TPMDC reports that Speaker Pelosi is upset with the White House because they want her to largely adopt the Senate bill in its entirety, including the punitive excise tax on health insurance benefitsZOMG! President Obama wants to tax your health insurance plans instead of his fat cat millionaire buddies! Heartless bastard! Democratic pie fight to ensue!! Prepare yourself.
Never mind that there is a near-consensus among economists about the merits of the excise tax on high-cost insurance plans as a cost-control method as well as in terms of upward wage mobility (I laid out a full informative and analytical piece about the Cadillac tax yesterday). Never mind that the Senate has a millionaire's tax, too. Well, a quarter-millionaire's tax. They would raise the Medicare payroll tax by an additional 0.9% on individual incomes over $200,000 or joint filers making over $250,000. Never mind that President Obama never actually said that the excise tax is his personal preference over the millionaire's tax (although he does think the excise tax is a cost-saver). Never even mind that no final decision has been reached about what form the revenue model will actually take. Never mind any of that. Don't let any of that get in the way of your seething anger at the President.
There is a bit of hand-wringing going on about what the President "prefers." The president is becoming personally involved in informal negotiations between the Democratic leaderships of the House and the Senate, and
“The Medicare approach taken in the Senate bill may provide the kind of path forward that would get some compromise” on how to raise revenue, Maryland Democrat Chris Van Hollen, an adviser to House Speaker Nancy Pelosi, told reporters yesterday.
New York Democrat Charles Rangel, chairman of the tax- writing Ways and Means Committee, told reporters the Senate’s plan to raise the Medicare tax on high wage earners to 2.35 percent may be a basis for compromise. “Yeah, we can work out something,” he said. Still, he predicted “it’s going to be a tough” set of negotiations to merge the two bills.
And what is this "steaming" Speaker Pelosi's reaction to Obama's leadership on this?
“Without [Mr. Obama’s] leadership, without his vision, without his encouragement, we would not be right on the verge right now of passing this historic legislation,” said House Speaker Nancy Pelosi at a Tuesday press conference.
So what does Obama 'prefer?' Well, let's see
We also learned from from TMCDC that Pelosi aids told them that the Speaker is mad at the White House for pushing the Senate's excise tax on high-end plans. Well, here it is from the horse's mouth:
Obama didn’t express policy preferences between the two measures, a Senate staff member said. A House aide said the president urged that subsidy provisions in the Senate bill be strengthened.
“We think that we have the fairest approach in our bill,” Ms. Pelosi said. “I always say when it comes to tax policy around here, it’s like a mirror. ‘Mirror, mirror on the wall, who is the fairest of them all?’ The Senate thinks theirs is fairer. We think ours is. We’ll see which mirror cracks.”It doesn't sound to me like the Speaker is under a tremendous amount of pressure from the White House to adopt the senate bill, or its revenue provisions, "in [their] entirety."
Here's what I think this all means. The president is not coming in and bullying the House. He does realize that in the Senate, there is zero margin for error. However, as Charlie Rangel put it, you also need 218 votes in the House. Other than that one report on TPMDC, I have done search after search, and I have not been able to find any evidence of the White House pressuring the House leadership to take everything the Senate gives it, or even the president preferring the excise tax over the millionaire's tax. Other than that one unnamed source, there is no evidence that the president is pressuring the House to give up the millionaire's tax completely. This bill has been delayed enough and the President, in the words of his press secretary wants to get this done:
"The president wants to get a bill to his desk as quickly as possible," Press Secretary Robert Gibbs said as reporters questioned him repeatedly about Obama's decision to go along with House and Senate leaders in bypassing the usual negotiations between the two chambers in the interest of speed.About time we got some urgency behind this. The longer things have gone, the more the conservatives gain power. We have been having debates just on these bills for a year. It's time to close it. It's time to get it done. And I'm glad the president is providing leadership to get it done.
Oh and one last thing. As I have noted, both sides of the excise debate concede that for those who will be hit by the excise tax, their health care premiums will drop because they will most likely choose a new, less expensive, more managed plans and that employers would save money on health care (employers of those employees). But do lower health costs mean higher wages? You tell me:
Let's go get this done!
*[dkos diary link.]
Update: Hat tip to Daily Kos comment by Arnie on Wed Jan 06, 2010 at 08:54:42 PM PST. President Obama has made his position clear on an NPR Interview:
JULIE ROVNER: Mr. President, before any of this takes effect, there will have to be a House-Senate conference to put it together. One of the big issues is going to be how this bill is paid for. The House wants to tax wealthy individuals; the Senate wants to tax health care providers and these very generous health plans, the so-called Cadillac tax. Which of those would you rather see in a final bill?The president has now thoroughly debunked the idea that he "prefers" the cadillac tax over the millinaire's tax. You can also listen to the interview with the President below. I highly recommend listening to all of it:
OBAMA: I think what we're going to end up seeing is a little bit of both. You are going to have some provisions that are smart that are in the House bill. There are going to be some provisions that are the right thing to do in the Senate bill. For example, I'm on record as saying that taxing Cadillac plans that don't make people healthier, but just take more money out of their pockets because they're paying more for insurance than they need to, that's actually a good idea and that helps bend the cost curve; that helps to reduce the cost of health care over the long term. I think that's a smart thing to do.
SIEGEL: Might you end up taxing people with Cadillac benefits and Chevrolet salaries, that is, people who are not anywhere near the $200,000 income level you talked about; you wouldn't raise taxes on those people. Is that a possibility in this one particular case?
OBAMA: Well, keep in mind that what we're talking about is imposing a tax or a fee on insurance companies for providing plans like that. But the fact of the matter is, members of Congress, for example, their policy basically costs around $15,000. A lot of people, when I travel around the country, they say, well, why don't we just make sure that everybody has the same plan that Congress has?
Well, I think that's a pretty good benchmark, and the cost of a plan for members of Congress, which are pretty good health care plans, is about $15,000 a year. Right now this fee on Cadillac plans doesn't kick in until $23,000 under the Senate bill. So I think that we can structure something that protects ordinary workers, makes sure that they are getting a great health care plan, but also makes sure that they are not overpaying in a situation where they're just giving money to health insurance companies that instead could actually be going into their pockets in the form of higher salaries.