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The Democratic Strategist

Political Strategy for a Permanent Democratic Majority

J.P. Green

‘Chevy Tax,’ Opt-Out’s Reverberations, Lieberman’s Motives

I’ll just share three interesting revelations scattered among the fallout from Senate Majority Leader Harry Reid’s announcement yesterday of the compromise Senate health reform package.
First, in his op-ed in today’s WaPo, “Health Reform’s Chevy Tax,” Harold Meyerson sheds fresh light on the numbers involved in the tax on the so-called ‘Cadillac benefits”:

The Senate’s tax would initially apply to all individual policies costing more than $8,000 a year, or $21,000 for a family. Those thresholds are to be indexed to the overall consumer price index (CPI) plus 1 percent. Problem is, medical costs and health insurance premiums increase a good deal more than the overall CPI. Since 2000, they have risen three to four times faster — which means, more policies will be subject to the tax with each passing year. The congressional Joint Committee on Taxation has calculated that in 2013, when the reforms kick in, the tax will apply to 19 percent of individual plans and 14 percent of family plans, but that by 2019 it will sock 34 percent of individual plans and 31 percent of family plans.
Last time I looked, a third of American motorists were not driving Cadillacs…Unfortunately, that excise tax targets a lot of Chevy plans as well.

Meyerson adds that the assumption that workers will get higher wages to help pay for the taxes is not warranted by recent experience, and he supports the surtax on incomes over $500,000 funding proposal championed by House Speaker Nancy Pelosi and others as a more credible progressive alternative.
I do hope Andrew Sullivan is right in his ‘The Daily Dish’ post “The Lethal Politics Of The Opt-Out Public Option” in The Atlantic Online. Sullivan writes:

…Imagine for a moment that the opt-out public option passes and becomes law (I give it a 65 percent chance at this point). Then what happens? Well, there has to be a debate in every state in which Republicans, where they hold a majority or the governorship, will presumably decide to deny their own voters the option to get a cheaper health insurance plan. When others in other states can get such a plan, will there not be pressure on the GOP to help their own base? Won’t Bill O’Reilly’s gaffe – when he said what he believed rather than what Roger Ailes wants him to say – be salient? Won’t many people – many Republican voters – actually ask: why can’t I have what they’re having?
This is why this is lethal. The argument against new entitlements requires a macro-level perspective. You have to argue that…you just need to rely on the wonderful private sector to deliver the goods in a more market-friendly way. This is always a tough sell because it requires voters to put abstract concerns over practical short-term gains. It’s why conservatism always has a tough time in welfare state democracies…Imagine Republicans in state legislatures having to argue and posture against an affordable health insurance plan for the folks, as O’Reilly calls them, while evil liberals provide it elsewhere…I can see a public option becoming the equivalent of Medicare in the public psyche if it works as it should. Try running against Medicare…it has the potential to make “liberalism’ popular again; it has easily demonized opponents – the health insurance industry; and it forces Republicans not to rail against socialism in the abstract but to oppose actual benefits for the working poor in reality.

If Sullivan is right, the opt-out concession to win moderates could end up being more of a problem for Republicans than an unadulterated ‘robust’ public option.
Lastly, anyone seeking a convincing explanation for Sen. Lieberman’s opposition to the public option for health care reform, despite strong support for it in recent polls, need not look much further than Charles Lemos’s MyDD post “The Worries of Joe Lieberman ,” in which he explains:

“I want to be able to vote for a health bill, but my top concern is the deficit.” So says Senator Joe Lieberman of Connecticut, a state that is home to 72 insurance headquarters, the largest concentration of that industry in the nation. Connecticut has three times the US average of insurance jobs as a percent of total state employment. In 2004, the insurance industry in Connecticut was a $12.2 billion dollar industry. Two years later, it hit $14.6 billion. That’s a CAGR of 9.4 percent.
Sixteen of those 72 insurance companies provide health or medical service insurance. Those 16 insurance companies employ over 22,000 employees and have annual payroll of over $2.3 billion. The total annual state insurance industry payroll exceeds $6 billion. 5.5 percent of the state’s gross domestic product comes from the insurance industry. But no Joe Lieberman isn’t worried about their profits, he’s worried about adding to the deficit.

Lemos goes on to add that Lieberman’s crocky tears about the deficit are somewhat belied by his blank check support for war ops in Afghanistan, now over $230 billion over the last 8 years, coupled with the fact that the CBO projects more than $100 billion in savings as a result of the publlic option over the next 10 years. As Lemos puts it “I can see a return on investment in healthcare, it’s harder to see one on Afghanistan.”


Wyden Battles to Broaden ‘Public Option’ Eligibility

Pronin2 of Daily Kos discusses Rachel Maddow’s excellent interview of Senator Ron Wyden (D-OR) (clip included in post), in which Wyden and Maddow add a sobering note to the overheated debate about the public option — that, according to CBO analysis, it would only be available to about 10 percent of the workforce under Reid’s compromise. Wyden argues that 10 percent is really not a large enough portion of consumers to hold down health care premiums, and it could be even smalller with the states’ opt-out. Says Wyden:

The bottom line is that the public option can’t really hold private insurers accountable if it is only competing for 10 percent of the insurance market, because private insurance companies aren’t going to change their business practices if 90 percent of their customers can’t take their business elsewhere.

He also says that the opinion polls showing a healthy majority in favor of the public option would likely be very different if they said something like “Would you support a public option open to a small number of people, not all?”
Wyden will be introducing an amendment to make the public option available to all consumers. Senator Jeff Merkley, also of Oregon, will introduce an amendment to broaden public option converage to include employees of small businesses.
Looking at it from another angle, it really is amazing that in the 21st century as many as 40 U.S. Senators, including even Olympia Snowe, would prefer to see tens of millions of Americans have no health security whatsoever, rather than support a public option — that’s a choice, not a requirement — for just 10 percent of consumers. It’s a sad measure of the moral decline of the Republican Party from the days when at least a few reasonable conservatives walked among them.


Breaking: Reid to Offer Triggerless, ‘Opt-Out’ Reform Bill

Senate Majority Leader Harry Reid has announced the broad outlines of the Senate’s health care reform compromise bill, which includes a public option with no ‘trigger mechanism,’ but which does have an “opt-out” provision for the states. The compromise reflects Reid’s math that his chances for 60 votes are better if he doesn’t try to win the support of Senator Olympia Snowe, whose “trigger mechanism” would have lost the vote of WV Democrat Jay Rockefeller and perhaps others. According to The New York Times report,

Senator Olympia J. Snowe of Maine…issued a statement saying that she would not support for Mr. Reid’s plan. “I am deeply disappointed with the majority leaders’ decision to include a public option as the focus of the legislation,” she said. Ms. Snowe expressed her long-standing position that a government-run plan should only be “triggered” in states where the health care legislation otherwise fails to provide affordable insurance to enough people.

It’s likely that Snowe’s inflexibility contributed to Reid’s decision — that if he announced in favor of a “trigger mechanism,” she would hang tough for a standard that would make any possibility of a real public option very doubtful, according to many experts. it appears unlikely that she would have been open to a face-saving “hair trigger’ version in which the ‘public option’ would kick in quickly, if insurers fail to offer affordable coverage. In the end, Reid must have concluded that she was more interested in killing the public option, period, than in achieving a compromise that would be acceptable to most Democrats. No doubt Reid also felt a responsibility to voters, who opinion polls indicate favor a real public option by a healthy margin. Making Snowe happy would likely have cost Democrats — and Reid — considerable public support. It appears she overplayed her hand.
According to the L.A. Times report by Noam M. Levey, Reid’s plan has 58 votes, and he feels that he has a good chance to win the two more he needs for victory on a cloture vote. Levey did not identify the two Senators Reid needs to win, But the NYT article says that Senators Mary Landrieu of Louisiana and Ben Nelson of Nebraska have “expressed doubts” about the plan.
The plan reportedly also provides for taxing of the so-called “Cadillac” health care plans, although there are no details about definitions yet available. Hopefully Reid won’t draw the line low enough to incur the opposition of unions. Democratic support for Reid’s compromise will turn to some extent on the Congressional Budget Office cost analysis.


Rep. Grayson’s Creative Challenge

Admirers of Rep Alan Grayson have a post to read at The Nation, where John Nichols reports on the congressman’s new project:

The Florida Democrat who drew national attention last month when he declared on the House floor that the Republican plan for uninsured Americans was “don’t get sick, and if you do get sick, die quickly,” was back on the House floor this week to announce the creation of a website to honor the victims of the current system.
Grayson, who has taken the lead in highlighting a Harvard study that shows 44,000 Americans die annually because they have no health insurance, told the House and the nation: “I think it dishonors all those Americans who have lost their lives because they had no health coverage, by ignoring them, by not paying attention to them, and by doing nothing to change the situation that led them to lose their live.”
With that in mind, he announced the launch of a Names of the Dead website.

Nichols quotes from Rep. Grayson’s welcoming message at his website:

Every year, more than 44,000 Americans die simply because have no health insurance…I have created this project in their memory. I hope that honoring them will help us end this senseless loss of American lives. If you have lost a loved one, please share the story of that loved one with us. Help us ensure that their legacy is a more just America, where every life that can be saved will be saved.

Naturally, the Republicans are going ballistic about Grayson’s latest project. But it’s a wonderful idea and a highly creative use of the internet to promote awareness of the brutality of the current ‘system’ and the urgent need for comprehensive, affordable health care reform. Rep. Grayson is providing either a courageous template for Democrats running in moderate to conservative districts or a cautionary example of political harakiri. Either way, in my book, he merits consideration for the JFK Library’s Profile in Courage Award (make your nomination here).


Is Tax on Health Benefits a ‘Poison Pill’?

A just-out WaPo-ABC News poll reveals that the ‘public option’ for health care reform now wins a “clear majority” (57 percent) of the public, according to a report in today’s Post by Dan Balz and Jon Cohen. However, the poll also brings signs of trouble for the proposal to tax the so-called ‘Cadillac’ health care benefits, as Chen and Balz report:

But if there is clear majority support for the public option and the mandate, there is broad opposition to one of the major mechanisms proposed to pay for the bill. The Senate Finance Committee suggested taxing the most costly private insurance plans to help offset the costs of extending coverage to millions more people. Sixty-one percent oppose the idea, while 35 percent favor it.

If Democratic lawmakers needed another reason to be skeptical about taxing health care benefits, unions are fiercely opposed to the idea. As Jeff Crosby put it in his AFL-CIO blog:

Vincent Panvani of the Sheet Metal Workers (SMWIA) warns:If any of these Democratic Senators vote for this, they’ll be out in 2010, and it will be used against Obama….[Y]ou’re taxing the middle class. Teamsters President James Hoffa calls taxing health care benefits “the poison pill that will kill reform.” The Laborers have attack ads at the ready…We have to say, right now, that we will kill any effort to tax our benefits as yet another transfer from our pockets to the health care profiteers.

Perhaps there is a income line that can be drawn to protect union workers from having their hard-won health benefits being taxed, while making those at higher income levels pay their fair share. Democratic leaders need to be very clear and unified that union benefits be exempted and only the wealthy, if anyone, will have their health benefits taxed. This ought to be doable, and most of the revenue shortfall should be made up with tax hikes on unhealthy substances like tobacco, liquor and soft drinks.


The Case for a Public Option — On a Fast Track

The moral case for the public option in health care reform has been well-made by numerous Democratic leaders, activists and writers, and some have also made a persuasive case that it’s good political strategy. Robert Parry’s Consortium News post, via Alternet, takes the argument a step further; that the public option is not only politically-wise; it should be implemented on a faster track — or the Democrats could be risking “electoral disaster.” As Parry explains:

Indeed, if the Democrats abandon the public option for the sake of passing a bill like the one that came out of the Senate Finance Committee, they may be courting electoral disaster once voters grasp that they will have to wait years for the law to be implemented and then that it could lead to higher costs for much the same unpopular private insurance plans.
…As the legislation stands now, many of the key features that hold some promise of helping consumers – such as the “exchange” where individuals and small business would shop for the best product – won’t even take effect until 2013. That means that Americans now facing the crisis of no health insurance won’t get much help for another four years, if then.
…By contrast to the four-year phase-in for these relatively modest reforms, the Medicare single-payer program for senior citizens was signed into law by President Lyndon Johnson on July 30, 1965, and was up and running less than a year later.
..The implementing delays mean that in both 2010 and 2012, Republicans will be free to make the truthful case that the Democrats – despite their promises – had accomplished little to help the American people on health care. Already, Republican senators are using the talking point that the four-year delay is part of a budgetary trick to make the bill appear cheaper over 10 years than it would be if its key features took effect quickly.

Parry believes the implementation delays of both the insurance exchanges and public option ‘trigger’ could work against each other to an even more deleterious effect:

…But the insurance exchanges won’t open until 2013, so it may take years before any trigger would be pulled. At minimum, the industry would have earned a lengthy reprieve.
And by the time, the exchanges have a chance to be tested, Congress and the White House could be in Republican hands. If that’s the case, the Republicans might well undo even the triggered public option. Unlike the Democrats, the Republicans would surely not worry about ramming their preferred policy through the Congress.

Conversely, Parry sees a huge upside to a bolder implementation strategy:

On the other hand, if Congress enacts a public option now, it presumably could be implemented at least as fast as Medicare, especially if it were piggybacked onto the existing Medicare bureaucracy. That would enable Democrats to show they had accomplished something beneficial for the public before voters go to the polls in November 2010.
By 2012, if the CBO predictions of substantial savings prove true, Obama could campaign for reelection on the basis that he had improved the welfare of the American people — and the budget outlooks for government and business.

It would be bitterly ironic if Democrats enacted a strong health care reform bill, with a solid public option, but then suffered political damage because it was implemented too late to do us some good. Parry makes a compelling case that putting implementation of both a public option and health exchanges on a faster track is wise strategy.


Our Line in the Sand

Just a hearty Amen and an addendum to Ed Kilgore’s post below, which provides one of the most crucial insights of the entire health care reform debate going on among Democrats: Every Democratic senator must be put on record — and soon — as supporting the party on cloture, no matter which health reform bill he or she advocates.
This has to be the first flashpoint at which Democratic leaders invoke party discipline, particularly when the stakes are the most important legislative reform in many decades. This is our line in the sand, where the emphasis should now be for all Democrats who care about health care reform and their party’s integrity.
And let all rank and file Democrats agree on one thing, if nothing else — that any Democratic senator who betrays the Party on a critical cloture procedural vote will get exceptionally well-funded primary opposition, regardless of his or her approval numbers. And may all progressive bloggers, journalists and activists pledge their hearts, souls and firstborn to the cause of denouncing cloture turncoats as shameless sell-outs for the rest of their miserable days.


Obama Formidable in Big Picture

In recent weeks President Obama has absorbed a volley of hits from progressives who are disssatisfied with his caution on a wide array of policies, including Afghanistan, the public option and bail-outs, to list a few (as reported for example, in Ed Hornick’s CNN.com post, “Candidate vs. boss: Obama’s ship not so tight these days, some say“). But the progressive cause may be better-served by taking a step back and considering his accomplishments in a broader historical context. Peter Beinart, senior fellow at the New America Foundation. and a former New Republic editor, does just that in his latest Daily Beast post, “Liberals Lay off Obama.” As Beinart explains,

…Our do-nothing president did something that Democratic presidents have been trying to do for most of the last century: He celebrated a universal health care bill’s passage through Senate Committee. For good measure, the Dow topped 10,000 for the first time since last fall’s meltdown. Obama’s polling has even ticked up: According to Gallup, he’s more popular than he’s been since summer…Even this summer, when the press was announcing a dip in Obama’s fortunes, the health care bills were moving steadily through Congress, the stimulus was gradually slowing the nation’s economic descent, and Obama’s approval ratings never fell below 50 percent…Get ready for the “Obama comeback” stories, in which the same publications that recently declared that “he’s failing miserably” (Politico) and “suddenly looking unsure of himself” (The Economist) discover that he’s thriving again. But the boring truth is that he was pretty much thriving all along.

Beinart attributes Obama’s sagging image, despite his accomplishments, to the media’s penchant for exagerating trends in roller-coaster fashion to heighten a story’s drama. But he believes Obama will ultimately be judged “against a low bar” — the disaster created by his predecessor. Even if Dems get “clobbered” in the mid-terms, Beinart believes, Obama should be looking pretty solid by 2012, when the stimulus will be showing positive results. Beinart continues:

So liberals should stop complaining that Obama hasn’t done anything. Sure, he hadn’t yet done much to bring world peace, but the stimulus bill — which includes vast sums for college tuition, renewable energy and mass transit — is one of the most important pieces of progressive domestic legislation in decades. And if Obama twins that with health care reform, he’ll have done more to rebuild the American welfare state in one year than his two Democratic predecessors, Jimmy Carter and Bill Clinton, did in a combined twelve.

For drama-seeking journalists, Beinart concludes, “The dreary truth is that politically, Obama is both lucky and good, and he’s well on his way to a successful first term.” Beinart’s big-picture analysis sounds plausible enough, and if he is right, the grumbling Dems of today will likely become Obama’s champions of tomorrow.


Snowe Vote Sets Stage for Creative Compromise

It is encouraging that Republican Senator Olympia Snowe (ME) joined in supporting the Senate Finance Committee version of health care reform, setting an admirable, albeit lonely example of bipartisanship in the 14-9 vote. As WaPo‘s Chris Cilliza suggests in ‘The Fix,’ Snowe’s vote could be significant in another way — inspiring hesitant Democrats to stand up for consumers against the worst instincts of the health care industry.
For the best report thus far on the SFC vote and it’s ramifications, read The Washington Post‘s coverage by Lori Montgomery and Shailagh Murray. Read also Chris Bowers’ easy-to-follow explanation of the legislative process regarding health care reform going forward.
It’s not such great news that a solid public option did not make the SFC cut. Nor is there much cause for celebration in the committee’s approval of nonprofit, consumer-run cooperatives to instead perform that role. In addition, agreement on the financing of health care reform is no closer as a result of the committee’s vote. According to the Posts’ coverage, the SFC version is a disappointment to some progressives because,

The measure does not mandate that businesses provide coverage to their workers. Committee members defeated two versions of a government insurance option. And the bill would tax high-value policies that, to the dismay of many liberal lawmakers, could affect some union households.

However, the good, make that great news is that all relevant Senate committees have now approved health care reform legislation that caps out of pocket spending by consumers at a reasonable level, bans disqualification from coverage based on prior medical condition and increases by millions the number of citizens covered. As Montgomery’s and Murray’s article notes, “Not since Theodore Roosevelt proposed universal health care during the 1912 presidential campaign has any such bill come this far.” Adds House Energy and Commerce Chairman Henry A. Waxman (D-CA), “We are much closer than we’ve ever been. I think we’re going to make it.
A range of creative compromises regarding the public or co-op options are still in play, including Snowe’s ‘trigger mechanism,’ state public options or some hybrid version, perhaps even widened access to ‘health exchanges,’ as Sen. Ron Wyden has proposed, all of which would be better than what we have now. Regrettably, the single-payer option remains d.o.a. — although single-payer for catastrophic coverage only could be proposed as an amendment before the deal is done.
Although the white house and congressional leaders would have welcomed more than token bipartisanship, Democrats should not hesitate to use the Republicans’ nearly unanimous obstructionist front against them, if need be. They can grumble, gripe and whine all they want. Democrats need only keep reminding the press and public that majority rule is the American way.


The Art of ‘Winning Ugly’

John Harwood’s Sunday New York Times article, “Democrats Must Attack to Win in 2010, Strategists Say” provides a good summation of the argument that Democrats are going to have to play rougher than usual to minimize losses next year. Harwood draws from the views of ‘nonpartisan political handicapper’ Charlie Cook and Democratic pollster Geoff Garin, who urges Dems not to “defend and justify,” but instead make Republican obstructionism “a central part of the debate.” Harwood lays out some sobering numerical realities to show why a more aggressive posture for Dems is needed:

,,,Democrats currently have 28 House seats in jeopardy to the Republicans’ 14; 7 Senate seats to Republicans’ 6; 13 governorships to Republicans’ 9…In last month’s New York Times/CBS News Poll, nearly 8 in 10 Americans rated the economy as fairly or very bad. That is only a modest improvement from a year ago…In a recent Gallup survey, independent voters preferred Republican candidates for Congress by 45 percent to 36 percent; last October, they favored Democratic candidates 46 percent to 39 percent.

As Cook, who gives Dems a slight edge in holding the House next year, says in Harwood’s article, “They’re going to have to play really rough…For the average Democratic Congressional incumbent, the opposition researcher will be the most important person in the campaign.”
For Garin, the image of the GOP as “completely obstructionist” provides a powerful vulnerability for Dems to mine over the next year, a view strongly affirmed in poll data in our recent staff post on the latest DCorps ‘Public Polling Report.’ Cook also emphasizes “the key thing is to disqualify your opponent on a very personal, individual level.” Harwood also quotes Republican pollster Neil Newhouse, who says Dems must “make the opponent the issue…tie them to George Bush — and then make it personal,” using “our playbook.”
Harwood writes about the comeback gubernatorial campaigns of New Jersey Governor Jon Corzine and Virginia Democratic nominee R. Creigh Deeds, both of whom have gained substantial ground by intensifying their attacks on their opponents. Corzine has scored by nailing his opponent for using his personal leverage to avoid traffic tickets, while Deeds has hammered his adversary for extremist views expressed in a college paper. I haven’t seen the ads of the Deeds campaign, nor clips of his attacks, but it’s hard to imagine him getting much lasting traction from an opponent’s college paper.
The ‘less defense, more offense’ strategy makes good sense in the current political environment, as was instructively illustrated most recently by Rep. Alan Grayson (D-FL). Grayson got great coverage by refusing to defend himself for what those sensitive Republicans saw as uncivil, and by seizing the media moment and going on the attack. But it’s important to remember that, more often, it takes money — lots of it for TV ads — to attack effectively. No matter how tough a candidate’s attacks, Dems can’t assume the media will report it adequately.
It’s also important to keep in mind that there are limits to what Harwood calls “winning ugly.” It’s more a matter of tone than content. Attacks must be tough and thorough, but without crossing the line into nasty, mean-spirited or petty. There is always a point at which the object of an attack can win sympathy. My guess is Rep. Grayson plays this card artfully, stopping just short of this point of diminishing returns.
To hold the line in the midterm elections, the next year must be a time of intensified Democratic attacks. As Paul Waldman, author of Being Right Is Not enough: What Progressives Can learn from Conservative Success, put it in a TomPaine.com post, “Democrats, Don’t Wimp Out,” :

Democrats should wake up every day thinking, “How can we keep Republicans on the run?” Never give them a moment’s rest, never let them advance their agenda, keep them on the defensive so they have to apologize for being the standard-bearers of a discredited ideology and a disgraced president. Do that, and every legislative battle and election to come will be that much more likely to swing in your favor.

That’s solid advice in any political year, and in 2010 in particular it could make the difference between political gridlock and a new era of Democratic accomplishments.