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Thursday, September 17, 2009

Obamacare news: Snowe melts away ... Rockefeller steams ... Democrats feel the heat? 

Some news of the health care reform wars that perhaps hasn't gotten coverage equal to its importance: Maine's Republican Senator Olympia Snowe has "left the building" as far as voting for Obamacare goes. She was the last Republican who was considering voting for it. And that has serious consequences...

(1) It's going to be an entirely partisan Democratic versus Republican fight on over health care from here on. And no social legislation on this scale (Social Security, Medicare, you name it) has ever been enacted like that, on a straight party-line vote, without bipartisan support (and "cover").

(2) The Democrats need every single vote now. (In fact, they have only 59 of 60 in the Senate until the Kennedy replacement arrives.) That puts them in very tight spot. At first consideration, one might think their reaction would be "the most controversial items go overboard" to make the bill as palatable as possible.

But as we saw in this year's circus of horrors performance of the New York State Senate, the marginal voter gets tremendous power -- call it even the power of "extortion" if you will. If you are a member of the last small group of voters -- or, glory be, have the very last vote itself! -- determining whether your party succeeds or fails, you can name your price in booty. That's what we saw in New York. You can also dictate the terms of the bill itself -- because it can't pass without you. Rather than compromise, the incentives become to play hardball.

Problem is, when the bill needs every single vote, everybody becomes the marginal voter who can dictate terms: "The public option is in, or I walk!" ... "The public option is out, or I walk!" Then where are you?

The New York Senate case was just about grabbing loot and patronage. This case is about turning major policy, securing power, and keeping your seat and job if you are a Democrat in a moderate state or district. It isn't nearly as easy to reach a split-the-difference compromise on these things ("that's my seat!") as it is about divvying up swag and patronage. So intra-party fighting could be much tougher to resolve.

And the fighting may have already started, on the very issue over which Snowe walked.

The Democratic head of the Senate Finance Committee, Sen. Max Baucus, has worked out a program to finance reform by taxing "high-cost" health insurance plans (placing a 35% tax on plans costing above $8,000 for individuals and $21,000 for families).

Maine is a state where health plans cost of lot, so the tax would hit there hard. As Senator Snowe wants to get re-elected from there, she signed out and said "goodbye".

But Maine isn't the only state with high-cost insurance. And some other states that have it also have Democratic senators -- such as West Virginia, and its senator Jay Rockefeller. Being a Democrat he can't walk away, but he can start shooting at his Democratic brethren.

And even before the Baucus Plan has been announced, he already is...
Dem Senator Warns of 'Big, Big Tax' on Middle Class in Baucus Bill

It's not every day that you hear a Democratic senator charge that a fellow Democrat is proposing to raise taxes on the middle class, but that is what happened on Tuesday when Sen. Jay Rockefeller, D-W.Va., ripped into the health-care bill developed by Sen. Max Baucus, D-Mt., the chairman of the Senate Finance Committee...

The West Virginia Democrat worries ... that a lot of middle class workers, like the coal miners in his state, will end up facing "a big, big tax" under the Baucus bill because they currently enjoy generous employer-provided health care benefits which they receive tax free.

Referring to Baucus, Rockefeller said, "He should understand that (his proposal) means that virtually every single coal miner is going to have a big, big tax put on them because the tax will be put on the company and the company will immediately pass it down and lower benefits because they are self insured, most of them, because they are larger. They will pass it down, lower benefits, and probably this will mean higher premiums for coal miners who are getting very good health care benefits for a very good reason. That is, like steelworkers and others, they are doing about the most dangerous job that can be done in America."

"So that’s not really a smart idea," Rockefeller continued. "In fact, it’s a very dangerous idea, and I’m not even sure the coal miners in West Virginia are aware that this is what is waiting if this bill passes"...
But he's telling them already, loud and clear. And the coal miners have a union influential in Democratic politics, one hears. (What union leader just got elected to head the AFL-CIO?)
Rockefeller, who sits on the Finance Committee, said that he cannot support the Baucus bill unless it receives major improvements during the amendment process....
Let the internecine warfare begin!