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Bob Kerrey Stands Behind Cornhusker Ben Nelson on Health Care Reform

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I called former governor and senator of Nebraska, Bob Kerrey, to ask how he would have voted on health care reform if he were he still in the United States Senate today. "I presume that the answer is I would vote yes," he said, but not with much enthusiasm.

Kerrey was on my call list because he is honest, particularly for a politician, and he's unconventional. (When we last spoke in 2006, I asked him about his characterization of President Bill Clinton as "an usually good liar." He indicated he did not mean it entirely as a put down and explained why.)

Currently a resident of Manhattan, Kerrey, 66, is finishing a controversial tenure as president of the city's New School -- he took the job after retiring from the Senate in 2001.

This time, I wanted to get his take on his friend and fellow Nebraskan, Sen. Ben Nelson (D-Neb.), who had also served the state as governor. In the days before and after the Senate passed its version of health care reform at 7 a.m. on Christmas Even, Nelson, 68, stood at the forefront of political firestorm.

First, Kerrey explained what he considered to be flawed in the Senate bill: There should have been "a universal public option... a national system, the feds are responsible for it." Kerrey added that if he were responsible for writing the bill, all private insurance companies would be eliminated. The private sector would still get a piece of the action because Kerrey would set up "a national system of payment" run by private, highly regulated companies.

Under a Kerrey plan, "The employment-based system of getting health care" would be history. One of his many beefs with the Senate bill is that although this system "is coming apart at the seams, [the new Senate bill] continues it."

Kerrey says he admires the British, the Canadian, the French, and the German health care systems. If only Americans could have "no anxiety about whether or not you're covered... I was in England and had a little problem with my jaw and went right in and got taken care of, so even for visitors there's a provision."

On the other hand, he says, he knows his ideas, as he recently wrote, "amount to a political fantasy."

Oh, and one more thing, "I'd federalize Medicaid" - the cost of the safety-net program for the poor is now paid for partly by the feds and partly by the states.

And that brings us to Ben Nelson, whose decision to become Harry Reid's 60th vote, has landed him in all kinds of trouble back home. If Nelson runs again in 2012, a Rasmussen poll shows that his most likely republican opponent -- the state's current governor -- would shellac Nelson by a 61-30 margin.

There's not much that the two old friends agree on when it comes to the Senate's health care bill. Nelson has been meeting constituents and running ads in Nebraska pronouncing the public option "dead." If the House's version of the public option ends up in the Senate bill,"... then it dooms the entire bill," Nelson promises.

In a television ad, Nelson looks directly into the camera and declares, "It's not run by the government."

And then there's abortion -- Nelson is staunchly anti-abortion and Kerry is "100 percent pro-choice." Nelson is taking plenty of heat from the Nebraska right-to-lifers who charge their Senator with not holding out for tough enough language and agreeing to vote yes even though the abortion language in the Senate bill is less restrictive than the language in the House bill.

Still, Kerrey has risen to his friend's defense. He had campaigned for Nelson in '06, Kerrey told me, and will do the same in '12. He called Nelson before the Christmas Eve vote to tell him that. Earlier, Kerrey promised Nelson that whether he voted yes or no, Kerrey would support him.

Nelson is taking the most heat over the $100 million he secured for his state in exchange for providing the much-needed 60th vote. That tidy sum -- dubbed by critics "The Cornhusker Kickback" -- was inserted in the bill to cover Nebraska's increased Medicaid costs that will result from the Senate bill's expansion of the program. Nebraska received special treatment and 12 republican attorneys general are already threatening to bring legal action if the Medicaid gift to Nebraska is not excised form the bill.

Kerrey argues that Nebraskans ought to be thanking Nelson, not castigating him. Of Nebraska Governor Dave Heineman, Nelson's likely republican opponent in 2012, Kerrey says, "He opposed the bill because of the increased Medicaid cost, and then when those costs were reduced to zero he continued to oppose it... I think what it gets back to is republicans have just made a decision; they're not going to support the bill regardless of what's in it." (Kerrey describes the republicans as "basically sitting it out" and predicts that they will not be part of the conference/reconciliation process because "I don't know how [Republicans] have a claim to get conferees.")

Heineman was quoted in the New York Times as saying, that the deal Nelson made with Harry Reid was an embarrassment to Nebraskans, and that if Nebraska gets exempted from Medicaid costs so should every other state. "It was an attack on [Nebraskans'] integrity."

Supporting the special windfall for Nebraska is becoming an increasingly lonely position. The Obama team had been advertising support from California's republican governor, Arnold Schwarzenegger; but they can't any longer. He is so angry that that his state didn't get its own permanent reprieve from Medicaid costs that he is asking California's congressional delegation (which includes House Speaker Nancy Pelosi) to vote against the bill that will eventually land on Obama's desk. The most memorable lines in Schwarzenegger's state of the state address was when he denounced the "sweetheart deal Senator Nelson of Nebraska got for the Cornhusker State. He got the corn; we got the husk."

It was clear that Nelson never felt comfortable with that $100 million gift, so it was predictable when two weeks after Christmas Eve, Nelson announced that he would fight for all states to get the same benefit -- i.e. let the feds pay for it; and let them pay indefinitely. "At the end of the day, whatever Nebraska gets will apply to all states." The problem is that the CBO would have to re-calculate the bill's costs, and the price tag for the $871 billion, 10-year legislation would rise by who knows how much? $30 billion, $50 billion, more?

As for the charge that Nelson's $100 million is anything like a payoff, Kerrey counters, "A payoff is when you vote yes on something as a consequence of a campaign contribution. Politically, it was in Ben's best interests to vote no, not yes. So I don't see a payoff here at all, unless you think that trying to get the best deal possible for your state is a payoff. He didn't benefit from this personally; the state did." For Nelson, who is being eviscerated in the newspapers back home, Kerry says, "The easiest vote would have been to vote no... It took guts for Ben to vote yes."

When Kerrey is asked if he has heard that Obama's aides threatened Nelson with closing Nebraska's Offutt Air Force Base, Kerrey laughs, "No, I did hear that they're threatening to move Interstate 80."

Kerrey, a Vietnam veteran, medal of honor winner, who lost part of his leg in battle, has a close kinship with John McCain - and a contrarian's view of McCain. Conventional wisdom has it that McCain has shed his maverick ways and, on the subject especially of health care, has become a hyper-partisan naysayer. "I don't see any fundamental change in John's behavior," Kerrey says, pointing out that McCain supported Obama on Afghanistan. "So it's not like he's totally partisan." (In 2006 Kerrey invited John McCain to be the New School's commencement speaker and stuck with the invitation in the face of harsh criticism from students and faculty.)

But Kerrey does think that McCain missed an opportunity in 2009. "It would have been quite interesting if John McCain in the last 60 days had said, `I'll be your 60th vote, Harry [Reid]... Here's my price.'" His price, says Kerrey, might have "tort reform." But McCain's price, whatever it was, would surely have been lower than "when Harry has to negotiate with the last democrat. His price is, 'I want 100% Medicaid coverage in Nebraska.'"

When I asked Kerrey if he could identify with the pressure Ben Nelson felt because Kerrey had been under the same sort of spotlight in 1993 when Bill Clinton needed Kerrey's vote on his budget bill. There was a famous phone from Clinton in the Oval Office to Kerrey that ended in Clinton telling Kerrey that if he voted no, Clinton's presidency was going down; one or the other ended the conversation with "Fuck you!"

(The history between Kerrey and Clinton is not friendly. In 1991, when Kerrey and Clinton were competing for the democratic nomination for president, the two men were caught telling lesbian jokes. Kerrey admitted his faux pas -- he had little choice because a microphone had captured him telling Clinton a joke about two lesbians and former California governor Jerry Brown, and dropped out of the race. Clinton, who had responded in kind -- no pickup by a microphone -- denied it, stayed in, and became president. Ten years later, after Clinton was out of the White House he told that very joke to Kerrey and others at Babbo in Greenwich Village. A diner at a nearby table heard Clinton and the episode landed in the Washington Post's gossip column.)

Kerrey says today that there was no "strong-arming" in 1993. Clinton's aides were lobbying Kerrey, of course, but "there was nothing Bill Clinton did or said that caused me to vote in the affirmative... I was persuaded by a variety of people in Nebraska," most prominently, the world's most famous Nebraskan, Warren Buffett. "I don't think it's going to get any better than this," Buffett told Kerrey about the budget bill.

Kerrey says he doesn't know if Buffett offered advice to Nelson on health care, but Kerrey says he called "Warren" before he [Kerrey] placed his call to Ben Nelson. "Warren said, `Look, this bill has gotten to be very unpopular.'" Buffett worried, explains Kerrey, "that this bill might have a negative impact on Ben's reelection possibilities."

Kerrey agrees that Nelson, could be in trouble if he runs for reelection in the red state of Nebraska in 2012. "When you're running as a democrat in Nebraska, it doesn't take but 15-20 percent who are determined to defeat you to defeat you." Kerrey points out that the fastest growing group in Nebraska is independents... Independents... are moving away from the president." (Nelson is the only Democrat who holds state-wide office In Nebraska.)

Trained as a pharmacist, Kerrey was also an entrepreneur -- health clubs and restaurants -- before entering politics. He returns to his opinion that the most "pro-business" move the congress could have made -- and did not make -- would have been to "nationalize the insurance side" and construct a system of private, heavily regulated payers. 'If individuals who were trying to start a business didn't have to worry about providing health insurance for themselves and their employees, I think you'd get a lot of growth in the United States. I think it's a very pro-business point of view. Unfortunately, that's not where we ended up."

He explains that at the New School he has "a thousand lives" insured. He would rather, he says, have "the feds" tell him, "Here's the price, here's your contribution, New School, and all your people will be insured." The person who wants to go into business," Kerrey argues, is "fighting with health care all the time, figuring out how to do health care for your employees is a real challenge." He adds that that the biggest challenge of all for business is "just getting a loan."

Kerrey's New School contract stretches to July 2011, but the search for a new president is about to start and if a candidate emerges and is approved Kerrey seems ready to leave early. His tenure has been tumultuous. He doesn't rule out running for office again, but calls it "unlikely." Among the controversies that would plague him are news stories about the killing of unarmed women and children during a Vietnam combat mission that he led.

Asked if he's going to give up Manhattan for Omaha, he says again he doesn't know, but adds, "I'd like to do something where when I go to work in the morning my cause and my job are the same thing."