he learned first hand the red tape and government bureaucracy which small business owners encounter every day.

It's our great pleasure and honor to have you here with us this morning, Senator Hutchinson. Thank you for joining us.


MR. HUTCHINSON: Well, thank you very much, Mike, and as he said, I'm -- really first of all I'll just express my appreciation for that nice introduction, because I was in Washington State with my brother Asa at a Lincoln Day dinner campaigning for George W. Bush about two weeks ago. And we don't do Lincoln Day dinners very often together. But this was, you know, the governor asked us to do this, go up and since Asa's the celebrity, I went along with him.


And he's very big in Republican circles. He's not liked particularly in Democrat circles, but he's loved by the Republicans, and so we up. And they explained to him, because he is a celebrity and everything, they explained to him the protocol that because I'm the senator that he would go first and then I would follow, and then after he made his remarks, he was supposed to introduce me.

So he got up, and it was a big crowd, 350 people or so at the Lincoln Day dinner up north of Seattle, up almost on the Canadian border, and he got

-- I mean, they gave him a standing ovation, and he gave a rousing speech. He got all wound up. He was going on and on. At the conclusion of his speech they gave him another standing ovation. And he was basking in this glory as he walked off the platform and forgot to introduce me altogether.


So I wasn't sure what that was, and they were like, "Go on, go on, go on." And I went up and I said I want to thank my brother for that generous introduction.


So, Mike, today I really mean it. Thank you for that generous introduction.

And as he said, I am from Arkansas, so I'm really glad to get invited to speak anywhere these days. And Arkansas, of course, is the state that has produced more New York Senate candidates than any other state in the nation.


Let me take just a few minutes and give a brief overview of where we stand on the so-called Patients' Bill of Rights and then open it up for questions, and I'd really like to spend the bulk of our time just taking Q&A.

Mike mentioned that I was elected to the Arkansas House of Representatives in 1984, began serving in 1985. When I went from northwest Arkansas to Little Rock, I had never so much as heard the acronym "HMO". I had no idea what that meant. Growing up Gravette, Arkansas, population 894, we had one doctor in the 1950s, Dr. Billy Hall, and he was beloved. He made house calls, he did everything. And I remember later, much later, after he had built a hospital in Gravette and he was the main -- he provided health care for the community and all the surrounding area there, he got in trouble with Medicare over something, which isn't necessarily a bad thing. He got in trouble and they were trying to sanction him in some way, and I remember bumper stickers sprouting up all over northwest Arkansas, "We Love Billy Hall." And he really was very beloved.

But he was what health care was. It was very much fee for service and it was very much if you couldn't pay in cash you bartered something with him. And that was health care.

And then as it began to -- a lot of good changes took place with technology and all of the developments that have occurred in health care in our society. But when I was elected to the House of Representatives, I literally had to have -- I wanted them to explain to me what the concept of an HMO was, what a PPO was.

And in northwest Arkansas, in the northwestern part of our State, health maintenance organizations were nonexistent even up into the 1990s. It was a very late-blossoming phenomenon in Arkansas in general.

And then when I was elected to the legislature -- to the Congress, rather, in '92 and went to Washington, I remember well as you all remember very well all of the health care debate and the Hillary care and her efforts at nationalizing our health care system. And that the great irony to me is that those today who are decrying managed care were the very ones who in 1993 were saying the salvation of our health care system was managed care, and that every American ought to be required to be in a managed care system. And now these are the very folks who are coming back and saying that we need to pass a patients' bill of rights.

There probably have been sufficient -- they're -- much of it anecdotal, but there's enough abuses that have come to light that it's going to follow that there's going to be an effort to government to step in and to do some regulation.

It's I think in a lot of ways like a pendulum, and the pendulum swung very much toward managed care as being the means by which the spiraling health care costs could be controlled. And when the pendulum went so far, there was this swing back. And now the question is, how far is it going to swing back, and are we going to devastate an employer-based health care system?

As Mike said, the vast majority of American citizens receive their health care insurance through their employer and through the benefits provided by their employer. Are we going to destroy that, and in so doing really be a back door effort at moving us toward that nationalized health care system which the American people rejected a few years ago? And that is my great fear.

Now we all are aware that health care costs, even with what has happened in managed care, that health care is -- health care inflation is rising much, much faster than inflation as a whole in society, which is almost nonexistent. But health care -- in the health care arena, you're still having six to seven percent annual increase in insurance premiums. That in itself translates into lots of folks who are losing access to our health care system because of those rising premiums.

If the House-passed bill would come out of conference, if it would be adopted and the president should sign it into law, the Congressional Budget Office estimates that that would add on top of the already six to seven percent inflation in health care, another 4.1 percent increase in -- annual increase in those premium rates, which puts you up over 11 percent, double-digit inflation in health care premiums.

We believe that -- I believe that the CBO has underestimated the impact that the liability provisions particular in the House-passed bill would have on health care costs. But even if you accept those numbers and you end up with 11 to 12 percent increase in health care inflation, you're talking in terms of three-plus million people if you adopt the studies that have been done and the formulas that have been devised as to how many people would lose their health insurance.

So you're then putting the total uninsured in America close to the 50 million mark, and we increase those numbers greatly by a House model kind of bill.

So let me just take a moment to talk about two particular areas, probably the two greatest areas of contention between the House and Senate bills. And that's liability and scope. As I visited with many of you before breakfast, I think you know these issues inside out, so I'm going to be brief on giving this over for you and then allow you to ask questions.

But the Senate basically says that the goal should be in the area of liability to ensure that a patient has a means of appealing the decision of their decision of their insurance company but doing so in such a way as to ensure quality health and quality health care for the individual, not just a means to spin the liability -- the litigation roulette wheel and clog the courts even further.

So we would provide for an internal and external appeal, an external, independent appeal, allowing a decision to be made independent of that which has been made by the insurance company and allow that patient then to be able to receive prompt treatment that's in that individual's best interest as determined by an external arbiter or external physician who looks at the situation.

We think that makes good sense. That's the best way to ensure that in fact that insurance companies are not practicing medicine, that they're not making medical decisions and overruling the good sense of physicians, and that there's a means by which those decisions can be appealed, done so in a very quick and expeditious way. And that if it was a bad decision, the right decision can be made and that person can get the health care they need and deserve.

The House, on the other hand, basically have

-- they have an external appeal mechanism, but it is not required that an individual utilize it. They have an unlimited right to litigate. Now it is argued that they protect the employer from lawsuit, but that is very much in dispute as to whether it adequately protects the employer from lawsuit. But certainly the HMO would be able to be sued in both state and federal court with unlimited punitive damages. And so the House has a very, very broad kind of liability provision.

And, according to NAM's survey of their own membership, 38 percent of employers in this country would reconsider whether they would or could offer health care as a benefit should that kind of liability provision be passed into law. And that is -- you know, maybe the CBO ought to take that survey into consideration when they estimate how many would lose insurance under a House-passed bill with that kind of liability provision.

So that is going to be obviously the biggest point of contention between the House and Senate conferees is how the liability issue is addressed in the conference bill.

The second great area of difference is the scope of the bills. The Senate approach was essentially that we should fill in the gaps of those who are unprotected and ensure that those who currently are not protected by the state insurance laws, essentially the ERISA self-managed plans, self-insured plans, that they would be covered by the Senate bill, while the House approach was to take the HIPPA model and say they were going to supersede all state laws and blanket all managed care plans with those added protections that they put in.

We think that we're taking the sensible and the reasonable and the right approach; that we are dealing with that area in which there is clear federal jurisdiction -- ERISA -- and that we are honoring the traditional role of the states in being the regulators of insurance, and that we should not step in and supersede what the states have done in their own state protections. And I think it's 22 states have passed some kind of patient protection legislation. And that is within their purview to address insurance as regulated by the state, and that we should only address that which is clearly in our jurisdiction on the federal side and the ERISA plans.

So there's a huge argument in the scope. And this was of course during the Senate debate on the floor and the week that we spent on the bill thrown up at us continually as leaving all of these tens of millions of Americans unprotected, which is very much a mischaracterizaton of the bill, because those Americans have protection under existing state laws. But that's a huge difference between the bills is the scope of the two bills.

Now we have had a number of meetings among the Republican senators who are conferees. And we have basically be re-briefed on all of the provisions in the Senate bill as well as contrasts and comparisons with the House-passed bill in preparation for the conference.

The conference was originally scheduled to hold its first full meeting February 10th. That meeting was postponed at the request of Senator Kennedy. And was he hospitalized at that -- he was in the hospital at that time with a case flu. And so because the Senate and House took different weeks for their recess schedule this year for President's Week, that has delayed now until at least next week a full conference meeting. We anticipate that the first full conference meeting will occur next week when the House comes back into session.

The leadership of the House and Senate have both established March 31st as the deadline for the conference to produce a bill. And the conferees are going to try to honor that. They're going to try to actually get a bill done by then, and that is a very, very ambitious schedule. This is clearly a conference that could last all year if one wanted to drag it out. And there is a commitment that that will not occur and that there will be a bill come out of the conference by the end of March.

I don't know if that can be met or not, but at this point, at least, that is -- they're seeking to honor that commitment and to get it done by then.

Conference committee, as you all know, is -- the purpose of that is to merge two bills together. And the only way that can happen is for there to be compromises. And so I suspect there are going to be a number of areas of compromise, and there's a lot of commonality between the two bills.

The two areas in which it's going to be interesting to see what kind of compromise can be reached, if any, is in the area of scope and the area of liability.

And there is -- and those two issues I think will be left to the very end. They'll be the last ones that will be addressed in the conference. And if there is any give on the Senate side's position, it will be in the area of having some kind of very limited liability provision that might attract more the Coburn-Shadegg kind of approach where it would be only after you had exhausted internal and external appeal, only in federal court, and probably with an inclusion of some kind of cap on damages, including tort reform and possibly even broader tort reform that would be included in the bill, which would in all likelihood be a poison pill for the president signing anything.

But the Senate does intend, and they feel very strongly about these issues, that we will defend the Senate bill and we will operate on any compromises based upon the principles that we should not increase the number of uninsured. We should not create new federal bureaucracies. We should not increase inordinately health care spending and health care costs in this legislation. And so based upon those principles, we'll try to produce a bill that meets some of the needs without doing damage.

And I think that what Mike said is do no harm, and what Bill Frist has said repeatedly as we've gone through this process is that that should be our first and guiding principle is that we don't do, in trying to improve a health care system, that we don't create the unintended consequences of harming what is arguably and defensively the best health care system in the world.

So with that, let me open it up and entertain any questions that anybody might have on this or other subjects. Rob?

QUESTION: Senator, Rob McDonald with --

MR. HUTCHINSON: China, right? China. You're going to jump from health care to China.


QUESTION: Well, if you want to do China -- as we've talked many times, whoever is elected president later this year, probably the most challenging bilateral relationship that person will have to manage is the U.S.-China relationship. And it promises to be a difficult one for years to come.

MR. HUTCHINSON: I was kidding. You really are going to ask about China.


QUESTION: You have been a real leader on behalf of those who would like to be able to speak their conscience in China and yet have been thinking a lot about this WTO agreement and does that help, does that hurt. Could you talk a little bit about how you see the U.S.-China WTO agreement, both on the commercial merits and on some of the issues that you have been very active on as well?

MR. HUTCHINSON: Yeah, the -- as Rob and I have had many, many lengthy discussions about China and trade. I have always opposed NTR for China on the annual debate, not because I thought that was a particularly effective means of addressing human rights concerns in China, but because I thought the annual debate was important, that raising the issue was important, and that there was never any risk that NTR was not going to be renewed for China year in and year out.

But the WTO debate really puts it in a different arena, I believe, because I have reached the conclusion -- and I always felt trade was not an effective means of addressing human rights, that it was in many ways aggravated the relationship between our two nations. It certainly hurt a lot of Americans who were producing products that could be sold there. But that China's membership in the WTO and accession into the World Trade Organization will provide us a greater means of encouraging transparency, of having greater influence over their behavior and their entry into the community of civilized nations.

I think it's very, very abhorrent the way they treat their people. I think that -- you know, I disagree with a lot of folks who think that the progress there has been adequate. I don't. And I think that their statements in the last week or so reiterated again today by the Chinese military, the very bellicose statements they've made about Taiwan, is very nonproductive and very harmful and frankly, pretty scary.

But I don't think that those problems and those misgivings about their human rights progress should prevent us from having them as members of the WTO. So I would vote for permanent NTR for China and would seek to have them as part of the world trade organization. And that's what Rob wanted to hear, and that --


I told him I'd said that publicly, but he just wanted to make sure I said that publicly.


That was kind of a lukewarm applause, but it's better than what I usually get on my China statements.


MR. BAROODY: By seeking recognition I may have cut off the applause. I wanted to get up principally to thank you for what you just said. We -- in introducing you, I focused exclusively on the health care concerns we have. But clearly for the overwhelming majority of American manufacturers, the China trade relationship is very important, and we applaud and thank you for the statement you just made.

Now, back to health care.


MR. BAROODY: I would just point out to you that not only did the NAM get a 38 percent response as you alluded to in your remarks, that people would seriously consider dropping health care if liability provisions passed, but that's been confirmed by another study that was conducted only of large concerns. Our study went to both our large and small manufactures. A study of was it 600 large concerns, found the same result: 38 to 40 percent, who said if liability becomes law, sooner or later they're out of the business of provision of health care.

The question has a predicate. A member of company of ours before the vote on Dingell-Norwood, a very large company, called their member of Congress and told him essentially that: If liability becomes law, we will stop providing health care and pass out vouchers or some equivalent.

After the congressman voted for Dingell-Norwood, that same company got back to him and said, "Didn't you hear us?" And the congressman said, "I heard you, but frankly, I didn't believe you." All that's a predicate to the question, how do we -- what do we need to do to make sure that members of Congress understand that this is very serious for American employers, certainly manufacturers, but across the board, and that it really would have that consequence?

MR. HUTCHINSON: Yeah. That's an excellent point. Because I had -- I know one of your members in Arkansas is Tysons, Tysons Foods. And Tysons has told me the same thing, that they would -- I don't know that they actually said they would. They would consider dropping it. Wal-Mart has even been stronger in their insistence that they would go to a voucher or some kind of health care benefit and say go get your own health care insurance.

But you're absolutely right, Mike, that most members do not -- they think that that's scare, it's scare tactics. They don't really believe that that would occur. And I am not sure how you impress that more, but I think reiteration, saying it and saying it and saying it again, is the best thing that you can do. And, you know, when members are in their districts, set up those NAM meetings, make sure that their local employers are making the point and making the point over and over. That's the only thing I think that can get through.

Because this is an issue that resonates. You know, campaign finance reform, frankly, it's much easier to vote against a McCain finance reform in Washington because nobody really cares out there. I mean, if you ask them are they for reform, they're for reform, but it doesn't touch their lives and they're not really that concerned about it. But you ask them about managed care, and they have experienced it. And it resonates and members see it as a powerful, powerful political issue that can be demagogued easily.

And it is more difficult -- I mean, when you talk in terms of a few more million people losing health insurance, that's a statistic. When you tell a story about somebody who was told by their HMO that they couldn't get the kind of CAT scans or whatever that would reveal a condition that could be life-threatening, and that the insurance wouldn't pay for it, then it becomes very, very personal. And if it's a loved one, it becomes very personal. And there are enough of those stories out there and enough of those things that have happened that this scares members of Congress to death, and that's what you have to overcome.

Because i really believe that if in fact we passed a liability provision anywhere near Norwood-Dingell, that a lot of companies would drop their insurance, that you'd have millions more out of insurance, and the result would be that we would have a whole new move for nationalizing the health care system.

And I don't know if that's calculated or not, but I think that that could well be the consequence of an ill-advised patients' bill of rights, that we would add new impetus to nationalizing the whole system, which I think would be a terrible move.

Yes, sir?

QUESTION: Just following up on that, you focused on the liability and scope issue, which has mostly been focused on, which are hugely important issues. There are also a whole set of other provisions in both bills. And while their titles may be the same, how they achieve their goals and the power that they give to the secretaries of HHS and the Department of Labor are very different. And I think the words really do matter --

MR. HUTCHINSON: Absolutely.

QUESTION: -- which is more of a statement than a question, but in trying to come to some agreement, we be conscious of the fact that we're in essence making the department -- the secretary of the Department of Labor a full partner with any employer who voluntarily chooses to provide these benefits. And I am not sure that that's the goal that we really want to achieve.

MR. HUTCHINSON: I agree entirely. And you're absolutely right about the significance of these other provisions and the wording of them.

And in most cases, in fact almost every case, the House language -- the result will be much more costly and much more bureaucratic. And I think that the staff -- and I want to -- I think everybody knows Kate Hall on my staff. But our -- in the Senate have done an incredibly good job of analyzing the impact of even every tiny provision in these bills. And we're going to be very conscious of that, and I have dealt with the two big issues.

But you're very right that there are in every area from I guess emergency room care, the language differences in the House and Senate -- all of those have much -- have a lot of impact on the cost and the burden placed upon business. So, point well made.

Yes, sir?

QUESTION: Just a question. What would be the chances the conferees would produce a bill the president wouldn't veto? And what would a presidential veto do to the whole --

MR. HUTCHINSON: Yeah, we're really in the -- there's a lot of possibilities, a lot of scenarios. So we could produce a bill -- I mean, Charlie Norwood, to a great extent, as far as whether a bill would pass the House, he's going to have a lot -- he's almost going to have veto power, because he has enough votes that he could control over there with that very small majority that if he decides a bill is not -- doesn't meet his specifications, that he can't live with it, I think he could cause a bill to fail in the House.

So we could conceivably produce a bill, Charlie felt left out of the process not being on the conference. He's already gone out there and said he thinks that the leadership should go meet with the president and negotiate their own bill, which is not the way the process works and is not the way it's going to work. But -- so you've got that possibility. We'd produce a bill that the Senate would pass and the House would not.

If we get -- and I think Charlie is willing to accept some changes in the liability provisions and take a more narrow liability approach. If you came up with a bill that you could get through the House, what would the president do? I think the first thing he would do is do a poll.


He would test it. And he takes credit today for welfare reform, but the only reason it passed was because it was an election year and it was popular, because he vetoed it twice. And so I don't discount the possibility that he would sign a bill that -- and it depends upon -- it all depends upon the politics of it. I mean, I think he wants a legacy, but he also wants Al Gore as president. And so if he wants the issue more than he wants to pass more modest reforms than what he would like, you know, I mean I think that's going to determine what he does, is how it plays with the public and how popular it is and how the press portray it. And there'll be a lot of polling done and then he will make his decision on that basis. And that's my cynical view of our president.



QUESTION: Senator, one thing that is being talked about a little bit is a possible compromise that talks about a ban on class actions but gives more rights to people to sue in either federal or state court, perhaps federal court. Is there a serious effort to try to make some sort of compromise along those lines?

MR. HUTCHINSON: No. And that is, I mean that has not even been discussed among Republican conferees on the Senate side. But it's been in the press and I've seen the accounts of that -- the White House's reference to that.

But, no. The only -- I mean, right now the Senate position is we like what we do. We don't want a right-to-sue provision in there. But there has been no meeting with the House at all yet, and at some point we're going to have to address can we come together at all on this. And to the extent that there's room for compromise, I think it would be along the lines I said -- where there would have to be -- they would have to exhaust internal and external appeals before they'd have any right to sue, that it would limited to federal court, and it would be with limitations on damages.

So that goes much further than the idea of limiting some class action lawsuits. As long as you have the potential for class action lawsuit at either state or federal level, you've got a pretty big loophole there, I think. And I'm not an attorney, but I don't think that is a basis for compromise between the House and Senate. There's going to have to be a lot more of these other limitations on any right to sue than just the class actions.

QUESTION: You've commented that a lot of the politicians react to the anecdotal information that is out there. The statistic about 41 million uninsured, if you look at the research, it's about 40 percent less than that. I fall into the category of uninsured because I opt out of my employer's plan and am covered under my spouse's plan. But that catches well.

I -- could you comment a little bit about how do you deal with preventing legislation by anecdote? And I think where there are abuses, I think we should come down with both feet on those organizations in the managed care industry that are kind of causing that. The majority -- we have been advised by a lot of organizations in this area it's not the case, yet what happens is we parade these stories out in front of legislators and they react responsibly to those stories, but there is nothing really to counter that. Any advice, Senator, on how to deal with that?

MR. HUTCHINSON: Well, Republicans are pretty bad at humanizing issues. Democrats are very good. As you saw during this whole debate on the Senate floor, it was anecdote after anecdote, pictures on the Senate floor of individuals along with the anecdotes. And it was -- and that's very powerful stuff. And the front page cover stories and news magazines about HMO abuses have all -- it's underlined and unscored. So I mean I think we did it about as well as it can be done during the Senate debate.

Don Nichols and Bill Frist, Don Nichols in particular deserve enormous credit in keeping us together, helping to spin the story and helping to get out, you know, daily and make our case to the media, going on the talk shows on the weekends and defending the Senate approach and the dangers of a Norwood kind of bill, and taking the hits through that week but controlling the damage as much as possible and producing a more rational, reasonable kind of bill.

I mean, that I think -- and that is the goal is for us in meeting -- with having a task force even beyond the conferees, who are familiar enough with the issues and with the consequences of the legislation to do more than just do the minutiae of the legislation but to actually go out and defend it and explain why this is the best approach. We're going to have to do that all the way through this process so that what we did that week on the Senate floor is continued in the way we handle the issue. And we need your help a lot on that.

But oftentimes what we do is emotionally based, whether it's gun control measures. I'm always amazed. Of course I come from a very -- Arkansas is an NRA kind of state. But emotional situations like these terrible tragedies in schools, and then immediately there would be a whole plethora of proposals, many of which are absolutely unrelated to whatever happened. But the emotion of the moment provides an impetus to really put pressure on passing legislation.

And I frankly think that's what happens in the health care debate. A lot of the anecdotes, you just kind of scratch your head and say, well, how's this going to address that? And they're unrelated, but they have a great deal of emotional impact. And we need to do a better job of making the -- putting a human face on people losing insurance and the consequences of that, but we sure do need your help on it.

And Mike's getting ready to stand up.

MR. BAROODY: I wondered if you had time for one more question. Is there any one more?

MR. HUTCHINSON: We'll do one more and -- yes?

QUESTION: Shannon Russell with Ashland. In the interest of full disclosure, this year I'm president of NABPAC, the National Association of Business PACs, and we are 130 corporations and trade associations who actually do have an interest in campaign finance reform.

With Senator McCain either, you know, coming back to the Senate or becoming president one day --

MR. HUTCHINSON: I expected this question sooner.


QUESTION: He certainly magnified the issue. Everybody in this room under Senator McCain's scenario is probably tainted by special interests or seemingly corrupt.


You have opposed McCain-Feingold in the past. You've supported a watered-down version this past time. I'm just curious if you've looked at the Hagel-Kerrey bill and how do you see Senator McConnell's upcoming hearings going and any idea if this issue which we believe will continue to have legs? But you're absolutely right. No one outside of Washington, D.C. does care about it.

MR. HUTCHINSON: Yeah. Shannon, I'm not clear -- I'm not sure of the specifics. I can't remember the specifics on the Hagel-Kerrey bill. My general impression was as I looked at that that I didn't have a lot of problem with it. I thought it was a pretty good approach in it.

I did -- my problem with McCain-Feingold initially was the restrictions on independent expenditures that I just think you've got great constitutional problems and real -- I had genuine, really genuine concerns about the First Amendment -- infringing upon First Amendment right. And that any group out there, whether it's ALCU or National Right to Life, ought to have the right to run an ad and criticize or commend members in Congress. And to start saying you can't do that 30 days before or you can't put a picture or there or you can't say this or that, I have very, very serious problems with that.

The ban on soft money, I had publicly supported that. I think the soft money has been abused; that it was never intended for soft money to work the way it works, where companies are extorted in one sense, and that money goes into the coffers of the party, and the party in turn effectively runs campaign ads with it, not at the control of the candidates. I think we needed to either put restrictions or eliminate the soft money. So I voted for the watered-down version of it.

I think the fact that Mitch McConnell is holding hearings and has talked about limitations, restrictions on the soft money, says how far the debate has moved, and that McCain has had a big impact on the realization that there's probably going to be something done on that. I don't know whether it will happen this year in the midst -- I doubt that anything will happen this year in the midst of an election year.

But you've got, you know, George Bush, now, George W. Bush saying we ought to ban soft money. So he's got his own version of campaign finance reform. But I think probably we're going to have something next year.

This year -- what have we got, 50 days, legislative days left? Fifty-two legislative? Not much time. And it's -- everybody's desire is -- I mean, when we go into a conference and Trent Lott says, we were on recess last week and we ticked up three more points in the polls, there's a recognition that we do a lot better when we're out of town than when we're in town.


So the main emphasis about getting the appropriations bills done early and wrapping things up early, and so things like campaign finance reform that you have a week-long debate on, the Democrats could coerce us into that kind of having to devote -- where Lott would have to say, we ought to set aside three days for this or whatever.

But with McCain on the road, I just don't expect that you're even going to have the debate on the floor this year. That you'll have the hearings and we'll not actually have a vote on a bill.

MR. BAROODY: Thank you.

MR. HUTCHINSON: Thank you very much. I've enjoyed it as I always do.





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