HCR—just a political liability, not a political disaster

[eridani]

I worried about the former last year, but it looks like jobs and taxes are forcing HCR out of the headlines, thank heavens. That it would at least be a political liability was 100% predictable. Obama and the Dems KNEW that insurance companies would jack up their rates the way they always have in the past, but blame it on HCR this time. They knew that Repukes would lie about it and call it communism and every other nasty snarl word under the sun. They effing well SHOULD have known that the only practical way to counter this would have been to frontload the plan with benefits for a significant number of people who could not be ignored this year—really big facts on the ground to counter the inevitable really big lies. They seem to have belatedly caught on to this, because not a single representative who voted for it is running on that vote.

In contrast, an initiative on the fall ballot in WA State to put an income tax on individuals earning more than $200K ($400K for couples) was crafted intelligently. To help the lowest income people, the thing to do would have been to cut our very high sales taxes. Unfortunately, many surveys have shown that the low income people who would benefit most from a taxation plan that included a graduated income tax are the very people who are the most strongly opposed to any income tax. Furthermore, the political problem with a sales tax reduction would have been that not a single one of the beneficiaries would have noticed it. Take a bottle of Suave conditioner on sale for $1.29. A 9.8% sales tax would result in a total price of $1.42. A 5.8% sales tax would result in a total price of $1.36. Big whoop. In other words, this is a price difference that no one would notice or care about. Sure these pinpricks add up over time to result in one of the most regressive state tax schemes in the country, but low income people certainly don’t have the time to save up a year’s worth of sales slips and calculate their total tax and compare it to their incomes.

The taxes that the initiative if passed will reduce are state property taxes and the Business and Occupation tax, which is probably the single most idiotic way ever invented to tax businesses—on their gross, not their net incomes. 80% of businesses will have that tax eliminated. You’d better believe that THAT will be noticeable. Also, property tax bills are paid once or twice a year, and a 20% cut in a big lump sum is also quite noticeable. These cuts don’t benefit lower income people nearly as much, but they are sure the hell much harder to ignore.

The analogy to HCR is clear, I hope. Sure, some people are benefiting now, but they are nowhere near as noticeable as the outrageous premium increases that have been inflicted on large numbers of people. Following is a list of the mostly invisible people who have benefited

• Sick rich people. Only 2000 out of 4 million have bothered to sign up for the high risk pool. Yes, Virginia, 10-20% less outrageously expensive is STILL outrageously expensive.
• 23-26 year olds whose parents can afford to insure them. A larger group, to be sure, but plenty of people in that age group are left out. Still, there are enough to help downgrade HCR from disaster to mere liability, which is a helpful political effect of this provision.
• Children with pre-existing conditions. This s a very small group, as kids are the healthiest demographic of all—the vast majority are never going to be seriously sick.
• The people on Medicaid whose situation will not deteriorate because states are getting chunks of change that will keep their health care budgets from crashing. But they aren’t going to notice anything because they aren’t the ones who get the money—state governments are.

Now, assuming that congress had been as politically aware as the authors of Initiative 1098, and that we were not going to end up with single payer this time around, what might they have done instead? The simplest possible thing to have done would have been to expand Medicare, either by dropping the eligibility age to 60 or 55, or by taking a smaller slice of older people and adding a slice of the youngest adults. The administrative apparatus is already in place—no waiting until 2014. Lieberman was actually for this before he was against it. Charge 4% of income for voluntary enrollment, and tell the teabag whackjobs to STFU and just not enroll if they don’t want to. This would have created a huge group of beneficiaries that would have been absolutely impossible to ignore. Enrolling older people only would have the political advantage of directing major benefits to a demographic slice that has seen its unemployment rate go up by more than 300%, and which tends to supply much more reliable voters in off-year elections. This would have been by far the smartest thing to do if we couldn’t get single payer. So why didn’t they?

[BzaDem]

1. You answered your own question.

There were 59 supporters of the Medicare buy-in before Lieberman reversed himself. (Ben Nelson later said he was opposed to it, but that was just because he knew it wouldn't pass at that point -- Ben Nelson actually was part of the group of 10 that negotiated the Medicare buy-in.) Lieberman (not part of the group of 10) reversed himself because he heard Anthony Weiner say something good about it.

Reid was so furious that he almost killed the bill. Luckily, cooler heads prevailed and the bill still passed despite Lieberman's intransigence.

But there will still be lots of conspiracy theory nuts who think that killing the Medicare buy-in was the Obama-instituted plan from the beginning.

[eridani]

2. So why did Obama lean on Kucinich and not on Lieberman? n/t