Liz Peek

Obama Shackles Himself to Health Care … Again

Liz | 02/19 at 01:31 PM

 

Look out America – here it comes again! Despite taking a bruising second only to the lump on Lindsey Vonn’s shin, President Obama has decided to re-launch his horrific health-care bill. Wresting control from those balky Democrats on Capitol Hill, the president is going to present his own package, which may be squirreled through Congress by means of budget reconciliation. Nearly everything about this plan stinks.

First, Obama’s bill will apparently force all Americans to purchase health insurance – a requirement that many consider illegal. Second, it will include a tax on high-cost insurance plans – but exclude union members. (In my view this was the line in the sand for many Americans.) The proposal would also insure some 30 million Americans, at a cost of some $900 billion.

What’s wrong with this plan? First, we cannot afford it. Second, this is the same terrible bill that does nothing to control medical costs – a shortcoming that should immediately disqualify it from consideration. Third, the majority of Americans are against it. Fourth, the president is expected to present this “fait-accompli” before his much ballyhooed February 25 meeting with congressional Republicans. He has promised GOP representatives that he will be open to their ideas; that seems unlikely. Rather, it is becoming clear that this gathering is to showcase the president’s verbal wizardry and win political points. If voters are cynical, who can blame them?

Unfortunately, the administration has been handed a public-relations bonanza from Anthem Blue Cross, which has attracted enormous heat for hiking insurance rates an average of 25% in California. Some residents of that state have seen increases of as much as 39%. Parent Wellpoint says that Anthem is losing money, as healthy people scrapped for funds are dropping coverage. Insurance executives point to the soaring cost of medical care and the depressed economy as the villains in this story. Insurers nationwide are pressed to raise rates, but sky-high unemployment in California has made the situation in that state especially dire.

This reminds us that the No. 1 focus of the president should be the economy and jobs. As Americans anxiously watch the vacillating jobs and housing starts numbers, and wonder how Senate Majority Leader Harry Reid could stiff the bipartisan jobs bill, Obama has fallen back on touting the dubious accomplishments of the Stimulus Bill. This week marked the one-year anniversary of that measure, known formally as the Recovery Act, which started out at $787 billion and quickly jumped to $862 billion. Ironically, a good chunk of the increase ($21 billion) went to increased unemployment benefits, which seems to undermine Obama’s celebration of jobs “created or saved.”

Of course, there are innumerable instances where the government’s money went astray. That’s to be expected from any huge program of this type. Progress under the bill has also been slowed by Obama’s relentless kowtowing to unions. The General Accounting Office reported last week that getting the stimulus monies spent has been delayed by provisions in the bill such as the “Davis-Bacon” requirement, which forces contractors to pay “local prevailing wages,” a measure championed by unions. In explaining why only 9,100 homes were weatherized out of a program meant to cover 593,000, the GAO said, “Thus the Department of Labor had to determine the prevailing wages for weatherization workers in each county in the United States, a task it completed on September 3, 2009.” Weatherization workers? Comical, right? Only if you can put aside the truly dire need to create jobs. Another time-waster was the “buy America” requirement, also a union pet, that held up all kinds of purchases by organizations that couldn’t find domestic sources for materials. 

These slipups are beyond frustrating, but not as alarming as what the Recovery Act masked. The truth is that $85 billion has been paid out to states and municipalities reeling from the recession – a boost that will not continue indefinitely. A slow recovery is not going to bail out these local governments; states’ projected budget deficits are only going higher. Adding to the future uncertainty, a new Pew Center report demonstrates that states face a pension shortfall of $1 trillion. The risk is that as Stimulus funds begin to decline, local authorities will need to raise taxes, compounding likely federal hikes. States may also have to lay off workers, undoing the scant impact the Stimulus Bill has had on unemployment.

A front-page story in today’s New York Times reflects this dilemma, reporting that nearly every state is now considering cutting Medicaid benefits, “even as Democrats push to add 15 million people to the rolls.” The recession has already added more than 3 million newcomers to the Medicaid program. The Times cites the National Association of Medicaid Directors as estimating that states next year could see a budget gap of $140 billion. 

Americans are up in arms about out-of-control government spending, but the Obama administration steams on through the icebergs. Instead of scrapping the health-care bill, the president has addressed these concerns by creating a bipartisan commission to cut the country’s debt. Raise your hand if you’re optimistic about the outcome. Instead, why doesn’t the president produce a plan that boosts private enterprise, reduces unnecessary regulation and spending and provides incentives for investment – in other words, the kinds of measures that have worked in the past – and then use his political capital to push it through Congress? Isn’t that the job of our chief executive?

Some months ago the Wall Street Journal ran an admiring piece about Mitch Daniels, Republican governor of Indiana. When asked how he had reined in the state’s budget deficit, Daniels replied, “Well, prepare to be dazzled. The answer is that we spent less money than we took in.”

As the Journal reported, Daniels had slashed his state’s expenditures, cut workers considered nonessential and halved the growth rate of spending. His story is impressive (and won him reelection by 18 points in a state that went for Obama) as is his signature accomplishment – turning a $700 million deficit into a $1 billion surplus. He even came up with a health-care plan that extended coverage to 130,000 people lacking coverage, and kept costs under control by making sure everyone has “skin in the game.” This playbook all fell from his stated goal upon taking office: “The strategic purpose of our administration is to raise the net disposable income of Hoosiers. Everything else remains a means to that end.”

That’s the kind of change I could believe in.

 

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