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Prez Presses House To Accept Insurance Tax, 190 Dems Push Back
President presses House to accept Senate insurance tax. NYT: "President Obama told House Democratic leaders at a meeting on Wednesday that they should include a tax on high-priced insurance policies favored by the Senate in the final version of far-reaching health care legislation, aides said."
AP adds: "In the end the House likely will have to accept the insurance plan tax at some level – say starting with plans valued at $25,000 or more, with carve-outs for certain union professions – but it might not happen without a fight."
W. Post explores arguments against tax from health care experts: "...several health-care experts question whether shifting people into lower-cost plans is the best way to slow spending. It is possible, they concede, that the tax could move more employees into HMOs known for more efficient spending. But many markets lack such options. It is more likely that employers would lower the cost of plans by increasing deductibles and co-pays, which skeptics say would not necessarily bring down health-care costs ... Opponents of the tax say the case for it assumes that the country's high health-care costs are the result of patients' overuse of care. But, they note, the country's usage of medical care is by many measures lower than in other developed countries; it is the price that is so much higher here."
FDL's David Dayen reports on media conference call with leading House tax opponent: "On a conference call put together by the Economic Policy Institute, Rep. Joe Courtney (D-CT) said that he has the signatures of 190 Democrats on a letter opposed to the excise tax on high-end 'Cadillac' insurance plans, and that stopping this tax was the '#1 priority' of the House of Representatives as they move to reconcile the House and Senate health care bills ... [Courtney said] judging from Nancy Pelosi’s recent comments, 'this is where there’s the most resistance to the Senate plan because she knows this is where the caucus is.'"
GoozNews is disappointed: "The president keeps his hands off Hill deliberations, and when he finally decides to weigh in, this is the issue he picks?"
In These Times' David Moberg attacks insurance tax: "...many of the high-cost plans are not especially generous in coverage. They cost more because of the age, gender, geographic region, industry or other distinctions about the insured person that insurance underwriters use. And if employers cut back on insurance coverage for these workers, they will either go without care they need–hardly an accomplishment Democrats want to claim–or pay out of their own pockets–an example of cost-shifting, not money saving."
Jon Walker criticizes Pelosi plan to compromise on the insurance tax: "The problem is not that the current level of $23,000 is too low (very few plans are currently above this limit), the issue is that the tax is unfocused, poorly designed, and badly indexed ... My prefered solution is to index the tax to the average premiums in the federal employee health benefit (FEHB) program plus some large percentage. "
The Treatment's Jonathan Cohn worries Senate won't bend on House's superior approach on affordability: "The reason the House bill does more is that it costs more ... it was willing, and able, to pay for the extra cost through additional revenue and savings. But the Senate couldn't come up with as many ''offsets,' ... Partly that was because centrists, like Budget Committee Chairman Kent Conrad, kept pushing to shrink the bill out of sheer principle. And partly that was because the Democratic leadership struggled to find a combination of offsets that sixty members would accept ... By all accounts, these same obstacles remain today."
Wonk Room's Igor Volsky proposes to way to maintain viability of public option: "A national public health insurance option is unlikely to muster 60 votes in the Senate, but House Democrats could insist on including a provision in the final health care bill that provides start-up funds to states that choose to create state-based public options."
Change.org's Gillian Hubble argues an individual mandate can indirectly lead to a public option: "...current ‘reform’ is going to force our unsustainable healthcare model closer to the precipice, when hopefully public demand will force the creation of a public option and other cost-control mechanisms. Having an affordable mandate up front accelerates this process by exposing market dysfunction instead of allowing private insurance greed to make scapegoats out of citizens."
Insurance company pressuring employees to oppose reforms. Inside Health Reform: "An in-house message sent by UnitedHealthcare to its employees used language that a consumer watchdog group calls 'highly coercive' by urging workers to participate in a Web presentation by the insurer's chief lobbyist as the company fights against major tenants of the health reform legislation moving in Congress."
Dodd Retirement Reverberates In Financial Reform Debate
The Hill reports general sentiment that Dodd retirement increases chances for financial reform passage but fault lines over consumer protection agency persist.
NYT edit board prod Dodd to unleash his reformer side: "Impending retirement frees him from having to woo donors or listen to anyone or anything other than his own best instincts. He is free to criticize and, if need be, condemn the [bipartisan] working groups’ proposals — to contrast their proposals with his own and challenge them to explain how anything less than sweeping reform will be enough to protect Americans."
Business Insider reports Congress may end income tax break for hedge fund managers: "...according to the Wall Street Journal, money managers might be charged a 'carried tax' double the current rate as soon as next year ... As of now, hedge funders and PE managers can claim income tax deductions by writing in some of their income (specifically, the profit they make on their deals) as 'capital gains,' which only get taxed 15%. Normal income gets taxed around 35% ... The tax will make its way through the Senate later this month."
Baseline Scenario debunks arguments in favor of Bernanke re-appointment: "...a wide range of smart economists have argued – at the American Economic Association meetings in Atlanta - that Bernanke should be allowed to stay on. I’ve heard at least six distinct points. None of them are convincing."
No Job Losses Expected In Tomorrow's Monthly Report
W. Post previews tomorrow's job report, expected to show no job losses: "These results will frame the political discussion in the weeks ahead about the Obama administration's performance in addressing the economic crisis, offering the most solid evidence yet of whether the nascent recovery is finally translating into gains for workers ... One worry for the labor market is that while employers appear not to be slashing jobs as quickly as they were earlier in the year, they haven't resumed hiring again. The economy must generate 125,000 or so jobs each month to keep up with population growth ... A positive sign, for example, would be if the number of hours worked rises; employers have cut back on hours in response to the recession. Also, economists will watch for stronger gains in hourly earnings and the number of temporary jobs, both of which would presage more positive results in the future."
EARLIER Krugman: "...the odds are that any good economic news you hear in the near future will be a blip, not an indication that we’re on our way to sustained recovery ... The Obama fiscal stimulus plan is expected to have its peak effect on G.D.P. and jobs around the middle of this year, then start fading out. That’s far too early: why withdraw support in the face of continuing mass unemployment?"
TNR's Jonathan Chait spots conservative think tank quietly acknowledging the stimulus blunted the recession: "AEI has its economic outlook, by John Makin. Notice anything strange here? ... ' Absent temporary fiscal stimulus and inventory rebuilding, which taken together added about 4 percentage points to U.S. growth, the economy would have contracted at about a 1 percent annual rate during the second half of 2009.'"
Connect To Win on new green jobs funding: "Big news out of the Labor Department today — they awarded $100 million in grants to programs training workers for the green jobs of the future:"
Obstacles to US cars in Japan's "cash for clunkers" program. W. Post: "The $3 billion U.S. program ran over the summer and was open to all fuel-efficient cars, no matter where they were made. Now the trouble is, as [Rep. Betty] Sutton sees it, that the Japanese government has not returned the favor. Under that country's own incentive program, not a single car from the Detroit Three is eligible ... Sutton filed a resolution calling for the U.S. trade officials to initiate a trade case against Japan if its program continues to exclude U.S. brands. But the rules for the Japanese incentive program are complex, and Japanese officials argue that it is open to imports but that American automakers have opted not to apply."
Climate Update
Rep. Henry Waxman expects Senate to pass climate bill this year reports Climate Progress.
AP reports Sen. Jeff Bingaman is unsure whether the Senate can pass a climate bill this year: "Sen. Jeff Bingaman, D-N.M., said there's no consensus on what form a cap-and-trade system would take, but strong desire exists in both the Senate and House to pass other energy-related bills that would curb pollution blamed for global warming ... Until Congress finds consensus on cap and trade, Bingaman is trying to tackle the problem through other legislative means, including an effort to encourage the production of renewable energy technologies in the U.S. by expanding a $2.3 billion manufacturing tax credit that was initially funded with stimulus money."
1Sky plans Jan. 12 call-in day to block Sen. Murkowski's plan to temporarily strip EPA of authority to regulate greenhouse gas pollution.
