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Transcript - 11.9.07


You might think that having the government provide health insurance for low income children is a decent idea. For ten years, so did most of Washington. Not anymore. The government's insurance program for children, S-CHIP, is running out of money this year, and the effort to reauthorize the program in congress has become a political free- for- all.

On the one side, the program's supporters, who want to expand the program to cover the estimated 9 million American children still without insurance. On the other, the White House and its allies, who see S-CHIP as a threat to the insurance industry and the first step down the road to universal health care. The latest moves are happening right now, as congress tries to push through a new funding bill that can survive a presidential veto.

Senior correspondent Maria Hinojosa and producer Deborah Runcie have our report.

HINOJOSA: Amanda Smith is a real estate agent and single mother.

SMITH: You ready to go?

HINOJOSA: She lives in McDonough, Georgia, which is about 40 minutes from the capital city of Atlanta.

SMITH: I've never asked for anything from the state, and now I am. And it's not there. And that's hard. It's kinda' hard to swallow.

HINOJOSA: Amanda is struggling to make ends meet. She says she needs help paying for health insurance for her 16 month old daughter, Sarah Margaret.

SMITH: I don't want to be fed or taken care of for the rest of my life, but in a difficult time, that's why these programs are there.

HINOJOSA: Amanda makes roughly $24,000 a year.

SMITH: Bye baby girl. Be good.

HINOJOSA: So Sarah Margaret doesn't qualify for Medicaid—her mom makes too much money, but she does qualify for the State Children's Health Insurance Program, better known as S-CHIP.

TV COMMERCIAL: If you're happy and you know it clap your hands...

HINOJOSA: When the federal government created the program 10 years ago, covering children like Sarah Margaret is exactly what it had in mind. S-CHIP provides health insurance nationwide for low-income, working families that have children under the age of 19. But when Amanda went online to apply for Georgia's version of S-CHIP —Peachcare for Kids —something unexpected happened.

SMITH: Closed enrollment. Yeah! Peachcare for kids is closed. This is when my heart sinks...if you don't already have it, you're toast.

HINOJOSA: At the time, Peachcare wasn't enrolling any new applicants. Georgia and 10 other states, were in need of more federal money for S-CHIP.


HINOJOSA: The shortage of funds has led to months of political brinksmanship in Washington. S-CHIP is entangled in a debate in congress over the future of health insurance. But in the meantime, millions of low income children have been left at risk.

SMITH: Just thinking 'bout her and how much more I would like to be able to do for her right now, and I wanna give my baby the very best of everything and I can't do that right now.

DR. BECKFORD: It's good to see you! Hi Paige, how are you?

HINOJOSA: Georgia pediatrician Avrill Beckford says nationwide, some of the children who are being denied the financial support they need from S-CHIP, may end up paying with their lives.

DR. BECKFORD: Health insurance if you have a chronic condition, is clearly unaffordable. That would be a great impact to anyone.

HINOJOSA: Dr. Beckford is talking about 14 year old Ashley Brewer. She has type one diabetes, which is the most serious form of the disease. It's not preventable, and it can't be cured. Dr. Beckford has been treating Ashley since she was four years old.

DR. BECKFORD: Do you always insert your insulin sat on your arm?

HINOJOSA: But now, Ashley and her mother Paige face another challenge. Just a couple of weeks before we met them, Paige Brewer's husband was laid off.

DR. BECKFORD: How are you doing as a person, how's the family doing?

PAIGE BREWER: Well actually my husband just lost his job, and we went and applied for Medicaid.

HINOJOSA: Without the coverage his job provided, the family can't afford the expensive medical care their daughter needs to treat her diabetes.

DR. BECKFORD: There's enough to worry about when you have to prick your finger 14 times a day, than worrying about where the insulin is coming from.

HINOJOSA: The cost: $908 dollars a month for supplies alone.

DR. BECKFORD: So you wore it on the back of your prom dress?


DR. BECKFORD: Beautiful!

HINOJOSA: The Brewers have applied for Medicaid. But there's a minimum waiting period of two months...and in the meantime, Ashley's life hangs in the balance.

DR. BECKFORD: If Ashley didn't have her insulin today, she wouldn't be with us tonight. She lives from hour to hour.

HINOJOSA: Normally, Peachcare would provide temporary coverage for Ashley's treatments. But because of the funding crisis, when the Brewers applied, they too were turned away.

HINOJOSA: So when they told you at—at Peachcare, "sorry, the enrollment's closed."

BREWER: And I said, 'well, what do we do in the meantime?' and she goes, 'well, here's a book—list of churches that can help you with some food and some clothes.' Well, I said, 'well, but what about her medication? She's got di—the diabetes. Well, how are we gonna pay for it?' and she said, 'we're sorry. There's nothing we can do to help you.'

HINOJOSA: And so when the politicians say the doors are closed...

PAIGE BREWER: Then it makes me feel like they're tryin' to hold her back from becomin' somebody that she could possibly be. Sorry.

HINOJOSA: At this point, there isn't a single state or federal program that will help pay for Ashley's medicine. Georgia governor Sonny Perdue, a Republican, says there's pain out there because the federal government is not fulfilling its obligation to pay its share of S-CHIP.

HINOJOSA: We met a young woman named Ashley who has diabetes. Her father just lost his job. It will cost her $908 a month, literally, to survive. They don't have the money. And because of the fact that enrollment is frozen, right now, she can't get help. So what do you say to a young woman like Ashley?

GOVERNER PERDUE: That's why she should call her congress—members, and say; we want this resolved right now. Let me—let me really clear about this. Georgia stands ready, is ready. We're currently funding the federal portion now, as we've run out of money. We're doing our part and the federal part. We're doing all that we can. To blame us for freezing a part—where our federal partners are not fulfilling their obligation, is not right, and I won't accept that blame. We're doing our part. You tell her to call her congressman.

HINOJOSA: And I'm sure if I called her and said; listen, the governor says you should call your member of congress. She would say; that's not gonna pay what I need to survive. So the next thing you would say to her would be?

GOVERNER PERDUE: We can do no more. We're doing the state's portion and the federal portion. For you to take an individual and wanna' cast blame on the state of Georgia, and me, and what would I do, and what would I offer her. I—I do take offense to that.

HINOJOSA: Until last July, Leslie Norwalk, was in charge of overseeing the federal part of S-CHIP. She says that states themselves are responsible for the S-CHIP crisis, because they expanded the program to include people it never intended to—like adults.

NORWALK: If we're going to spend more money on S-CHIP than we do on other federal programs, then let's focus on what S-CHIP should focus on. That's kids, particularly kids who have lower incomes.

HINOJOSA: Georgia doesn't have any adults on the program, but fourteen other states do. The reasoning was that those states could reach more uninsured children if they enrolled their parents.

And at the time, the administration agreed, giving states permission to enroll adults. But now that over 670,000 adults are being covered by the program, the Bush administration and its allies, like Georgia Republican Congressman Nathan Deal, are saying "enough."

HINOJOSA: You've been quoted as saying that, "Petty and not so petty dishonesties erode taxpayer's trust." What do you mean in regards to the S-CHIP program?

CONGRESSMAN DEAL: Well, yes. States that try to manipulate the programs, you know about four states that insure more adults than they do children. That's not the purpose of this initial legislation. And we ought to—refocus it on children.

HINOJOSA: But not all children. The administration wants to limit S-CHIP to families making under $41,000 a year. Advocates say that would punish low-income families living in states that have a high cost of living.

The two sides are very far apart. While Democrats say it will cost sixty billion dollars just to maintain the program at current levels for another five years, the president is proposing less than half that amount.

But even as the administration attempts to shrink S-CHIP, the fact is, an estimated nine million children nationwide aren't covered by any insurance at all. This is putting even more pressure on the states.

GOVERNER PERDUE: It's not my prerogative as a Governor of a state to tell Congress how to do their business. I'm more interested that they do their business, and the federal government and Congress needs to come up with a reauthorization bill for the future.

AMANDA SMITH: Out came the sun and dried up all the rain.

HINOJOSA: As the September 30th deadline drew near, congress did come up with a reauthorization bill to expand the program.

After weeks of political maneuvering in Washington, a bipartisan agreement was reached. Both sides agreed to fund the bill by raising the federal tax on cigarettes.

HINOJOSA: The bill passed, but it wasn't veto-proof.

President Bush planned on vetoing the new S-CHIP bill, labeling it: "irresponsible." He says the plan would raise taxes on working Americans and expand the program to include families making up to $83,000 a year.

So when S-CHIP supporters were looking for someone to speak on behalf of families and children, 12 year old Graeme Frost was the ideal spokesperson.

GRAEME'S RADIO ADDRESS: "I don't know why President Bush..."

HINOJOSA: After a near fatal car accident in 2004, S-CHIP helped save his life, as well as his sister's.

GEMMA FROST: "I know that my head hit against the tree, and Graeme's head hit against the window."

HINOJOSA: Gemma Frost, who was 6 at the time, suffered a cranial fracture. Her older brother Graeme, sustained a brain stem injury. For three years, S-CHIP has covered the ongoing surgeries and treatments they need to survive.

HINOJOSA: 4 days after Graeme Frost's radio address, not only did bush veto the new S-CHIP bill, but the Frost family says it began facing a firestorm of insults, and even hate mail. Conservative Republicans who opposed the bill accused the Frosts of abusing the program.

HINOJOSA: It turns out the attack campaign was orchestrated by a staffer in Republican Senate Majority Leader Mitch McConnell's office.

The controversy set off investigations into allegations about the Frost family's finances and lifestyle.

However, it was quickly discovered that while the Frost children did attend private schools, they were on scholarships, and the family home, valued at over 260,000 dollars, was purchased for less, at 55,000 dollars.

Halsey Frost says the attempted smear campaign, doesn't change the fact low-income families are still in need of help.

HALSEY FROST: We're not in the wild, wild west anymore...we can't be...everybody being an individual and 'if you can't afford it, tough'. You know.. 'you made a decision to have children...that's your problem'. Sink or swim baby... you know. And we're all Americans. We need to work together; we are all on the same team.

HINOJOSA: The night before the congressional vote to override the president's veto, we spent time with the Frost family in Baltimore, Maryland. Graeme who is in seventh grade, is still receiving treatment for his injuries. He says he'll keep talking about how the program helped him.

GRAEME FROST: I don't have any regrets because... I mean...I'm proud of what I did and it's...I don't think there is enough attention being paid to it...and if some people don't like it... tough.

HINOJOSA: The next day, the congress failed to override President Bush's veto of the program. A week later it sent him a new bill that barred families making over $51,000 dollars a year.

While millions of children in need now wait on the president's next move, the Smith's were fortunate enough to get on S-CHIP when the freeze was lifted over the summer.

As for the Brewers', the family survived with random jobs until Ashley's father landed a job with health insurance. They say they were lucky; and that the politicians should be focusing on the millions of families in need of S-CHIP right now.

PAIGE BREWER: To me, it, it gets me here because I know that it's not just my Ashley that has these problems and that can't afford it.

BRANCACCIO: I want to ask you to take a few minutes to meet quite a person, who as a novice lawyer, came up with an innovative legal strategy for holding U.S. corporations accountable for human rights violations overseas. Her name is Katie Redford, and when we first reported on her effort to help the villagers of Burma—aka Myanmar—back in 2004, she was waging an epic legal battle against a mighty oil company, Unocal. We have some news to report on what happened, and we also want to tell you how Katie Redford and her group, EarthRights International, have gone global in their efforts to make U.S. corporations behave themselves.

Chris Thompson and Megan Thompson produced our report.

Katie Redford is not your typical Washington lawyer. While many of her neighbors on K Street fight for America's largest and wealthiest corporations, Redford is fighting against them - and changing the practice of human rights law along the way.

REDFORD: I think every time a case goes forward successfully, corporations have to wake up and listen and take their human rights responsibilities much more seriously.

BRANCACCIO: It all started on a journey to Southeast Asia just before law school. Redford spent time in Thailand, working at a camp for refugees from Burma - also called Myanmar. She met people who said they'd fled an oppressive military regime that terrorized its citizens with forced labor, rape and murder.

REDFORD: I went to law school with these memories very fresh in my mind and sort of the taste of them in my mouth, if you will, and felt that while I was in the United States, my heart was in Thailand and with these people of Burma and I wanted to find a way that I could use the law to help them.

BRANCACCIO: During her summer breaks, Redford went back. She traveled into Burma and met a man named Ka Hsaw Wa. He said he'd been tortured by the Burmese military, and was collecting the stories of victims who had endured similar abuse.

Redford learned that much of the violence and forced labor was happening near a natural gas pipeline being built in part by Unocal, a giant American oil company. The Burmese military was helping to construct. And secure the pipeline - using violence and forced labor along the way.

REDFORD: I just was thinking that can't be right. It can't be that an oil company and particularly an American oil company being from the United States, um... can legally come in and do this.

BRANCACCIO: Redford had found her mission. She and Ka Hsaw Wa later married and vowed to seek justice for the people of Burma.

Back at law school, Redford learned about an obscure statute called the alien tort claims act. Signed by George Washington in 1789, the law was originally used to prosecute pirates on the high seas, outside of regular U.S. jurisdiction.

She wrote a paper describing how the law could be used in a different way - to allow foreigners to sue American corporations in American courts for human rights abuses abroad. Redford's professor gave her an "a," but said her strategy would never work.

REDFORD: I still had this feeling in my heart... that what Unocal was doing was not right. And not only was it not right, that it couldn't be legal, that there was just... it just couldn't be. And so I didn't believe him...

BRANCACCIO: And so Redford and Ka Hsaw Wa founded EarthRights International to do just what her professor told her couldn't be done. In 1996, they led a coalition that sued Unocal on behalf of the Burmese victims. For years, they pushed the case forward through uncharted legal territory. When we last spoke to Redford, she was still fighting the case.

REDFORD: So in spite of their millions of dollars and their overwhelming size and power and political accessibility to the government, they haven't been able to make this go away.

BRANCACCIO: And then, in 2004, after almost a decade of litigation, Unocal agreed to settle the case. The company denied any wrong-doing, but paid an undisclosed amount—reported to be around $30 million in news accounts. Which went to help the villages and to fund humanitarian projects. For Redford it was a long awaited but bittersweet victory.

REDFORD: When you think about rape, torture and killing, money is not going to get back your dead family members or give you back the dignity you lost when you were raped or when you were forced as a slave to work for an American oil company. But it does allow people to rebuild their lives, to bring their families back together...

BRANCACCIO: The settlement also transformed human rights law. The legal strategy once dismissed by Redford's law professor had now become as a powerful tool for human rights activists.

REDFORD: Unfortunately Burma and Unocal were not the exception to the rule, but sort of the rule in the way that business was being done overseas in this age of economic globalization.

BRANCACCIO: And now Redford is going after another American oil giant - Chevron - which acquired Unocal just weeks after the settlement in the Burma case.

EarthRights alleges that Chevron was complicit in human rights abuses in Nigeria, home to some of its largest oil operations. Like Burma, Nigeria is terribly-poor, but oil rich. Its government is accused of corruption and its military accused of brutality. And also like Burma, Nigerian soldiers have helped secure foreign oil facilities.

The Niger River Delta has long been home to violent conflict between local Nigerians and the foreign oil companies operating there.

In 1998, protesters climbed onto an off-shore chevron oil platform and barge. Accounts of what happened next differ greatly. According to the EarthRights lawsuit, Bowoto v. Chevron, the protesters were demonstrating peacefully when Nigerian soldiers, flown there by Chevron, shot and killed two.

But according to Chevron, the protesters assaulted its workers and held over 200 hostage. In a statement to NOW, Chevron says that they "regret the loss of lives," but that it would be unreasonable to blame the company for seeking the help from government authorities. Then the next year, Nigerian soldiers attacked the villages of Opia and Ikenyan, which lie close to Chevron oil wells and a pipeline. Chevron said it had nothing to do with the incidents. But EarthRights alleges that Chevron sent the soldiers, who attacked the villages, burning them to the ground and killing five people. This video - part of the lawsuit—was filmed in the villages just after the incident. EarthRights also points to this receipt as a key piece of evidence - they say it shows that chevron paid the soldiers for their services —after the villages were burned.

HERZ:And we want Chevron to understand that it can't continue to do business this—in this way in the Niger Delta with its hired—military thugs.

BRANCACCIO: And they may be getting closer. In august —- after 8 years of litigation —a judge cleared the way for the Nigerian villagers to bring their case to a jury trial sometime next year. Redford has no illusion that cases like this will topple the abusive governments in Nigeria and Burma. But she hopes her work will serve as an in your face warning to the American companies that continue to do business with these governments.

REDFORD: These are not good business partners. They are not reliable in terms of their commitment to human rights and the rights of their people. And corporations should be warned and on notice that if they're complicit in these kinds of abuses, they can and will be sued.

BRANCACCIO: And that's it for NOW. From New York, I'm David Brancaccio. We'll see you next week.

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