June 29, 2009
After last year's elections, a Democratic operative told me that if the Democrats got to 59 seats in the Senate, it would be easy to peel off one or two Republicans to pass key legislation like serious health care reform. I was left wondering what political planet he'd been living on for the past three decades.
For almost as long as I've been in Washington (I arrived for the Associated Press in 1977) it has worked the other way. Even when the Republicans appear to be on the defensive and outnumbered, they band together and vote as a bloc, while Democrats bend over backwards to be "bipartisan."
This dynamic has continued into Barack Obama's presidency as he and the Democrats have watered down their proposals with the hope of winning over a few Republican votes so they can claim they achieved some bipartisanship, even if it means passing bills that are half-hearted half-measures.
In exchange for the weaker stimulus bill, the Democrats got three Republican votes in the Senate and none in the House. (The Republicans then drove one of those GOP senators, Arlen Specter, out of the party, though Specter still won't count himself as a reliable Democratic vote.)
The pattern of belligerent Republicans and timid Democrats is now repeating itself on health-care reform. Democrats first excluded from the debate the one measure that probably could save significant money "" a single-payer system "" and they now appear poised to trade away Obama's proposal for a "public option" to possibly garner a couple of Republican votes.
In doing so, the Democrats could well recreate the worst mistake of Hillary Clinton's failed health insurance plan of 1994. The fundamental flaw in her complex scheme was that it tried so hard not to harm the insurance industry that it wasn't clear how it would make matters any better "" and the industry still torpedoed it with a misleading public relations campaign.
Today, the Obama administration and Senate Finance Committee Chairman Max Baucus have been so proud of getting all the players to sit down at the table (with the exception of single-payer advocates who were excluded) that they have lost track of the hard reality that if the nation is really going to address its health care crisis, there will have to be some financial losers.
Right now, the losers are the tens of millions of uninsured and under-insured Americans, the doctors and nurses who are appalled at the cruelty of the U.S. medical system, and the U.S. businesses that pay for their employees' health insurance and thus are put at an economic disadvantage to their foreign competitors operating in countries that have single-payer systems.
Helping the Industry
For the status quo to change significantly, the private health insurance companies and other parts of the medical industrial complex must be compelled to extract savings from their bureaucratic waste and excess profits. To do that would require, at minimum, a robust "public option" that forces a revamping of the private health insurance business model.
Not surprisingly, the health insurance industry doesn't want to undergo such a transformation, so its lobbyists have leaned on the Republicans and a handful of "centrist" Democrats to either kill the "public option" or in Baucus's phrase "sculpt" it into something that doesn't threaten the industry.
That's where Sen. Kent Conrad's scheme of setting up "cooperatives" comes in. The North Dakota Democrat has proposed building from scratch a network of non-profit "cooperatives" that would lack both the size for administrative savings and the bargaining power to negotiate lower prices.
While a public option could piggyback on the Medicare bureaucracy to maximize savings and have the advantage of simplicity, the emerging Baucus-Conrad scheme would add an array of cooperatives to the already confusing mix of insurance plans. For many Americans, these new entities won't present an appealing alternative to private insurance.
If such a "compromise" emerges, a few Republicans might vote yes; the industry would be happy; and the Obama administration could have a "bipartisan" signing ceremony.
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