by Rossputin | 4:28 am, December 21, 2009 | Comments Off
[Update: A blogger at Redstate.com makes a similar point to mine about possible bipartisan opposition to the bill.]
As I watched soon-to-be-former Senator Ben Nelson (D-NE) cave in on health care reform, my initial reaction was one of despondence followed by a Randian sort of “the voters are getting what they deserve.” I’ve written many times in the past that I hope the country gets a bipyrg hard dose of socialism in some electoral orifice so that they learn once and for all not to vote for liberals (whether Democrats or Republicans).
But after a conversation with the indefatigable Connie Hair, she has convinced me that while the odds may not be on the side of liberty and rationality right now, this is not over and we should not give up.
Indeed, Connie made the point that one of the primary motivations behind Harry Reid’s push to have health care reform/destruction pass the Senate before Christmas is to demoralize political opponents of the plan (and of our nation’s current overall socialist/fascist trend.) She urged me not to let that happen, that there is simply too much to lose to give up, and that if the pro-liberty forces in America are allowed to feel defeated, then they will be defeated. She convinced me, so I’ll try to convince you – as well as discussing some of the reprehensible substance of what just happened. (Also – I’m pointing this out early so you’ll read the whole thing – I’ll explain at the end of this note why I believe this is a rare opportunity for “bipartisanship” as the left and the right both have legitimate reasons to oppose HarryCare.)
First, let’s start with Ben Nelson.
Nelson is just the latest, clearest example that “conservative Democrat” means “Democrat who wants to be able to extort more favors than the average politician”. Nelson is not up for re-election until 2012, but I believe and hope that his actions this week will cost him dearly.
[Before I jump into this next part, allow me to make clear that while I am pro-choice, I am against government funding of abortion.]
All the talk was about him being “strongly pro-life”. Right. He’s strongly pro-winning as a Democrat in a red state, and must have the support of pro-life forces in Nebraska (or at least not their opposition) to stand any chance. So while we see breathless reports of Nelson on the phone with a leading pro-life activist in Nebraska, he nevertheless settled for language which the House of Representative’s leading pro-life Democrat, Bart Stupak (D-MI) appears to find unacceptable. Rather than a ban on government-funded abortions, the Examiner reports that Nelson went along with language that “any State may opt to prohibit any new insurance exchange from covering abortion services.” While Nelson may have gotten his Nebraska pro-lifers to cave in along with him, the Democrats will have a much harder time with national pro-life groups who may have just enough influence over just enough Democrats to prevent Pelosi from having enough House votes to pass a Motion to Concur with the Senate Bill.
As Connie pointed out to me, if Pelosi does not have the votes in the House to just go along with the Senate bill, she’ll have no choice but to send the bill to a Conference Committee where the odds increase dramatically of a change which will cause the bill to be unable to pass one or both chambers of Congress.
But let’s get back to Nelson. As I said, all the talk was about abortion, trying to make Nelson look like a man of principle. And I’m sure he cares a little bit on principle. But two other issues seem to have been important to Nelson behind the scenes. First, in a story which Connie broke on Saturday, Nelson seems to have gotten language removed from the Senate bill which would have removed the insurance industry’s anti-trust exemption. I haven’t thought a lot about the issue, and the little academic research I’ve read is inconclusive. My gut instinct is that if Chuck Schumer wants it repealed, then we should keep it. Essentially, it gives regulation of insurance to the states. The major downside is that the regulation seems to be a primary reason that there is not interstate competition for health insurance, probably the thing that is singly most responsible for our health insurance inflation problems.
Given the size of Mutual of Omaha, with over 5,000 employees and over $4 billion in revenue, Nelson’s action is good news for one of his state’s largest businesses and certainly a political boon for him.
But even bigger fish hiding behind the minnow that is Ben Nelson’s pro-life position was the recognition that Harry Reid’s “reform” bill will bankrupt states by increasing the Medicaid rolls. So, much like the $300 Medicaid payoff of Senator Mary Landrieu (D-LA), Nelson got language added to the bill which will force all federal taxpayers to pay for Nebraska’s Medicaidme cost increase. A must-read article in the Politico describes Reid’s payoffs to Democratic senators in order to reach 60 votes, “Nelson’s might be the most blatant – a deal carved out for a single state, a permanent exemption from the state share of Medicaid expansion for Nebraska, meaning federal taxpayers have to kick in an additional $45 million in the first decade.”
According to Politico, “Nelson and Sen. Carl Levin (D-Mich.) carved out an exemption for non-profit insurers in their states from a hefty excise tax. Similar insurers in the other 48 states will pay the tax.”
Does anyone recall when just a few days ago, Nelson said his vote was “not for sale at any price?” Apparently there is a price, and it’s to be paid for almost entirely by people outside of Nebraska.
While there are clearly no rules in Washington DC anymore, how could it possibly be OK for politicians to carve out single-state (or 2- or 3-state) exemptions to federal rules, dumping their share of costs on to every other state? Why don’t representatives of other states make more noise about this since those carve-outs damage not just the nation but also their constituents?
It points out the utter misunderstanding in Congress these days of the Commerce Clause which, when it talks about Congress “regulating” interstate commerce, meant the term in the sense of “making or keeping regular”, preventing tariffs and other barriers between states, etc, rather than how it is now interpreted as the right to make regulation about any commerce that crosses a states’ borders. What could be less “regular” than 2 states getting an exemption from an excise tax or 1 state getting an exemption from funding its own Medicaid expansion? Again, I strongly urge you to read the Politico article, but not either just before or just after eating.
The bill itself relies for funding on new taxes, a Medicare tax increase, and Medicare spending cuts which will never happen. As with all of the Democrat bills, it begins the tax increases immediately but doesn’t “reform” health care in any substantial way for several years. Thus, it’s all pain up front in return for a promised gift several years from now. Furthermore, the structure of paying for 6 years of “reform” with 10 years of taxes allows the Democrats to game the CBO score so that the measure appears to cut the deficit. However, if you start counting at the time when all provisions of the bill are in force, the cost will end up somewhere between $1 trillion and $3 trillion dollars to the American taxpayer over 10 years. For perspective, total US federal government spending, including “off-budget” items in 1986 was less than $1 trillion, and was about $2.4 trillion in 2006. In other words, this bill is likely add something on the order of 10% to the cost of the federal government while massively increasing the cost of insurance in the private sector.
President Obama came out (in his distinctly unpresidential shirt-with-collar-unbuttoned look) to say with a straight face that this bill was a great deficit-reducing measure. I can’t imagine that even he believes it to be true, but certainly nobody else does. Even the CBO when announcing the “score” noted several caveats, warning as best the CBO can that the “savings” the Democrats claim is unlikely to be achieved.
Reid wants to demoralize the “tea partyers”. Indeed, it would be easy to feel somewhat beaten after many of us thought the August/September “town hall meeting” revolts around the country would have scared enough Congressmen or at least one Democratic senator away from the bill to prevent its passage. But politics ain’t beanbag. Reid and Pelosi know that this battle is for the medium-term future of their party. In my view, they can’t win no matter what happens at this point. However, they clearly agree with Bill Clinton that passing anything is worse than passing nothing.
So we have Obama and others talking about a long “struggle” for health care reform when in fact the bill does NOT include a “public option” or government-run plan which is really the goal of the left. Instead, it is just a massive tax hike to pay for massive regulation and some subsidies.
When the left (as represented by Howard Dean and the DailyKos, among others) complains that this bill is nothing but an enormous gift to insurance companies, they’re basically right. Much like the tobacco “master settlement”, this measure simply guarantees customers to the insurers and guarantees them the ability to raise prices almost without limit.
Looking at the prices of health insurer stocks is instructive. Look at THIS chart which shows two of the biggest, Wellpoint and United Health, in comparison to the S&P 500 (the green line). What you can see is that they tracked the market fairly well until late September when it became clear that Congress was going to proceed with health care “reform” despite the public outcry against it. The insurance stocks cratered and stayed weak through October. In November, when the Democrats’ plans became clearer, i.e. that they would force both willing and unwilling Americans to buy health insurance and would not encourage interstate competition, the health care stocks took off and have now outperformed the S&P over the last 3, 6, and 12 months.
My point is that nobody other than politicians and insurance companies want this deal. (Oh, and the AARP likes it too because the plan guts Medicare and one of AARP’s main sources of income is selling “Medigap” insurance.) The right should (and does) hate it. The left should (and does) hate it. I am not one who believes in bipartisanship as an end in itself. But in this case, conservatives, libertarians, and liberals should be working together over the holiday break to put as much pressure on their Congressmen as possible to vote against this bill. It is, as Mitch McConnell properly noted “a legislative train wreck.” It accomplishes only two things: Increasing insurance company profits and allowing Democratic politicians to claim a victory, no matter how Pyrrhic. (And just watch Obama come out with his own victory lap even though he’s been strikingly absent from the entire debate, knowing as he must that he has in less than a year turned from The One into The Liability.)
I urge my friends on the left (of whom I have approximately none, but you get the point) and on the right to defeat this bill, to cause a Conference Committee Report to be unpassable, and then to start again with a true “war of ideas” and let the better argument win.
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