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Health Care Jaw Jaw Continues

Bloomberg on the state of talks: "Democratic Senator Max Baucus, leading the talks among six Democrats and Republicans on the finance committee, said they made progress and will meet again today. House Democrats have failed to reach a consensus, prompting Obama’s chief of staff, Rahm Emanuel, to go to Capitol Hill yesterday for more than seven hours of talks with lawmakers."

Senate Finance aide pushes back on speculation that deal is imminent. Politico: "A top aide to Max Baucus (D-Mont.) is pushing back against a WaPo story [Actually, the headline more than the story] claiming that a health care deal -- sans a public option -- is 'close.' Russ Sullivan, staff director for the Senate Finance Committee, sent an unusual e-mail this morning to top Senate staffers, telling them not to believe the hype: A health care deal is not imminent, despite what a Washington Post headline Wednesday suggests. Sullivan actually goes out of his way to suggest that a bipartisan agreement is still a ways off. The key bit: 'In fact, significant policy issues remain to be discussed among the Members, and any one of these issues could preclude bipartisan agreement,' Sullivan wrote. 'Members will continue their methodical work.'"

AP notes small agreement: "A bipartisan group of senators agreed tentatively Tuesday on a plan to squeeze an additional $35 billion out of Medicare over the next decade and larger sums in the years beyond ... Under the plan, an independent commission would be empowered to recommend changes in Medicare annually, to take effect automatically unless Congress enacted an alternative ..."

W. Post's Meyerson urges Obama to ignore the Baucus cabal: "Max Baucus, then, isn't negotiating universal coverage with the party of Everett Dirksen, in which many members supported Medicare. He's negotiating it with the party of Barry Goldwater, who was dead set against Medicare. It's a fool's errand that is creating a plan that's a marvel of ineffectuality and self-negation -- a latter-day Missouri Compromise that reconciles opposites at the cost of good policy. Obama should thank the solonic six for their work, and, as much as is politically practicable, ignore it."

Reid noncommittal on public plan, while other Dems dig in. Politico: "'It would be really premature for me to lay out for each of you what I think should be in this bill,” Reid said when asked whether he would advocate a public option. “...I have a responsibility to get a bill on the Senate floor that will get 60 votes, so we can proceed to it." ... Sen. Tom Harkin (D-Iowa) said Reid should 'absolutely' advocate for a public plan when he attempts to merge the two bills. 'I believe that has to be in the final bill.' 'And at the end of that day in that merger, I’m hoping that there will be a very significant public option,' said Sen. Robert Menendez of New Jersey ..."

More Dem tough talk in Politico: "Sen. Sherrod Brown ... said 80 percent of Senate Democrats support establishing a government insurance plan ... 'Just because Finance was slower doesn’t mean they are stronger, that their way, that their plan will carry the day. I don’t think it will.' ..."

Sen. Rockefeller expresses displeasure with Baucus. NYT: "But some liberal Democrats, like Senators John D. Rockefeller IV of West Virginia and Debbie Stabenow of Michigan, expressed reservations about concessions being made by Democrats to keep a few Republicans on board. Mr. Rockefeller said he was unhappy that the legislation would end the Children’s Health Insurance Program and could reduce the scope of benefits for 11 million children in the program. Asked if he would support the bill, Mr. Rockefeller shot back a somber, stony look. 'Can’t you see the joy on my face?' he asked."

Rep. Maxine Waters calls out Blue Dogs. The Hill: "The delay prompted Rep. Maxine Waters (D-Calif.) to lash out at the Blue Dogs as hypocritical and even hint that more liberal Democrats might challenge them in primaries."

President Obama suggests to TIME he could back a national co-op for the public option: "I think in theory you can imagine a co-operative meeting that definition [of a public option]. Obviously sort of the legal structure of it is less important than practically how can it operate. There are concerns that in the past, attempts at setting up co-ops have not been successful because they just haven't been able to get off the ground; sort of the start-up energy involved may not exist if you're doing a state-by-state co-op effort as opposed to a broad national plan."

WSJ on liberal efforts to save public plan option: "Some Democrats are threatening to oppose any bill that excludes this option, and sympathetic outside groups are pressuring wavering lawmakers. Health Care for America Now, a liberal group, and the American Federation of State, County and Municipal Employees spent $800,000 on television ads targeting moderate Democrats, citing their opposition to a public option. Meanwhile, announced a series of television ads Monday to run in Washington, D.C., and on national cable networks accusing the Republicans of playing political football with health care. Americans United For Change, another liberal group, announced a radio ad targeting moderate Republican Sen. Olympia Snowe of Maine, a key swing vote."

McClatchy head: "Democrats may drop public option from health bill"'s Mike Madden offers optimism: "The bill could shift to the left again in later negotiations between the House and Senate, even if it has to shift to the right now to stay on track."

At The Treatment, Jacob Hacker explains why other regulation is no substitute for a public plan option: "But even within the [health insurance] exchange, where regulations and monitoring are likely to be most extensive, the rules could vary hugely in effectiveness depending on who's setting the exchanges up, how it's structured, and who's allowed to buy coverage within it. Above all, we think the exchange is likely to work vastly better and be a much more attractive option if it includes a national public plan. The public plan will create a strong competitor that pushes plans to focus on controlling costs and improving value. This will in turn make the exchange more attractive, thus reducing the scope of the less-regulated individual and small group markets. What's more, just having the public plan will allow regulators to go after private plans for bad practices with less concern that they're taking away one of the few good options in an area. And yes, lastly, the public plan will serve as a crucial backup for those ill served by private plans, allowing them to get good coverage on similar terms in all parts of the nation."

Right-wing opposition becomes increasingly insane. Politico: "If this is the face of anti-health care reform protest, the GOP has a serious problem. This unidentified man decided he was doing the Tea Party-anti-reform effort a real solid by hanging freshman Maryland Democratic Rep. Frank Kratovil in effigy [note the creepily expert knotted noose] with a placard 'Congress Traitors The American' [and a word that looks like 'idol']."

Conservatives sympathize with the poor poor insurance industry. WSJ: "'The health insurance industry is one of the most regulated industries in America,' said Sen. Jon Kyl (R., Ariz.) on the Senate floor Monday. 'They don't need to be "kept honest" by the government.'"

Conservatives make up stuff. Wonk Room's Pat Garofalo: "Sen. John Thune (R-SD) appeared on the Senate floor to decry the health care bill that has emerged in the House. During his speech, Thune claimed that 'most' Americans and small businesses would pay 'fifty cents of every dollar in taxes' if the House’s plan to implement a surtax were adopted ... First, let’s dispense with a few myths. The surtax would only affect 1.3 percent of taxpayers, not 'most.' Only 4 percent of taxpayers that make any income at all from small businesses would feel the surcharge, which as Citizens for Tax Justice noted, should have 'no effect on their hiring decisions.' But Thune also seems to be a bit hazy on the concept of marginal tax rates (or he’s deliberately obfuscating the issue) when he says 'fifty cents of every dollar' will be taxed. For those richest one percent of taxpayers, the surtax would be assessed on every dollar after the first one million dollars."

Obstructionists backed by drug lobby funds. USA Today: "Lawmakers who count pharmaceutical companies among their biggest contributors lead the opposition to a health care proposal that would cut costs by allowing generic drugs to compete sooner with pricey biotechnology drugs, campaign-finance records show. Sen. Orrin Hatch, R-Utah, has helped lead Senate efforts to give drug companies 12 years of exclusive rights to sell biotech drugs, rather than seven as proposed by President Obama. Hatch has received nearly $1.3 million from the employees and political action committees of drug and health products companies since 1989, making the industry his largest contributor ... In the House, Rep. Anna Eshoo, D-Calif., whose district is home to dozens of biotech companies, is sponsoring a similar measure. Drug company employees and political action committees have donated $645,000 since 1992 to Eshoo — second only to the computer and Internet industry."

AP questions how glitzy "Cadillac" plans really are: "Senators scrambling to pay for a $1 trillion health care overhaul are leaning toward taxing health insurance companies on policies costing more than $25,000 a year - about twice the value of the average employer-provided family plan. But some insurance experts say the reason certain plans are so expensive isn't that they're providing lavish benefits like full-body diagnostic scans and tummy tucks. Instead, the super-high premiums are likely being charged to older, sicker people, either as individuals buying their own coverage, or working for a small employer ... It's unclear if such a narrowly targeted tax could have much of an impact on health care costs overall. It is a fact that a small number of patients account for most costs. Government statistics show that about 20 percent of people - often those with chronic conditions such as diabetes and heart disease - account for 80 percent of medical costs. But the proposed tax doesn't appear to affect the way care is delivered to the costliest patients."

Say on Pay Passes House Cmte

NYT on advance of increased shareholder role in executive compensation: "The approval by the House Financial Services Committee, on a party-line vote of 40 to 28, clears the way for the measure to be considered by the full House later this week, when it is likely to be adopted. The bill does not set pay limits. Instead, it gives shareholders the right to vote on pay and requires that independent directors from outside of management serve on compensation committees. The shareholder votes would not be binding on company management ... While the measure still faces political obstacles in the Senate, it has not encountered as much resistance as two other cornerstones of the administration’s proposal — a greater role for the Federal Reserve in monitoring large institutions that could pose risks to the financial system and the creation of a new agency to protect consumers from deceptive or ill-suited mortgages, credit cards and other kinds of loans. The legislation comes as the Obama administration is separately examining the pay practices of seven big companies that have received significant taxpayer assistance in recent months. The administration’s top official for compensation, Kenneth R. Feinberg, has been in discussions with the companies as he considers whether to approve the compensation of top executives at American International Group, Citigroup, Bank of America, General Motors, Chrysler and the financing arms of those two automakers."

Climate Update

New ads look to flip House opponents of climate bill. Politico: "Just three House
members — Reps. Tim Holden (D-Pa.), Mark Souder (R-Ind.) and Patrick Tiberi (R-Ohio) — are targeted by the ads being launched Wednesday by the Environmental Defense Fund. But what the ads lack in scope, organizers hope they will make up in endurance. They are scheduled to air for two months, which will likely coincide with the critical final congressional vote on the climate change bill."

No US-China climate breakthroughs. LA Times: "Relations between the United States and China are getting cozier as their battle against the global recession has drawn them closer together. But things aren't quite so warm when it comes to some hot-button topics, particularly climate change ... U.S. officials hope to have an agreement with China in time for an international climate change conference in December in Copenhagen ... Beijing contends that the U.S. should share the technology if it truly cares about limiting climate change. But American manufacturers worry that the transfer of research and development will lead to cheaper Chinese products flooding the market. That concern was addressed in a provision of the House climate bill that prevents imports of such products from nations that fail to sign emission caps."

Farm lobby splits on climate bill. Politico: "One key group — the American Farm Bureau Federation — believes that higher fuel, fertilizer and other costs resulting from climate legislation could hurt farmers more than higher temperatures ... But the National Farmers Union, which represents roughly 250,000 farm families, believes that changed weather patterns stemming from global warming could have a significant impact on farmers’ livelihoods."

F-22 Fight Moves To House

Murtha acquiesces to WH on F-22. CQ: "John P. Murtha, D-Pa., will offer an amendment that would divert $369 million from advance F-22 procurement and toward spare parts and shutdown costs for the current F-22 fleet and other Air Force needs. The White House, which wants to end production of the expensive fighter jet, had threatened a veto over the F-22 procurement funds ... Murtha, the chairman of the Defense Appropriations Subcommittee, originally supported building more F-22s, but he called off the fight after the Senate [vote] ... It is unclear whether Murtha’s amendment has enough support to be adopted..."

Pentagon wants more savings. CQ: The military will need to save up to $60 billion over the next five years in order to pay for new spending priorities to be set by the Defense secretary, a top Pentagon official said Tuesday. The basis for this order from Defense Secretary Robert M. Gates is the assumption that there will be no real growth in Defense budgets over the next five years, a radical departure for a department that has seen its budgets increase more than 80 percent since 2001."

A Little More Stim For States

Congress moves to plug gap in unemployment and highway funds. Politico: "With federal highway and unemployment trust funds running low, Congress is rushing to pump in more than $12 billion from general revenues to replenish the accounts and help states through the summer when lawmakers are home for August. House Ways and Means Committee Chairman Charles Rangel (D-N.Y.) and Appropriations Committee Chairman David Obey (D-Wis.) filed the measure Tuesday in anticipation of quick floor approval — possibly as early as Wednesday. In a floor speech Tuesday morning, Senate Majority Leader Harry Reid (D-Nev.) signaled that he also expected the Senate to act before it leaves next week."

Terrance Heath contributed to the making of this Breakfast

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