Blanche Lincoln Justifies Opposition To Bill That Includes Public Option With Disingenuous Argument
Blanche Lincoln Justifies Opposition To Bill That Includes Public Option With Disingenuous Argument
NOTE: We are live-tweeting the Senate vote for cloture on the motion to proceed at @wonkroom.
In a dramatic and long winded speech on the floor of the Senate, Sen. Blanche Lincoln (D-AK) announced today that she would provide the 60th vote “in support of cloture on the motion to proceed” to the health care reform bill. But Lincoln also stressed that she is “opposed to a new government administered health care plan as a part of health care reform and will not vote on the health care proposal introduced by leader Reid as it is written”:
I’ve already alerted the leader, and I’m promising my colleagues, that I’m prepared to vote against moving to the next stage of consideration as long as a government-run public option is included. The public option as a part of health insurance reform has attracted far more attention than it deserves. While cost projections show that it may reduce costs somewhat, those projections don’t take into account who pays if it fails to live up to expectations. If in fact premiums don’t cover the cost of the public plan, it is taxpayers in this country who are faced with the burden of bailing it out.
Watch a compilation:
The Senate bill requires that “the premiums for the public plan be set to fully fund expenditures for medical claims, administrative costs, and a contingency reserve” and instructs the Secretary of Health and Human Services to negotiate reimbursement rates with physicians. The Senate’s public option would save the government $3 billion over 10 years, the Congressional Budget Office has concluded.
Lincoln, who supported giving Americans the choice of enrolling in a public option as recently as July, is arguing that the option could ignore the letter of the law and charge premiums that would not cover the cost of the program. Her skepticism may be well-founded, but it’s also short-sighted and inconsistent. She is doubting the integrity of the public option, while tacitly assuming that private insurers — who have a long-standing practice of exploiting loopholes in the law and skimming on coverage for beneficiaries to increase profits — will follow the new benefit and rate regulations. Lincoln supports ‘building on the current system’ and regulating private insurers without questioning their commitment to “live up to expectations.”
Ultimately, if she’s is worried that the language of the health care bill won’t be properly implemented, she should encourage the Senate to establish a federal oversight mechanism that could force private health insurance companies and the public plan to abide by the new rules of reform. As it stands now, her objection to the public plan sounds rather manufactured and hypocritical.
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Landrieu To Provide 59th Vote On Motion To Proceed, Responds To ‘Some Very Partisan Republican Bloggers’
Landrieu To Provide 59th Vote On Motion To Proceed, Responds To ‘Some Very Partisan Republican Bloggers’
NOTE: We are live-tweeting the Senate vote for cloture on the motion to proceed at @wonkroom.
This afternoon, Sen. Mary Landrieu (D-LA) took to the Senate floor to announce that she would vote on a motion to proceed with the Patient Protection and Affordable Care Act. Landrieu is the 59th Senator to commit to voting to open debate on the floor. Senate Majority Leader Harry Ried (D-NV) would still have to secure the support of Sen. Blanche Lincoln (D-AK) to begin considering the legislation.
In her remarks, Landrieu stressed that she was concerned about the bill’s costs to small businesses and individuals, the possible premiums spikes families could face in the time between when the bill passes and its reforms are implemented, and reiterated her opposition to a public health insurance option:
My vote today to move forward on this important debate should in no way be construed by the supporters of this current framework as an indication of how I might vote as this debate comes to an end. It is a vote to move forward to continue the good, and essential, and important and imperative work that is underway….We must enhance and expand tax credits that are in this bill that are for small businesses, particularly those of 25 and less and if we can expand it between 25 and 50, that would be a great help…I will continue to fight for more tax equity for the 27 million Americans who are currently self employed…in order to really deliver on our promise to lower costs for families focus on ways for premiums to be excessively raised between the time this bill is enacted and the time these provisions go into affect … I remain concerned that the current version of the public option included in this bill could shift significant risk to tax payers over time, unnecessarily…I’ve suggested that a free-standing community option…
Watch a compilation:
Landrieu also directly responded to “some very partisan Republican bloggers” who suggested that she agreed to support the bill only after Reid included “an extra $100 million in federal aid for low-income people in her state. “The Louisiana money is intended to adjust the percentage of federal payments to the state for Medicaid to avert a scheduled cut in U.S. assistance in 2011 for the program, which provides medical care for the poor. Louisiana had a bump in per capita income from the post-Katrina construction boom, which would force the decline in federal aid.”
Landrieu explained that following the hurricane, “some of those one-time recovery dollars were calculated into our per-capita income” and inflated the state’s income. As a result, the state is scheduled to receive less matching fund for the Medicaid program. “It is the number one request of my Governor, who is a Republican and it is unanimously supported by every member of our delegation, Democrat and Republican. I’ m proud to have asked for it. I’m proud to have fought for it, and I will continue to,” she said.
Although I don't agree with everything in this bill, I have concluded that I think it's more important that we begin this debate to improve our health care system for all Americans rather than just drop the issue and walk away....I will vote in support of cloture on the motion to proceed to this bill. But madam President, let me be perfectly clear, I'm opposed to a new government health care plan as a part of health care reform and I will not vote in favor of the proposal that has been introduced by leader Reid as it is written....I've already alerted the leader, and I'm promising my colleagues that I'm prepared to vote against moving to the next stage of consideration as long as a government-run public option is included.
Financial Services Industry Warns That Transactions Tax Will Cause ‘Stalling Of The Stock Market’
Financial Services Industry Warns That Transactions Tax Will Cause ‘Stalling Of The Stock Market’
With House Democrats seriously considering proposing a financial transactions tax (FTT) to pay for a new jobs creation package, the financial services industry has gone on the defensive. The premise behind a financial transactions tax is that it is so small (a fraction of a percentage point) that a normal investor who is buying a stock to hold is barely going to notice it. But an investment bank like Goldman Sachs, which is involved in lots of high-frequency trading, is going to pay a pretty penny. It’s estimated that an FTT can raise about $150 billion annually.
The Securities Industry and Financial Markets Association, a leading lobbying organization for banks and securities firms, said that such a tax would literally stall the stock market:
Imposing a tax on financial transactions is the wrong idea at the wrong time. Such a tax would likely result in a stalling of the stock market, cutting off companies’ ability to raise capital to fund new investments in plants and equipment, and thus create jobs. Furthermore, it would directly and detrimentally affect millions of Americans by imposing a tax on their savings such as mutual funds, just as they are seeing their investment assets regain value.
An analyst in Washington at Concept Capital, which advises brokers and dealers, told clients that “we cannot completely dismiss the slight possibility it could be part of a House jobs bill,” but vowed that it has “virtually no chance in the Senate.” Even right-wing tea party organizers Americans for Prosperity got into the act, saying that the FTT would be a “disaster.”
Contrary to SIFMA’s assertion, under the proposed plan, the tax would be refunded “for those involving assets kept in individual retirement accounts, education savings accounts and health savings accounts” and the first $100,000 in annual transactions. So “millions of Americans” would not see their savings accounts slammed.
But furthermore, an FTT will make the financial system allocate capital more efficiently, as trading for the simple sake of trading will be more expensive. Center for Economic and Policy Research co-director Dean Baker estimates that an FTT could free up more than $60 billion a year in capital and labor for productive uses.
Finally, I’m not sure where SIFMA gets off suggesting that an FTT would stall the stock market, as the United Kingdom already has both a tax on stock trades and a vibrant stock exchange. Wall Street was saved by taxpayers to the tune of $700 billion dollars, plus untold amounts of guarantees against losses and cheap money from the Federal Reserve. An FTT — the revenues from which could be put towards programs or deficit reduction — seems only fair.
Why Rush Wyden’s Choices Amendment?
Why Rush Wyden’s Choices Amendment?
Senate Majority Leader Harry Reid (D-NV) has agreed to include a watered-down version of Sen. Ron Wyden’s (D-OR) ‘Choices Amendment’ in the merged Senate bill. Wyden, an ubiquitous presence on cable television, has been hawking his idea of instantly opening up the insurance exchanges to Americans in employer-sponsored coverage for months. He introduced the amendment in the Senate Finance Committee just hours before it ended its marathon mark-up session, but withdrew it for later consideration.
Under this compromise, a small sliver of the population — individuals and families under 400% of the federal poverty line who receive employer-sponsored coverage and spend 8-9.8% of their income on premiums — could “convert their tax-free employer health subsidies into vouchers that they can use to choose a health insurance plan in the new health insurance exchanges.” Currently, individuals in employer-based coverage who have to spend more than 9.8% of the incomes on premiums aren’t required to purchase health insurance and don’t quality for affordability credits if they enter an Exchange:
“As I have long said, empowering Americans to choose the health insurance that works best for them and their family is the single best way to hold health insurance companies accountable,” Wyden said in a statement. “While this is just one step in the direction of guaranteeing choices for all Americans, it is a major step because – for the first time – it introduces the concept of individual choice to a marketplace where it has long been foreign. This is a significant step toward real reform.”
The theory of instantly “empowering Americans to choose the health insurance that works best for them” is sweeter than the reality. The merged senate bill establishes a time line that more or less allows everyone to choose a plan from an exchange by 2017. In this way, the legislation builds on the current structure but also sows the seeds for an eventual transition to a more ‘individualistic’ system — or what Wyden calls “real” reform.
This ‘time release’ approach — to borrow a pharmaceutical term — is intentional. Opening the exchanges only to small businesses, individuals and the self-insured for a limited period preserves the employer contribution in the health care system and allows the exchanges to build a capacity for covering more people over time. It helps the Exchanges find their footing without being overrun by millions and millions of new applicants from the employer market. Care continuity is also better preserved.
In short, the existing legislation accomplishes the main goals of Wyden amendment on a more realistic timetable. Wyden was concerned that it didn’t have his name stamped all over it. Now it does.
Support Iran’s Opposition Or Bomb Iran: You Can’t Do Both
Support Iran’s Opposition Or Bomb Iran: You Can’t Do Both
Washington Times national security editor Barbara Slavin has an article on Iranian filmmaker and dissident Mohsen Makhmalbaf, who has become a spokesperson for Iran’s Green Movement in the wake of the June 12 elections. Makhmalbaf called upon President Obama to more explicitly support Iran’s opposition movement and more strongly condemn Iranian human rights abuses. He also had some interesting things to say about the prospect of further sanctions:
“Inevitably, you are going to put [new] sanctions on Iran,” Mr. Makhmalbaf told a small group of Iran specialists and journalists in Washington. He said the U.S. should “let the Iranian people know why you are going to sanction and what the targets are so they can support you.”
He rejected proposed U.S. legislation that would target gasoline imports to Iran, saying that would hurt average people. He said it was better to focus on the Revolutionary Guards, who have been at the forefront of repressing demonstrations and who have taken control of considerable elements of the Iranian economy.
You know who also opposes U.S. legislation targeting gasoline imports to Iran? The Iranian regime. For some, this shared interest is quite enough to tar Makhmalbaf as a regime apologist. Those who are genuinely interested in supporting Iran’s opposition — and not just in smoothing the road toward a U.S.-Iran war — understand that this is silly, of course. The Iranian opposition — and its supporters outside the country — include a number of different factions and trends with various end goals and methods of reaching them.
Speaking of smoothing the road toward a U.S.-Iran war, the very same Washington Times also runs an editorial today telling Americans to Get Ready To Bomb Iran:
Force need not be used to be effective, but the threat of force must be credible to have any chance of influencing Iranian behavior. Right now, there is no credible threat emanating from the United States. The Obama administration unambiguously opposes military action against Iran, particularly by Israel. But it would help to have a little ambiguity on this issue. So long as Tehran thinks the United States will work actively to prevent Israel from taking action, it has one less reason to worry. It would be most helpful if the United States began to send signals to Tehran that the United States will assist Israel in its preparations for military action and maybe even participate when the attack ultimately is launched.
If the regime in Tehran is not made to fear serious consequences for its continued intransigence, it has no reason to abandon its nuclear ambitions.
Leaving aside that anyone who talks seriously about bombing Iran has revealed themselves to be no friend of Iran’s opposition — Abbas Milani represents the overwhelming consensus when he writes that “the forces now controlling Iran would be immeasurably strengthened by an American or (especially) Israeli attack” — this shows a pretty serious misapprehension of the situation in Iran right now.
It’s not at all clear that Iran’s ruling hardliners, who are currently weathering the most serious crisis of legitimacy in the Islamic Republic’s history, wouldn’t actually welcome a military strike by either Israel or the U.S. Such a strike, in addition to extinguishing the Green Movement, would effectively end the ongoing debate within the regime over whether to obtain a nuclear weapon in favor of those who have been arguing “yes,” in very much the same way that the preventive U.S. invasion of Iraq convinced Iran’s hardliners that they needed to keep open the option of having a strategic deterrent.
It’s pretty broadly understood across the U.S. defense establishment that a strike on Iran — either by Israel or the U.S. — would very likely result in a number of disastrous consequences, consequences Iran knows that the U.S. would rather avoid. There’s really no credibility to be generated by pretending otherwise.
Why Does The Senate Bill Establish Two Separate Exchanges?
Why Does The Senate Bill Establish Two Separate Exchanges?
Over at FiredogLake, Jon Walker points out that the merged merged Senate bill would “create two exchanges per state. There would be an exchange for individuals and a “Small Business Health Options Program” know as the SHOP exchange for businesses.” “This is, pure and simple, a dumb idea,” he writes. “The more customers using one exchange the larger the risk pool and the better the bargaining power.”
It’s unclear why the Senate separates the individual and small business markets rather than follow the Massachusetts model of combining the two markets. Under the Senate bill, insurers would pool risk for all policies in the individual market (inside and outside of the exchange) and all small business policies (inside and outside of the exchange) but couldn’t combine the risk unless the state voluntarily merges the two markets.
As Sarah Lueck explains, allowing multiple exchanges to participate in the same geographic area would increase administrative costs and “diminish the ability of an exchange to improve efficiency by creating a well-functioning marketplace”:
If there were multiple exchanges in the same area, the exchanges would have to spend money on marketing and advertising in order to attract customers….Also, permitting multiple exchanges in a single area would require a vastly more complex risk-adjustment system. Risk adjustment provides higher payments to insurers enrolling higher-cost beneficiaries, while lowering payments to plans enrolling healthier individuals with lower-than-average costs. In areas with multiple exchanges, the risk-adjustment mechanism would have to compensate for risk differentials across the various exchanges, as well as among the insurers within each exchange. This would make it more difficult to risk-adjust accurately.
One possible reason for the separation, a source suggests, is the reluctance of some insurers operating in the small group market to expand their options to individuals. The may not want to change their business model or cover a potentially sicker crop of newly insured individuals.
The so-called SHOP-exchanges have also been promoted by the National Federation of Independent Businesses (NFIB) and championed in the Senate by Sens. Dick Durbin (D-IL), Blanche Lincoln (D-AK) and Sen. Olympia Snowe (R-ME). But why they’re still necessary in the broader context of health reform is somewhat of a mystery.
SHOP may not make policy sense, but it may help win the support of a few moderate lawmakers.
Steve King Reminisces About The Days When Football Players Could ‘Get A Job Because They Knew Someone’
Steve King Reminisces About The Days When Football Players Could ‘Get A Job Because They Knew Someone’
Yesterday, Republican members of the House Immigration Reform Caucus (HIRC) dedicated a three and a half hour long pseudo-hearing in a nearly empty room in the Rayburn building to spewing their “well-worn rhetoric about the hordes of illegal aliens destroying the American way of life.” During the event, “American Jobs in Peril: The Impact of Uncontrolled Immigration,” Rep. Steve King (R-IA) seemed to suggest that the U.S. should rid itself of its immigrant workers because, back in the good ‘ol days, high school “football stars” could get good-paying jobs not because they were qualified to work at them, but rather, because “they knew someone”:
Thirty years ago in the packing plants there in that town — which I do call my hometown — you had to know somebody to get a job. And I can remember looking at the football stars on our football team that graduated back in those years in the mid to late 60s and thinking:
“Those guys will get the best-paying jobs at the beef plant. They can just take their degree and go out and get a job — IF they know someone. If they don’t, they won’t get the job. Well I can’t do that because I’m not tall enough or strong enough.”
But today it’s entirely different.
Watch it:
King attributes the end of cronyism in the meatpacking industry and the deterioration of wages and working conditions to undocumented immigrants. The United Food and Commercial Workers International Union (UFCW), which has represented meatpackers for almost a hundred years, has a different take about the sequence of events.
Back in March, Center for Immigration Studies Senior Fellow Jerry Kammer — who was also a panelist at the event — offered an interpretation of the industry’s history similar to King’s, minus the football players. The UFCW was quick to point out that Kammer’s misinterpreted and manipulated “data to reach a totally biased and flawed conclusion” and demonstrated a “complete lack of understanding about the history of the meatpacking industry.” They also provided their own account of what happened:
Immigrants worldwide have been essential in strengthening the U.S. meatpacking industry, by organizing around increased wages and improved industry standards. But during the ‘80’s, something happened. Consolidation, mergers, and company-induced strikes helped drive down wages for meatpackers. During the strikes, companies aggressively recruited strike breakers-not immigrants but individuals who came from the decimated farm industry-to cross the picket lines.
Many of these workers soon realized something: these jobs were tough. Too tough to perform at the wages companies were offering. So, they left. But the damage was done. And the UFCW has been fighting to rebuild wages and standards for these jobs ever since.
In direct reference to yesterday’s event, UFCW’s Director of Civil Rights and Community Action, Esther Lopez, commented, “Given their [King and his allies] terrible track record on worker issues, it really is the height of hypocrisy that they are now trying to portray themselves as champions of workers.”
The House Immigration Reform Caucus (HIRC) is a group of (mostly Republican) representatives founded by former Rep. Tom Tancredo (R-CO) with the mission of stopping “the explosive growth in illegal immigration,” “reversing the growth in legal immigration,” and halting “amnesties.” The forum featured panelists from two of the three organization which “stand at the nexus of the American nativist movement,” and are often referred to as part of the “Nativist Lobby.”
Cross-posted at Think Progress.
ClimateGate: Hacked Emails Reveal Global Warming Deniers Are Crazed Conspiracy Theorists
ClimateGate: Hacked Emails Reveal Global Warming Deniers Are Crazed Conspiracy Theorists
Thousands of “emails from the University of East Anglia webmail server” — a top climate research center in the United Kingdom — “were hacked recently” and dumped on a Russian web server. Global warming deniers are sifting through the illegally obtained letters of private correspondence for “proof” that the scientific consensus on climate change is actually a global conspiracy.
— “If you own any shares in alternative energy companies I should start dumping them NOW,” says the Telegraph’s James Delingpole.
– Hot Air’s Ed Morrissey claims the emails discuss “repetitive, false data of higher temperatures.”
– The National Review’s Chris Horner salivates, “The blue-dress moment may have arrived.”
– “The crimes revealed in the e-mails promise to be the global warming scandal of the century,” blares Michelle Malkin.
– The Australia Herald-Sun’s Andrew Bolt claims the emails are “proof of a conspiracy which is one of the largest, most extraordinary and most disgraceful in moderrn [sic] science.”
Evidently due to this e-mail conspiracy, Arctic sea ice is at historically low levels, Australia is on fire, the northern United Kingdom is underwater, and the world’s glaciers are disappearing. Oh yeah, and it’s the hottest decade in history.
I don't know how you get from some scientist having sexed up a graph in East Anglia ten years ago to The Final Nail In The Coffin of Anthropogenic Global Warming. Anyone who comes to that connection has more screws loose than the Space Shuttle Challenger. And yet that's literally what some of these bloggers are saying!
DeLauro: Chamber of Commerce ‘Ignoring The Needs’ Of 57 Million Workers Without Paid Sick Days
DeLauro: Chamber of Commerce ‘Ignoring The Needs’ Of 57 Million Workers Without Paid Sick Days
In response to the threat posed by the H1N1 virus (swine flu), Rep. Rosa DeLauro (D-CT) and Sen. Chris Dodd (D-CT) have proposed legislation that would require all businesses with more than 15 employees to provide seven days of sick leave. As I’ve noted before, the Centers for Disease Control has advised workers who contract the virus to stay home, to prevent them from infecting other workers, but nearly half of the private sector workforce has no paid sick leave — and the number increases to 78 percent of hotel workers and 85 percent of food service workers.
In response to the new legislation, the big business community — led by the Chamber of Commerce — has voiced its opposition to the very notion of paid sick days, by downplaying the extent of the problem. The Chamber said that “the problem is not nearly as great as some people say,” while the National Association of Manufacturers claimed that employers who don’t provide sick leave are “clearly the exception.”
The Wonk Room sat down with DeLauro today to discuss her bill. She said that by steadfastly opposing paid sick leave, the Chamber and its allies are simply ignoring the 57 million working Americans who currently have no paid sick days:
[The Chamber of Commerce] is just ignoring the needs of a bulk of a workforce, people who get up every day, go to work, want to work, but you know what? They get sick. People get sick and to not have the opportunity to take a day or two days, nobody’s talking about two weeks…What we are trying to do is address the issue of 57 million people — who are hard-working people — who today have not one paid sick day.
Watch it:
DeLauro noted that the arguments coming from the Chamber are the same that the group employed to oppose the Family and Medical Leave Act of 1993:
They said at that time that business was going to crash, that this country was going to go to hell in a handbasket, that we couldn’t survive this kind of an act. Well, they were proven wrong, and they are wrong in this instance.
Watch it:
DeLauro correctly noted that the U.S. economy loses $180 billion in productivity annually due to sick employees attending work and infecting other workers. DeLauro is also a sponsor of the Healthy Families Act, which would permanently require seven paid sick days for workers (again, at firms with more than 15 employees). In both bills, leave could be used to care for a sick child or elderly relative.
After Inhofe’s Endorsement, Carly Fiorina Challenges Climate Science
After Inhofe’s Endorsement, Carly Fiorina Challenges Climate Science
Our guest blogger is Daniel J. Weiss, a Senior Fellow and the Director of Climate Strategy at the Center for American Progress Action Fund.
Following the endorsement of Sen. Jim Inhofe (R-OK) Wednesday for her campaign to unseat Sen. Barbara Boxer (D-CA), ex-Hewlett Packard CEO Carly Fiorina questioned the science of climate change. Boxer, as the chair of the Senate environment committee, is the chamber’s leading advocate for action to create jobs, make America more energy independent, and cut global warming pollution. Ranking environment committee member Inhofe — “Senator Climate Change Denier” — led a failed boycott of Boxer’s Clean Energy Jobs and American Power Act (S. 1733). After news of Inhofe’s endorsement of Fiorina came out, a reporter asked whether she believes in global warming. Fiorina admitted she is skeptical about climate science:
I think we should have the courage to examine the science on an ongoing basis.
Fiorina’s refusal to recognize the science of climate change and her belief that cap and trade legislation “will kill jobs” puts her in opposition to California’s business and political leadership.
Gov. Arnold Schwarzenegger (R-CA), the leader of the California Republican Party, recently noted that California is “already experiencing” the devastating impacts of global warming:
In California, we are already experiencing rising sea levels eroding our coastal infrastructure, reduced snow pack in the Sierra leading to prolonged droughts and more conflict over water, drier forests suffering more frequent and ferocious forest fires, and worsening smog-related public health threats and crop damage. The implications for our state if these trends continue are simply staggering.
Fiorini’s opposition to binding reductions of global warming pollution will make it very difficult to encourage innovation and create jobs, accord to her Silicon Valley neighbor, venture capitalist John Doerr, who testified in July that the United States “must put a price on carbon and a cap on carbon emissions” because “no long-term signal means no serious innovation at scale, which means fewer new American success stories.”
On the same day he endorsed Fiorina, Inhofe “proudly” declared in a speech on the Senate floor that 2009 is “the Year of the Skeptic.”
A Doctor Should Know Better: Coburn Says ‘Botox Tax’ Would Apply To Reconstructive Breast Surgery
A Doctor Should Know Better: Coburn Says ‘Botox Tax’ Would Apply To Reconstructive Breast Surgery
Cosmetic surgeons and some conservative lawmakers are mischaracterizing that the new 5% “botox tax” on cosmetic surgeries and procedures in the merged Senate health reform bill. The tax, which would raise an estimated $5 billion over the next decade to help fund health reform, is narrowly tailored towards voluntary cosmetic procedures. But some critics, like long-time contrarian Sen. Tom Coburn (R-OK), are suggesting that the reform bill would also tax more serious operations, like breast reconstruction surgery following cancer:
Just yesterday — the day before yesterday, U.S. preventive task forces, services, recommended because it’s not cost effective that women under 50 not get mammograms unless they have risk factors. Well, you tell that to the thousands of women who were diagnosed with breast cancer lat last — last year under 50 with a mammogram. You tell them it’s not cost effective. Also in this bill is a 5% tax on the breast reconstruction surgery after they had a mastectomy. They’re going to tax having your breast rebuilt after your breast is taken off because it is elective plastic surgery. It is elective cosmetic surgery. We’re going to have a tax on it because we’ve taxed elective cosmetic surgery. We’re in trouble as a nation because we’ve taken our eye off the ball.
Coburn may be one of only two doctors serving in the Senate, but he’s no more knowledgeable about what constitutes ‘elective cosmetic surgery’ under reform legislation, than the average layman. Section 9017 of the merged Senate bill relies on the IRS definition of ‘cosmetic surgery,’ which defines the procedure as “any procedure which is directed at improving the patient’s appearance and does not meaningfully promote the proper function of the body or prevent or treat illness or disease.”
The Senate bill doesn’t tax all cosmetic operations. Surgeries to “ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or disfiguring disease” are excluded from taxation.
Under that standard, surgery performed to reconstruct a woman’s breast after cancer — a disfiguring disease — would not be taxed:
The tax is intended to discourage consumers from undergoing unnecessary surgeries or procedures. As much as one-third of nation’s health care expenditures are spent on procedures that don’t improve health outcomes. Capturing some of that spending and re-investing it into health care reform would help to slow the growing rate of health care spending, finance reform, and ultimately reduce costs for everyone. In short, the tax would help fill the wrinkles in America’s broken health care system.
The WonkLine: November 20, 2009
The WonkLine: November 20, 2009
Welcome to The WonkLine, a daily 10 a.m. roundup of the latest news about health care, the economy, national security, immigration and climate policy. This is what we’re reading. Tell us what you found in the comments section below, and subscribe to the RSS feed. Also, you can now follow The Wonk Room on Twitter.
National Security
Iran analyst Genieve Abdo writes “as [Iran's] religious and political crisis unfolds, it is becoming clearer that the central problem, among many, lies with Khamenei and his absolute power as Supreme Leader.” Abdo suggests that the Supreme Leader will not be replaced after he dies.
Dipali Mukhopadhyay writes that acknowledging the role played by warlords in Afghanistan governance “need not mean the abandonment of formal institutional capacity building on the part of international, intervening organizations.”
Venezuela has blown up two pedestrian bridges on its border with Colombia in the latest sign of deteriorating relations between the Andean neighbors.
Economy
The House Financial Services Committee approved a measure yesterday, proposed by Reps. Ron Paul (R-TX) and Alan Grayson (D-FL), “that would allow Congress to order audits of all the [Federal Reserve's] lending programs as well as of its basic decisions to set monetary policy.”
House Democrats are looking at implementing a financial transactions tax, but Speaker Nancy Pelosi (D-CA) said yesterday that any such tax “would have to take effect internationally to keep Wall Street jobs and related business from moving overseas.”
“What’s Obama’s trade policy?” asks McClatchy’s Kevin Hall. “So far, there isn’t much of one.”
Climate Change
Sen. Bob Corker (R-TN) tells President Obama not to be a leader on climate change, saying, “As a country, I know we’re not there yet, so I would hope the president wouldn’t be out in front of where the country has been.”
Sen. John McCain (R-AZ) trashes the efforts by his former best friends, Sen. Lindsey Graham (R-SC) and Sen. Joe Lieberman (I-CT) to develop climate and clean energy legislation: “Obviously, they’re going nowhere.”
The Department of Labor announced “nearly $55 million in grants to help workers, many in underserved communities, find jobs in expanding green industries,” as the United States and China race for clean energy jobs.
Immigration
Former CNN anchor Lou Dobbs told Reuters that he is “mulling” a Senate or White House run, stating “Do I seek to have some influence on public policy? Absolutely. Do I seek to represent and champion the middle class in this country and those who aspire to it? Absolutely.”
The White House denies claims made by Latino leaders that Chief of Staff Rahm Emanuel “has his fingerprints all over” the Obama administration’s support of barring undocumented immigrants from purchasing health insurance at full cost on the exchange.
Federal prosecutors dropped all 72 immigration charges against Sholom Rubashkin — the owner of the company which underwent the nation’s largest immigration raid.”
Health Care
The Senate will vote on Saturday on a motion to proceed with the health care reform bill. Senate Majority Leader Harry Reid (D-NV) doesn’t have the 60 votes necessary to overcome a filibuster but remains ‘cautiously’ optimistic that hold outs Sens. Mary Landrieu (D-LA) and Blanche Lincoln (D-AK) will vote for the motion by 8pm.
Yesterday, the House “overwhelmingly approved a physician repayment bill to permanently fix the way doctors who cover Medicare patients are reimbursed. Only one Republican member [Rep. Michael Burgess (R-TX)] voted with Democrats for the bill that was approved 243-183.”
“Chances of business supporting the Obama administration’s health overhaul are fading fast, after Senate Majority Leader Harry Reid’s bill took a liberal turn,” the Wall Street Journal is reporting.
Gregg: Kanjorski Amendment Allows Gov’t To Break Up Wal-Mart ‘Because They Don’t Have A Union’
Gregg: Kanjorski Amendment Allows Gov’t To Break Up Wal-Mart ‘Because They Don’t Have A Union’
Can Kanjorski break them up?
Though regulatory reform legislation has been moving in the House for weeks, the Senate only started today, with members of the Senate Banking Committee giving their opening statements regarding Chairman Chris Dodd’s (D-CT) reform bill. Republicans, who have already said that they will lend the regulatory reform effort zero support, were unanimously opposed to the bill, particularly the provision to create a Consumer Financial Protection Agency (CFPA).
But Sen. Judd Gregg (R-NH) also took a few minutes to criticize the Kanjorski amendment, stating that it was too “European,” and that it empowers the government to break apart Coca-Cola and Wal-Mart, the latter because “they don’t have a union“:
The Kanjorski amendment that was dealt with yesterday on the House side was an exercise in European politics where there was some belief that a group of thoughtful people can choose winners and losers in the marketplace that are still doing well, that aren’t at risk, and decide how those winners and losers should be structured. Well where does that stop? Is Coca-Cola, should they be broken up under the House bill? Wal-Mart, maybe, because they don’t have a union, should be broken up under the House bill? This is undermining the American advantage, especially relative to our European neighbors.
Watch it:
While Wal-Mart’s lack of unionization is a shame, Kanjorski’s amendment clearly states that it only pertains to financial institutions, which can be broken apart only for threatening the financial system, and only after more stringent capital requirements have proven ineffective in removing the threat:
Scott Valentin, the banking analyst at FBR Capital Markets, told DealBook that he expects the Kanjorski’s push will meet its demise in the Senate, as “Wall Street’s objections…will win out in the end.” Valentin “based his opinions partly on meetings he had with Senate Republican staffers the day before the final language of the bill was released.”
New Study On Nuke Testing Proves Kyl Wrong
New Study On Nuke Testing Proves Kyl Wrong
A new congressionally commissioned report just stuck it to Sen. Jon Kyl (R-AZ). Kyl is the leading advocate in the Senate for testing nuclear weapons and has led the charge against the Comprehensive Test Ban Treaty (CTBT) – a treaty that seeks to stop countries from testing nuclear weapons.
Obama has made ratifying the treaty a major priority and there are hopes that the Senate will bring it up next year, yet conservatives led by Kyl are looking to block it. One of Kyl’s main arguments against CTBT is that it would prevent the U.S. from physically exploding nuclear weapons, which he insists we need to do to ensure the effectiveness of the US nuclear arsenal. Writing an oped in the Wall Street Journal last month titled Why We Need To Test Nuclear Weapons, Kyl wrote that “a ban on testing nuclear weapons would jeopardize American national security.” He asserted that “concerns over aging and reliability have only grown” and insisted that “the reliability of U.S. nuclear weapons still cannot be guaranteed without testing them, despite more than a decade of investments in technological advancements.”
Unfortunately for Kyl, a new congressionally-commissioned study (pdf) conducted by a panel of independent scientists has proven him dead wrong. The study concluded that the current programs in place to maintain the effectiveness of the US nuclear arsenal – a program called the Life Extension Program (LEP) – have demonstrated that:
Lifetimes of today’s nuclear warheads could be extended for decades, with no anticipated loss in confidence, by using approaches similar to those employed in LEPs to date.
In other words, there really is no need to ever test a nuclear weapon – something the US hasn’t done in the last 17 years – or build new replacement warheads. This study effectively undercuts one of the main arguments of CTBT opponents and should strengthen the push to ratify the treaty next year. As Daryl Kimball of the Arms Control Association concluded: “There is no technical or military reason to resume U.S. nuclear weapons testing, and it is in the U.S. national security interest to prevent nuclear testing by others. A growing list of bipartisan leaders agree that by ratifying the CTBT, the U.S. stands to gain an important constraint on the ability of other states to build new and more deadly nuclear weapons that could pose a threat to American security.”
Cornyn Senselessly Wonders If Alleged Terrorists Can Seek Asylum While Tried In U.S.
Cornyn Senselessly Wonders If Alleged Terrorists Can Seek Asylum While Tried In U.S.
Republicans often use immigration as a wedge to kill initiatives and policies they don’t like, but Sen. John Cornyn’s (R-TX) most recent antics are quite a stretch. Yesterday, the Senate Judiciary Committee put Atty. Gen. Eric H. Holder Jr. in the hot seat over the decision to hold the trials of alleged 9/11 plotters on American soil.
Holder seemed baffled when Cornyn started drilling him on whether alleged 9/11 plotters will have an immigration status or be able to apply for asylum:
CORNYN: When the detainees come to the United States, will they have some immigration status?
HOLDER: I am not an immigration expert, I do not know what their status might be. I am confident however, given the fact that they would be here under the supervision of and as a result of being charged in a federal court that we would be able to detain them, that we would be able to hold them as we would do with anybody who has been charged with such serious crimes.
CORNYN: Are you aware of any more to their ability to claim asylum, or argued that they should not be able to be removed from the U.S. because of the convention against torture?
HOLDER: Again, I am not an immigration expert. One can be paroled in the United State solely for this purpose, but there’s no right to be here after[...]
CORNYN: Will you acknowledge that it’s possible — or let me ask you if you’d like into it — whether if a detainee claims an immigration status by virtue of their presence on U.S. soil it will allow them to immediately trigger tandem administrative and federal judicial immigration proceedings?
Watch it:
The National Immigration Law Center tells the Wonk Room that detainees will be brought to the U.S. but kept in custody on criminal charges — without an immigration status. In the unlikely event that they are acquitted, they could still be kept in custody and put in removal proceedings.
It’s unlikely that suspected 9/11 plotters would be granted asylum — let along a green card — even if they tried. Syracuse University points out that there’s a common misconception that the U.S. asylum system is abused by people who endanger national security. However, “asylum applications are subject to stringent review procedures by adjudicators in the Department of Homeland Security and the Department of Justice and to rigorous background and security checks.” Terrorism concerns essentially lead to an automatic disqualification from asylum and immediate deportation.
In yesterday’s congressional testimony, Holder indicated that he was “confident justice would be delivered to Khalid Shaikh Mohammed and other accused plotters of the 9/11 attacks.”
Global Boiling Declares War On Thanksgiving
Global Boiling Declares War On Thanksgiving
Our increasingly extreme climate is devastating American agriculture. Hurricanes Katrina and Rita, strengthened by global warming, caused $1.6 billion in agriculture damage in Louisiana alone. Now it appears that a Thanksgiving mainstay — pumpkin pie — is next on the global boiling hit list. On Tuesday, Nestle Baking, “which controls about 85% of the pumpkin crop for canning, issued a rare apology and said that rain appeared to have destroyed what remained of a small harvest this year and that it expected to stop shipping the holiday staple by Thanksgiving.” Paul Bakus, vice president and general manager of Nestle Baking, bemoaned the devastating rains that made it impossible to harvest the Morton, Illinois pumpkin crop used for Libby’s canned pumpkin:
If only we could have changed the weather. We hope Mother Nature is nicer to us next year, hopefully delivering less rain and more sunshine.
In addition, waffles are on the hit list, as supplies of Eggos are disappearing. “Heavy rains that soaked Atlanta last month knocked out Kellogg’s waffle operations,” ABC News reported on Tuesday. September’s epic flooding actually exacerbated a shutdown caused by an earlier virulent outbreak of the deadly bacteria Listeria monocytogenes. Kellogg’s initially only referred to the food poisoning threat as “equipment issues,” preferring to let global boiling take the blame.
Unfortunately, we have changed the weather.
“2009 continues to climb up the rainiest-years-ever chart” in Illinois. This year’s rainfall in Peoria of 49.34 inches — 50 percent above normal — has already exceeded the total of 2008, itself 25 percent above normal. With only six more inches of precipitation, 2009 will break the record rainfall set in 1990.
Similarly, the September 21st flood in Atlanta, Georgia “was worse than what’s statistically projected to happen once every 100 years — even worse than every 500 years.” It was “extremely rare”, “epic” and so “stunning”, the U.S. Geological Survey says the “flood has defied its attempts to define it.”
This kind of extreme precipitation is part of the changes to our climate wrought by global warming, which increases the amount of water vapor the atmosphere can hold and changes circulation patterns. As the U.S. Global Change Program reported in June, 2009 on the impacts of climate change in the Midwest and the Southeast:
– In the Midwest, both summer and winter precipitation have been above average for the last three decades, the wettest period in a century. The Midwest has experienced two record-breaking floods in the past 15 years.
– According to climate models, precipitation in the Midwest is projected to increase in winter and spring, and to become more intense throughout the year.
– In the Southeast, average autumn precipitation has increased by 30 percent for the region since 1901. There has been an increase in heavy downpours in many parts of the region.
Merged Senate Bill Removes 5-Year Grace Period For Grandfathered Policies
Merged Senate Bill Removes 5-Year Grace Period For Grandfathered Policies
The Senate Finance Committee’s health care reform bill and the House legislation require insurance issuers to meet certain basic benefit standards, but grandfather all existing insurance plans for a period of 5 years (the House bill only applies this restriction to current employment-based health plans) . If insurers do not comply with the new federal requirements after the 5-year grace period, they would no longer be able to offer health care coverage.
The merged Senate bill takes a different approach. Section 1251 eliminates the 5-year period and allows enrollees to remain in their insurance plans for as long as the coverage remains available:
By 2017, most Americans will have the option of purchasing comprehensive insurance coverage within the Exchange and would theoretically abandon plans that offer sub-prime benefits and high-deductibles. Insurers that want to minimize their administrative overhead and standardize their plans, may also modify all existing policies to meet the new federal guidelines.
Under the Senate bill, individuals under 30 years of age or those who are exempt from the individual mandate, could still chose to enroll in a catastrophic plan that covers essential health benefits.
Facts On National Debt Don’t Match The ‘Expensive Expansions Of Government’ Narrative
Facts On National Debt Don’t Match The ‘Expensive Expansions Of Government’ Narrative
Our guest blogger is Michael Linden, Associate Director for Tax and Budget Policy at the Center for American Progress Action Fund.
There’s been a fair bit of hemming and hawing over the news that the federal debt has now surpassed $12 trillion. Sen. Judd Gregg (R-NH), widely known for his fiscal hawkishness during Democratic administrations, couldn’t resist pointing the finger, saying, “this level of fiscal recklessness and irresponsibility should be shocking to the American taxpayer, especially since it is our children and grandchildren who will be forced to grapple with the consequences of our debt.”
While this milestone is actually nothing of the sort – $12 trillion is gross federal debt, not the debt owed to the public, which is the much more important figure – you can be sure that many people will use this as another excuse to condemn what Gregg called “expensive expansions of government” and to blame all of our fiscal problems on President Obama. But here are three facts about this year’s deficit that you probably won’t hear much about:
– Less than one-fifth of all the new spending in FY 09 came from Obama initiatives;
– The big deficit this year was as much a product of a huge decline in tax revenues as it was an increase in spending;
– The overall cost of the decline in tax revenues was four times larger than the cost of Obama’s initiatives.
These facts don’t fit with the narrative of an Obama “spending binge.”
It’s true that there was a big increase in spending in fiscal year 2009. Total spending rose by about $600 billion, not counting payments for interest on the debt (which actually declined in 2009 because of extraordinarily low interest rates).
But fiscal year 2009 began on October 1, 2008, when George Bush was still president, and by the time President Obama took office more than 40 percent of that new spending had already been committed, in the form of TARP and the bailouts for Fannie and Freddie. Another quarter of the new spending came from growth in entitlement programs and unemployment insurance, which was certainly outside the control of a new president.
The American Recovery and Reinvestment act, on the other hand, was responsible for only 18 percent of the new spending in 2009. So, spending did rise, but only one in five of those new dollars came from Obama’s initiatives.
And spending is only half the story. The other half is that tax revenues plummeted this year to their lowest levels since 1950.
Johnny-come-lately fiscal hawks almost never talk about the tax side of the balance sheet when they rail against deficits, because it’s more politically expedient to point fingers at the Recovery Act. But the size of the decline in tax revenues was four times larger than all the Recovery Act spending this year!
This year’s deficit was eye-catching, but it didn’t just appear out of the blue on January 20th, and it isn’t just a product of new spending. If you hear some pundit or politician claiming that a huge expansion of government is responsible for our fiscal woes without mentioning President Bush and with nary a word about tax revenues, you can be pretty sure that he’s more interested in scoring political points than actually solving problems.
Positive Steps And Missed Opportunities In China
Positive Steps And Missed Opportunities In China
Our guest blogger is Winny Chen, Research Associate for the National Security and International Policy Team at the Center for American Progress Action Fund.
Looking at the deliverables from President Obama and Chinese President Hu Jintao’s first summit is a lot like looking at the box score on the sports pages: it only tells part of the story. Sometimes, the best plays — astute defense, patience in the pitch count, taking the charge — won’t manifest in the final readout, but they could be the game-changing plays.
At first glance, the results of the summit were a mixed bag. The trip, at times, seemed to highlight the differences between the United States and China more than it did to deliver results. There was agreement on the need for free trade but also mutual finger-pointing on currency and protectionism, recognition of the progress in the Strait but the same catechisms on arms sales and One-China.
Perhaps the biggest loser was human rights. To be fair, President Obama did speak directly to President Hu about the issue, asserting “America’s bedrock beliefs that all men and women possess certain fundamental human rights,” and urging Chinese leaders to meet with the Dalai Lama. But at the end of the day, what some deem as President Obama’s more practical approach resulted in some missed opportunities. Unlike in past presidential summits, China didn’t release any political dissidents as a symbol of goodwill. Indeed, China went the opposite direction and detained activists before the President Obama’s arrival. The Obama team did not meet with any political activists or dissident leaders in China, nor did they directly reference China’s human rights record on the trip. The president’s much-publicized call for greater internet freedom was, ironically, censored in China. And ultimately, President Obama’s more conciliatory approach seemed to soft-pedal human rights.
But there was progress, too. Obama and Hu recommitted to improving and increasing military exchanges, programs, and dialogue and have laid out an affirmative agenda focusing on law enforcement and counterterrorism. They reaffirmed a unified approach to the crisis on the Korean peninsula. On non-proliferation, Presidents Obama and Hu agreed to work together to achieve a successful Review Conference of Parties to the Treaty on the Non-Proliferation of Nuclear Weapons in 2010 and supported the launching of negotiations on the Fissile Material Cut-off Treaty at an early date in the Conference on Disarmament. Most surprising was the progress made on climate change. So, all in all, a mixed tally.
But what the score, and many accounts of the trip, won’t reflect is the important contributions that President Obama’s trip made to U.S.-China relations. There were three intangibles that we cannot overlook. First, he signaled that the United States is back in Asia, ready to assume its role as an engaged Pacific power once again. Second, his remarks at the joint press conference with President Hu on Tuesday threw support and momentum behind sustaining the U.S.-China dialogue at the highest levels in both governments. Third, he made clear to the Chinese and to the American audiences at home, that, like it or not, on the big issues — security, economy, climate change — we’re in this together.
GOP Blocks Credit Card Bill, Endorses Skyrocketing Interest Rates
GOP Blocks Credit Card Bill, Endorses Skyrocketing Interest Rates
Back in May, Congress approved and the President signed legislation reforming the credit card industry, ensuring that credit card companies couldn’t raise rates for no reason or retroactively increase rates on existing balances. However, most of the new rules don’t go into effect until February, 2010.
In the interim, banks have been jacking up rates left and right. In fact, half of Americans report that their credit card rates have been raised in the past six months. According to Pew Charitable Trusts’ Safe Credit Cards Project, the lowest interest rates offered on most bank cards “jumped by more than 20 percent” in that time.
To deal with this problem (which is significantly of their own making), Democrats crafted a bill bumping up the implementation date of the new regulations and freezing interest rates until the new laws come into effect. The bill was approved by the House on a vote of 331-92 earlier this month.
Due to a packed floor schedule, there was no stomach in the Senate for a prolonged fight over credit cards. So, as Ryan Grim noted “the only way Democrats could pass the bill in time for the holidays would be with the support of the GOP.”
Sen. Chris Dodd (D-CT) tried to do just that yesterday, with the support of Sen. Mark Udall (D-CO), by asking for unanimous consent to bring the bill to the floor. However, Sen. Thad Cochran (R-MS) objected “on behalf of several senators on this side of the aisle,” killing the whole effort. Watch it:
According to Pew, none of the credit cards currently offered online by the 12 largest U.S. banks “would meet requirements of new federal curbs on the industry’s rates and fees.” But Republicans still saw fit to allow the credit card companies to do whatever they want until the new rules comes into effect next year.
As the Coloradoan reported, “Republicans didn’t explain their decision to block a vote…beyond Cochran’s short objection.” Dodd, clearly expecting an objection, lamented that a bill “that would really have allowed us to do something meaningful” was being derailed.
This is, sadly, exactly how the rest of the financial regulatory reform debate is going. Yesterday, Senate Republicans said that “there is no support within the GOP for the financial overhaul plan outlined last week by Democrats.” “My understanding is that it’s not acceptable to any of the Republicans on the [banking] committee as it now stands,” said Minority Leader Mitch McConnell (R-KY).
That’s right. In the wake of the financial crisis, not one Republican is prepared to vote for regulatory reform. And the reason is that “they think the plan goes too far by putting onerous restrictions on Wall Street that could limit the availability of credit.” So by preventing the credit card bill from going forward — and by uniting in opposition against wider regulatory reform — the GOP is endorsing the credit card companies’ actions and the wider return to rampant risk on Wall Street.
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