The American Red Double-Cross?

There are only two important things in politics. The first is money, and I can’t remember the second.

– Mark Hanna

Sightings from The Catbird Seat

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March 14, 2002

Bad Week For The Red Cross

By Reed Irvine

The second week of March started out badly for the American Red Cross. 60 Minutes devoted a segment of its Sunday program to searing criticism of the way in which the organization handles the big bucks it collects ostensibly to provide assistance to victims of major disasters.

That was followed the next day by a blast from the Catholic League for Religious and Civil Rights. It asked over 100 organizations to drop their support for the American Red Cross because its chapter in Orange County, California, had canceled its invitation to a student choir to perform at a large function the previous day because it was planning to sing a medley consisting of “America the Beautiful,” “Prayer of the Children” and “God Bless the U.S.A.”

A spokeswoman for the Orange County Chapter explained the cancellation saying, “We wanted songs representative of all races, all creeds. We are not a religious organization. We have to be neutral and impartial in all situations.”

The national headquarters in Washington, D.C., supported the cancellation of the invitation, issuing a news release that said, “The dispute was over the music program and has nothing to do with patriotism…. The dispute centers only on our sensitivity to religious diversity and a preference for a music program that would be inclusive and not offend different populations participating in this particular event.”

Cherilyn Bacon, the director of the group from the Orange County High School of the Arts that had been invited to sing, had arranged the medley, titling it the “Heroes Trilogy.” It was her intention to honor those involved in rescue efforts following the September 11 attacks.

A Red Cross representative objected to the medley, saying the lyrics might be offensive to some of the 400 guests at the annual Volunteer Recognition Awards.

Ms. Bacon told the AP, “We have never had a complaint about the medley. People have cried when they heard it. I think the Red Cross is taking the issue too seriously.” They took it so seriously that they dis-invited Ms. Bacon’s group and substituted another one from the same school, perhaps a group that promised not to sing any songs that used the words “God” or “prayer.”

In a news release accompanying his letter asking over 100 groups to withhold support from the American Red Cross, Catholic League President William Donohue said, “The American Red Cross has every right to adopt the platform of political correctness by censoring the free speech of young men and women who want to honor God and country. And we have every right to ask our friends to send the Red Cross an unmistakable message by refusing to donate one more dime to the organization. Our request is being sent to our allies in virtually every faith community. The time to put an end to this anti-religious madness is now.”

Apparently the way to get the attention of the American Red Cross is to take an action that threatens its income. With no big stories in the media applying pressure, a lengthy apology was issued by the Orange County Chapter and distributed by national headquarters the same day the Donohue letter went out. It said they “did not intend to hurt or offend anyone,” but that it was clear that the judgment they made to exclude certain songs from the Sunday program was a mistake. It concluded, “We want to apologize to the community and to any people who were hurt or disappointed by our actions.”

The “60 Minutes” program on the handling of the large donations the Red Cross gets to help victims of major disasters will not help the money roll in. It summarized the tardy disbursal of the $930 million given to the Red Cross to help the families of the 9/11 victims. It showed that it had taken 18 months to disburse the $16 million collected to assist the victims of the huge Red River flood in Minnesota in 1997.

It finished with the Red Cross response to a fire that destroyed many homes in a canyon near San Diego last year. The Red Cross put a photo on its Web site of a woman who lost her home in the fire. It helped raise nearly $400,000, but that woman and others had received no help.

After six months, a group of them met with the woman who heads the San Diego Red Cross chapter to ask how the money had been used. She was paid $309,000 last year, but she gave them no answers.

Both she and the head of the Red Cross national office refused to be interviewed by “60 Minutes.”

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December 28, 2001

From The Courier-Journal: AMERICA STRIKES BACK . . .

Mitchell to Oversee Fund for Red Cross

NEW YORK – Former Sen. George Mitchell was named yesterday to oversee the $667 million American Red Cross fund created to help victims of the terrorists attacks.

The charity also announced that it will exceed its goal of distributing $275 million in aid from the Liberty Fund by Dec. 31. It said it expects to hand out $317.5 million by year’s end.

Mitchell, who is from Maine, has spent his post-Senate life trying to negotiate peace in the Middle East and Northern Ireland.

As independent overseer of the Liberty Fund, Mitchell will supervise the development and carrying out of a plan to distribute the fund’s balance, said Harold Decker, chief executive of the Red Cross. The plan is scheduled for release by the end of January….

(Catbird musing: Wonder how much George Mitchell and his attorney pals will get paid for “overseeing” the Liberty Fund donations?)

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From The Cheating of America, by Charles Lewis, Bill Allison and the Center for Public Integrity:

Sweet Charity

Groups granted tax-exempt status by the IRS control a staggering amount of wealth. In 1999, more than 1.5 million nonprofits, including approximately 350,000 religious organizations, controlled assets of $1.3 trillion – nearly one and a half times the amount of government debt held in the Social Security trust fund. But whereas the Social Security trust fund holds government bonds, many nonprofits engage in businesses with potentially much higher rates of return.

In 1998, for example, the American Association of Retired Persons derived 60 percent of its $541 million in revenue from its business activities….

The same year, the Red Cross, known for its blood drives, raised 59 percent of its revenues by selling, among other things, donated blood and blood products to hospitals….

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< < < FLASHBACK < < <

From … and the truth shall set you free, by David Icke:

In 1917, the Elite used the cover of a Red Cross mission to Russia to arrange the final details of the Bolshevik takeover. The Red Cross in Washington launched a campaign to raise $2 million. It was successful thanks only to substantial donations from New York financiers, including J.P. Morgan himself, who gave $100,000.

The bankers and industrialists proceeded to take control of the United States Red Cross and, as the Elite’s John Foster Dulles put it, they “viewed the American Red Cross as a virtual arm of government…”

The personnel of this mission to Russia in August 1917 says it all. Only seven of the party of twenty-four were doctors. The rest were mostly New York financiers and their assistants, led by William Boyce Thompson (Committee of 300) – the first full-time head of the Federal Reserve Bank of New York. . . .

Also in the party were three Russian interpreters, all known Bolsheviks. One of them, Boris Reinstein, would become secretary to Lenin and head of the Bureau of International Revolutionary Propaganda. . . .

The Red Cross has been used on many occasions by the Elite without the knowledge of its genuine staff.

This is not only an insult to the work the Red Cross is seeking to do, it is also extremely dangerous for the 99% who are genuinely working for that organization out of compassion for the plight of the world’s peoples….

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September 28, 1989


In the spring of 1988, Dr. Carol Kasper began to have problems purchasing Factor VIII, the lifesaving blood-clotting concentrate she uses to treat hemophiliacs.

With it, hemophiliacs can lead relatively normal lives; without it, they can bleed to death from a minor cut.

By fall, as a nationwide shortage of Factor VIII deepened, the supply at the hemophilia clinic that Kasper runs in Los Angeles had dwindled to one-third of usual levels, and she faced a wrenching choice:

Should she save her limited supply of a new, safer Factor VIII for the children, or share it among all 500 hemophiliacs she treats – including many adults already suffering from AIDS?

The children had not yet been exposed to the AIDS virus. But by that time, 60 percent of all adult hemophiliacs in America had become infected, as a result of using clotting factor made from blood plasma contaminated with AIDS.

While the doctor wrestled with her life-and-death decision, U. S.-based manufacturers of Factor VIII were making decisions of their own.

Several companies stopped making Factor VIII as long as three months before introducing their new, safer clotting concentrate; one company raised prices nearly 20 percent at the height of the shortage, and three manufacturers continued to export large amounts to Japan and Europe, where they could charge higher prices.

As a result, America’s 20,000 hemophiliacs faced not only a health crisis but a financial one as well – a crisis that continues today, even though the shortage has eased.

The average cost to hemophiliacs soared from about $8,000 a year in 1987 to more than $50,000 a year today. Hemophiliacs who must use large amounts of the clotting medicine pay as much as $80,000 a year.

Manufacturers denied they were profiteering. They cited higher production costs and said that profits from the worldwide sale of clotting factor helped underwrite lower prices paid by Americans.

In many ways, though, their justifications underscored a fundamental tenet of business: Companies will try to sell their products wherever the most profit can be made. That is as true in the blood business as it is in the oil or steel industries.

The buying and selling of blood is a multi billion-dollar business. And plasma, from which many medicines are made, is the most commercial part of the blood business. The plasma industry had sales of more than $2 billion in 1988.

Unlike blood banks, the plasma industry operates on a global scale, is highly competitive and experiences dramatic swings in the availability and price of its products – as with Factor VIII last year.

Plasma and the medicines made from it are bought and sold like other commodities, with decisions made in one country often causing sharp price changes or shortages in other countries.

“It’s like selling hog bellies or wheat or beef. It gets sold all over,” said Thomas M. Asher, chairman of Hemacare Co., a for-profit company in Sherman Oaks, Calif., that trades in plasma and other blood products.

And if U. S.-based manufacturers choose to sell plasma medicines such as Factor VIII to other countries while there’s a shortage here, they are free to do so. The U. S. government makes no attempt to restrict exports of such medicines during shortages to ensure an adequate domestic supply.

When it comes to selling blood, the United States has the most liberal standards in the world for how often a person may sell his own plasma.

Federal regulations allow individuals to sell up to 60 liters a year (nearly 127 pints) of their own plasma – a maximum of two donations a week. That is twice the amount allowed by the next country, Canada. And it is four times the amount – 15 liters a year – recommended by the World Health Organization. (A liter is a little more than a quart.)

Result: More than half the estimated 12 million liters of plasma used in medicines worldwide comes from the United States.

“The U. S. is the OPEC of the plasma business,” said Thomas O. Hecht, chairman and chief executive officer of Continental Pharma Cryosan Inc., a Montreal-based distributor of plasma products. “You know what that stands for: the Organization of Plasma Exporting Countries.”

To put the 60-liter figure in human terms, the average American male could each year sell the equivalent of 21 times the amount of plasma in his veins at any given time.

Most of this plasma is collected at the nearly 400 commercial centers that operate nationwide. The centers pay between $8 and $25 for a donation of plasma, which is extracted as whole blood and then put into a centrifuge, which spins out and separates the plasma. The oxygen-carrying red blood cells are then transfused back into the donor.

Many plasma centers offer bonuses to encourage frequent donations Some advertise special Christmas deals, with the message that selling your plasma is a good way to earn money for Christmas gifts.

While U. S. donors are the source of more than 60 percent of the world’s plasma, foreign owners dominate the business. Four of the six largest plasma companies in the United States are owned or controlled by foreign corporations based in Japan, West Germany, Austria and Canada.


These companies collect and buy more than three million liters of plasma in America annually and sell them overseas to other companies, brokers or foreign governments.

They also sell the majority of their plasma medicines abroad. Japan is the single biggest customer, each year importing more than $300 million worth of plasma and plasma medicines. In 1988, 90 percent of plasma products used in Japan were made from blood collected in the United States.

On a per-capita basis, the Japanese use about three times more plasma medicine than either the French or English, according to a World Health Organization report. But Japan collects only about 10 percent from its own donors.

In this international market, it is not uncommon for plasma to change hands several times. Sometimes plasma brokers – middlemen who profit by bringing together those who have plasma with those who need it – are involved.

Even in industry circles, brokers are considered a secretive lot. There are no lists of brokers and finding one is no small task. Locating one willing to talk is even harder.

Asked to describe his business during a brief telephone conversation, one of them, Eric Jarrett, a Woodland Hills, Calif., broker said: “We sell plasma to whoever wants to buy it.”

“No one knows how much they control,” said Joseph Rosen, vice president of Sera-Tech Biologicals Inc., a New Jersey company. “One broker may sell to another broker, who again may sell it to me or to a company in Europe.”

Tracking this plasma once it leaves the country is difficult at best, industry officials and government regulators say.

Besides a registration requirement, the federal Food and Drug Administration does not regulate the activities of brokers and does not inspect their operations.

“Whether or not sterility is ever a problem, we do not really know,” P. Ann Hoppe, assistant director of the FDA’s Division of Blood and Blood Products, told an industry meeting last November. “The storage conditions often are such that bacterial contamination could proliferate if there were any present. So sterility may be less than 100 percent.”

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March 13-19, 1999

Tainted Blood: Poison from the prisons

The Economist

Little Rock, Arkansas

At the end of February, a group of Canadian haemophiliacs infected with HIV and hepatitis C descended on Washington. They want an inquiry into why the United States, particularly the federal Food and Drug Administration, allowed the export of tainted prison plasma from Arkansas and Louisiana to Canada in the 1980s.

At the time, Bill Clinton was governor of Arkansas, and the FDA had already ruled that prison plasma was too unsafe to be used for the manufacture of blood products inside the United States.

In January, the same group filed a $1 billion suit against the Canadian government and companies involved in the plasma production. This month, it plans to bring lawsuits in the $5 billion range which will name the FDA, the states of Arkansas and Louisiana, their prison systems and various medical- care providers for the prison inmates, including Health Management Associates (HMA), which ran the Arkansas prison plasma programme from 1978 to 1994 and also bought prison plasma from Louisiana. The suit may also name the president, if evidence is found that Mr Clinton knew about repeated FDA violations and yet did not shut down the plasma industry in his state’s prisons.

The Krever commission, set up by the Canadian government in 1995 to look into contaminated blood issues, found that the tainted plasma often came from Cummins prison. Cummins is a vast farm-based penitentiary that sits in bleak countryside, strewn with shanties and burned-out churches, 70 miles south-east of Little Rock. The inmates’ blood was sold by the Arkansas Department of Correction to HMA which, in turn, sold it to North American Biologics, a subsidiary of Continental Pharma Cryosan, a blood-broker based in Montreal. From there, it was shipped all through Canada and across the world.

Many Arkansans seemed unaware of the plasma programme in their state prisons until last summer, when Michael Galster, a prison doctor, wrote a fictionalised account that exposed it. In past news reports, prison officials had denied knowledge of what was going on.

Yet not only did the prisons run such a programme from 1969 on, they were often in trouble for it. In Cummins, even when the existence of AIDS and hepatitis C was recognised and tests for these diseases became available, they were not always used; the FDA discovered that one hepatitis-testing laboratory was out of action for two months. Needles were often dirty, so that many inmates now claim to have been infected as they gave blood. (People caught in homosexual acts were, however, removed from the list of suitable donors.)

In the early 1980s, the FDA accused the centre of numerous violations and even ordered a temporary shutdown. It didn’t matter. Arkansas police investigations have shown that HMA continued to try to find ways to sell inmates’ blood, especially to Connaught, a Canadian company that may have sold the plasma worldwide (the matter is under investigation).

The Krever commission found that Connaught decided it was “impracticable” to inspect all the plasma- collection sites itself, and decided to rely instead on FDA reports which it did not, in fact, review. In any event, Arkansas prison blood products found their way to Europe and Japan, and in at least one instance were sent back to the United States itself.

Whenever trouble appeared, HMA asked for Mr Clinton’s help. The group invited a friend of the governor’s, Leonard Dunn (now chief of staff to the lieutenant-governor), to come on board as HMA’s president in 1984. When the prison’s plasma licence was revoked, HMA simply applied for a new one under a different name.

Prison administrators wanted to keep the programme, and prisoners liked it for the pocket money it provided: $7 a pint, with which they could buy soap and cigarettes.

Francis Henderson, the creator of HMA and chairman of its board, maintains that AIDS cases simply did not exist in the South during the 1980s, and that prison plasma was no riskier than other kinds.

However, Art Lockhart, then director of the Arkansas Department of Correction, contributed in 1984 to an information bulletin about prison plasma centres published by the American Correctional Association, in which prison populations were said to be at high risk, and concerns were raised about “quality control” in taking blood from them. Despite this, the Arkansas Department of Correction went on running its plasma programme for another decade.

In the next few weeks the Canadian haemophiliacs will go to Cummins itself, seeking answers from a state that has long and steadily denied even having a prison plasma programme.

It remains unclear whether they will get an invitation to the prison where, in effect, they received a death sentence….

  From: “Linda C. Miller” <>


Subject: Tainted prison plasma

Date: Mon, 20 Jan 2003 02:16:16 -0800

I found your site by searching on “tainted prison plasma”, and am always glad to find others who are making this issue known to the world. However, I don’t know where you got the information that prisoners caught in homosexual acts were not permitted to donate thereafter. In fact, known jailhouse prostitutes, also known to be infected with HIV and AIDS were permitted to donate regularly. One male AIDS-infected prisoner prostitute, known as “Charlotte” donated right until the end of “her” life.

You might be interested in my web site on this topic – my brother was one of the hepatitis-infected prisoners who was the source the the tainted plasma. Most of my information was provided by prisoners who worked and/or participated in the program. In addition to the web site, I am working with a documentary film maker who is in the process of selling his film about the AR end of this atrocity.

My web site is at

Thanks for your interesting and informative site.




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  April 12, 2003

In Proposed Court Deal, Red Cross Vows to Follow Blood-Safety Rules

By Randolph E. Schmid, Associated Press

WASHINGTON – The Red Cross, accused by the government of “persistent and serious violations” of blood safety rules, promised in a court settlement yesterday to meet all safety requirements and pay fines that could reach into the millions if it fails to do so.

The Food and Drug Administration said the consent agreement settles concerns stemming from inspections dating back 17 years.

The Red Cross, the nation’s leading collector of blood donations, said it welcomed the agreement as marking “a new era of cooperation” with FDA.

Two years ago, the FDA went to court seeking a contempt citation against the Red Cross for not following a 1993 agreement to meet blood safety standards.

Under the new settlement, fines for various violations could total up to 1 percent of the Red Cross’ $1.9 billion in annual revenues – or $19 million – in the first year, increasing to a maximum of 4 percent by the fourth year.

“The new financial penalties in the consent decree create an important new incentive for (the American Red Cross) to improve the processing and controls necessary for making safer blood products,” said FDA Commissioner Dr. Mark McClennan.

In its most recent inspection of the Red Cross last December, FDA said it found “numerous and troubling problems in producing blood products – including a lack of management control and quality assurance oversight that could lead to a patient receiving potentially unsafe blood.”

Among problems cited by McClennan were alternation of records so blood could be accepted from an unsuitable donor, failure to keep good inventory records so blood could be recalled if necessary and mislabeled blood products. He said, however, that people who need blood transfusions should not hesitate to get them.

There are overlapping safety procedures in effect and any particular breach of the safeguards does not necessarily result in unsafe blood products, he said.

The agreement will be submitted to the court for approval, he said.

The Red Cross issued a statement saying it recognized the need to strengthen its procedures and was launching an aggressive quality program.

The Red Cross provides about 45 percent of the nation’s blood supply. Another 45 percent is collected by independent blood centers and the rest is collected at hospitals.

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March 13-19, 1999


The Economist

Each year, more than one million American women give a part of their bodies to make valuable vaccines used throughout the world.

In return, they don’t even get a thank you.

But these women – all of whom have just given birth – might be surprised to learn that their “gifts” are part of a multimillion-dollar business involving hospitals, brokers and an international conglomerate based near Paris.

The business: buying and selling placentas, the vital mass of tissues that nourishes the fetus during pregnancy.

The maternal blood contained in placentas provides a valuable source of plasma proteins used to make vaccines for rabies, as well as other medicines.

For one French company, Institut Merieux in Lyon, placentas are an important source of income. The firm buys 15 tons of placentas a day – five million placentas a year – and processes them into products sold in about 100 countries, including the United States.

In 1987, the most recent year for which data were available, Merieux reported profits of $35 million on sales of more than a half-billion dollars.

That year, more than 1.7 million pounds of frozen placentas – 776 metric tons – were shipped from U. S. ports overseas, shipping records show. Most went to Merieux.

A placenta weighs about one pound.

Merieux is by far the largest commercial company in the world that uses placental blood plasma to make medicines. Its supplies come from hospitals in 30 countries, including Canada, Cuba and the Soviet Union.

Sometimes Merieux pays hospitals for their placentas and other times it negotiates a fee with agents operating on its behalf, according to documents and interviews.

One such agent is R. P. International, a privately held company in North Wales, Montgomery County. Shipping records show that in 1987 this firm sent nearly 401,000 pounds of frozen placentas to Le Havre, France, for Merieux’s facility in Lyon.

Roland Roth, the head of R. P. International, declined to be interviewed. However, Henry Portner, an attorney representing the company, described its operations this way:

“We are in essence the middle person between the hospital and the manufacturer. We place freezer units at the hospitals and nurses at the hospitals are given special instructions on how to take the placenta from the mother and to place it in special bags in the freezer. At some point, we come . . . into the operating room and acquire the placentas.”

Portner would not say how much Roth’s firm pays hospitals for the placentas. “Honestly, I’m not sure. I know we’re paid by Institut Merieux. I’m assuming there is probably some payment,” he said.

Jacques Francois Martin, Merieux’s general manager, said it was impossible to say what the company pays on average for placentas because the fee varies according to location and transportation costs.

Dr. Arthur J. Shulthise, president of Bio-Med HU Inc., a Louisville, Ky., company that also gathers placentas, said he pays hospitals “on the basis of quantities and weights. We pay for the electricity and the space. It’s basically a remuneration for these things.”

He declined to say how many placentas he purchases from hospitals. However, records show his firm shipped more than 703,000 pounds of frozen placentas overseas in 1987.

Shulthise said the placentas would probably be destroyed, at a cost to the hospital, if they weren’t sold to Merieux. By using them to make medicines, Merieux is providing a valuable service, he said.

“It’s still part of the human body. It still has benefits and that’s what we’re interested in,” Shulthise said.

Of course, Merieux makes a profit in the process. The company’s 1987 annual report notes that the firm sells vaccines, albumin and other products in nearly 100 countries. About 50 percent of the company is owned by the French conglomerate Rhone-Poulenc S. A.

Merieux occupies a unique niche in the worldwide market for plasma medicines. Under French law, only the government’s nationalized transfusion service can collect blood and plasma from human donors. However, a loophole in the law allows Merieux to collect and make medicines from placentas, nearly all of which are sold outside France.

Merieux operates a state-of-the-art facility in Lyon where the frozen placentas are minced into small balls, more or less like a wine press, thawed and then processed. Proteins from the maternal blood are separated, purified and made into albumin and vaccines.

Where do the U. S. placentas come from? Few hospitals will say.

The Inquirer contacted four of the largest hospital maternity services in the region to ask what they did with placentas. None of the four presently sell placentas, according to spokesmen. One of them, Abington Memorial Hospital, used to sell its placentas to Roth’s company but stopped.

Donna Greenberg Root said the hospital stopped selling them in 1987.

“We stopped because of the AIDS situation. We would have to make sure the placenta was not infected. There was also a question of confidentiality. The whole thing got to be such a nightmare.”

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For David Schmitt, a hemophiliac, the choices were stark:

Stay in England, where he could get all the Factor VIII blood-clotting concentrate he needed from the National Health Service and pay nothing. Or come home to Philadelphia, where friends and a new job waited but where he faced a severe shortage of Factor VIII and costs of more than $52,000 a year.

“I was extremely concerned,” Schmitt, a 31-year-old architect, recalled in a recent interview back in Philadelphia. “At the time, (in London) I was able to get all of the medicine I needed and I didn’t want to be constantly worrying if I would have enough and would have to change the style of life I was accustomed to.”

Schmitt had moved to London in September 1983 to study and work. By the time he was ready to return to Philadelphia just before Christmas last year, the world that he and 20,000 other American hemophiliacs knew had changed dramatically.

Six of every 10 American hemophiliacs had been infected with the AIDS virus as a consequence of taking Factor VIII made from tainted blood plasma. Nearly 800 hemophiliacs had developed full-blown symptoms of the disease.

Available supplies of Factor VIII had dropped by nearly half, forcing hemophiliacs to cancel elective surgery and to ration the amount of medicine they used. Some had to quit jobs, stop exercising and abandon travel so they could be near a hospital or clinic in case of an emergency.

Meanwhile, the average wholesale price of available Factor VIII had risen nearly 700 percent – from 9 cents a unit to 68 cents a unit in the case of one manufacturer. Hospitals added their own markups – in some cases as high as 100 percent. So hemophiliacs or their insurers ended up paying $1.30 a unit or more.

It is not uncommon for hemophiliacs with the severest form of the disease, Hemophilia A, to use 50,000 or more units a year. More than half the 20,000 hemophiliacs in the United States, including Schmitt, suffer from Hemophilia A.

To control bleeding, Schmitt injects himself six times a month with the clotting factor. Each injection or dose contains 874 units of the medicine. So he uses 5,244 units a month, or 62,928 units a year – $52,230 worth a year.

“I never really added it up before,” he said. “I wish I made that much myself.”

Compared to some hemophiliacs, Schmitt is relatively lucky. He has a good senior life insurance plan that covers most of his expenses. And a Pennsylvania program picks up most of his out-of-pocket costs.

Some hemophiliacs are less fortunate. Schmitt has heard stories about patients who have become impoverished paying for their clotting medicine. And he is by no means immune. At current prices, hemophiliacs with $1 million worth of health insurance – like Schmitt – will exhaust their coverage in 10 to 15 years.

“It seems to me the pharmaceutical companies are making a lot of money by charging exorbitant prices to people who have no choice,” he said.

Manufacturers say the higher prices are the result of costly new technologies used to make a safer version of Factor VIII.



When Schmitt moved to England in 1983, he continued to use clotting factor that he had purchased in the United States. But when his supplies were exhausted, he turned to the British National Health Service, receiving treatment at the hemophilia center at the Royal Free Hospital in London.

“For a chronic disease like hemophilia, it really was a superb system,” Schmitt said. “The big difference between here and there was there was a shared responsibility. They didn’t treat you like a clinical object.”

Although there also was a shortage of Factor VIII in England in 1988, Schmitt said he never had a problem getting medicine. “Never. And I never paid for anything,” he said.

About 70 percent of the Factor VIII used by England’s estimated 7,000 hemophiliacs is manufactured at three government-owned facilities, including one in London. The remaining 30 percent is purchased on the open market, with U.S.-based companies supplying most of it.

In the United States, hospitals, hemophilia treatment centers and private pharmacies buy Factor VIII from manufacturers and sell it to hemophiliacs. There is also a growing home-care business, in which companies deliver the concentrate to customers’ residences for a fee.

Schmitt decided to return to Philadelphia, in part because he found a home-care company in California willing to supply him with older, less expensive Factor VIII. And he had three months’ worth of British medicine that he could bring home with him.

“By the time I used that up, the shortage had eased and I was able to get what I needed at Jefferson (Thomas Jefferson University Hospital, where Schmitt bought his medicine).”

Even so, Schmitt said he was considering switching to the older, heat-treated form of Factor VIII, if he can find it. It costs less than half of what he’s now paying.

“It just doesn’t seem right to pay that much,” he said. “I may just go back with the California company.”

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  Bob Dole & Elizabeth Dole – Famous for his erectile dysfunction, this former presidential candidate and his also-wanna-be-president wife should both go down in history for their ethical dysfunction.

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From The Money Men: . . . Hand-to-hand lobbying is all about access . . . And who better to worm their ways into official circles than people who had just been there or who were close to the people who still were? As an added bonus, these also were people who, for the most part, could serve as a credible public face for the interests they served. The top ten of Fortune’s list was filled with recently departed leaders of Congress and of the political parties.

The number-one lobbying firmVerner, Liipfert, Bernhard, McPherson, and Hand— acquired its marquee names over a relatively short stretch in the mid-1990s. They included two former Senate majority leaders, Bob Dole and George Mitchell, and a former treasury secretary, Lloyd Bentsen. . . .

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From The Buying of the President 2000: . . . Elizabeth Dole’s tenure as the president of the American Red Cross echoed her performance at the Transportation and Labor departments. She remained uninvolved in the day-to-day operations of the $1.9 billion-a-year charitable organization, and attempted to manage a staff of 31,000 primarily through pronouncements to the press.

When she took over the century-old charity, the world’s attention was focused on the crisis in Kuwait and the ensuing Persian Gulf War. In 1991, as soon as the fighting was over, she flew to the front to be photographed with Red Cross staff and the troops they were supporting.

After touring an understaffed children’s hospital in Kuwait City, she told the cameras that her organization would send doctors and supplies. Her unilateral gesture offended Muslim factions within the fragile coalition of organizations that makes up the International Red Cross and Red Crescent movement.

On the job barely three months, Dole’s May Queen style of diplomacy had already initiated a minor international incident.

Dole’s stump speeches were filled with references to her proudest achievement at the Red Cross: “a seven-year, $287 million transformation of the way the organization collects, tests, and distributes half of the nation’s blood supply,” or almost six million units of blood a year. But as was the case with air bags, it took a court order to force the action for which Dole now takes credit.

During the 1980s, the Red Cross and other organizations had been slow to begin testing for new blood-borne diseases – including AIDS – and the public was losing confidence in the blood supply. By the time Dole was hired, testing costs were climbing, donations were falling, and the organization was slipping behind on reforms promised in a 1988 agreement with the Food and Drug Administration. Congressional hearings were focusing national attention on the Red Cross’s failures.

Dole responded with a press conference. On May 20, 1991, she announced a two-year “transformation program” that would rebuild the Red Cross blood-supply system from the ground up. Twenty-eight separate computer systems would be replaced by one national computer, which would contain the medical histories and test results of every donor.

(Catbird pondering: Wonder how much this huge ‘transformation’ cost? Wonder who got the contract? Wonder how it’s working?)

Dole called her plan “the most dramatic and far-reaching public safety step the Red Cross has taken in its history.”

Congress and the media responded warmly to Dole’s pronouncement. But much of her own staff was shocked. Few of them heard anything about her plan until they read it in the newspapers. And many feared her sweeping reorganization – which called for temporarily shutting down every Red Cross blood center in the country – would risk leaving too many patients high and dry.

By 1993 – nearly two years after Dole’s sweeping pronouncement – the Red Cross has consolidated some of its testing laboratories, upgraded its computer systems, and begun providing better training at its blood banks. But the FDA still wasn’t satisfied. So the Justice Department sued the charity on behalf of the FDA.

The lawsuit, United States v. American National Red Cross, accused the charity of distributing “adulterated” and “misbranded” blood and blood products. The government promised to file criminal charges against Red Cross executives – including Dole – if the organization failed to meet a new set of deadlines.

Dole wasted no time in responding. First, she sent her lawyers back to the FDA to negotiate a new consent decree that didn’t hold her personally responsible. Then, in a move perceived by many to be the ultimate expression of how distant she was from her own senior staff, she assigned two longtime associates to investigate what her people were doing and report back to her.

The blood-supply system was eventually rebuilt. But Dole’s leadership style remained unreformed. She continued to insulate herself from the organization through an inner circle with deeper connections to Republican politics than to the work of the Red Cross.

The members of Dole’s palace guard included: Jennifer Dorn, her top aide at the Transportation and Labor Departments; John Heubusch, who went on to become the executive director of the National Republican Senatorial Committee; Mari Maseng Will, a speechwriter for Presidents Reagan and Bush who had worked in all of Senator Dole’s campaigns; and Robert Davis, her private attorney.

Her reliance on this shadow staff of consultants was singled out for criticism in a 1996 review of the charity by the auditing firm KPMG Peat Marwick.

At times this inner circle put its own interests ahead of the Red Cross’s.

In 1995, for example, the Red Cross was putting the finishing touches on a pamphlet, posters, leaflets, and videotapes to be used by instructors in its AIDS-awareness education program. Funded by a $5 million grant from the Centers for Disease Control and Prevention, the Red Cross program sends trained instructors to schools, churches, and civic organizations to teach people how to protect themselves from HIV, the virus associated with AIDS. The carefully edited materials advise sexual abstinence but also illustrate the safe use of condoms. It is the largest AIDS education program in the United States, reaching two million people a year – half of them youth.

But release of the AIDS awareness supplies to the charity’s 1,300 local chapters was delayed for months so that the language – which had already been carefully revieewed by the Red Cross staff – could be further scrutinized. Dole’s husband was running for President, and her political advisers feared that the materials’ frank discussions of sex might upset the Senator’s delicate courtship of Christian conservatives.

Dole’s allies reedited the materials, playing down the use of condoms and instead stressing abstinence. Never before had there been such high-level interference in the AIDS program.

Dole’s final act in her $185,000-a-year job was her most transparent use of the charity for her own political ends. She gave herself the starring role in “The American Red Cross Celebrates Real Life Miracles,” a nationally televised Christmas Eve extravaganza produced by Dole’s media adviser and paid for by the Red Cross.

The 1998 special featured long scenes of Elizabeth Dole glowingly describing the Red Cross’s accomplishments, as well as shots of its Washington, D.C., headquarters, which bears a remarkable architectural resemblance to the White House.

An estimated 3.6 million viewers watched the show, which urged viewers to call and donate to the Red Cross via a toll-free telephone number.

The show raised $25,000 in pledges– at a production cost of $1.3 million….

* * *

From The Buying of the President (1996): . . .

Bob Dole is, of course, the veteran presidential candidate. In his unsuccessful bid for the GOP nomination in 1988, he raised $20.8 million. Dole represents, revels in, and resists reform of the current campaign finance system. Very few political figures have raised more private money to run for public office since Watergate than Dole . . .

In the not-so-noble world of campaign finance … Dole campaigns have solicited and accepted illegal contributions and have even seen one senior advisor hauled off to prison. The think tank Dole established in 1993 abruptly shut down amid a flurry of bad press regarding its secret contributions.

What most people don’t know about Bob Dole is that from 1973, the middle year of the Watergate scandal, through 1994, he has raised at least $47,612,125 for his Senate and presidential campaigns and his leadership PAC. …

Between 1981 and 1993, when it was legal for senators to accept money for appearances, Dole received $1,326,771 in honoraria for speeches….

Those interests that have given most heavily to the Kansas senator have reaped magnificent returns on their investments. . . .

As he rose to power and stature on Capitol Hill, Dole became an accomplished fundraiser. Throughout his political career, Dole, like Nixon, saw his campaigns for various national offices scrutinized by federal authorities, sometimes resulting in large fines for illegal contributions.

David Owen, the close friend of the Dole family who ran Dole’s 1974 senatorial race and played key roles in Dole’s 1980 and 1988 presidential bids, but later went to prison for tax fraud, observed, “He was obsessed by money and power. . . .”

Dole’s 1980 presidential campaign was forced to refund more than $50,000 to various companies and to the Federal Election Commission for undocumented campaign disbursements. During that same campaign, the FEC filed a complaint against Dole’s wife, Elizabeth Hanford, for loaning his campaign $50,000. The $50,000 loan had been requested by Owen’s bank at below the prime rate.

At the time, Owen was also chairman of the Dole for Senate Committee and Elizabeth Dole’s financial adviser, later handling her blind trust….”

During Dole’s 1988 presidential campaign, allegations emerged that Owen, a former Kansas lieutenant governor and close Dole aide, had employees and executives of a Kansas company– to which he served as a $3,000/month consultant and in which he held stock– make $24,000 in contributions to Dole’s 1986 Senate campaign. Employees reportedly were ordered to contribute and later got reimbursed by the firm, Birdview Satellite Communications (no connection to The Catbird Seat)….

Owen resigned from the 1988 campaign and told the Center for Public Integrity that Dole knew about the Birdview donations….

Owen landed in prison in 1994 as a result of an earlier situation similar to the Birdview episode. Owen’s tax fraud conviction stemmed from two counts of filing false income tax returns. One count stated that Owen “disguised political contributions through his companies to the 1986 Kansas Governor Mike Hayden campaign as business expenses” and that these were improper deductions. Owen spent just over 7 months in Leavenworth Prison and maintains that Dole had tried to strong-arm him into raising the money for Hayden . . .

Still more problems plagued Dole’s 1988 presidential bid when it was later learned that the campaign had accepted more than $350,000 in illegal contributions and in-kind contributions of trips and services from corporations, individuals and Dole’s own leadership PAC, Campaign America. As a result, in 1993 the FEC fined Dole’s presidential campaign and Campaign America $122,975, to that date the largest penalty levied against a campaign.

Despite the fact that the infamous break-in occurred during his chairmanship to the Republican party, he escaped being pinned with any responsibility for Watergate or the CREEP slush funds.

His common refrain regarding the break-in was, “Musta been my night off.” . . .

~ ~ ~

By Dec 1975 … he married Elizabeth Hanford, a talented Washington insider who was then a commissioner for the Federal Trade Commission. . . .

~ ~ ~

One legislative issue Dole has rarely championed is the reform of the political process. Because of his leadership role in Congress, good-government citizens’ groups have viewed Dole as a major impediment to any serious effort at cleaning up Washington.

According to Fred Wertheimer, who was head of Common Cause until his retirement in 1995, “The past decade, Bob Dole has been in the forefront to block every serious effort to reform the campaign finance system.”…

* * *

From The Buying of the President 2000: . . .

Elizabeth Dole inherited many of her lucrative speaking engagements directly from Bob. . . . Senator Dole was no stranger to the speaking circuit. He collected $1.4 million in appearance fees for 1981 to 1991– even though throughout that time Senate rules prevented him from accepting more than $2,000 per speech.

In 1993 new rules went into effect that barred senators from keeping such fees. Elizabeth Dole picked up the slack, and began speaking to some of the same groups. From 1991 to 1994– while her husband was still Senate Minority Leader– she spoke to at least 16 high-paying organizations that had business pending before the government. . . .

Dole used her tenure as the president of the American Red Cross to boost her profile– and fees– as a speaker.

Although she was president of the charity through the end of 1998, none of the money for the 29 speeches she made that year went to the American Red Cross.

While Dole took large fees for her speeches, her predecessor rarely charged anything. “Most of the time, I didn’t get remuneration,” Richard Schubert, who was the president from 1983 to 1990, told the Center for Public Integrity. “If I did, it was in the form of a donation to the Red Cross.”

Throughout the early 1990s, Dole tried to deflect criticism of her seemingly mercenary speaking habits by repeatedly promising to donate the money to charity. But of the $875,000 in speaking fees she earned from 1991 to 1994, only $405,513 went to charitable organizations. The rest went to cover her personal expenses, and to her substantial retirement fund….

The proceeds from her speaking engagements in 1998 went into the Elizabeth Dole Charitable Foundation, about which her campaign would provide no information.

Of the $1,136,000 in speaking fees that Dole received in 1998, only $602,458 went to the Elizabeth Dole Charitable Foundation … The rest of the money went to taxes and to another generous contribution to her retirement plan . . .

The Dole Foundation is a creation of a Cleveland-based accounting firm called Investment Advisors International, Inc., itself a subsidiary of the renowned celebrity agency International Management Group, which is best known for its representation of such sports superstars as Tiger Woods, Joe Montana, Wayne Gretzky, Andre Agassi, and Arnold Palmer. . . .

The Elizabeth Dole Charitable Foundation is controlled by Elizabeth Dole. In 1998 it gave away only $29,157 out of more than $1 million in assets, the minimum required by law to maintain its foundation status.

The Doles are no strangers to the kinds of services that IMG provides. In early 1997 the firm set up a for-profit operation, Bob Dole Enterprises, Inc., to capitalize on the Senator’s name. Dole became a TV pitchman for everything from Visa check cards to Viagra….

Elizabeth Dole’s connection with IMG suggests that she may have been less interested in moving into the White House than in further feathering her nest at the Watergate. (In the summer of 1990 the Doles purchased the place next door– most recently occupied by Monica Lewinsky— to expand their apartment.)

As soon as Dole got out of the presidential race, IMG was poised to help her cash in on her heightened celebrity status and her campaign-financed mailing lists– and, of course, to put her back on the road telling bedroom jokes for a million dollars a year….

~ ~ ~

Elizabeth Dole has never lacked for money. She and her husband are worth at least $7 million, a large part of which is invested in the stocks of such blue-chip U.S. companies as Microsoft Corp and Walt Disney Company.

She has always had considerable personal wealth independent of her husband’s, especially after she received her family inheritance following her father’s death in 1981. In spite of these advantages, her financial life has been peppered with questionable business dealings, several of them engineered by longtime friend David Owen.

Owen stepped into the center of Dole’s life in 1974, when Bob’s first Senate reelection campaign was faltering. … (Owen) took over the Dole campaign and rustled up a narrow victory. Owen remained Dole’s main fund-raiser throughout the 1980s, and he was the national finance co-chairman of Dole’s 1988 presidential campaign. He once estimated that he had raised more than $10 million for the Senator.

Owen did far more than raise money. After joining the Reagan Cabinet, Dole put her money into a blind trust. In 1985, Owen was hired as the trust’s investment advisor. He had power– indeed, the responsibility– to make investment decisions without apprizing Dole of them. Owen’s stewardship of the trust followed a familiar pattern for the Doles: time and time again, their personal fortune would either provide benefits to, or directly benefit from their political careers….

Early in 1986, Dole’s blind trust, under the direction of Owen, paid $1,350,000 for a drab, two-story office building in Overland Park, Kansas … Before the year was out she sold the building– to herself and a partner– for a $63,000 profit. Her partner in the purchase was a company owned by John Palmer, a former aide to Senator Dole.

To facilitate the transaction, the Dole trust had loaned Palmer part of the money. With the Senator’s help, Palmer received a no-bid contract to provide $26 million worth of food service at a U.S. Army base in nearby Missouri. (The chairman of the House Small Business Committee later branded the contract “replete with appearances of improper activities.”)

Of course, such sweetheart deals have added to Dole’s considerable wealth. Like many of the well-to-do, she’s been willing to shield some of the investment income she’s received by taking advantage of tax loopholes.

In 1983 she invested in a tax shelter called Altenn Associates Limited Partnership….

Altenn was set up to lose money for 15 years, thereby enabling its 49 limited partners to reap far more in tax breaks than the investment they risked. The Doles, for example, received more than $300,000 in tax write-offs over 5 years, for an investment of $14,651 in cash and $156,780 in the form of a note….

~ ~ ~

Elizabeth Dole raised only $3.5 million through the first half of 1999. Her husband’s prestigious Washington law (and lobbying) firm, Verner, Liipfert, Bernhard, McPherson, and Hand, is the top patron of her current campaign . . .

* * *

If you can stomach more, GO TO > > > Broken Trust

  George Mitchell – former Senate majority leader, now a lobbyist for Verner, Liipfert, Bernhard, McPherson and Hand.

From The Courier-Journal, Dec 28, 2001:

Mitchell to Oversee Fund for Red Cross

NEW YORK – Former Sen. George Mitchell was named yesterday to oversee the $667 million American Red Cross fund created to help victims of the terrorists attacks….

Mitchell, who is from Maine, has spent his post-Senate life trying to negotiate peace in the Middle East and Northern Ireland.

As independent overseer of the Liberty Fund, Mitchell will supervise the development and carrying out of a plan to distribute the fund’s balance, said Harold Decker, chief executive of the Red Cross. The plan is scheduled for release by the end of January….

* * *

From The Cheating of America, by Charles Lewis, Bill Allison and the Center for Public Integrity:

Sweet Charity

Verner, Liipfert, Bernhard, McPherson and Hand, the Washington, D.C.-based law firm … had a cozy relationship with the Bishop Estate. The estate had relied on the services of Verner, Liipfert in 1995, when the law firm lobbied to kill a provision of the Taxpayer Bill of Rights 2.

The bill contained language, known as the Interim Sanctions Act, that would have imposed an excise tax on “insiders” at nonprofit organizations who partake in “excessive benefit transactions”– exactly the sort of transactions that Bishop Estate trustees were involved in for years.

The trustees spent $900,000 of estate money to lobby against the Intermediate Sanctions Act. They later compromised and sought only changes in certain provisions of the legislation, which President Clinton signed on July 30, 1996.

Among those enlisted by the Bishop Estate was former Hawaii governor, John Waihee, who after leaving the gubernatorial mansion joined Verner, Liipfert. Waihee met with Clinton’s then deputy chief of staff, Erskine Bowles, in late 1955 to discuss the bill; he and his wife also spent the night at the White House as a guest of the president.

Waihee’s partner at Verner, Liipfert, former Senate majority leader George Mitchell, also contacted Clinton’s then chief of staff, Leon Panetta, about the bill….

(Catbird Note: Ex-senator George Mitchell’s son-in-law, W. Stuart Price, was president of Gene and Nora Lum’s company DYNAMIC ENERGY, which was involved in illegal foreign campaign contributions. This same firm employed Ron Brown’s son, Michael Brown.)

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For much more, GO TO > > > Dirty Money, Dirty Politics & Bishop Estate

  For more Privatizations for Profit, GO TO >>>



















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  Last update January 22, 2003, by The Catbird