Obama is already getting tripped up by his 'say anything' style of campaigning. He has to break some big-time campaign promises now. Which ones will he chose?
Time to sever healthcare constraints
By Clive Crook
Published: August 23 2009 19:25 | Last updated: August 23 2009 19:25
Barack Obama’s presidency is in trouble. Support among centrist and swing voters continues to leak away, his signature domestic initiative is in jeopardy and the prevailing theme of US political commentary is shifting from hope and expectation to explaining what went wrong. Mr Obama’s cool is being tested in a way that few predicted – not by force of circumstance, but by the results of his own political bungling.
The paradox is that the White House has tripped up over healthcare reform – an initiative that the country both wants and needs, and which was at the centre of Mr Obama’s stunningly successful election campaign. For this, the administration has no one to blame but itself. Its own mistakes have brought it to this perilous point.
It is not too late to correct these errors, wrest a substantial and much-needed reform from the mess of current difficulties and emerge with approval ratings fully restored. But for all its brainpower, this White House is a slow learner, and one wonders.
The selling of healthcare reform has been marked from the start by indecision, both on substance and on tactics, and by an extraordinary lack of clarity. The country still does not know what Mr Obama is advocating. Much of the time, apparently, neither does he.
Since the congressional recess began this month, Mr Obama has been on the road to sell a plan that does not yet actually exist. Rival bills are in the works and the final result will quite likely resemble none of them. Meanwhile, the president states and restates fundamentally incompatible goals – universal coverage, higher quality, lower costs – as if mere commitment to those aims should be enough to satisfy sceptics. He says he wants a bipartisan solution, then defaults to left-liberal talking-points about the scheming of Republicans, the tyranny of special interests and the wickedness of insurance companies. It is a complete shambles.
The recent confusion over the “public option” – a government-run insurance scheme to be offered alongside private insurance – encapsulates the problem.
The left of the Democratic party says reform is not worth having without the public option. Why? Because they see a government-run alternative as the thin end of a wedge that will move the system towards public insurance for all – something most Americans do not want. Mr Obama, saying that this objective is the last thing on his mind, nonetheless supports the public option. It is necessary to keep those insurance company bandits in line, he says. But he adds, by way of reassurance, that it will be unsubsidised and forced to compete on a level playing field – so if you are happy with your private insurance, nothing will change and there is nothing to worry about.
Can the tactical geniuses in the White House really fail to see that none of that makes sense?
Dropping the public option is the first thing Mr Obama needs to do if he wants to clarify his message. The most ardent Democrats will be dismayed, but so what? Distress on that part of the political spectrum helps Mr Obama in the centre, which is what counts.
Moreover, nothing is lost. Rules forbidding insurance companies to deny coverage because of pre-existing conditions, caps on out-of-pocket expenses and subsidies to make it easier for people with modest incomes to buy insurance can achieve close to universal coverage. That, surely, is the real prize. And if Mr Obama can sort himself out, it is perfectly achievable.
The second thing that needs to happen, though, is that Mr Obama must start being honest about costs. Widening coverage will call for subsidies and will be expensive. The Congressional Budget Office and other analysts have stamped on the idea that the cost of universal access can be met mainly by cutting waste, inefficiency and insurance company profiteering. Voters do not believe the administration’s assurances on this and they are right not to do so.
The reform bills do have ideas worth trying on long-term cost control – but their value remains to be seen and savings cannot be prudently budgeted until they have begun to be realised. Until then, new revenues will be needed. Limiting the income tax deduction for employer-provided insurance can provide the needed funds – and reducing this subsidy would push the incentive to economise on health spending in the right direction too.
If universal coverage requires an increase in taxes, this obliges the administration to tell the median voter – who already has employer-provided health insurance – what he gets in return. If you are being asked to pay higher taxes, it is not good enough to be told, “If you are happy with your present insurance, nothing will change.” Mr Obama has, until recently, failed to stress the benefits of assured access for people who already have insurance. It is surely worth something to know that, however your circumstances may change, you will continue to be covered. Forget the other, frequently bogus, rationales: this is the deal that the president needs to start pitching.
Mr Obama has promised not to raise middle-class taxes. You could argue that this foolish pledge is the ultimate cause of his difficulties. Breaking his word as his popularity slides will be his moment of greatest peril: this is not, on the face of it, the best way to restore trust. All one can say is that the alternative – for the country, for Mr Obama and his party, and for hopes of meaningful healthcare reform – is worse.
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