Waxman Plans Industry Show Trials

Democrats understand that passage of Obama’s healthcare “reforms” will probably hurt them in November, so they’re doing everything they can to dampen the anger directed at them and turn it against someone – anyone – else.

Anger-dampening was built into the bill, postponing the tax increases and other burdens Americans will feel directly until after the 2010 elections (and some until after 2012). Obama and the congressional Democrats are out bragging about the rainbows and unicorns they’ve produced.

But now several major American companies – AT&T, Verizon, Deere & Co. and Caterpillar – are spoiling the carefully-planned narrative by saying that they will incur huge losses (impliedly causing job losses) because of the costs they will incur under the Obamacare plan.

As a result, congressional Dems are planning a public punishment of the heretics.

According to a Washington Examiner report, “Caterpillar stated in an SEC filing they would earn $100M less in 2010, Verizon sent emails to employees informing them of their expected costs to increase in the short term, and AT&T filed with the SEC that they expect a $1B hit because of the new law.”

Rep. Henry Waxman (D-Cal), chairman of the House Energy and Commerce Committee, has asked the CEO’s of AT&T, Deere & Co., Verizon and Caterpillar to testify on April 21 at a hearing into the companies’ declared financial losses caused by the new healthcare legislation.

In letters to the CEOs, Waxman has demanded that they produce every piece of paper (and e-mail) seen or prepared or reviewed by senior company officials related to the cost impact projections of the healthcare “reforms.”

The hearing will be a nasty show trial. It is intended to vilify, not find fact: to shift the blame from congress to the industry executives who are trying to do their jobs in accordance with the law.

I know. I’ve been before the same committee three times, twice advising and accompanying principal witnesses and once as a witness myself, as a Defense Department official under House subpoena.

These hearings will be run with the same playbook. But the CEOs shouldn’t play by the standard industry rules: if they play hardball, they’ll come out unscathed.

The companies (or the government agency) always play defensive. Industry executives have to answer to risk-averse boards and government officials don’t want to risk an open breach with congressional appropriators. If they are unwise in the extreme, they fail to claim the protections and assert the privileges against giving up documents they are entitled to claim. (Most of the documents Waxman wants will be proprietary to the company, containing financial details they cannot make public without giving competitors an advantage. Many will be protected by the attorney-client privilege).

The companies should refuse to produce any documents that are proprietary or legally privileged. What is produced before the hearing will be selectively leaked (no matter what assurances they get from committee staffers) to bolster the narrative of wrongdoing the committee wants to create and sustain. And then comes the hearing.

Before an assembled array of television news cameras and reporters, the witnesses will first be subjected to verbal assault by Waxman and the other committee Dems in their “introductory remarks.”

These remarks will be comprised of freighted words – “fraud,” “overcharging,” “manipulation of accounting” and such – that the witnesses must endure stoically, every frown duly televised. The freighted words are written into these speeches in a manner calculated to score soundbites on the evening news.

The day’s victims then give their opening statements which are uniformly non-combative. Advised by too many defensive subordinates, they welcome the chance to clear up the record. And that chance is never given.

For hours they will be subjected to accusatory questions, their answers cut short by interruptions by seemingly-exasperated Democrats who will roll their eyes to the skies for the cameras, and chuckle in a “you can’t expect us to believe that” tone at what answers are permitted.

But there is another way, one which will keep the blame for the costs and job-killing effects where it belongs. It should be built into the CEOs statements and every answer they give.

It’s in two parts. First, attack the Dems’ strategy in every answer. Avoid using the freighted words the Dems will use. Don’t say, “We didn’t manipulate accounting.” Say, instead, “We are following the law to the letter. We didn’t vote for it.”

Second, say, and keep saying, “We didn’t create this situation. The 219 House members who voted for this bill are responsible.” Have in your hand the list of congressmen who voted for the Senate bill. Begin every answer with, “I note, sir, that you voted (or didn’t vote) for the bill which causes these problems.”

Afterward, don’t run from the hearing room. Hold your own press conference in the hall outside and stay on the offensive. Only audacity will win the healthcare political war, and that’s all this hearing is about.