Is Obama a Back-Room Blue Dog on Health Care?

The news media -- particularly 24-hour cable -- has focused its health care coverage on the raucous demonstrations by tea-baggers and other middle aged and elderly white fringe elements who are being ginned up by the right-wing of the Republican party.

It makes for good television, but it's a side-show to the main event. The real story should be about the back room deals reportedly being negotiated between the Obama administration and Blue Dog Democrat Max Baucus, on the one hand, and Big Pharma, for-profit hospitals, and the private insurance industry, on the other hand. This is where the real action is taking place and it's looking increasingly likely, as a result, that the Health Care bill which ends up emerging from Congress could represent a massive public subsidy to the private health care industry.

Failing to pass Health Care reform would be a set-back to President Obama and the Democrats. But passing a bad bill which subsidizes wealthy private interests; reverses Obama's campaign promise to allow Medicare to negotiate lower prices with drug companies; and mandates that people without insurance must buy inadequate policies from for-profit insurance companies (or a neutered, non-competitive "public option" or co-op which is too weak to reduce costs) lest they be fined by the IRS, could turn a generation against the Democratic Party, revitalize the Republicans, and "prove" to many Americans that government intervention in the economy is a bad thing.

The first hint of the real story came when Rahm Emanuel summoned leaders of liberal organizations to the White House and reamed them out for criticizing Blue Dogs who were trying to gut the public option, telling the liberals that they were "f..king stupid" and ordering them to stop, as though popular movements that helped get Obama elected should be nothing more than an arm of the White House.

The next hint was a New York Times story in which the White House confirmed it had cut a back-room deal with Billy Tauzin, chief lobbyist for Big Pharma, to block any Health Reform bill that would allow Medicare to negotiate for lower drug prices. In return, Big Pharma made an unenforceable promise to lower federal drug prices by a mere $8 billion a year, a fraction of the amount which could be saved by using the market power of Medicare to negotiate meaningful price cuts, as almost every other capitalist democracy in the world does, reducing their drug costs to about half of what Americans pay. It was a direct repudiation of Obama's campaign promise to revoke the Bush Administration's bill which banned Medicare from negotiating for lower prices.

A few days later came Business Week's cover story entitled "The Health Insurers Have Already Won: How UnitedHealth and rival carriers, maneuvering behind the scenes in Washington, shaped health-care reform for their own benefit". The Business Week story begins:

"As the health reform fight shifts this month from a vacationing Washington to congressional districts and local airwaves around the country, much more of the battle than most people realize is already over. The likely victors are insurance giants such as UnitedHealth Group (UNH), Aetna (AET), and WellPoint (WLP). The carriers have succeeded in redefining the terms of the reform debate to such a degree that no matter what specifics emerge in the voluminous bill Congress may send to President Obama this fall, the insurance industry will emerge more profitable. Health reform could come with a $1 trillion price tag over the next decade, and it may complicate matters for some large employers. But insurance CEOs ought to be smiling...The industry has already accomplished its main goal of at least curbing, and maybe blocking altogether, any new publically administered insurance program that could grab market share from the corporations that dominate the business...[It has] also achieved a secondary aim of constraining new benefits that become available to tens of millions of people who are currently uninsured. That will make the new customers more lucrative to the industry."

Thursday's New York Times confirmed Business Week's analysis, reporting that the White House, in conjunction with Sen. Baucus, has made a deal with hospital lobbyists limiting reductions in hospital costs to $155 billion over 10 years and crippling the public option by agreeing "that the final legislation would not include a government-run health plan paying Medicare rates -- generally 80 percent of private sector rates -- or controlled by the secretary of health and human services". According to Chip Kahn, a top industry lobbyist, "We have an agreement with the White House that I'm very confident will be seen all the way through conference".

This is consistent with a White House-brokered deal that Chairman Henry Waxman made between Blue Dog Democrats and the Progressive Caucus to drop a provision which would set rates for the public option at 110% of Medicare rates in exchange for a meaningless floor vote on single payer which is certain to be defeated. Moreover, the New York Times article indicated a high probability that the White House will accept a final bill that jettisons the public option entirely in exchange for co-ops that will be too small and powerless to negotiate lower health care costs or compete with private insurance, and, I would add, would be good for the private insurers because they can be a dumping ground for older and sicker patients whom they don't want to cover anyway. The New York Times article concludes that according to Rep. Waxman,

"'The president has said he wants a public option to keep everyone honest. He hasn't said he wants a co-op as a public option'. Still, industry lobbyist say they are not worried. 'We trust the White House,' Mr. Kahn said. 'We are confident that the Senate Finance Committee will produce a bill we can fully endorse".

So the real story isn't the right-wing rallies. The real story is that it appears that the Obama administration has made back-room deals promising that health reform will protect the profits of the health insurance industry, Big Pharma, and private hospitals, at taxpayer's expense; that a "public option", if any, will be ineffective; and that health care costs will continue to rise.

Obama may get a "Health Reform" signing ceremony on the White House lawn declaring victory. But if the "reform" subsidizes industry profits and mandates that individuals must buy bare-bones policies which they can barely afford and which don't cover many of their health care costs, the raucous town hall meeting could end up being just a precursor to the wrath that American voters will end up aiming at Democrats in a few years when the true effects of this industry-friendly reform become clear.

Republicans have warned that failing to pass a health care bill could be Obama's Waterloo. Passing a bad bill could be an even bigger Waterloo, not just for Obama but for the Democratic Party, and for idea that government intervention is needed to counter-balance the power of free markets and corporate oligarchies.

Liberal organizations who have supported incremental health care reform like Move On, Health Care for America Now, the AFL-CIO, Families USA, and the SEIU need to make clear to Rahm Emanuel and President Obama that they are not an arm of the White House and will mobilize their supporters to oppose a deeply compromised, industry-friendly, health care bill. The House Progressive Caucus needs to make clear to the White House that they have the guts to vote down such a bill. No less than the future of liberalism, as a counter-weight to free market conservatism, may be at stake. If Obama ends up siding with the health insurance industry over ordinary Americans, progressive Democrats in Congress enable him to do so, and liberal and progressive organizations don't speak out, then what's left for millions of Americans whose homes, jobs, and health care are under attack except right-wing populism? The tea parties could end up being, well, just tea parties, compared to the shit-storm to come.

I truly hope the analysis in this article is wrong. Deep in my heart, I hope that Obama is throwing a series of ball fakes at the health care industry and in the end, he will pivot to his left, take off from the foul line like Dr. J, and slam home meaningful health care reform. But articles like those in the New York Times and Business Week provide strong evidence that the fix is already in on health care reform and the endgame is a lobbyist-brokered bill that will boost health care industry profits and not do enough to help most Americans.

If I take any hope, it's from yesterday's syndicated column by Helen Thomas, dean of the White House Press corps, who's been observing the ebb and flow of American politics about as long as anyone still writing:

"I covered the battle to create the Medicare system back in the 1960s. The cries of 'socialized medicine' worked for years until President Johnson rammed Medicare through Congress in 1965...

What kind of a nation are we if we do not provide everyone with the excellent medical care that only
some of us now receive?

In 2003 before he became a U.S. senator from Illinois, Obama actually called himself a single-payer "proponent." But now that he is president, Obama has buckled to Republicans and conservative Blue Dog Democrats in pursuit of consensus. My question is if Congress passes a watered-down version of health care that doesn't truly cover everyone, is the result worth it?

...[President Obama has] worked out a deal with the drug manufacturers not to use the federal government's massive bargaining power to negotiate lower drug prices -- although now the White House appears to be having second thoughts...

It's understandable why the president has bent over backwards to appease Congress, having studied Hillary Clinton's failure to touch base with key lawmakers in selling the program she drafted in her years as first lady. Her recommendations died on Capitol Hill, aided by the phony 'Harry and Louise' television distractions.

President Obama should lay down markers for real health care reform -- meaning we all kick in to a national program instead of fattening the pocketbooks of the insurance financiers.

Instead, the president has given up on Medicare for all, calling single payer 'impractical.'

He still has time to do the right thing and nothing to lose."

Comments

[journey80]

Good grief. Are you serious? Nah. you can't be. Rahm, Mr. DLC, a Blue Dog? Is the Pope Catholic?

Sheesh.

[porsche996]

Wow Miles...this is vuja de. Like you've been reading my comments on HP for the past month which have been making me very unpopular with the President Obama worshipers. They've been vicious and relentless in denying my opinion. I have pointed out that Rahm was running the Blue Dogs from the get go, and that it was a classic false flag strategy to kill single payer. Even when he started to get headlines for running cover for some of them when they started to get too much heat, only a few people on the HP understood what I was pointing to. Then today Sebelius who had already given many hints of President Obama's duplicitous stylings came out and took the point on the "great disappointment" of the WH willingness to lose the public option, the Obama apologists on HP were calling her some kind of rogue agent in order to deny that she takes directions like Rahm from the Oval Office...dduuhh?

Congratulations you are now conscious, don't worry I'll keep posting comments so that you'll have a new column soon. What do think about Obama not being allowed to change SECDEF? More soon......

[LewDan]

What's the President supposed to do? He's not the one who enacts laws in this country.

Call Congress and demand reform? -- or what?!

Frankly Congress is ignoring him, and us, because they're not impressed by empty threats. And Congress enacts legislation, not the President. I've yet to hear anyone fill-in the blank; and all too many make the calls to Congress, feel powerless and give up (or in.) Lobbyists don't make empty threats, they deliver on their threats. THAT's why Congress listens to them.

What we need is to make it clear that we WILL PUNISH at the ballot box those who do not support us, Republican or Democrat. We need leaders who will make that call to arms clear -- that calling Congress is just the first step. The warning shot across the bow. That we probably WON'T be taken seriously until and unless WE DELIVER ON OUR THREATS; until Congress is more afraid of us than the lobbbyists.

Until WE understand that this will likely take more than one election and show the willingness and the perseverence to follow through why should they listen to us?

We have the power, but we almost never use it -- Of course Congress isn't afraid of us; if they cross the lobbyists the lobbyists go after them, if they cross us we go after the President.

With the kind of "support" we've shown up until now Obama will be lucky to negotiate anything for us.

[WorkingClass]

The health care failure will have Democrats leaving in droves. There needs to be someone just outside the tent, asking the deserting Democrats if they want to join the new AMERICAN LABOR PARTY.

[wonketteRAWKS]

It seems effective healthcare reform is only a term used to campaign with or spin for the masses. This is being rushed through without real transparent debate. Like you said, a bill will be passed, but in the long run meaningless reform will be just that...meaningless.

[Nm Cruz]

Hi Mr. Mogulescu, I just wanted to ask if you have read the H.R bill or any version of the bill. If so, what did you think of it and what recommendations would you make to improve it to make it more beneficial to society as a whole. If you have not read it, do you plan on reading it in the near future?

[Miles Mogulescu - Huffpost Blogger]

Adopt Rep. Weiner's amendment to substitute HR 676--John Conyer's Medicare for All bill--for the entire house plan. But that won't happen because President Obama, the entire Democratic leadership, and much of the progressive movement took Medicare for All off the table before the negotiations even began, leaving a public option as the most liberal position to be attacked by the health care industry and eliminated or neutered. Beyond that, it's hard to know where to begin because the House and Senate bills are so complicated. The best thing would be to strengthen the public option--let it set rates at 105%-110% of Medicare rates, make it the default plan for the uninsured which they could then opt out of, allow employers to choose the public plan over private insurance, let Medicare negotiate prices with the drug companies. But the House leadership has already made a deal with the Blue Dogs to take such proposal off the table, too. Anyway, according to reporting in the NY Times and NBC News, the slightly more liberal House bill is irrelevant anyway--The White House is going to back the Senate Finance Committee Bill which Max Baucus is negotiating with the insurance, drug and hospital lobbies.

[Edward Virtually]

There is going to be a floor vote on HR-676 and if we can force our "representatives" to vote for it en masse, it can pass, backroom agreements to the contrary not withstanding. And similarly, SR-703 can be passed by reconciliation in the senate, thus avoiding concerns of a GOP filibuster. The question is, are the dems smart enough to figure out that selling us out now might be easy, but will result in them being thrown out at the next opportunity along with the dems chances of ever commanding a voter majority again.

[nash2]

Progressive Democrats should vote agaist Obama's bill. He has sold out to industry.

I supported Obama rather than Hillary because I feared she might do something like this.

Obama conned us. He's just another lying tool of the lobbyists.

[ThomasDoubting]

It appears that we are not going to get a Free, Universal, Single Payer, Not For Profit, Health Care System, in the near future. The polls say that more than 70% of the American people want a Single Payer System. The Congress, those who admit to being Republicans, and those who say that they are Democrats, together have sold us out to the Insurance, and Pharmecutical industries. Many people feel that anything this government gives us, will be better than what we have now. That does not necessarily follow. In fact with this crowd, that is presently in power, it's hard to believe that they will not make it worse. I know, it is hard to believe. Maybe we should vote it down, until they give us what we want. Isn't that how it is supposed to work, in a democracy ? "Medicare For All"

[huffingt]

We don't want our country to be like Russia but we will follow Russian Or ly
We are informed citizens, thus follow Pa li n, to see Russia from her porch
We don't want socialism but social security, unemployment insurance and medicare
We want our country back - back from intellectual people
We don't want govt. bureaucrats; we can elect govt. Mo rans
We don't need to show my birth certificate, but demand others to show theirs
We want States right for governance & succession but could use some stimulus money
We don't want govt control but stand by me at every crises & Katrina in my life
We are Americans so we exercise our rights over others
We are unique in our stu pi dity, so, America is the only place for me
We are not angry mob, unamerican, nor militias, just boring left over teabagans
We ha te color people, but, presently on vacation in Puerto Rico to TAN my skin
We yell at meetings to say- hands off when my foot is in my mouth
We have values, good ones, but hard to practice in C. street when lights are off
We don't mind false sided F. news when delivered with a Tear
We are fearful of death panel as it prohibits us from pulling the plug on my rich relatives
We know amendments –to conceal drugs, alcohol, gu ns & soul mates
We understand constitution-"Our forefathers & Sotomayor wrote something.I know she did”

[jmpurser]

"Failing to pass Health Care reform would be a set-back to President Obama and the Democrats. But passing a bad bill which subsidizes wealthy private interests; reverses Obama's campaign promise to allow Medicare to negotiate lower prices with drug companies; and mandates that people without insurance must buy inadequate policies from for-profit insurance companies (or a neutered, non-competitive "public option" or co-op which is too weak to reduce costs) lest they be fined by the IRS, could turn a generation against the Democratic Party, revitalize the Republicans, and "prove" to many Americans that government intervention in the economy is a bad thing."

That's EXACTLY what I see coming down.

[Helzapoppin]

yep, yep and hell yep.

[LewDan]

Only if we allow ouselves to be conned.

A bad bill is realisticly about the best we can expect with the current Congress. But if WE punish in 2010 those in Congress who didn't support real reform we'll get an improved bill. If we continue to hold Congress accountable in 2012 we could actually get single-payer.

But as long as we target the President instead of Congress; as long as we act as if whatever legislation comes out now is the endgame; as long as Republicans believe preventing reforms will return them to power as we typically eat our own in frustration, we'll never see reform.

Obama promised us we could bring change to Washinton. We can -- If WE'VE changed. The Repulicans, Blue-Dogs and the rest of the Beltway are betting we haven't. But it really is up to us. If we act differently than we usually do we'll get what we want. If we don't, we won't.

Obama isn't Santa Claus. Waiting for, and expecting him to deliver what we want for us isn't a change.

[caribgirl]

I think the President is a realist in terms of what can get done versus what he wants done. He can craft a bill with a strong public option, and other progressive reforms that will make for true reform but how does he get it passed? Even if he went for reconciliation, could he get 50 votes in the senate? I don't see it. I'm pretty sure the WH is very much aware of how many fence sitters they have on each of the major issues for healthcare reform. How can he force their hands without making compromises and deals even if some of them are with the devil?

I'm not advocating that he take something over nothing but the reality is that the President has to find a middle ground where the legislation is strong enough to be called reform but also palatable to liberal, moderate and conservative democrats particularly in the senate so that a large enough coalition of them will vote for it. He knows there will be no republicans on board.

[Helzapoppin]

If you can't pass something that actually makes a difference, then there's no reason to pass anything at all.

[Boghog1]

based on the comments it looks like some of you are waking up. it is more of the same

[Kassandra]

Oh, don't worry...well DO worry, I am. Frank Rich summed it up best when he asked "Is Obama punking us?"
He may well be, with the help of Rahm. But, we're fighting back as hard as we can., I don't know what else we can do. I've certainly let all my Congressmen and they ARE all men what I want.
I agree with you that if Obama truly DOES punk US, it will prolly be the last straw for America...in many ways.
At the beginning of his presidency, Alex Jones released a full length movie on Obama. I sat there with my chin on my chest and thought, if even half this is true, it's too much. I've watched with sinking heart as so much of it does seem to be true. See if you can find it on the internet; I think Youtube has it.

Obama is playing a very dangerous game with America and not just on the healthcare thingy
O, Discordia!

[yawnimawke]

I have been pushing this thought to the back of my head until today. I called and emailed the WH, emailed the DNC, DCCC and the DSCC to let them know about my intentions to pull my money and vote from them should they abandon the public option that is tax payer funded. I have my suspicious side because of the history of our government. I can only place all my hope in us. That we stand up and demand the public option. I do not think voting is enough. So please, do all you can. Call, write, visit your reps & senators office. We are the people we have been waiting for right?

[Boikin]

Why not just expand Medicaid to all Americans uninsured? Because covering the uninsured is not the point. It's the ruse.