The "Less Quality Now!" Plan

The real kicker to the Baucus draft plan in today's New York Times is squirreled away near the bottom of the article. The top-line stats include the tax on more expensive health care policies, seen as a way to get at the employer deduction, where a giant pile of money exists in health care. Then there's the mix of expanding Medicaid up to 133% FPL, subsidies inside the insurance exchange for up to 300% FPL, with assurances that people up to 400% FPL would not pay more than 13% of their income in premiums. There is no public insurance option or a trigger for one, and the concept of co-ops is strangely not mentioned at all in the article (UPDATE: Per WSJ, there are co-ops in the plan). There are limits on out of pocket expenses, albeit higher limits than in the other bills ($6000 for individuals, $12000 for families). There's no talk of either an individual mandate or an employer mandate. So there are some holes here, but if it follows the pattern of the other plans, you're ensured coverage if your employer provides it or if you make so little that you qualify for Medicaid. If you're over 65, you're on Medicare. If you fall in between all of that, you go to the exchange, and can qualify for subsidies to afford coverage.

The plan is expected to cost $850-$900 billion over 10 years, but given the coverage subsidies and Medicaid expansion, I can't see that number being so low. Plus the talk in Washington, apparently, is about a $700 billion dollar bill. So how can that all square? By allowing insurers to offer crap coverage.

Coverage under Mr. Baucus’s plan would, by some measures, be less extensive than the least generous of three levels envisioned in a bill approved by three House committees.

To compare health plans, experts often focus on the percentage of medical expenses paid by insurance, on average, for a given population. This figure ranges from 70 percent to 95 percent under the House bill’s options, but it would be less than 70 percent under Mr. Baucus’s proposal.

The only way to keep insurance premiums down for the poor, and therefore keep the subsidies down, is to make the coverage less generous. And the insurers would only pay for covered expenses. Anything not covered by the plan would go directly to the consumer. Someone making $20,000 a year would still be on the hook for up to $6,000 in medical bills under this plan, and that doesn't include their premiums or non-covered expenses. Insurers, then, get off the hook for a huge chunk of medical costs while having to pay a nominal tax, and the goal is actually to have them not pay it at all, but simply to discourage companies from buying good insurance policies for their workers. And you would still see plenty of medical bankruptcies. Virtually everyone's health coverage gets worse under this Baucus scenario. I don't remember "Less Quality Now!" being part of any sloganeering on the reform side.

The real problem is that Washington is choking on the cost of providing health coverage to those who needed it. They don't want to use any external taxes or mechanisms, and they don't want to cut into industry profits to pay for the bill inside the system. So we get an ever-reducing price tag, now around $700 billion over ten years. Ezra Klein notes that these same fiscal conservatives all voted to eliminate the estate tax on ridiculously wealthy Americans, to the tune of $750 billion over ten years. That money would have entirely accrued to the deficit, while Democrats are consumed with being responsible and paying for this health care bill. It's really all a matter of priorities - help millions of uninsured people get the critical care they need, or give Paris Hilton a tax cut. George Bush financed practically every new program he brought into being by borrowing from China and adding to the debt. But the deficit only matters when there's a Democrat in the White House.

The Baucus plan gives new meaning to the term "aiming low." We'll know by Wednesday if the President agrees.

...Josh Marshall hits something I've been saying for a while.

You 'solve' the problem of the uninsured by passing a law forcing them to buy health insurance which, by definition, most a) cannot afford or b) are gambling they won't need because they're young and healthy. Either you end up with low subsidies which still leave it onerous to buy, thus creating a lot of disgruntled people, or you get generous subsidies, which cost a lot of money.

It's sort of like reform with all the cool political downsides but none of the reform.

A bill that criminalizes you for not buying health insurance, and then makes that health insurance demonstrably worse, will be an unmitigated disaster for the Democratic Party.

America's Worst People

I mentioned that Congress passed a budget yesterday. In the Senate, the vote played out almost exclusively among party lines, with only two Senators - Evan Bayh and Ben Nelson - crossing the aisle. They are the two most conservative Democrats in the 111th Congress, by voting record. And they didn't only vote against the budget - they voted definitively FOR a motion to recommit, which essentially would have substituted this budget for a Republican version.

Enter Mike Johanns, the freshman Republican senator from Nebraska whose amendment preventing the Senate from passing climate change legislation through the reconciliation process passed on Tuesday.

He also authored a different measure--not an amendment, but a "motion to recommitt"--which would have scrapped the budget that passed and replaced it with a much more conservative version. Most significantly, it would have indexed non-defense, non-veterans discretionary spending to the expected rate of inflation. It failed 43-55--for all intents and purposes a mirror image of the vote on the final budget resolution. Which is to say that Bayh and Nelson voted for the "Johanns Budget".

So how did these two Republicans, who voted affirmatively for a Republican budget, justify their votes? They said it costs too much.

Nelson defended his vote in a prepared statement:

"The administration inherited a lot of red ink in this budget, along with our ailing economy. But this budget still has trillion dollar-plus deficits in the next two years, and adds unsustainably to the debt. These are tough times, and the federal government needs to take a lesson from American families and cut down on the things we can do without.

I respect the Administration offering an honest budget…but it just costs too much."

Similarly, Bayh issued a statement saying he opposed the budget in an attempt to be the voice of “fiscal responsibility“:

"[U]nder this budget, our national debt skyrockets from $11.1 trillion today to an estimated $17 trillion in 2014. As a percentage of our gross domestic product, it reaches a precarious 66.5 percent. The deficit remains larger than our projected economic growth, an unsustainable state of affairs. This budget will increase our borrowing from and dependence upon foreign nations. I cannot support such results. We can do better, and for the sake of our nation and our children’s future, we must."

These same two Senators, the ones whining and crying about fiscal responsibility, voted last night to shield millionaires from taxes on their estates, costing the government $250 billion dollars.

WASHINGTON (AP) -- The Senate has voted to cut taxes on multimillion-dollar estates as it gets ready to pass a budget backed by President Barack Obama.

By a 51-48 vote, the Senate embraced a nonbinding but symbolically important amendment by Arkansas Democrat Blanche Lincoln and Arizona Republican Jon Kyl to exempt estates up to $10 million from the estate tax. Estates larger than that would be taxed at a 35 percent rate.

Tim Fernholz has more on this nonsense, including the good news that this will likely never make law. But let's just soak in this for a minute. The two ConservaDems who voted against the budget on the grounds of fiscal responsibility voted to give a handout to families with estates over $7 million dollars. Tremayne at Open Left has a chart showing just exactly who this tax policy would affect.

Hard to see it, but those with annual incomes in the millions are represented by the vertical red line on the left and those making less than a million (i.e., almost everyone) are the horizontal red line on the bottom. Lincoln and Kyl are concerned about the people on the vertical red line.

So are Bayh and Nelson, America's worst people.

Chart Of The Day

Blanche Lincoln (D-AR) and Jon Kyl (D-AZ) teamed up today to offer a budget amendment that would offer $250 billion dollars in tax cuts to families that inherit estates worth over $7 million dollars. Tremayne at Open Left links to this chart showing just exactly who this tax policy would affect.

Hard to see it, but those with annual incomes in the millions are represented by the vertical red line on the left and those making less than a million (i.e., almost everyone) are the horizontal red line on the bottom. Lincoln and Kyle are concerned about the people on the vertical red line. Actually, as the OpEd piece linked above points out, the concern is not for everyone on the vertical red line but only the wealthiest of those wealthy.

Why would Lincoln, a Democrat, be so concerned about that tiny and very wealthy segment of the population I wondered.

This is not so hard to find, and Tremayne was able to locate the source of Lincoln's concern, which begins with Wal and ends with Mart.

But, are there any rich people at all in Arkansas? Turns out there are. Here are the richest 5 families there:

1. Sam Walton Family (Wal-Mart, inheritance)

2. Witt and Jack Stephens Family (finance)

3. Charles Murphy Family (oil, etc.)

4. Winthrop Paul Rockefeller Family (inheritance money, ha ha)

5. Don Tyson Family (chicken)

I wonder, does Blanche Lincoln have any connections to these rich families? Is that why she is so concerned about them she is cosponsoring an amendment that won't help hardly anyone else? Hmmm.

A little more Googling around and I found this, the list of the top 5 contributors to Blanche Lincoln's reelection campaign:

Stephens Group: $34,200
DaVita Inc: $32,000
Wal-Mart Stores: $25,800
Tyson Foods: $24,750
Goldman Sachs: $24,000

Very interesting. Let's see if there is any overlap with the above list of rich families. Hey, lookie there: 3 of the top four contributors are also on the top five wealthiest families in Arkansas. How about that?

I don't think it even has to be that complicated. The Walton family wields tremendous power in Arkansas that can be measured well beyond campaign contributions, and Lincoln has an interest in ensuring their ability to hoard money and make them richer.

The New York Times hit this with an editorial today. But Blanche Lincoln is simply an example of a Democrat beholden to a certain sector on key issues, in this case ultra-rich department store owners. There are niche sectors for plenty of other Democrats: the credit card industry in South Dakota and Delaware, the financial sector in New York, the auto sector in Michigan, farm states like Minnesota and North Dakota and Iowa. These regional anomalies have frustrated progressive change for some time, making this a sclerotic country that seems stuck in molasses and unable to move forward on important issues. There's a path to neutralize these forces, but let's get real - we're going to be dealing with this in some form forever.

Bob Johnson's A Fool

Bob Johnson, the founder of BET (which doesn't actually reflect well on him or do much to "lift up" Black America, considering that their almost entire output it Hot Ghetto Mess and 106th and Park), said a really stupid thing yesterday, obliquely citing Barack Obama's drug use as a teenager, and then lying about it.

"To me, as an African American, I am frankly insulted the Obama campaign would imply that we are so stupid that we would think Hillary and Bill Clinton, who have been deeply and emotionally involved in black issues — when Barack Obama was doing something in the neighborhood; I won't say what he was doing, but he said it in his book — when they have been involved," Johnson said.

Obama wrote about his teenage drug use — marijuana, alcohol and sometimes cocaine — in his memoir, "Dreams from My Father."

Johnson later said his comments referred to Obama's work as a community organizer in Chicago "and nothing else. Any other suggestion is simply irresponsible and incorrect," he said in a statement released by Clinton's campaign.

Actually, Bob Johnson is irresponsible and incorrect. A community organizer is not only a noble profession, but Saul Alinsky, the "godfather" of community organizing, was one of Hillary Clinton's heroes. His comments make no sense if he was referring to community organizing.

The real problem here is that the Clinton campaign is allowing Bob Johnson to speak for them at all. Johnson has a horrible economic past, having gleefully sat on Bush's "privatize Social Security" board, having called the estate tax "racist" and having lobbied against tax fairness for hedge fund managers. No respectable Democrat would ever share the stage with him. I agree with Matt Stoller that this offers a real opportunity for Obama:

Obama should use this moment to go after big media and outclass Clinton with substantive and sharp distinctions on policy that show him as a forward-looking and deep candidate. He is already out with the policy that diversity of media ownership is critical to a healthy media system, now is a good moment to make that explicit and go after the media monopolies.

Better that than continue this identity fight, which, because of the stereotypes being thrown around, he will probably lose. He's doing much better in the recently released Washington Post poll, that shows the race nationally at 42-37-11. Obama has already garnered increased support from African-Americans because of the Clinton campaign's attacks combined with his Iowa victory, leading to Clinton practically pulling out of South Carolina. It's time to get back the white liberals. Moving off of racial identity and on to some substantive and noticeable fight would be a way to do that.

Media ownership is one of Stoller's pet causes, but in this case he's absolutely right. Johnson is a creature of a diseased media oligarchy, and the causes he's supported feed right out of that. He's an example of the narrowness of out discourse. Rather than harp on the racial nonsense and the smearing, Obama could offer a direct critique of the kind of economic inequality someone like Johnson wants to maintain. Otherwise, I do fear that Obama is being lured into a trap.

And so it's worth wondering if there's not a coordinated strategy among the Clintons to force a conversation over race. Not a conversation that will be harmful to Obama -- the Clintons have, after all, had to spend a fair amount of time apologizing, and clarifying -- but a conversation that will be harmful to his message. If Obama has to spend a lot of time talking about race, it's hard for him to be the post-racial candidate. If he has to spend a lot of time on divisive topics, it's hard for him to make an appeal for unity. And if he gets thrown off message at this point in the campaign, it will be exceedingly hard for him to blunt Clinton's momentum. And, whether it's a coordinated strategy on the part of the Clintons or not, it's definitely what's happening.

And when you add in the voter suppression effort that Clinton surrogates are engaged in, trying to make it harder for union members to vote, you have to question the win-at-all-costs strategy here. I don't think Obama's campaign has been squeaky clean, but I've yet to see voter suppression tactics. Meanwhile John Edwards seems completely apart from this debate, and he's doing pretty darn well in Nevada considering the media blackout. If Obama would short-circuit the debate and talk about the ECONOMIC reasons to reject Bob Johnson's comments, he would reap a bounty. Instead, it's identity politics, his coalition isn't big enough, and Clinton is likely to benefit.

Rudy Gives Up

After a few days of being completely unable to defend his contradictory positions, Rudy Giuliani has said "To hell with it" and will run as a pro-choice Republican.

After months of conflicting signals on abortion, Rudolph W. Giuliani is planning to offer a forthright affirmation of his support for abortion rights in public forums, television appearances and interviews in the coming days, despite the potential for bad consequences among some conservative voters already wary of his views, aides said yesterday.

At the same time, Mr. Giuliani’s campaign — seeking to accomplish the unusual task of persuading Republicans to nominate an abortion rights supporter — is eyeing a path to the nomination that would try to de-emphasize the early states in which abortion opponents wield a great deal of influence. Instead they would focus on the so-called mega-primary of Feb. 5, in which voters in states like California, New York and New Jersey are likely to be more receptive to Mr. Giuliani’s social views than voters in Iowa and South Carolina.

Tactically, he probably has a better chance just being honest than trying to reconcile being "personally pro-life" and funding Planned Parenthood. Of course, this completely changes the nature of the Republican race. His STATED STRATEGY is to wait until New York and California on Feb. 5 to make his move. Nobody's going to be able to do that (plus, California's Republicans are as wingnutty as they come, so that's just a dumb strategy). And while Rudy will probably get plaudits from the punditocracy for this "bold, courageous move," he's not exactly Mr. Straight Talk.

Sports fans grew accustomed to seeing Giuliani, in Yankee jacket and cap, within camera view of the team's dugout at every one of the 40 postseason home games the Yankees played while he was mayor. His devotion reached such heights that at the 1995 Inner Circle press dinner, he played himself handing the city over to George Steinbrenner in a lampoon version of the Broadway musical Damn Yankees, succumbing to a scantily clad Lola who importuned him on behalf of the Boss to the tune of "Whatever Lola Wants (Lola Gets)." Mike Bloomberg understood years later that the song was no joke; he nixed Rudy's stadium deal in his first weeks in office.

It is only now, however, as Giuliani campaigns for president, that we are beginning to learn that this relationship went even deeper. Giuliani has been seen on the campaign trail wearing a World Series ring, a valuable prize we never knew he had. Indeed, the Yankees have told the Voice that he has four rings, one for every world championship the Yankees won while he was mayor. Voice calls to other cities whose teams won the Series in the past decade have determined that Giuliani is the only mayor with a ring, much less four. If it sounds innocent, wait for the price tag. These are certainly no Canal Street cubic zirconia knockoffs.

He has 4 $200,000 rings on his fingers, and he tried to fund new stadiums for the guys who gave them to him. This is a guy who's a reformer fighting corruption in government?

Not only that, the latest is that his campaign is so hell-bent on pushing estate tax elimination that they're scouring Iowa for nonexistent family farmers to be used as props, and then cutting them loose when they don't make enough money.

A lot of people think Giuliani's pretty much done; he's in the lead now, but his vulnerabilities will be too much to overcome. I'm still going with the GOP nominee being "none of the above." And he'd (because a "none of the above" Republican would be a white male) have a better chance in November '08 than anyone else in the field.