Are Democrats Sacrificing Too Much?

Jonathan Cohn: Too Many Concessions May Cost Public Support and Democrats' Chances of Passing Health Care Reform

(The New Republic)  Jonathan Cohn is a senior editor at The New Republic. This column is a collaboration between TNR and Kaiser Health News. KHN is an editorially independent news service and is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization, which is not affiliated with Kaiser Permanente.

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Bill and Hillary Clinton are off saving the world, he through his global foundation and she via the State Department. But their presence looms over the health care debate as surely as if they were running the White House. Their epic failure to pass reform in 1994 has become the defining object lesson in how to botch health care legislation--a lesson President Obama has obviously taken to heart. Push for reform right away; let Congress hash out the details; and, above all, don't threaten people's current insurance arrangements. You can sum up Obama's strategy for health reform as "WWCD": What Wouldn't the Clintons Do.

And it's working well so far. Notwithstanding the predictable fits-and-starts of the legislative process, it seems likely that Obama will have a bill to sign by year's end, thereby accomplishing what the Clintons famously could not. But then what? Having crafted a bill that can pass Congress, will Obama be signing a bill that people actually like? It's a question best answered by examining another episode of the past--one that, although a mere footnote in political history, is fraught with warnings for today's reformers.

The episode is the fight over the Medicare Catastrophic Coverage Act, which President Reagan signed in 1988. Its purpose was to plug some of the emerging gaps in the Medicare program: If you stayed in the hospital too long, Medicare just stopped paying the bills. The Act extended hospital coverage indefinitely, capped out-of-pocket spending for beneficiaries, and offered partial coverage of prescription drugs, among other things.

Or at least that's what the law was supposed to do. After the bill passed with overwhelming, bipartisan support, a backlash developed, memorably culminating in a "riot" of angry seniors who chased a beleaguered Dan Rostenkowski--then chairman of the House Ways and Means Committee--into his car after a Chicago meeting. Less than two years after passage, before the bill's implementation, Congress voted to repeal the act, again with sweeping margins.

What had soured the public? As political scientist Jonathan Oberlander recounts in The Political Life of Medicare, a major factor was the sense among seniors--the program's intended beneficiaries--that the program's limited upside wasn't worth the cost they were paying. Medicare's lack of catastrophic care was a real problem, for sure, but not necessarily its biggest and certainly not its most visible, since only a tiny percentage of seniors ever ended up with those extended hospital stays. (Nursing home costs were a much bigger problem.) The other benefits, like the partial prescription drug coverage, would have helped more people. But few seniors understood that and the affluent among them already had supplemental coverage for many of those needs anyway.

At the same time, all seniors felt the program's burden: Determined to make the new benefit self-financing, lawmakers imposed a mandatory premium on seniors and tacked on an income tax surcharge for the wealthy among them. The financial hit to most retirees would have been quite modest, but it hit right away, before the full benefits kicked in. That made seniors a receptive audience for demagogic advertisements attacking the program.

Fast forward two decades, take a closer look at what's happening on Capitol Hill, and you may notice some familiar storylines. In order to make sure reform can pay for itself, lawmakers are talking about slowing down implementation, so that the program is not fully on line until 2014. They're also talking about offering fewer subsidies to help people obtain insurance. In a nod to centrists who don't like the idea of too much government, there's a strong push to gut or even eliminate proposals for the public insurance plan, which was supposed to provide security for individuals and competition for private insurers.

These are not small concessions. Consider the proposed reduction in subsidies. In the original schemes, families of four making up to $88,000 a year would get at least some assistance; under the alternatives under discussion, only families making up to $66,000 could get subsidies. Yet families making between $66,000 and $88,000 are precisely the sort of families who could use help--not a lot of help, but a little--paying for insurance. And that's assuming subsidies really end up at $66,000. Lawmakers could easily bid the number down more before reaching a final compromise.

Put aside, for a moment, the policy merits of these moves. The politics are lousy. Obama would be in danger of producing legislation that seems to offer little up-front benefit, particularly for the electorally vital middle class. And if some of these people end up paying even modestly higher taxes to help finance reform they're not likely to be happy about it. It's hard to imagine such legislation provoking a backlash that could produce total repeal. It's not so hard to imagine such legislation creating bad political feelings, the kind that linger around until the next Election Day and pave the way for legislative retrenchment later on.

Of course, holding out for more generous subsidies, a robust public plan, or other reform elements that deliver clear, short-term benefits would obviously carry its own set of political risks. To get something through Congress, Obama probably needs some centrist support--or, at the very least, he needs to make a good show of courting it. But Obama must be wary of conceding too much. Even in strictly political terms, a good bill that passes with a narrow margin may preferable to a weak bill that carries huge majorities.

The lesson of the Clinton health care fight is that Congress won't embrace reform if there aren't some compromises. The lesson of the Medicare Catastrophic Care Act is that the public won't embrace reform if it has too many compromises. We know that Obama has mastered the first one. For his own sake, as well as ours, he'd better master the second.

[tautomer]

If you look at the US government deficits from 1987 to the 2011 budget the deficit in years when the House is Democrat averages 451 Billion. In years where the House was Republican it averages 104 Billion.

Since all spending emanates at the House this is the proper way to evaluated Dems vs Repubs on Spending Deficits.

Democrat Congresses run about 4.5 times the deficits that Republican ones do.

[tautomer]

Obama would be in danger of producing legislation that seems to offer little up-front benefit, particularly for the ELECTORALLY VITAL middle class.
______________________________________________________________________

That's right folks. For Obama it's just about gettin re-elected, nothing more. Good policy/Bad policy, he doesn't care. Just as long as he gets reelected!!! But then we knew that.

[taxguydave]

"by All_pols_need_2_go July 1, 2009 7:50 AM PDT
Newsflash Democrats don't sacrifice anything. They take everything from everyone else to fund their crazy ideas that have never worked. Tell me do any dems have any ideas for how to get things done that doesn't include raising my taxes and creating even more government? I have yet to see a single instance to the contrary. Nothing the government controls and runs is efficient and well run, on or under budget, NOTHING! But let me guess Healthcare will be different, RIGHT!!! And tonight around 10pm I will be winning the Powerball Jackpot as well. I mean while we are all in lala land I might as well join in with you dilusional idiots."

Another newsflash--conservatives have REALLY short memories!

The last Democratic President lowered taxes, and left the government smaller than when he came in.

Ronald Reagan--Taxes higher and government bigger when he left than when he started.

GHW Bush--Same thing.

GW Bush--Lowered taxes, but increased the size and spending of the government to unprecedented levels.

So, really, Bill Clinton was the only President in over a generation to actually give us lower taxes and a smaller government.

Not only do liberals remember our history better, we can also spell!

[tautomer]

Clinton was the only one who had a Republican Congress, That's why the deficit was controlled. Bushes big deficits came with Democrat Congresses, and of course Obama with the BIGGEST DEFICITS EVER came with Democrat Congresses.!!

Clinton was in deficit when he had Democrats Congresses in 1992-4. He only ran surplusses with Republican Congresses.

[onesword]

As long as my bi-weekly payments are lower with no co-pays and with a superb health plan. Whether it's taken out by taxes or not. I'm all for it.

[rhs648]

But is this what we will be getting? None of us know what we will get, how it will work, or how much it will cost. In spite of that, many people are jumping onto it assuming it will improve things.

[sjc_1]

With Optional National Health Insurance you get the same policy that federal workers get at COST. That is what you get if you choose the public policy. Nothing is hidden and no gotchas in the fine print.

[walt1944]

I am hearing a lot of people who voted for Obama and the Democrats are getting increasingly fed up with Obama's "flip-flopping" now that he has the Oval Office and the lack of a "spine" with the Democrats as a whole.

The neocon Fascist Nazi Republicans at least have a spine and solidarity enough to close ranks of issues, no matter how wrong they are!

If Obama caves in on health care, and other campaign promises he is suddenly not keeping, he is going to be a one-termer and the neocons will grab Congress again. It will be the Democrats that will be the big losers in this!!!!

HAIL OBAMA????????

[xlib]

The democrats making concessions!!!??? You have got to be kidding,or lying. My God, look at what they and the rhinos have done so far. Huge, massive spending bills to pay back the unions and other special interest groups that none of them have read.
Hey mike the dem who supposedly worked himself sick, tell me, are you a union member? If you are, not to worry. Say, how's that high unemployment rate working for you? How has your 401K or retirement fund working for you? How are your children and grandchildren going to pay off the massive deficit your messiah has given you?
You know what mike and the rest of you lemmings, you are in power and all this mess you are making is on you. Got it.

[nikosk11]

by All_pols_need_2_go July 1, 2009 7:46 AM PDT
Yeah but Mikey your Messiah was going to be the one the change all that and transcend the bipartisan nature that has been a part of DC for so long. He also said he was going to do A LOT of other things, like post bills online for 5 days etc etc etc that he has NOT DONE. So which is it Change or Meet the New Democrats, same as the Old Democrats? Remember to that you can be voted out as quickly as you were voted in and everything you have done can be reversed after that happens. So where is this Change We Can Believe In? Shall I create a list of all the things BO said he would do and compare it to what he has actually done? It would be a long list for such a short time.

DON'T FORGET "MASSIAH" WAS PUT TO THE CROSS BY HIS OWN PEOPLE. "HE" DID "HIS" PART. IF THE MASSES (DEMS) DON'T WANT TO FOLLOW "HIM" THEN WHO'S FAULT IS IT? THE PRESIDENT CAN SAY AND SCREAM ALL HE WANTS. IF THE "GOOD FOR NOTHING" CONGRESS DOESN'T WANT TO DELIVER,....WELL, YOU KNOW THE REST.

[All_pols_need_2_go]

Newsflash Democrats don't sacrifice anything. They take everything from everyone else to fund their crazy ideas that have never worked. Tell me do any dems have any ideas for how to get things done that doesn't include raising my taxes and creating even more government? I have yet to see a single instance to the contrary. Nothing the government controls and runs is efficient and well run, on or under budget, NOTHING! But let me guess Healthcare will be different, RIGHT!!! And tonight around 10pm I will be winning the Powerball Jackpot as well. I mean while we are all in lala land I might as well join in with you dilusional idiots.

[getgenec]

Very funny. You got me. Brilliant satire - have the Democrats Sacrificing Too Much? I thought the article was serious at first.

I recall a closing where the attorney for the buyer asked his clients if there was anything left in their checking account balance. When they answered "yes." He looked over at the other attorney and quipped, "We did something wrong."

[rhs648]

This could prove to be a boost to the Republican party whrn people see how much universal health care will cost them in higher taxes and reduced spending power. Too many of us are ready to jump on the bandwagon when so few details are being provided. Most of us want lower premiums, better coverage, reduced hassle, and portability when changing jobs. Is this what we will get? Shifting the cost of healthcare for uninsureds is bound to anger many people already struggling to pay their taxes and health insurance premiums. Maryland, for one, raised the cigarette tax by $1.00 per pack to expand health coverage to more children. Ironically, tax revenues on cigarettes has decreased leaving other taxpayers to fill in the gap. If the blue states (Democratic) see a lot of their money being shifted to red states (Republican) where labor unions are weaker and fewer employers provide health insurance, look out. The Republicans states will benefit in two ways. More money to their constituents and voters supporting them out of anger. This could be a trojan horse for the Democrats.

[kennsabe]

NOW IT IS OUR TURN - DO NOT LET THE REPUBLICANS MESS US UP- AGAIN- WE GOT THE VOTES, USE THEM.....During the last 8 years of the Bush administration, the Republicans held power in 6 of those years. They held all the bases of power, presidency, courts, congress, senate, public opinion. Does anyone remember them saying anything like..... now we have got to make a point of compromising with those Democrats on these nominations to the courts, or we have got to compromise with the Democrats on how much of a tax cut to give the super rich, or to fund programs for the poor as an example. They said NOTHING like that, nada, zip. They delighted in outvoting the Democrats, then rubbing their nose in it, never compromising ever.

So, as a Democrat that worked himself literally sick (no sleep, working 18 hours a day for weeks)to get Democrats elected, why do I now feel really unhappy because we all of a sudden WE have to make nice with Republicans, who we beat in the last election by a good majority. I want to outvote them to get a good health care bill passed, with a public option, to get the Presidents other bills passed, and while I do not want to rub their noses in it, I want to win some for our side, especially now that we got the 60 votes in the Senate. For goodness sake, why are we hesitating, why are we listening to them = we have had over 10 years to listen to their right wing ideas - over and over and over etc. And we know that those ideas do not work, doesn't the crummy mess the Republicans left the country in remind us of the rotten job they did bankrupting, dividing, and causing us to doubt ourselves.

So, be Democrats, do something for our side, you know they will criticize you, that is about the only thing they are truly good at.

Mike Williams

[All_pols_need_2_go]

Yeah but Mikey your Messiah was going to be the one the change all that and transcend the bipartisan nature that has been a part of DC for so long. He also said he was going to do A LOT of other things, like post bills online for 5 days etc etc etc that he has NOT DONE. So which is it Change or Meet the New Democrats, same as the Old Democrats? Remember to that you can be voted out as quickly as you were voted in and everything you have done can be reversed after that happens. So where is this Change We Can Believe In? Shall I create a list of all the things BO said he would do and compare it to what he has actually done? It would be a long list for such a short time.

[lawgal1]

Mike Williams, I am a democrat. All my life - come from a long line of democrats. I DO NOT SUPPORT THIS AND WILL NOT VOTE FOR ANYONE THAT DOES.

[tautomer]

The reason you are hesitating is because you've already created an additional 1.8 TRILLION in deficit spending after only 5 months on the job!

That is 18 times the average deficit run by Republican Congresses since 1987! Even Democrats know they can't run multi Trillion dollar deficits.

Your health care will cost another 2 Trillion according to the Congressional Budget Office, your wars are costing us $700 Billion/yr, your bailouts, handouts, throwaways are costing untold Billions more!

Deficits 2001 to 2006 (the Republican years average 231B)... in 2007 - 2010 ( the Democrat years )deficits have averaged 929 Billion!!

That's why you are hesitant. Youve already quadrupled what the last set of Republicans did!!!

[ubrew12]

Despite a well-funded full-court corporate press, the big issues that need resolving are too big for half measures. And all of them call for greater government control of segments of the economy: healthcare, climate change, finance sector reform, economic recovery. These ALL require BIG government solutions, which naturally eats into the power of the corporations, so various of them oppose the needed remedies.

But the public needs the stimulus package (in fact, another one). It needs single payer healthcare, it needs reregulation of the Finance Sector, including hedge funds, and it needs a carbon tax. If Democrats go halfway, they will fail on all these fronts. But the truth is, they may (as individuals) not care. They are as well-funded by the corporations as the GOP is. So although they may lose some seats for being incompetent, they'll keep the gravy train coming. They'd rather get turned out of office than have the gravy spigot turned off.

As long as that is true, the needs of the public in this 'democracy' will come last, and pressing problems will continue to fester. People will be severely hurt, even die, because BOTH parties cannot upset their masters. And that is not the public.

[element51]

ubrew.....I tend to agree with your comments. I have been a life long democrat but I am sorry to say that I have lost faith in my party. I finally realized that both parties are owned by the wealthy and that the things they say are meant to keep the rest of us in our place. When push comes to shove, they will all do exactly as they are told and to helll with what the people need. All decisions will be made to benefit the wealthy. Money and/or power are the things that motivate our "honest" politicians and the sooner we accept that the clearer things will be. Sad but true.