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Progressive Issues for Progressive Democrats
"Health care is a fundamental right." (Ted Kennedy, 8/26/08)
* * * * * * *
The Progressive Platform Project

Axelrod: Government by Consent of the Corporation

by: BruceMcF

Thu Sep 10, 2009 at 09:32:10 AM EDT

crossposted from The Hillbilly Report

David Axelrod made the case for insisting on the public option if there is an individual mandate to buy from health insurance exchanges, on the Rachel Maddow show last night (segment page). Of course, he thought he was making a different case:

And there is an incentive for the insurance industry to go along and not try to fight these, and that is that there is going to be a larger insurance market, and they have to make that calculation, but we are prepared to do it easy or do it hard, we want to make it work for consumers.

One reading of Axelrod is:
"M'lords, the peasants are getting restive, and if you want to avoid a revolt or other crisis - say, a majority of the House of Representatives elected without being beholden to your largesses - you have to make concessions. However, make the calculation - in some versions of this reform, because of the greater number of peasants you will be taxing in your domains, you will be better off."

BruceMcF :: Axelrod: Government by Consent of the Corporation
Burning the Midnight Oil for the Next American Revolution

So, lets check out the calculation Axelrod is referring to. There is a given set of restrictions on the insurance companies. There are, however:

  • Subsidies to the purchase of insurance to those presently priced out of the market
  • "Pay or play" provisions to penalize firms that do not offer comprehensive health insurance
  • Individual Mandates to penalize individuals that do not obtain health insurance

Even without an individual mandate, the system can set to "expand the market" by directing the "pay" side of "pay or play" into the individual's account at the health insurance exchange, up to, say, the Social Security payroll income tax threshold, after which it the balance goes to fund Medicaid.

And as Ezra Klein has noted, there are expected savings in the medical system as part of the reforms that the CBO will not include - that the CBO will not "score" - because in the view of the CBO they are not certain enough. And the CBO does this all the time - they famously massively overstate the cost of cap and trade air pollution control systems, for example. But there is an approach that can bring these savings onto the table:

Health policy experts David Cutler and Judy Feder, however, have an innovative proposal for making them count. In a paper for the Center for American Progress, they argue for the implementation of "failsafe" policies - crude, surefire interventions - that will kick in if the expected savings don't manifest. Limiting the growth of Medicare payments, for instance. Increasing the excise tax on insurers. Moving the public plan towards Medicare rates.

You can think of a dozen with little trouble. But if you kept them looming behind the curtain - the Oddjob to your Goldfinger - in the event that the expected modernization savings didn't manifest, it would make the anticipated savings visible to CBO, and free up money for affordability

The question, then, is, what is the basic deal being pursued? A system to benefit the individual citizen, with accommodations to "legitimate interests" of commercial corporations - or a system to benefit the commercial corporations, with accommodations to "legitimate interests" of individual citizens?

Is the "health care crisis" that 100,000 people a year are dying preventable deaths, or that the health care and health insurance cost explosion is interfering with other corporations in their pursuit of profit?

Is this a government that derives its legitimacy from consent of the governed citizen, or consent of the governed corporation?

Fighting Back Against Our Taxation By Corporations

At one time, this government was founded on a principle of No Taxation without Representation. And, yes, those taxed and not represented outnumbered those taxed and represented, initially - but we made progress on that. We reached the point where the largest single cause of taxation without representation was the taxed not bothering to show up to vote.

But, no matter how the CBO scores it, a premium paid to purchase a health insurance policy that the government coerces us to buy, is simply a different form of taxation. And if there is no publicly administered plan in that exchange, that is a tax directed to the private government of a corporation, governed under the formal principle of one dollar, one vote, and often governed in fact by a class of senior executives, both in the management of the firm, and in the network of interlocking directorates managing strategic policy for the industry.

Now, some progressive make the simplest possible argument: no public option, no bill. But I do not. I have seen this song and dance long enough to know that if it comes down to no public option, no bill - enough "progressive" Congressmen will cave to allow passage.

However, there is a more powerful and still simple argument that can be made: No Public Option Means No Individual Mandate. Or, more directly:

   No Captive Markets

And a powerful argument to be made to, and by, Progressive Congressmen, because the individual mandate is likely to be the single most unpopular element of the bill, and is at the same time the very strongest point for Republicans to craft a reactionary populism ... and it is the strongest point because it would be a reactionary populism based on a kernel of truth, which is that Government by Consent of the Corporation is not seen as legitimate government outside the corporate elite.

They Do Not Even Try To Hide What They Are Doing

Clearly, last night, the script was written. A public option will be included in the House bill. It will not be included in the Senate bill. It will be killed in Conference. The argument will be made - indeed, the talking points by Axelrod gives us the entire argument that will be made - that the resulting bill will be better than nothing.

So, what to do? Well, just like the tea party warm-ups to the August Town Hall Heat Wave, we know what is coming. What say, unlike the tea party warm-ups to the August Town Hall Heat Wave, we get ready for it this time.

We know precisely what we need to do at that point: strike the individual mandate provisions, and leave the rest of the conference report intact. The House, after all, can do that. Double blue dog dare the "Blue Dog" Senators to stand up on the Floor of the Senate arguing in favor of the individual mandate, arguing for corporate taxation without representation.

After all, the individual mandate is "just one part of the bill" - its not worth losing everything else that is in the bill just to get the individual mandate through.

Bring the worm infested core of this rotten political system into full public view on the floor of the Senate, and see whether they blink.

Because of the Progressive Caucus of the House starts to exercise the true weight of their numbers, they can pass health care reform again next year, and make the Senate run on that issue - in 2010, in 2012, in 2014 if necessary.

A member of the Progressive Caucus who stands up to the Insurance Corporations and says "No" to an individual mandate to buy corporate insurance is in a safe seat. The main "risk" will be "losing" them to the House if they pursue a move into the Senate to take the fight into enemy territory.

Which means that this can be an issue that every single Senator in the US Senate will have to face, no matter when they are scheduled to run.

Unless they take it off the table by passing a bill that respects the rule:

  • No Public Choice = No Citizen Mandate

The corporations view us as their playing field:
    We need to teach them to try to level us at their peril.

The following is the context of the above quote, where Axelrod lays out the script (not an official transcript and I am not a trained stenographer, so apologies for any glitches)

... His point was this, though. If we can pass a bill that brings long awaited insurance reforms to people who need them - most people in the country have insurance, this would help them greatly - and help those who don't have insurance today get it at a price they can afford, and also reduce the overall cost of the system, that would be a historic achievement, and that is our goal, that is what we are pointing to, and we ought not make one individual element of that so important that it dwarfs that greater goal.

Maddow: I think that part of the reason that progressives have imbued the idea of the public option with so much importance is because of the fear that there will be a mandate without serious reform, that attempts to regulate the insurance industry won't be effective. And when the President moves from his position in the campaign, which was that he was against individual mandates, to being for individual mandates now, there is concern that regulation of the insurance industry won't make insurance less junky, less resented, as it is now, and we'll all be forced to buy something that isn't very good, that will just pad the insurance companies pockets. Is there sequencing there? Is there a guarantee that the reforms work before individuals are forced to buy coverage?

Well, uh, there, uh, no individual's going to be forced to buy coverage, in the sense that there's going to be a hardship exemption, if they don't want to buy coverage. It's also a fact that when people don't have coverage and get sick, its a burden to the rest of us, so what he said is that everybody has to take responsibility.

But our goal is to make sure that the insurance system works better for everybody, people who have it and people who don't have it and will have it, and we believe these insurance reforms can and will work, and I think there's a broad consensus that they can and will work, but Rachel, we, uh, this whole system is going to be phased in over a period of time, and obviously if things are not working for consumers, we're going to make adjustments. The whole goal here is to bring security and stability to people - and they don't have it today, they can be dumped if they get sick, that happens all the time, if they have a pre-existing condition they don't get insurance, that's a standard policy in the insurance industry, out of pocket costs, you know the largest single cause of bankruptcy are health related issues, if you cap out of pocket costs, you can stop that. And there is an incentive for the insurance industry to go along and not try to fight these, and that is that there is going to be a larger insurance market, and they have to make that calculation, but we are prepared to do it easy or do it hard, we want to make it work for consumers.

Enough of the Warm-Up Act ...

Enough of the warm-up act, now for the headliners.

Midnight Oil: Blue Sky Mine video clip

My gut is wrenched out it is crunched up and broken
A life that is led is no more than a token
Who'll strike the flint upon the stone and tell me why
If I yell out at night there's a reply of bruised silence
The screen is no comfort I can't speak my sentence
They blew the lights at heaven's gate and I don't know why

But if I work all day at the blue sky mine
(There'll be food on the table tonight)
Still I walk up and down on the blue sky mine
(There'll be pay in your pocket tonight)

The candy store paupers lie to the share holders
They're crossing their fingers they pay the truth makers
The balance sheet is breaking up the sky
So I'm caught at the junction still waiting for medicine
The sweat of my brow keeps on feeding the engine
Hope the crumbs in my pocket can keep me for another night
And if the blue sky mining company won't come to my rescue
If the sugar refining company won't save me
Who's gonna save me?

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Hits Daily Kos at 1pm EDT (3.00 / 3)
I assume it will drop like a rock unless people tell their friends to show up early at my diary page to drop in comments and make it stand out on the recent diary list.

Of course, Daily Kos is always a crapshoot - the best discussion normally occurs out here in the progressive blogosphere.

Support Lesbian creative works - 100% Yuri from ALC Publishing

Should I emphasize that last hint? (3.00 / 1)
The best discussion normally occurs out here in the progressive blogosphere - hint, hint.

IOW, waddy'all think? (in my best goulash of exotic Brooklyn and Southern accents)

Support Lesbian creative works - 100% Yuri from ALC Publishing

[ Parent ]
I'm sorry I missed the crapshoot (3.00 / 1)
And I like how Maddow always gets people to reveal things they didn't' intend and this is a good example and we should all be very worried.

Your CBO analysis was very important and I would like to add to it because there are flaws to them and we also misunderstand them and this is also being used in sort of a defeatist way by some people who are using these estimates as to how many people will be eligible for the public option when it's really more of an estimate to how many people will sign up, which is based on the same year by year legal analysis as well as economic analysis by the law into effect year by year as they do with CBO baseline budget estimates.


When looking at the difference between CBO baseline estimates and actual budget outcomes, it may appear that the CBO is simply bad at projecting. While many economic forecasts by both private and government economists are indeed often wrong, the CBO baseline should not be confused with a predictive forecast. A forecast is a prediction of some measure of economic performance, whereas the CBO baseline is intended to be a reflection of the budget under current law. It shows what would happen to the budget over a certain time period without any changes to policy. Baselines, then, are a tool by which we measure the incremental budgetary affects of changes to policy. It is important to note, however, that in order to make the 10-year projections, CBO must include an economic forecast, since economic performance affects the budget through revenue collections or spending. Each year the CBO adjusts the budget baseline to not only reflect new laws, but also to include an updated economic outlook. That means that changes to the baseline are caused by either new legislation or a different economic environment.

So though the public option is weaker than I and many here like and wish Jacob Hacker's original proposal was still in full, a public option we can amend as more people become unable to afford the junk insurance a mandate will make and I'm not fooled by whatever laws insurance companies monopolies and duopolies get tow rite themselves will really stop rescissions and denying coverage for preexisting conditions. We've seen this movie before with Medicare part D and many other things.

Republicans will be able to steal that populist argument for 2010 and 2012 and it will have a kernel of truth. this is anything but a strategy for reelection and it's disastrous for the American people. I don't get it. So bottom line, no public option to catch the windfall of those dropped and ripped off, no mandate, period. And if your estimation is correct which it sadly most likely is about the Public option being killed in conference then an individual mandate must die and the work goes on and the cause endures as the dearly departed Liberal Lion would say.

[ Parent ]
Follow up on the CBO: (0.00 / 0)
The flaws are a double edged sword and depend on changing law either good or bad and a mandate would be very bad. Even a flawed public option included in the bill would have potential for good as well. So that's what I am pointing out.

I hope you're wrong about progressives caving in because I would prefer no bill(though they have done it in the past, Darcy Burner says they are serious this time) but given that you are right, killing a mandate is our last saving grace as that will be used to crush us as the teabaggers are motivated and we are not. Remember, in 1994, Republicans didn't get that much more votes, we just stayed home.

[ Parent ]
And ultimately a mandate is quite a regressive tax without representation nt (0.00 / 0)

[ Parent ]
We have to make it possible for progressives not to ... (0.00 / 0)
... cave, and that includes holding their feet to the fire. The majority of them are in Dem+10 and higher districts, after all, and the only serious risks many of them face of losing election are (1) the netroots getting riled and funding a primary rival, either unseating them in the primary or leaving them wounded for the general (as the right wing base has done to many a "moderate Republican"), or (2) a Republican wave election.

Support Lesbian creative works - 100% Yuri from ALC Publishing

[ Parent ]
There is a shadow Congress (3.00 / 4)
that is fueled by campaign contributions. And We the People are being taxed and paying their salaries but not being represented.

It's the Planet, Stupids!

I totally disagree with... (0.00 / 0)
We reached the point where the largest single cause of taxation without representation was the taxed not bothering to show up to vote.

I'm not going to produce a long argument. If you need to fell that we ever had representation, instead of the fact that they occasionally threw us a bone because of building public outrage, then that your prerogative.

In the history I've read of this nation representation of the people is a government created facade, a propaganda program. What the people want compared with what the government is willing to give on medical reform is nothing new. It is an example of the long history of American government.

I understand your need to believe that this either was or is a representative government. I like to cling to "well what about what FDR did and Truman tried to do" just as much as the next guy but I choose realism. There was a golden era that I guess ended with Lyndon B. Johnson. After that it has just been a bunch of useless scum bags running the nation into the ground for the highest bidder.  

The largest single cause of taxation without representation is now and always was corruption. Rich people paying off worthless people who like to sit around pretending that they are in charge. If you have the money all you need to do is hand them a few buck and stroke their ego, then they will kill for you.

"Democracy only works when we claim it as our own" -Bill Moyers

We have NEVER been in charge of our representatives ... (0.00 / 0)
... without an active movement holding them accountable.

That is not the claim I am making. I am making a point about existing fokviews regarding our institutions, which is the basis for "legitimacy". Whether or not we are actually in CHARGE of our representatives, and whether or not the choice of prospective representatives we have in elections is the choice we would wish to have ... the election is how we confer legitimacy on the elected representatives, and a corporate board elected by shareholders on a one-dollar, one-vote basis does not have the political legitimacy to be the institution to which we must make a mandatory payment.

Failing to organize a movement to press our representatives to actually represent our interests has always implied that they end up actually representing the vested interests of the status quo.

So this fight it a two-fold fight - the fight for the principle itself, and against the ongoing rise of corporate New Feudalism; and the fight to build the movement we need through the process of organizing to achieve an important objective.

Support Lesbian creative works - 100% Yuri from ALC Publishing

[ Parent ]
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