07/22/2009 07:47 pm ET | Updated May 25, 2011

Showdown on Health Reform: Chamber, Insurers vs. Obama, Labor, Grass-Roots Activists

The Chamber of Commerce announced yesterday a new $2 million media campaign targeting the public health option that's central to the health care reform President Obama was promoting in his major news conference Wednesday night. For now, the Chamber is focusing on attacking the public health option in states with wavering centrist Senators, including Arkansas, Colorado, Louisiana, Maine and North Carolina.

But in seeking to reach out directly to the public, President Obama declared at the beginning of his news conference that health care politics as usual has to end:

I've heard that one Republican strategist told his party that even though they may want to compromise, it's better politics to "go for the kill." Another Republican Senator said that defeating health reform is about "breaking" me.

So let me be clear: This isn't about me. I have great health insurance, and so does every Member of Congress. This debate is about the letters I read when I sit in the Oval Office every day, and the stories I hear at town hall meetings...This debate is not a game for these Americans, and they cannot afford to wait for reform any longer. They are counting on us to get this done. They are looking to us for leadership. And we must not let them down. We will pass reform that lowers cost, promotes choice, and provides coverage that every American can count on. And we will do it this year.

One argument against the public health care option is that it would some destroy the private insurance industry that serves most Americans, even though companies have price-gouging near-monopolies in different regions. But reports yesterday from UnitedHealth Care showing that their second quarter profits margins doubled to $859 million -- nearly a billion -- show, reformers argue, that major private insurance won't go under if faced with public competition that "keeps insurance companies honest," as President Obama says.

The aim of the Chamber's campaign is to help generate grass-roots support for slowing down the President's drive for health care reform and scaring small business owners with what critics say are false claims about newly-imposed high taxes affecting small business owners. The tagline of the new ads that were unveiled today is "Don't Drag Down Health Reform."

As Bruce Josten, the Chamber's executive vice-president of government affairs, told reporters in a conference call yesterday, "Let's not drag down what works, and let's fix what's broken." For instance, the Chamber says -- as long as the threat of federal health reform looms -- that it favors ending the ban on pre-existing conditions, and Josten suggests that some sort of market-based reforms in the states could help solve the runaway costs of medical care and lack of access to affordable care.

But Gerry Shea, the AFL-CIO's lead expert on health care reform, scoffs at these nostrums. "They'd look like fools if they said they're against health reform, but it sounds like a lot of obfuscation to cloud their direct opposition to what the President and the Congressional committees are proposing," he says Indeed, he notes there's been nearly two decades of failed state-based private insurance "reforms," including "pools" for uninsured citizens in the states, that proved to be too expensive and served only a tiny fraction of people needing insurance.

Even so, unlike the decades of Chamber opposition's to previous social reform legislation, from the minimum wage to Medicare to the SCHIP program for kids, the Chamber's new attacks on the public health option are couched as being in favor of "responsible reform."

But this mask of reform, critics say, differs little from the line of attack it's used against social reform programs from Medicare until now. Indeed, Josten continued to make the claim that Democratic health care proposals will lead to a "government take-over" of health care, and ultimately destroy private insurance and rob employees of their care.

Yet, as Gerry Shea points out, the public health option will force the insurance companies to lower their costs to providers and consumers, and "these big private insurers have hundreds of millions in the system even if they had lower costs."

And , Shea and others say, the Big Business and Blue Dog Democrat cries about high costs in the bills now on Capitol Hill don't take into account the new reforms in the proposed legislation to reduce the provision of needless, duplicated tests and other procedures that don't advance health outcomes -- or end the soaring 30% rates of hospital readmissions under Medicare and private insurers now because of poor follow-up care. Indeed, the Blue Dog Democrats and influential House Energy and Commerce Chairman Henry Waxman yesterday struck an important deal to lower costs by having an independent panel determine what procedures were wasteful.

What's really going to determine the impact of the President's speech and the drive for reform is the role of grass-roots support. Now, via,, the millions of Obama supporters now affiliated with Organizing for America are calling citizens to urge reform, joined by such independent groups as Health Care for America Now, which includes labor and other progressive organizations. For instance, Bill Miller, the Chamber's senior vice-president of political affairs, boasted that the Chamber has generated 78,000 letters in recent weeks in opposition to the President's plan, while Gerry Shea laughed, "That doesn't strike fear into our hearts," noting that labor and progressives have already generated hundreds of thousands of letters, phone calls, emails and signatures.

As health care journalist Ezra Klein noted in his column on the "left's suprising organizing advantage":

This year, the legislators flipping their positions under activist pressure are centrist Democrats who have been targeted by Health Care for America (HCAN) and its allies. The news stories about rallies and letter-writing campaigns and grassroots efforts tend to feature liberals organizing in support of the public option. And then, of course, there's the 800-pound gorilla that is Organizing for America, Obama's grassroots structure.

Ultimately, labor health reform advocates say, the Chamber's initiative won't slow them down -- or fool the American public. Lori Lodes, SEIU's lead spokesperson health reform, declares:

The American health care system is broken and the Chamber of Commerce - with the bottomless pockets of corporations behind them - is championing the status quo that denies the care you need and bankrupts small businesses. The Chamber has ALWAYS been opposed to meaningful health care reform on behalf of the bottom lines of their corporate benefactors, so it's not a surprise that they are trying to kill health care reform now. They are using the same distortions and smear tactics as they have in previous years. But this time, the Chamber's Tokyo Rose campaign won't work. Americans know that NOW is the time to reform a system that costs too much and covers too few and bankrupts families and businesses.