How Republicans Can Steal Health Care
As a Senate committee releases a draft of the Democrats’ health-care plan this afternoon—and Ted Kennedy remains sidelined by his cancer—The Daily Beast’s Reihan Salam plots how the Republicans can make Obama’s issue their own.
There is no way for Republicans to stop the Democrats’ health-care legislation (which will appear in draft form this afternoon), and they shouldn't even try. But they can get a seat at the table, steal a bit of Obama’s momentum, make themselves into something other than a speedbump in the legislative process.
Fortunately for Republicans, Obama's approach to health care suffers from a number of serious political vulnerabilities.
Tuesday’s news that health-care champion Ted Kennedy has been sidelined by his brain cancer highlights just how top-down the process has been thus far. Obama has sent a not-so-subtle message to Congress: He's not interested in compromising the goals he set out during the campaign, including a large Medicare-like public insurance plan that would compete with the private sector, even if that means unified Republican opposition. It helps that today's Democrats, including conservative rebels like Ben Nelson of Nebraska, all back the principle of universal coverage, a dramatic departure from Bill and Hillary Clinton's last attempt at remaking the health-care system in 1993. Recognizing that he might never be as popular as he is right now, Obama is eager to do what Truman and LBJ and Clinton couldn't by fulfilling the New Deal vision of universal health care as a cornerstone of the American welfare state.
The White House strategy is to push sweeping health-care legislation through Congress by the end of the summer, giving the country about 90 days to revamp a sector that amounts to 17 percent of GDP and is rising. After the Bush administration created the Troubled Asset Relief Program, Americans discovered, to their horror, that then-35-year-old Neel Kashkari was in charge of rescuing America from a new Great Depression. This week we learned that 31-year-old Brian Deese is going to save the American auto industry. We can all be very grateful that 40-year-old Peter Orszag is the wise elder statesman who will, in the next few weeks, decide what will or will not go into grandma's IV drip.
Actually, that's not fair. Orszag is, by all accounts, a brilliant and humble guy who knows the health-care sector better than almost anyone, and he leads a team of superwonks who are the best government has to offer. But it's worth underlining the dizzying speed at which the White House is moving, and how it complicates the lives of Republicans. Some conservatives are content to sit on the sidelines and decry the Obama approach as so much warmed-over socialism. Others are hoping to have a seat at the table—to prevent the new health-care system from becoming an expensive, bureaucratic mess.
When Republicans derailed ClintonCare, they saw it as a massive strategic success. Yet they inadvertently turned the health-care issue into an even more effective recruiting tool for the Democrats. Back in 1993, Republicans argued that the health-care crisis was a myth and that only incremental steps were necessary to solve the most pressing problems. Since then, however, health care has been a key source of economic anxiety for voters.
Fortunately for Republicans, Obama's approach suffers from a number of serious political vulnerabilities. Even in the GOP's battered and bruised state, conservatives can play a major role in shaping the legislation—and the future shape of the American economy—if they can learn from past mistakes.
Led by Orszag, the White House is aggressively pushing the idea that an health-care overhaul is essential to putting the federal government on a sustainable fiscal path. By now you've probably seen the terrifying graphs of federal spending zooming skyward as the baby boomers retire. It turns out, however, that cost growth in health care is driving ballooning entitlement costs far more than the aging of the population. Limiting cost growth even slightly will have a huge impact on the taxes we'll all have to pay 10 or 20 years from now, which is why tax-cutting conservatives should have a strong interest in reform. One encouraging sign emerged this week when President Obama backed empowering the Medicare Payment Advisory Commission to create cost-saving plans that Congress would then subject to an up-or-down vote. The idea is to depoliticize the inner workings of Medicare by putting decisions about which devices and medicines to use in the hands of technocrats.
But while the White House talks a good game on restraining cost growth, its central political objective is expanding coverage. And those goals are in tension. In the short term, at least, the federal government will have to spend much more to cover everyone. Apart from a promise to subsidize effective treatments more than ineffective treatments—easier said than done—we don't have a clear sense of how Obama intends to deliver lower costs. As Maya MacGuineas explained in The Washington Post, the Obama administration has balanced the $100 billion they'll need in new spending with $33 billion worth of cost-saving programs, about $33 billion in tax increases and another $33 billion, well, to be determined.
Instead of opposing health-care reform, Republicans need to highlight these unanswered questions. Last month, four of the brightest congressional Republicans rolled out the Patients' Choice Act, a cheaper alternative that channeled the enormous subsidy for employer-provided health coverage into refundable tax credits for all Americans that could be used to buy private insurance plans. The credit isn't big enough to buy most plans, and so low-income families would receive additional subsidies. Like the emerging Democratic plan, the Republican plan doesn't do enough to curb long-term cost growth.
But in the cash-strapped near-term, it is much less of a budget-buster. A significant majority of Americans—63 percent according to a new CNN poll—are comfortable with a bigger federal role in health care designed to increase coverage. Yet only 47 percent are willing to pay higher taxes to that end. Republican stinginess—relative stinginess, as all the proposals will cost massive amounts—could yield political dividends.
No Republican plan will pass, of course. But offering a smart, sane, cheap alternative will help restore Republican credibility on the biggest domestic issue facing the country. And for now, that is good enough.
Reihan Salam is a fellow at the New America Foundation and the co-author of Grand New Party.