Against Comprehensive Incrementalism

Nancy Pelosi understands that her place is in the home in the health care reform debate is to position her caucus at the left edge of what is possible to get 218 votes. Everything she has been doing recently has moved toward that goal.

Speaker Nancy Pelosi is not among those praising Sen. Max Baucus (D-Mont.) for bringing his healthcare bill in well under President Barack Obama’s $900 billion limit.

Pelosi (D-Calif.), an advocate of the government-run health insurance option left out of the Senate Finance Committee chairman’s bill, criticized the means by which Baucus kept costs down.

“The savings come off the backs of the middle class,” Pelosi told a closed-door caucus meeting. “This is why we need a strong public option going into conference with the Senate.”

By contrast, Blue Dogs want to "pre-conference" the bill, so they don't have to take a tough vote. That's ridiculous and a corruption of the legislative process. The House reflects to a far greater degree the concerns of the American people; there's absolutely no reason that it cannot stake out its priorities with a vote.

The problem with simply accepting and rubber-stamping the Senate Finance Committee bill is not only that it isn't generous and doesn't cover as many people as needed. The real problem is that it's not going to feel different to the vast majority of people. Maybe that's a virtue, in some respects, but in the sense that health inflation will continue to ascend, costs will still rise, medical bankruptcies will still not be avoided, and the whole thing will be a "comprehensive incrementalism" rather than a sweeping change, I think people might look back and say, "what was the fuss about?" Now, I think Ezra is right here:

Which is only to say that this is not the end. That's true also for the House and HELP bills. All these proposals are major improvements for the uninsured and those left out of the employer-based market. That means they're major improvements for those who are hurting the worst. And in constructing exchanges and beginning the hard work of delivery system reform and creating a system of subsidies and an individual mandate, they're building the foundation of a better health-care system. But as they embark on that project, they're leaving most of our current health-care system virtually untouched, which means most of the systemic problems will remain unsolved.

I think that project can start now, particularly in the area of competition with the insurance industry in the form of a public option. Until we discover that this is all that is possible - and I don't think we're they're yet - Pelosi is absolutely right to engage and strategically position herself at the left edge.

The House still doesn't seem to grasp how to pay for the bill, knowing simply that they don't want to piss off labor with the tax on high-end insurance plans. A tax on "windfall insurance profits" would have a similar effect, however. And a public option that could lower costs would decrease the amount of people hit by the high-end insurance plan tax.

The real danger here is that the comprehensive incrementalism is so incremental that the industry decides the plan doesn't cover enough people, and they start breaking their own promises. This is what's intimated here. While I do subscribe to the "if the health industry hates it, well it must be good" theory, I think there's a real danger of not controlling rising costs because of the thinner risk pool. And that could incentivize insurers to continue their worst practices. More reform is really a cumulative answer to these problems, and we should not stop halfway.

Everyone Loves An Opt-Out

Here we have yet another compromise on the public option that sets moderates in Washington stirring. The "opt-out" national public option, which would offer states a chance to eliminate it for their own jurisdiction, is gaining support on Capitol Hill. Chuck Schumer says it's being "very seriously considered". Max Baucus says through an aide he would consider supporting it. Howard Dean said he'd support it if he were a Senator. Richard Kirsch from HCAN says it's better than triggers, co-ops and opt-ins, which is faint praise but praise nonetheless.

I think there's some good and bad to it. We don't know what the opt-out would look like - a referendum? Gubernatorial veto? Federal waiver? A policy bill with a hurdle in state legislatures? Tied to funding? - and how easy it could be surmounted, as well as how easily gamed by special interests. Insurance companies are spending $1 million a day to beat the public option in Congress, you don't need that much to beat it in the states. Would this have a chilling effect on all federal legislation, with every big bill subsequently requiring a state opt-out, balkanizing the country? Or would every red state Governor bluff at opting out, and then, after seeing the numbers for how this would really help people, grudgingly accept it? We also don't know what kind of public option this would bring into being. Would it be Chuck Schumer's weak conception with no tie to Medicare bargaining rates? Or a robust public option with Medicare + 5% rates and Medicare's provider network? I think Nancy Pelosi is doing something very smart by scoring both versions just so the fiscal conservatives can choke on the numbers.

Speaker Nancy Pelosi (D-Calif.) will submit multiple versions of the House's healthcare bill for cost estimates, she announced on Thursday.

The first proposal will include a "robust public option," which would tie doctor reimbursement rates to that of Medicare plus five percent. The remaining two drafts submitted for the Congressional Budget Office's consideration would include a public option based on "the negotiated rates that some in our caucus have supported and which was passed by the Energy and Commerce Committee," the speaker explained during Thursday's press briefing.

"And then we'll see back from the CBO what the scoring is on all of that," Pelosi said. "And, of course, we have promised not a dime to the deficit. This is our promise. We will not take a bill to the floor, the president will not sign a bill that adds a dime to the deficit."

We already know that the CBO considers the robust version to save $85 billion more than the weak version, so this will just cement that even more.

All the while, House Progressives, which have formed a block requiring a straight national public option with no opt-out and ties to Medicare rates, continue to say they won't compromise, won't blink, and claims that they have the votes they need to pass their plan in the House, although some have questioned the numbers.

I think the strategy should be maximalist - pass the best of what you can in the House, and the best of what you can in the Senate, so that when the two bills are merged, you at least are dealing with the best possible from both chambers. A merger, for example, could see a Medicare-tied public option with the opt-out clause.

However, the nagging feeling is that nobody wants to stop the public option, or at least nobody wants to be responsible for it. In that case, shouldn't the plan for supporters be to say to them, "We dare you to kill this"?

Printing Gossip As News

Robert Gates has now added his opinion to the debate over the public comments of Gen. Stanley McChrystal on Afghanistan:

Defense Secretary Robert M. Gates said Monday that President Obama's advisors should keep their guidance private, in effect admonishing the top commander in Afghanistan for publicly advocating an approach requiring more troops even as the White House reassesses its strategy.

The comment by Gates came a day after Obama's national security advisor, James L. Jones, said that military commanders should convey their advice through the chain of command -- a reaction to Army Gen. Stanley A. McChrystal's public statements in support of his troop-intensive strategy for stabilizing Afghanistan.

The exchanges suggested some disarray in the Obama administration's attempts to forge a new policy on Afghanistan and underscored wide differences among top officials over the correct approach.

I don't know that the comments suggested anything but the plain fact that the media treats generals like heroes whose pronouncements should never be questioned, unnecessarily distorting policy debates about foreign policy. News outlets are never going to be good at figuring this out because they try very hard not to understand the impact they have on political debates. But simply put, McChrystal makes a public statement for more troops, and the narrative immediately becomes "will the President go against the advice of his generals? How COULD he?" So a policy of not allowing that narrative to form seems perfectly reasonable, especially because generals have a narrow focus on their own area of responsibility and are not supposed to have a big-picture approach, and furthermore because they have a very explicit chain of command for recommendations of this types. McChrystal probably knows how this works and is using the system to his advantage, but his is not the first sin. It's a media failure to properly contextualize in favor of a yen to sensationalize.

Nancy Pelosi parroted Gates last night, so it's a full-on talking point, but again, her target is McChrystal instead of the media process that turns McChrystal into a deity. That's probably because it's impossible to get the media to understand their personal failure, so you have to shut down the debate entirely. And now, of course, the gossip-mongers on cable news are headlining: "Gates and Pelosi SLAM McChrystal," turning it into a personality-based he-said/she-said, when if they were the least bit responsible about handling public comments from leaders of the military this wouldn't even be a problem.

...And Americans have subconsciously figured out how this all ends: it doesn't. Because we cannot have a serious debate on anything in this country without it devolving into bitchy gossip and meta-critiques of how things "play" politically, tough decisions just don't get made. And so 68%, in this poll, said America will not win or lose the war in Afghanistan; it will just go on without resolution.

Tragically, people have actually gotten USED to this outcome.

Showdown In The House

There's an important meeting today in the House of Representatives, where progressives and Blue Dogs will likely show their cards on health care reform.

The Blue Dog Coalition is engaged in a member-to-member whip operation in the House, beginning with a survey of its 52 lawmakers, to find out where they stand on critical health care issues. The principal focus is the public insurance option, but the canvass also touches on various tax and revenue increase proposals to pay for reform.

For the first time since they formed in 1995, the Blue Dogs have been out-organized by their liberal counterparts. The Congressional Progressive Caucus completed its first survey and began whipping back in the spring. They launched a final whip count last week that will be finished by Wednesday evening.

The whip count builds on an earlier letter that 60 members of the progressive caucus signed, pledging to oppose any health care bill without a "robust public option."

"We're going back to those people and saying, 'Hey, are you still with the letter?'" said Rep. Raul Grijalva (D-Ariz.), co-chair of the CPC. "And if there's been slippage, how much? And if we have a committed core, how many?"

Grijalva is asking members to back the public option all the way through the process, not simply on the first vote on the House floor.

The count comes in advance of a critical House Democratic caucus meeting Thursday morning in the Capitol, where leadership will take their own whip count. The fate of the public option in the House will be largely determined by the parallel whip efforts -- and how aggressive each bloc is in pushing for its priorities. In other words, it comes down to which pack wants it more, the Blue Dogs or the progressives.

So far, Grijalva has intimated that he still has the votes, although he hasn't delivered an exact count. Blue Dogs are trying to bait Pelosi by claiming she doesn't have the votes for the bill as currently constructed, but we'll probably know that by tonight. For Pelosi's part, she has a plan to start finalizing the bill after the meeting, with a possible floor debate on the public option. However, she shot down the trigger today as "an excuse for not doing anything."

The Blue Dogs are also whining about not being protected from tough votes, because the mission of public service is to come up with the most bland, inoffensive legislation possible and not to do anything that might make anyone mad. That's the picture of leadership. These ConservaDems either don't understand politics very well or are just being opaque about their true feelings.

Politically vulnerable Democrats say Speaker Nancy Pelosi and other House leaders aren’t offering them the protection from tough votes that they did in the last Congress.

Conservative Democrats fear that dozens of members could be swept out of their districts in the midterm election next year, and that fear has been intensifying in recent weeks.

Between a tough vote on a climate change bill that many don’t expect to become law and a leftward push on healthcare legislation, Pelosi’s (D-Calif.) critics within her caucus say she’s left the so-called “majority makers” exposed.

“She keeps trying to push an unpopular package,” said Rep. Gene Taylor (D-Miss.), a centrist Blue Dog Democrat, referring to healthcare. “I think it’s fair to say they were better at it before.”

Another Blue Dog lawmaker put it more bluntly.

“They’re seriously endangering their majority,” said the Blue Dog, who requested anonymity. “With the increased margin and a [Democratic] president, there seems to be a different feeling.”

What would endanger the majority are two things - no health care bill, or a health care package without a public option, which translates into a health care package that nobody in the country would like. What you would have left is an individual mandate to force people to shell out money to private insurers only, without the price controls to make that insurance affordable, a recipe for a continued skyrocketing of premiums. People interface the health care market primarily through those premiums as long as they remain healthy, and without competition in the insurance market it's going to be hard to dial them downward. There is currently no provision forcing insurers to lower premiums as a function of lowered overall health care delivery system costs. Only competition will provide that.

As I've said, the insistence on the public option is a self-preservation strategy. Rahm Emanuel might want to throw up his hands and pretend that only Congress decides on it, but he may want to get involved. As someone who claims to have brought the Democrats the House and Senate, he should know a thing or two about losing a majority. He could also recall 1994, when he worked in the Clinton White House and pushed NAFTA on the Congress, and watched as conservative Democrats from rural districts, who lost the trust of the people through selling out their jobs, were the first in line to fall from the Gingrichites. Failure to energize the base and provide something tangible for people could produce a similar result.

Making Blue Dogs Blue

The Hill reports that the Speaker will respond to pressure from progressives and move the health care bill back to the left when she merges the competing measures from committee:

Speaker Pelosi is nixing a deal she cut with centrists to advance health reform, said a source familiar with negotiations.

Pelosi’s decision to abandon the agreement that was made with a group of Blue Dogs to get the bill out of committee would steer the healthcare legislation back to the left as she prepares for a floor vote.

Pelosi is planning to include a government-run public option in the House version of the healthcare bill. She wants to model it on Medicare, with providers getting reimbursed on a scale pegged to Medicare rates.

"The speaker is full-steam-ahead," said a senior Democratic aide.

Let's be clear who broke the agreement. The Blue Dogs and Waxman negotiated a deal to water down the public option but still include it in a final bill. Mike Ross came back from recess and said he could not support a public option whatsoever. At that point, the deal ended. And Ross, secure with his payoff from a pharmacy chain from a couple years back, has nobody to blame but himself.

This puts the House bill in the best negotiating position for the inevitable conference committee. Obviously the public option is a compromise in itself, but further grinding it into nothing would have made it nearly impossible to defend its inclusion in conference. Pelosi is determined to have the House be an equal player in this debate, and that starts by her passing the best bill possible from her chamber.

In other good news, the single-payer bill, HR 676, will finally get a score from the Congressional Budget Office. This score could be an excellent tool for advocates down the road, and it's sad that it's taken this long for such a score to be calculated.

Health Care Update

Looks like lawmakers are gradually expanding the puny subsidies in the Baucus health care bill:

The chairman of the Senate Finance Committee, Max Baucus, said Monday that he would modify his health care bill to provide more generous assistance to moderate-income Americans, to help them buy insurance.

In addition, Mr. Baucus said he would make changes to reduce the impact of a proposed tax on high-end health insurance policies.

Mr. Baucus, Democrat of Montana, disclosed his plans in an interview a day before the committee is to begin meeting to debate and vote on the sweeping legislation, which is intended to remake the nation’s health care system and guarantee insurance for millions of Americans.

Mr. Baucus said the changes showed that he had heard the criticism of his bill from colleagues, who asserted that many people would be required to buy insurance who could not afford it — even with federal subsidies to help defray the cost of premiums.

“Affordability — that, I think, is the primary concern,” Mr. Baucus said. “We want to make sure that if Americans have to buy insurance, it’s affordable.”

Affordability to Baucus means reducing the limit of policies from 13% of total income to 12% of total income, through subsidies up to 400% of the poverty level. That's at least a start, though still short of what's in the House bills.

As it says above, responding to changes Baucus will reduce the impact of taxing insurance companies, basically by raising the threshold when plans start to hit the tax. But this is paradoxical. Raising the subsidy levels costs money. Raising the tax threshold takes away money. Lawmakers want the bill to protect more people on affordability while taking away some of the money that would pay for those protections. There is a late and familiar entry here, however, and that's Jay Rockefeller's idea to add back in a variation of what the Obama Administration sought all along:

In fairness to Rockefeller, he's got some ideas along those lines.

He's said many times he would be perfectly happy with the sort of financing they have in the House--i.e., a straight-up tax on the rich. And while such a scheme might have trouble in the Senate, Rockefeller is trying gamely to intorduce a more scaled-down version.

Among the amendments he's introduced for this week's Finance Committee hearings is a proposal to cap the deductability of charitable contributions at 35 percent--which would, in effect, reduce the deductability of contributions that very, very wealthy people make to charities. It seems to be a version of what President Obama proposed at the beginning of this process, an idea that still has a lot of merit even though many Senators rejected it out of hand.

Would they reject it again? Maybe not in scaled-back form, which might be enough. In the end, the most likely solution to the funding problem is some sort of combination strategy--a tax that hits expensive health benefits, a tax that hits the wealthy, and, maybe, some sort of tax sugary drinks or tobacco. The new Rockefeller proposal, according to Capitol Hill sources familiar with it, will probably raise about $90 to $100 billion--which is a decent chunk of change and could pay for a lot of new subsidies.

The President wanted to roll the charitable deduction credit back to 28% - exactly where it was during the Reagan Administration, at a savings to the government that could easily top $300 billion over ten years, enough to make the subsidies big enough to make health care truly affordable for everyone. And it would only hit those who make enough money to take advantage of the charitable deduction to begin with. It's really a no-brainer.

Of course, there are more areas of conflict in the bill beyond affordability and financing. There are various amendments in the Senate Finance Committee to add a public option, as well as Olympia Snowe's amendment to add a trigger, and a weak trigger to boot. Obama went on the record saying “I absolutely do not believe that (the public option is) dead," although his close colleague Dick Durbin said today that only a "variation" of it could make it through the Senate. Nancy Pelosi continued her public statements that the public option must be included to pass the House, though House liberals, wary of a bait and switch, asked the Speaker to stand with them when the bill reaches a conference committee. Jerry Nadler reiterated the seriousness of the threat from the progressive side:

Rep. Jerrold Nadler (D-N.Y.) said Monday he is optimistic that any healthcare bill from the House will include a public (or "government-run") option, and are undertaking a whip count to test lawmakers' commitment to that measure.

"The public option is still very much alive only because the progressives have stood together and held our ground and said that, regardless of what the President or Leadership says, we won't vote for any bill [without] a public option," Nadler said in a chat online hosted by the liberal AMERICAblog.

Nadler told the blog that 60 lawmakers had pledged to vote against any healthcare bill lacking the public plan, and that liberal Democrats are "undertaking a whip count now to see how firm these pledges are."

While affordability and financing may come to some compromise position that is at least passable, the statements above show that there's no such middle ground for the public option. This may vex the White House, but they will eventually have to show their cards.

Annals Of The Insurance Industry

Just a few tidbits about the industry that Republicans and many conservative Democrats say we must keep in business at all costs:

• A member of a non-profit in Virginia was arrested at the headquarters of Anthem for trying to question them about a rate increase. This is the same Anthem who sent a letter to their customers telling them to contact members of Congress and tell them to oppose a public option. When the same customers try to contact Anthem, they are met with arrest.

• Crystal Lee Sutton, the union organizer who inspired the movie "Norma Rae," died from cancer this week, after a protracted battle with the disease - and her health insurer.

As Daily Kos blogger hissyspit points out, last year Sutton gave an interview to the press where she described a struggle with her health insurer over treatment. The Times-News in Burlington, North Carolina, wrote in 2008:

[Sutton] went two months without possible life-saving medications because her insurance wouldn’t cover it, another example of abusing the working poor, she said.

“How in the world can it take so long to find out (whether they would cover the medicine or not) when it could be a matter of life or death,” she said. “It is almost like, in a way, committing murder.”

She eventually received the medication, but the cancer is taking a toll on her strong will and solid frame.

• In eight states and the District of Columbia, insurance companies define domestic violence as a pre-existing condition. The theory goes that a victim of abuse is more likely to be abused again, and would require medical treatment for those beatings.

Words cannot describe the sheer inhumanity of this claim. It serves as yet further proof that our insurance system is broken, destroyed by the profit-mongering of the very companies whose sole purpose should be to provide Americans with access to care when they need it most. In 1994, an informal survey conducted by the Subcommittee on Crime and Criminal Justice of the United States Senate Judiciary Committee revealed that 8 of the 16 largest insurers in the country used domestic violence as a factor when deciding whether to extend coverage and how much to charge if coverage was extended.

• The same insurance interests who deny coverage to victims of domestic violence, who deny claims for cancer patients, who arrest those who dare to question them, have spent $585 million dollars in the past 2 1/2 years, and $700,000 a day, lobbying Congress to ensure that any reform bill protects their profits. They have scored with at least one committee, Max Baucus' Senate Finance Committee, which produced a bill that CIGNA whistleblower Wendell Potter calls an absolute gift to the insurance industry.

Potter argued that the lax employer requirements would shift the cost and risk of coverage onto the individual and maintained that the bill’s “network of cooperatives” would be unable to compete in today’s concentrated health insurance markets. “The co-ops won’t stand a chance,” he concluded.

Reform must also do more to regulate insurers, who have agreed to accept applicants with pre-existing conditions but are insisting on benefit and rate flexibility. Potter argued that the benefit package standards in the Exchange and the high deductible option for younger beneficiaries would allow insurers to design almost anything that they can sell in the health market place and push the country towards consumer driven health care.

Under the Baucus legislation, private insurers could also charge older individuals up to five times more for coverage. “You’re just using age as a proxy for health status,” Uwe Reinhardt, an economics professor at Princeton University told the New York Times. Reinhardt estimates that “Senator Baucus’s age-rating plan would allow insurers to cover roughly 70 percent of the additional risk they’d take on by being required to accept all comers, regardless of health.”

Some, like Nancy Pelosi, have vowed not to pass the "Insurance Industry Profit Protection And Enhancement Act," as she called it. But they are under tremendous pressure from powerful interests to enact just such a giveaway. Reform groups like Health Care for America Now understand that attacking this industry, and devaluing their influence, is a means to getting a bill that truly helps all Americans obtain quality and affordable health care.

The Al Qaeda Slump

It's going to be a real blow to neocon efforts to frighten their way to victory, once they recognize that they may have to find a new enemy.

Osama bin Laden's al-Qaida is under heavy pressure in its strongholds in Pakistan's remote tribal areas and is finding it difficult to attract recruits or carry out spectacular operations in western countries, according to government and independent experts monitoring the organisation.

Speaking to the Guardian in advance of tomorrow's eighth anniversary of the 9/11 attacks, western counter-terrorism officials and specialists in the Muslim world said the organisation faced a crisis that was severely affecting its ability to find, inspire and train willing fighters.

Its activity is increasingly dispersed to "affiliates" or "franchises" in Yemen and North Africa, but the links of local or regional jihadi groups to the centre are tenuous; they enjoy little popular support and successes have been limited.

This has a host of implications on our foreign policy moving forward:

• The article credits CIA drone strikes in part, although I do think they increase the amount of extremist activity in general. But there have always been extremists; Al Qaeda provided a durable network. Once which is foundering. And if the demand for extremism dries up with the lack of a durable network, then ultimately the entire project will topple upon itself.

• Of greater benefit is monitoring and law enforcement techniques, which have been proven effective in disrupting "core Al Qaeda," which is down to 6 or 8 people and maybe another couple hundred on the margins. To the extent that these techniques work, they are not labor-intensive, involve global cooperation and do not have a role for the US military to any strong extent. You do not put 100,000 troops in the field to deny 8 men safe havens. Much of the intelligence, in fact, is coming from relatives and friends, suggesting that giant military apparatuses are not required to deal with a movement that has become broadly unpopular.

• The Pakistan campaign is really helping disrupt Al Qaeda, as the Pakistani and Afghan Taliban have turned on the unit, probably because it's giving them so much trouble.

This all adds up to yet another reason why we have no need continuing escalation in Afghanistan. The local Taliban hate Al Qaeda and would not be likely to offer them safe havens should they topple the central government, which is unlikely outside the areas where they have ethnic solidarity. In Pakistan they're simply on the run. There's a better chance of Al Qaeda consolidating in a place like Somalia than Afghanistan. They don't exist there right now, and no group fighting for control wants them in place. So why are we still fighting there?

Nancy Pelosi said today that there's no support in the country for a further escalation. If people truly understood the lack of a threat from Afghanistan, how our presence has inflamed the insurgency, and how we can through a variety of containment, law enforcement and intelligence techniques maintain national security without a military footprint, that support would drop even further from the perilous point it's at right now.

Pelosi Starting To Warm To The Trigger...

It looks like all the Washington gossip has gotten to Nancy Pelosi, seen today trying to thread the needle on triggers.

But I said it before and I'll say it again: The health insurance industry, which is out there fighting the public option tooth and nail because it does increase competition, which they don't want. They'd be better getting a public option now than one that is triggered because if you have a triggered public option, it's because the insurance industry has demonstrated that they're not cooperating, they're not doing the right thing, and I think they'll have a tougher public option to deal with.

She's trying to keep progressive activists on her side by saying that she would only accept a trigger that would bring into existence something like Medicare for All. But that assumes the trigger would be written in such a way that it could ever conceivably get pulled. And I think we all now that's not how this works. The formula for pulling the trigger would get debated endlessly, insurers would sue based on their version of the formula, and conservatives would call it a government takeover of health care and the beginning of the death panels and all the things you saw on display in August.

Pelosi's trying to sell a dead fish as a pet. There's nothing called a "triggered public option" that will satisfy progressives who think the market for health insurance is irreparably broken and private insurers are not to be trusted. Triggers are a Washington type of solution, where the solution isn't offered, but gives everyone involved something they think they can run on down the road.

As Paul Krugman describes well, the politics of reform without a public option will be extremely damaging to the Democratic Party for years to come.

Remember, to make reform work we have to have an individual mandate. And everything I see says that there will be a major backlash against the idea of forcing people to buy insurance from the existing companies. That backlash was part of what got Obama the nomination! Having the public option offers a defense against that backlash.

What worries me is not so much that the backlash would stop reform from passing, as that it would store up trouble for the not-too-distant future. Imagine that reform passes, but that premiums shoot up (or even keep rising at the rates of the past decade.) Then you could all too easily have many people blaming Obama et al for forcing them into this increasingly unaffordable system. A trigger might fix this — but the funny thing about such triggers is that they almost never get pulled.

Let me add a sort of larger point: aside from the essentially circular political arguments — centrist Democrats insisting that the public option must be dropped to get the votes of centrist Democrats — the argument against the public option boils down to the fact that it’s bad because it is, horrors, a government program. And sooner or later Democrats have to take a stand against Reaganism — against the presumption that if the government does it, it’s bad.

But they're not doing that. They're sensing an opportunity to pass something, anything, and because Olympia Snowe supports triggers, they figure most ConservaDems will agree. So we have the half a loaf caucus in the House telling Democrats that they'll have to accept whatever the Senate rams down their throats. (The Senate could actually pass a public option as a deficit reduction play through reconciliation right now - but nobody wants you to know that.)

Rahm Emanuel was been pushing for triggers since well before the summer. It protects the insurance industry while allowing everyone to pretend they passed a strong bill. And that means industry will still line the pockets of Democrats as a token of thanks for preserving the status quo.

That's the decision for people to make when they assess this - whether to endorse that.

The Progressive Revolt And Its Implications

House liberals will not go quietly, Mr. Emanuel.

In a letter delivered to the White House moments ago, the two leaders of the bloc of House progressives bluntly told President Obama that they will not support any health care plan without a public option in it — and demanded a meeting to inform him face to face.

The not-yet-released letter — the first joint statement from progressives since news emerged that Obama might not address the public option in next week’s speech — is their sharpest challenge yet to the president, given the extraordinary sensitivity of this political moment. The letter urges him to mention the public option in his speech.

“Any bill that does not provide, at a minimum, a public option built on the Medicare provider system and with reimbursement based on Mediare rates — not negotiated rates — is unacceptable,” reads the letter, which was sent over by a source. It was signed by Reps. Lynn Woolsey and Raul Grijalva, the two leaders of the Congressional Progressive Caucus.

They're buttressed by the Speaker of the House, quoted again as saying that a bill without a public option cannot pass the House and that its elimination would be a major victory for insurance companies. Not much room to climb down from those remarks.

Some chin-scratchers are wondering why the public option, a so-called "sliver" of the legislation but not its entirety, has taken on such prominent significance. I think this gets at part of it.

To help understand, I think it’s useful to read past the sarcastic opening to this Chris Bowers post and read him lay out the strategic thinking in detail. I think what you’ll see is that while the movement on behalf of the public option certainly wants a public option and believes the public option is important, the larger goal is to “to try and make the federal government more responsive to progressives in the long-term” by engaging in a form of inside-outside organizing and legislative brinksmanship that’s aimed at enhancing the level of clout small-p progressives in general and the big-p Progressive Caucus in particular enjoy on Capitol Hill.

That requires, arguably, some tactical extremism. If you become known as the guys who are always willing to be reasonable and fold while the Blue Dogs are the guys who are happy to let the world burn unless someone kisses your ring, then in the short-term your reasonableness will let some things get done but over the long-term you’ll get squeezed out. And it also requires you to pick winnable fights, which may mean blowing the specific stakes in the fight a bit out of proportion in the service of the larger goal.

There's more to it than that, however. First of all, whatever the state of the public option on offer - and I don't think it's sufficient - can be improved upon if it just gets past the post and into circulation. I cannot believe that Ezra Klein would think that something like a public option could be introduced as an add-on later, as long as the "basic structure" of universality gets enacted now. A government-administered insurance plan is not a minor fix; getting one for Medicare or Medicaid took a number of years and tough battles, and we still leave out everyone under 65 who isn't impoverished. Adding it later would not be a "relatively simple matter," as he says. We get a crack at this now, or we create a forced market through an individual mandate that makes it a crime not to buy private health insurance. Given our crack regulatory structure in the US of A, that won't hold, the insurance companies won't live up to their end of the bargain, and costs will continue to soar. If the subsidies are too low, this wouldn't even get out of the gate - both parties would be clamoring to repeal it. Adding the public option offers far more opportunities to improve upon the system, rather than not having that option and having to do a supreme lift to get it. I agree that the coverage subsidies and the design of the exchanges are important, but the public option stands with those as a pillar of the plan.

And I know that because none other than Max Baucus told me so in his original white paper on the subject.

Tell me how this sounds for a health care reform plan.

• A national health care exchange
• Buy-in to Medicare at age 55
• No discrimination against those with pre-existing conditions
• No waiting period for Medicare for disabled
• CHIP covers up to 250% of poverty level
• Credits for small businesses and individuals to make health care affordable

Oh, and don't forget this bit:

• A public option

Now, it may surprise you to learn this. But the architect of this program is none other than Max Baucus--the guy who has been pushing against a public option since the insurers were allowed to drive this debate. Here's the language from his white paper--dated November 12, 2008--on the public option:

The Exchange would also include a new public plan option, similar to Medicare. This option would abide by the same rules as private insurance plans participating in the Exchange (e.g., offer the same levels of benefits and set the premiums the same way). Rates paid to health care providers by this option would be determined by balancing the goals of increasing competition and ensuring access for patients to high-quality health care.

There was a time when conservative Democrats knew how to best deliver a quality health care bill, and us dumb-as-a-stick bloggers and activists went ahead and looked at the proposals and actually agreed with them. Silly us!

The other reason why progressives are drawing a line in the sand over a public option is that they voted for one, and voted for a President and a Congress to deliver it. Clearly conservatives were going to freak out on the President as a mad socialist no matter how much he trimmed his sails, so it would be appropriate to at least deliver on a promise or two. Give them something to talk about and all that.

And contrary to popular opinion, Blue Dogs actually need health care reform far more than progressives. Sure, they want to do it in such a way that preserves corporate profits. But progressives can see the desire to pass something and exploit that for their own ends, which is approximately how politics works, basically.

The reason I disagree with Klein is fairly simple: if no health care legislation passes, and Democrats lose seats as a result, Blue Dogs are the people who will lose the seats, not Progressives. Even if Klein is correct and Democrats lose a bunch of seats because Progressives blocked it, Blue Dogs are actually the ones who will bear the brunt of those losses. As such, Blue Dogs have more to lose if health care fails to pass than Progressives [...]

If we feel that we have to protect Blue Dogs at all costs, then of course it will be impossible for Progressives to have as much leverage as Blue Dogs. However, as soon as we make it clear that we don't feel much of a need to protect Blue Dogs, then they are the ones who have a lot more reason to cave into our demands. If another Republican wave really is coming, Blue Dogs will be the first Democrats to lose.

I see nothing wrong with a maximalist strategy, which also corresponds to the stated goal of cutting costs and helping people get health care coverage. It does have an importance for future fights. But it also has an importance for right now. A health care reform that forces people to buy private insurance will destroy the party that builds it. And because of the emphasis placed on the public option, which is really out of the control of Washington at this point, a failure to incorporate it into the final legislation will dispirit the base and lead to a slaughter in 2010. In addition to being smart politics, the progressive revolt is a self-preservation strategy for the Democratic Party.

Establishment Coalescing

Here are a couple headlines that I didn't think I'd see. One, Tom Daschle saying that budget reconciliation may be the only way for health care reform to pass. Two, and this one is really a stretch, Terry McAuliffe saying health care reform is a failure without a public option:

Former Democratic National Committee Chair Terry McAuliffe is demanding his party take a stand on health care legislation that the president and many others aren't willing to take: Pass a bill with a public option for insurance coverage or don't pass anything at all.

The long-time adviser to the Clintons, striking an atypically progressive tone, urged the White House to get more assertive in its handling of health care reform and described a bill without a public plan as a "failure."

"If we don't have the public option, we are wasting our time," McAuliffe told the Huffington Post. "To chalk something up and get something that is not the right thing to do is morally wrong... To pass something just so you can go home and go into election saying we passed something is not why lawmakers are sent to Washington."

After a bit of silence following his loss in the Virginia Democratic gubernatorial primary, the former DNC chair has come out swinging on the year's most important legislative issue. On Thursday, McAuliffe agreed to host a fundraiser with the first Virginia pol who insisted that a public option be in the bill. The offer, he said, extends to Sens. Jim Webb and Mark Warner -- both of whom have been sour on the idea of a government-administered option for insurance coverage. He's also involved in whipping support in Congress for the public option.

McAuliffe is the first business-friendly Democrat making the business case for competition in health care, saying that the status quo is bankrupting individuals and companies. But more important, he's a figure with ties to the donor class and the Third Way wing of the party. That he's arguing so strongly for a public option suggests that he's placed a bet that the party would benefit from going that route, and more important, would suffer from failing to do so.

Now it's basically up to the leadership to decide which way to go. Nancy Pelosi has said that her chamber cannot pass a bill without a public option. Steny Hoyer cut her off at the knees yesterday, saying "I'm for a public option but I'm also for passing a bill." Of course, in the House, those two statements are not mutually exclusive, but Hoyer clearly counts on progressives caving. $361,614 says they won't.

As for the Senate, Harry Reid has a choice to make. He can include the public option in the elements of the bill to pass through the reconciliation process, or turn the screws on ConservaDems to invoke cloture on the bill, or he can continue to allow the Baucus caucus to hijack the process. Reid has the ability to bypass the Finance Committee completely, if he chooses, and bring a bill to the floor. And he can use reconciliation for the elements about which Baucus and his cronies feel squishy.

Reid can't do it alone, of course. The President would have to get involved behind the scenes. But Democrats who are losing their base had better think of something to get this through.

Public Option On The March

Turns out that the polls still show the same robust support for a public option, as long as the question is asked consistently.

More than three out of every four Americans feel it is important to have a "choice" between a government-run health care insurance option and private coverage, according to a public opinion poll released on Thursday.

A new study by SurveyUSA puts support for a public option at a robust 77 percent, one percentage point higher than where it stood in June [...]

Earlier in the week, after pollsters for NBC dropped the word "choice" from their question on a public option, they found that only 43 percent of the public were in favor of "creating a public health care plan administered by the federal government that would compete directly with private health insurance companies."

Opponents of the president's agenda jumped on the findings as evidence that backing for the public option was dropping. Proponents responded by arguing that NBC's tinkering with the language of the question (which it had also done in its July survey) had contributed to the drop in favorability for a public plan.

SurveyUSA's poll, which was commissioned by the progressive group MoveOn.org, a proponent of the public plan, gives credence to those critiques. While arguments about what type of language best describe the public option persist --"choice" is considered a trigger word that everyone naturally supports -- it seems clear that the framing of the provision goes a long way toward determining its popularity.

"Choice" may be a trigger word, but it also accurately describes the policy - under the plan individuals seeking insurance would have a choice of a range of options in the insurance exchange, including a public plan. And people like that. A lot.

Jacob Hacker, the progenitor of the structure of the public plan, is out today with a study showing that the types of plans in the initial House bill, the ones that progressives are fighting for, are the only ones likely to work (I'd personally like to see the firewall removed and allow individuals the same choice as well, but baby steps).

Progressives have raised $264,000 and counting for the 64 lawmakers who have said they will vote for nothing unless it contains a public plan. Nancy Pelosi is saying no plan will pass the House without that element included.

"There is no way I can pass a bill in the House of Representatives without a public option," she said to a crowd in California, noting that regional health care co-ops won't get the job done. "If they want to have [co-ops] for their state, perhaps that could be included in the legislation. But it is not a substitute for a public option."

And we're up to 45 Senators willing to support it as well, with the final five directly in the sights of activists. If 50 go definitively for a public option in the Senate, given the option of reconciliation for the more contentious bits there's absolutely no reason to leave it on the table.

Heck, when you have Terry McAuliffe vowing to hold a fundraiser in Virginia for the first lawmaker to pledge to support a public option (yes you read that right, Terry McAuliffe), something has shifted.

Terry McAuliffe thinks it is time to "insist" on the public option. We couldn't agree more. Terry's agreed to host a fundraiser with Virginia and national bloggers who are insisting on a public option for the first Virginia Congressman who will take our pledge! This will be an awesome event to highlight and honor any Virginia Congressman who shows leadership on this issue [...]

Will the fundraiser be for Bobby Scott? Jim Moran? Gerry Connolly? Tom Perriello? Any of them can get a night with national and local bloggers honoring them featuring T-Mac... but first they have to do the right thing.

All the energy and excitement on the Democratic side is around this element of reform. If it's bargained away, all the energy goes away. And so does any chance at a health care bill.

Figure it out, Rahm.

Not Backing Away

It's good to see the health care discussion rounding back around to what's actually in the bill, because progressives have a winnable fight on those grounds. The situation with these town hall meetings, where the signal to noise ratio was so low, just served to shut everything down. Looking seriously at where everyone stands on key elements of the legislation presupposes that legislation will pass and makes clear who needs pressure and who needs thanks. Today we're seeing lots of public officials coming together strongly in support of reform with a public option. Anthony Weiner says it cannot pass without it.

WEINER: The President does seem like he's moving away from the public plan, and if he does, he's not going to pass a bill. Because there are just too many people in Washington who believe that the public plan was the only way that you effectively bring some downward pressure on prices, and if he says well we're not going to have that, then I'm not really quite sure what we're dong here.

BECKY QUICK: So you would not vote for a bill that made it through, if it got through...

WEINER: Not only I but I think there's probably a hundred members of the House, who believe for various reasons that you need to have something to bring down prices. Otherwise you're basically, what you're doing, you're keeping the cost arc. . . the CBO agrees with that. You know as it was, I think the public plan had been watered down so much. So if the President thinks he's cutting a deal to get Senate votes, he's probably losing House votes.

Even House leadership refuses to budge:

“As the President stated in March, ‘The thinking on the public option has been that it gives consumers more choices and it helps keep the private sector honest, because there’s some competition out there.’

“We agree with the President that a public option will keep insurance companies honest and increase competition.

“There is strong support in the House for a public option. In the House, all three of our bills contain a public option as does the bill from the Senate HELP Committee.

“A public option is the best option to lower costs, improve the quality of health care, ensure choice and expand coverage.

“The public option brings real reform to lower costs over the 10 year period of the bill.”

And even on the Senate side, you have people like Russ Feingold making their presence known:

“A public option is a fundamental part of ensuring health care reform brings about real change. Opposing the public plan is an endorsement of the status quo in this country that has left tens of millions of Americans uninsured or underinsured and put massive burdens on employers. I have heard too many horror stories from my constituents about how the so-called competitive marketplace has denied them coverage from the outset, offered a benefit plan that covers everything but what they need or failed them some other way. A strong public option would ensure competition in the industry to provide the best, most affordable insurance for Americans and bring down the skyrocketing health care costs that are the biggest contributor to our long-term budget deficits. I am not interested in passing health care reform in name only. Without a public option, I don’t see how we will bring real change to a system that has made good health care a privilege for those who can afford it.”

It's just going to be incredibly hard for these politicians to climb down from that rhetoric, certainly not if they measure in the hundreds, as Weiner intimates. The House is committed to waiting on the Senate, as they won't send a bill to the floor until the end of next month. But they won't be content to just follow whatever crappy bill comes from the Finance Committee.

The fact that the White House let health care reform be defined on the left as the public option is their own damn fault. They didn't offer anything for progressives to run with, no tangible reforms that would do anything to both increase access and control costs. The public plan was all that was left. Now they have a major problem negotiating the space between House liberals and Senate ConservaDems. Considering that all they have to do is get a much smaller number of ConservaDems to agree to cloture and free them to even vote against the final bill, from a tactical standpoint the choice is pretty clear, IMO. We'll be watching.

And yes, we should thank those who are doing right in this fight.

...Yet another letter, this time from 60 House members, saying they won't vote for a bill without a public option. Mike Lux does a good job of laying out the way forward here.

Top-Level Democrats Assault The Extremist Astroturfers

The White House took the lead on this, publicly calling the teabagger disruptions an example of astroturfing and citing conservative industry-backed groups taking credit for activating the rioters. Now other elements of the Democratic Party are taking up the baton. Dick Durbin and Chuck Schumer blasted the clown show today:

Speaking outside the White House after meeting with President Obama, Sen. Dick Durbin of Illinois and Chuck Schumer of New York both dismissed the significance of boisterous protesters who have been interrupting Democratic lawmakers' events.

"It is a small fringe group," Schumer told the Huffington Post, "and if we let a small group of people who want to monopolize the conversation and not listen to the facts win, you may as well hang it up."

"These town hall meetings have been orchestrated by the tea baggers and the birthers to just be a free-for-alls, make a lot of noise, go on YouTube and show discord," said Durbin. "I mean that is what they are determined to do. But that is not going to accomplish what we need to accomplish: real health care reform."

Likewise, the DNC called the protesters "right-wing extremists funded by K Street" and alluded to the Palin/McCain rallies with the ugly cries of racism and xenophobia. The House Speaker's blog has a pretty comprehensive list of the extremism of the rioters, the links to special interests, and the coordinated strategy to shut down debate. And I've seen every single Democrat on cable news today talking about the Brooks Brothers riot, astroturfing, lobbyist-funded front groups, and the like. It's pretty interesting.

Will this push either the extremism or the astroturf element of this into the conversation, given the obvious evidence of lobby groups strategizing on this? I'm not sure. The media has a depressing tendency to treat a mob like a poll sample of public attitudes. In fact, public support for health care is still very strong. But the various ambushes throughout the country will still get national and (perhaps more important) local ink.

I'm glad that Democrats are fighting back, but I'm compelled to note that their charges also have to get into the game themselves. The ads have largely been garbage, the organizing hasn't gotten the traction from the media, and they have been unable to drown out the shouters. There is a gap here.

Finding The Target

As I said in the last post, astroturf groups are going to be out in force in August, creating mini-Brooks Brothers riots all over the country, harassing members of Congress, doing whatever they can to be the squeakiest wheel in the hopes of drowning out support for health care reform. So how will Democrats respond?

With polls suggesting that public support is sagging for President Obama's push to overhaul health care, House Majority Leader Steny Hoyer said the party will use the August break to make a strong sales pitch to middle-class voters.

"We're going to be on the air. We're going to be in the neighborhoods," said Hoyer, D-Md. "Our members are going to now have the opportunity to go home ... and say to their constituents, 'Look, this is what we're doing. This is why it's good for you and your family.' " [...]

A House Democratic memo obtained by USA TODAY shows the steps the party is taking to coordinate its message over the break. Lawmakers are encouraged to hold town-hall-style meetings, post videos on the Internet and find small-business owners "whose testimony can provide a powerful narrative," the memo states.

And it looks like Democrats have settled on a message, one that I guess works as well as any other - bash the hell out of insurance companies.

"Remove them from between you and your doctor. No discrimination for pre-existing conditions. No dropping your coverage because you get sick. No more job or life decisions made based on loss of coverage. No need to change doctors or plans. No co-pays for preventive care. No excessive out-of-pocket expenses, deductibles, or co-pays. No yearly or lifetime cost caps on what insurance companies cover."

According to the memo, they've coordinated this strategy with the Obama administration and a number of sympathetic groups. "The Leadership is working in close coordination with the White House and outside groups (including but not limited to HCAN, Families USA, AFSCME, SEIU, AARP, etc.) to ensure complementary efforts during August."

Those groups have literally hundreds if not thousands of events planned in August, and they're digging in against opponents of reform, Republican or Democrats. You already hear the fruits of this rhetorical shift, from health care reform to health insurance reform. Nancy Pelosi called insurance companies "the villains" in this debate. The President has also shifted the debate toward insurers versus consumers, a "people versus the powerful" maneuver.

President Obama has framed the health-care debate in Washington as a campaign against insurance companies whose irresponsible actions, he repeatedly says, must be reined in to control costs and improve patient care. In North Carolina this week, he told an audience that the existing system "works well for the insurance industry, but it doesn't always work well for you."

The message is no accident, as the president's chief pollster made clear in a rare public speech last month. Joel Benenson told the Economic Club of Canada that extensive polling revealed to the White House what many there had guessed: People hate insurance companies.

"Take the public plan, for example," Benenson said. "Initial reaction to it wasn't as positive as it is now. . . . But we figured out that people like the idea of competition versus the insurance company, and that's why you get a number like 72 percent supporting it."

Hitting insurance companies must poll off the charts. And it's certainly better than having to discuss the intracacies of the employer deduction or MedPAC. Obama said in his interview with Karen Tumulty that he's struggled with relating the urgency of reform to the public in clear, simple terms. He's decided to go with a battle with the insurance industry, something that appeals to both the base and has resonance for most people. It's probably the right choice, even if it is shorthand. Scaling back and targeting the rhetoric can actually move forward the policy.

Obviously we have to keep this up for the next month.

Vote Or No Vote

Politico reported on a letter that claimed no floor vote in the House on health care before the August recess. Nancy Pelosi disputed the letter and said a floor vote and a delay in the recess remained possible.

I think everyone knows there will be no vote and just don't want to break it to anyone yet.

Why the Congress would break for a month at this time, given the state of things, is just insane.

Playing Defense vs. Playing Offense

Joe Biden took to the pages of the New York Times to defend the stimulus package on Sunday.

The single largest part of the Recovery Act — more than one-third of it — is tax cuts: 95 percent of working Americans have seen their taxes go down as a result of the act. The second-largest part — just under a third — is direct relief to state governments and individuals. The money is allowing state governments to avoid laying off teachers (14,000 in New York City alone), firefighters and police officers and preventing states’ budget gaps from growing wider.

And those hardest hit by the recession are getting extended unemployment insurance, health coverage and other help to get through these tough times. The bottom line is that two-thirds of the Recovery Act doesn’t finance "programs," but goes directly to tax cuts, state governments and families in need, without red tape or delays.

As for the final third, the act is financing the largest investment in roads since the creation of the Interstate highway system; construction projects at military bases, ports, bridges and tunnels; long overdue Superfund cleanups; the creation of clean energy jobs of the future; improvements in badly outdated rural water systems; upgrades to overtaxed mass transit and rail systems; and much more. These investments create jobs today — and support economic growth for years to come. Far from being a negative, the wide array of these investments is needed given the incredible diversity of the American economy.

Projects are being chosen without earmarks or political consideration, and many contracts have come in under budget. More than 30,000 projects have been approved, and thousands are already posted on recovery.gov — providing a high level of transparency and accountability. Taxpayers should know that we have not hesitated to reject proposals that have failed to meet our merit-based standards.

None of this is false - in fact, some of us objected to spending so much of the Recovery Act on non-stimulative tax cuts, which some, though not all, of the tax cuts in the package are. But when faced with an economy like this, you can do one of two things. You can defend the actions taken to this point, or you can look at the economic picture as it is, and make changes based on those evolving conditions. This would require admissions that the package may have been too small, but it's better than the alternative, defending a faulty program while unemployment heads into double digits. That's why it's sad to see Nancy Pelosi tossing aside talk of a second stimulus. By the time people realize something has to be done, it'll be too late to do it.

I recognize the political difficulty in getting another round of stimulus passed, but it becomes impossible if nobody is willing to say what needs to be said.

Also, Mr. Vice President, a little less emphasis on projects coming in "under budget" when the whole point is to get as much money out into the economy as possible would be helpful.

In Praise Of Lobbyists?

If you haven't been following the health care debate, this AP article will strike you as curious.

A strong force, perhaps as powerful in Congress as President Barack Obama, is keeping the drive for health care going even as lawmakers seem hopelessly at odds.

Lobbyists.

The drug industry, the American Medical Association, hospital groups and the insurance lobby are all saying Congress must make major changes this year. Television ads paid for by drug companies and insurers continued to emphasize the benefits of a health care overhaul — not the groups' objections to some of the proposals.

Why on Earth would the drug industry, insurance industry, hospital industry and the AMA be so interested in protecting the passage of health care reform? Because they would all grab some goodies in the process. As a result of all those meetings with health industry executives, the President secured their support for reform. But it came at a price. The drugmakers got to extend their patents for biologics and didn't have to completely fill the doughnut hole for Medicare Part D. The insurance industry got their individual mandate that will require millions of Americans to sign up for their coverage. The AMA got the sustainable growth rate (SGR) formula for Medicare physician reimbursement dumped, which will likely increase their payments. And hospitals are working hard for their piece of the pie as well. All of these deals, which constrict the ability for Congress to wring more costs out of the system, would fall apart if no reform bill passes, leaving these interests vulnerable. So of course they want the process to advance. Yet if you take the Blue Dogs at their word, that they are concerned about costs, these deals are INHIBITING progress, not promoting it.

Deals, of course, are made to be broken, and Nancy Pelosi, who didn't sign on to any of them, will not adhere to their guidelines if it risks cost control.

House Speaker Nancy Pelosi said Thursday that she doesn't feel bound by the $235 billion in deals that the White House and the Senate Finance Committee cut with hospital and pharmaceutical companies to defray costs of a new health-care plan, stating that she thinks the industries could do more.

"When we're trying to cut costs, certainly we know that there are more costs to be cut in hospitals and pharmaceuticals. . . . So we'll be subjecting everything to some very harsh scrutiny as we see whether we can get more savings," Pelosi said in a late-afternoon interview, shortly after she left a marathon negotiating session with White House Chief of Staff Rahm Emanuel and conservative "Blue Dog" Democrats, who have put the brakes on the House version of the health-care reform bill. "As we look, there may be some more ways to get money out of pharmaceutical companies."

Pardon me if I don't see the lobbyists as the key to real reform. I think Nancy Pelosi's calculus might have more to do with it.

Transfer Of Power

The remaining House committee to finish work on the health care bill, the Energy and Commerce Committee, has repeatedly delayed their markup sessions this week, as Henry Waxman negotiated with the several Blue Dogs on the committee over changes to the bill. Talks seemed to reach a breakthrough when Waxman agreed to add expanded power for MedPAC, an independent board that could make recommendations on public medical spending and face an up or down vote in Congress. But despite that, there's been delay.

And that's because the Blue Dogs want to sequence the votes. They want the Senate to go first with whatever comes out of the Finance Committee over there rather than take a vote on something that won't be part of the final bill. Nancy Pelosi said as much yesterday:

House Speaker Nancy Pelosi has been pretty adamant: She would prefer to pass a health care bill by early August, and would be willing to hold the House in session past a scheduled recess to get there. But she's also unwilling to move unless the Senate does...something.

'[I]f we're done, and they're not done and they're gone, what is the point?" Pelosi said in a meeting with reporters yesterday. "It's interesting to me that people are saying, 'Don't leave until it's done.' I don't know how much more we can do if the Senate is not going to move."

This reflects a general frustration with the holdup in the Finance Committee, particularly the secrecy of them and how long they have played out. As far back as February, Max Baucus talked about a markup session in June. And he consistently agreed to that throughout the next several months. Now he hasn't only help up the process, but he doesn't even plan to run it by the Democratic caucus once he introduces it:

However, the level of consultation with Democrats stands in contrast with how Republican negotiators are briefing their Members. Senators said Enzi, who is the ranking member on the Health, Education, Labor and Pensions Committee, briefs leaders every day on the talks. And all three of the GOP negotiators have agreed to brief the entire GOP Conference before they sign on to any deal with Baucus.

But Democrats said Baucus is unlikely to run any deal by his caucus before he shakes hands on an agreement with Republicans.

On the stimulus bill, we had Presidents Nelson and Collins dictating the size and scope of the bill. Now there's been a transfer of power. Presidents Baucus and Grassley are large and in charge. And virtually nobody in the Democratic leadership has challenged this hijacking of the process, outside of off-the-record grumbles. In particular, nobody has mentioned that they've gone well outside the confines of their mandate:

I would have thought that the role of the Senate Finance Committee was to figure out how to finance necessary health care reforms in a responsible fashion. It wasn't their job to make the major "policy" calls about what reform entails. That's the job of the Senate Health, Education, Labor and Pensions Committtee, and the respective House Committees, and they've already defined what they want and are in basic agreement.

No, Finance's job was to look at the range of financing options -- some from Tax A, some from Tax B, a bit from Tax C, plus Savings X, Savings Y, etc. -- and then choose. Put together a package that's fair and that does the job. But apparently, the entire Congressional leadership is waiting for President Baucus and President Grassley to tell them what the substance of reform will be.

So, what have the two Co-Presidents produced so far? Zero. Nada. Zilch. Unless you count delay.

Did you know that last November, you all voted for Max Baucus and Charles Grassley to become Presidents of the United States of Health Care?

UPDATE: Jane reports that a deal is coming from the Finance Committee shortly, and that it'll use John Kerry's suggestion to tax insurance companies for their most expensive plans, and that it won't have a public plan. As Scarecrow said, since when does the Finance Committee dictate policy provisions?

Jane believes that the Senate bill could come together quickly, and that when Harry Reid reconciles the Finance bill with the HELP Committee bill, that he will drop the public plan. I would say that, since it's completely at Reid's discretion, the pressure is on him to include that in the merged package or not. Either way there will be an amendment to either strip it or add it back in. If Reid includes it, that amendment may need a 60-vote threshold to strip it, and if he doesn't, it may need 60 votes to put it back in. So Reid has every opportunity to advance the prospects of a public option. Jane also says:

Anyway, as was always going to be the case, the only hope for the public plan is coming out of the House. And the only hope of forcing the Senate's hand is if there is a roadblock in the House that can't pass a health care bill without one. It puts them in the position of tanking health care because they petulantly insist on refusing to give in on something that 76% of Americans want, and the public pressure becomes enormous.

So please tell members of the House to stick around and fight, because with 50 million people in this country uninsured, it isn't All About Them.

The best way to stop the delay tactics from the Finance Committee is to refuse them an out by putting passage of a bill ahead of the August recess.

...and Harry Reid abdicates his responsibility as a leader of the caucus...

Senate Majority Leader Harry Reid said today that the Senate would not attempt to pass sweeping health care reform until after returning from the August recess.

“It’s better to get a product that’s based on quality and thoughtfulness than on trying to just get something through,” Reid told reporters.

Reid said the Senate would try to complete a package in the fall.

The article makes it sound like Republicans asked for a delay, and Reid AGREED to it.

Should we just let Mitch McConnell be Majority Leader at this point?

...I should mention that I haven't seen reports of that Baucus/Finance Committee/public option deal anywhere else. Things are very fluid and I still feel that most stakeholders in the debate are resigned to something called "public option" in the final bill. Whether it's good or not remains to be seen. But conceding the recess and allowing the Finance Committee to delay and dictate the terms is unconscionable.

Health Care Notes

Just a few things I saw today:

• Orrin Hatch will no longer participate in the Senate Finance Committee's bipartisan discussions on health care reform. I'm surprised he hung in as long as he did. If Ted Kennedy came to him and asked to vote for cloture, I think it'd be 50/50.

• Olympia Snowe has become queen of the weasel words. In her district she had a statement read supporting a public option;



But back in Washington, she adds an extra line that wasn't read that turns it into a trigger. Now THAT'S weaselly.

• In the Nancy Pelosi interview I noted before, she has some interesting comments on MedPAC reform:

MedPAC has been an idea out there for awhile. There have been some concerns about it among many of us because it's a big transfer of authority to the executive branch. I myself could have argued the issue both ways. Do I want my members figuring out how much oxygen people need or do we want to pass it on? But how we pass it on was important. Does Congress participate in appointing membership? Do we establish criteria to make sure we bend the curve in a way that protects people?

Steny [Hoyer] and Mr. Waxman and Mr. Dingell and, I think, Mr. Rangel were among those who did not fondly receive this proposal at first. It became more of an issue when we were seeing what CBO was going to score. When we found out they could score that, we thought okay, with the proper criteria, this is something we could probably live with.

They mention the Defense Base Closure and Reauthorization Commission. But leadership has appointments to BRAC. We want to see representation, not some ex officio group we have no say over.

That's probably a fair compromise. And it's vital to get the kid of cost savings many seek.

• Michael Steele actually doesn't know what kind of health insurance he has. This is the leader of the Republican Party. And the RNC doesn't have a choice of plans, either. Some free market.

• John Kerry's proposal in the Finance Committee is pretty interesting:

Orszag also said the White House is open to a proposal by Sen. John F. Kerry (D-Mass.), a Finance Committee member, to tax insurers for very generous health policies. The idea is a variation on a provision that Baucus, Grassley and others on the committee had pushed: to tax beneficiaries who receive generous policies through their employers.

Obama staunchly opposed taxing beneficiaries as a candidate, and on Monday he threatened to veto a bill that targets individuals. But Orszag said that the White House is open to the Kerry alternative, noting that a fee on high-value policies would "create an incentive for companies to create more efficient plans."

A senior House leadership aide said Democratic lawmakers there are keenly interested in the Kerry provision, along with other revenue measures with consensus support in the Finance Committee, to replace the wealth surtax that Baucus and others have already declared dead on arrival. "Our guys want to see some movement there," the aide said. "They're loath to vote on a tax increase if it is not going anywhere in the Senate."

It's a shame that nobody's willing to say that America is worth paying for. But I'm with Digby. As long as we're stuck in this paradigm, with the old dialogue about taxes, you might as well try to accomplish the same goal - reducing incentives for "Cadillac" health care plans - as limiting the employer deduction through a tax on the insurers. In the end it's the same deal.

• It's sad that the White House won't release the documents of which health industry stakeholders they've met with. It reverses the expressions of transparency he vowed in the campaign and continues to vow. CREW is suing and I hope they win - secret government should not become precedent.