SEN. JOHN CHAFEE (R-RI)

• On February 10, 1993, Sen. Chafee and his wife purchased between 2,000 and 30,000 dollars worth of stock in Merck (the giant pharmaceutical... specializing in human AND animal drugs). It just so happens that this purchase coincides with the introduction of at least five major health-care bills. And since Sen. Chafee sits on the Senate Finance Subcommittee on Health as well as the Subcommittee on Medicare, his purchase of Merck constitutes an immediate and glaring conflict of interest. But let's leave this obvious instance for a moment.

Six days before Sen. Chafee's purchase, a bill was introduced in the Senate, CO-SPONSED BY SEN. CHAFEE, that would help Merck. The bill was S. 340: Amends the Federal Food, Drug, and Cosmetic Act to allow, on order of a vetrinarian...(1) a new animal drug approved for one use to be used for a different purpose; and (2) a new drug approved for human use to be used in non-food producing animals... (Pending; Last Action on July 28, 1994).

• On March 19, 1993, Sen. Chafee purchased an additional 1,000 to 15,000 dollars worth of stock in Merck.

One week later (on March 26, 1993), Sen. Chafee's colleague (Sen. Danforth) introduced S. 666: RESEARCH AND DEVELOPMENT ENHANCEMENT ACT...To establish a permanent Research and Development tax credit (Referred to Senate Finance; Pending).

Now, Merck has long been interested in getting Congress to pass a permanent R&D tax credit; they have lobbied this issue aggressively for many years. According to Jeffrey Birnbaum in The Lobbyists, Merck is one of the key members of an organization known as Coretech (an organization comprised of 72 universities and 46 companies dedicated to securing a permanent R&D tax credit). Two of the point lobbyists for the R&D tax credit are Stuart Eizenstat and Catherine Porter (former tax aide to Sen. Chafee). Birnbaum notes that Sen. Chafee was an loyal supporter of an R&D tax credit (especially the 861 legislation). Birnbaum quotes Sen. Chafee as saying, "...they [Eizenstat and Porter] have a good product to sell."

I should also note that Sen. Chafee also purchased between 1,000 and 15,000 dollars worth of stock in General Electric on March 19, 1993. Although GE is not nearly so public in their support of a permanent R&D tax credit, they clearly won't turn their noses up at it! Birnbaum quotes former chief executive at GE (Reginald Jones) as saying, "I can do more for General Electric by spending time in Washington and assisting in the development of responsible tax policy than I can by staying home and pricing refrigerators."

• On August 13, 1993, Sen. Chafee purchased an additional 1,000 to 15,000 dollars worth of stock in General Electric. Eleven days earlier (August 2, 1993), a bill was introduced in the Senate that would clearly tickle GE's fancy. The bill was S. 1339: DEPARTMENT OF ENERGY NATIONAL SECURITY ACT...Authorizes appropriations in the Department of Energy for operating expenses incurred and for plant projects and capital equipment necessary for carrying out our national security programs in the following areas: (1) weapons activities; (2) new tritium production and plutonium disposition activities; (3) environmental restoration and waste management; (4) materials support and other defense programs; (5) defense nuclear waste disposal.

PAC MONEY NOTES: Sen. Chafee has received $7,000 in Merck campaign contributions from 1987 thru 1994; he has received $6,000 in General Electric campaign contributions from 1987 thru 1993.

NOTES: Sen. Chafee is # 5 on the Senate Finance Committee; he is # 1 on the Senate Finanace Subcommittee on Health and # 4 on the Senate Finance Subcommittee on Medicare; he is # 1 on the Senate Environment Committee; he is a member of the Environmental & Energy Study Conference; he is # 5 on Senate Select Intelligence.