Conservative Principles Now

In the wake of the White House’s health care summit, reconciliation is still seen as the likely route that congressional leaders and their liberal allies will take to jam Obamacare through Congress. Congressional Democrats and President Barack Obama already are using the summit as a public relations vehicle to help fast-track the Senate health care bill through a parliamentary process used primarily for budgetary issues.

But beware Plan B — the more “modest” plan. There’s a surer, well-worn path that the Clinton Administration took after the collapse of Hillarycare in 1994: A careful, well-coordinated, step-by-step march to the Left on federal health care policy.

The Republican congressional victory in 1994, even though it reflected public revulsion at the Clinton Administration’s proposed takeover of the private health care system, did not change the fundamental direction of federal health policy. It only changed the degree and velocity of liberal policy success. The Clinton team started taking baby steps to expand federal control over health care financing and delivery, lulling often clueless congressional Republicans into cooperation with long-term consequences for doctors and patients. In some cases, the GOP majority enacted provisions of the Clinton health bill word for word.

In fact, much of today’s health care landscape reflects the enormous policy success the Clinton Administration achieved during the 1990s in the wake of the legislative failure of Hillarycare:

• Unprecedented statutory interference with the doctor-patient relationship — restricting private contracting — in Medicare in 1997
• The frustrating regulatory burden imposed on doctors through the  Health Insurance Portability and Accountability Act in 1996
• The creation of the State Children’s Health Insurance Program (SCHIP), which has now become a roaring entitlement, costing billions more in taxes and crowding out private health coverage as Congress pushes eligibility up the income scale

Through all of this, Republicans in Congress dismissed or ignored the warnings of conservative health policy analysts and economists, and instead cooperated with President Clinton or played an ineffective defense.

Congressional conservatives should ponder liberals’ past incremental health care successes. It may help them prepare for what may lay ahead. Rest assured that Team Obama is keeping options open.

According to the Wall Street Journal, while no final decisions have been made, “the smaller plan’s outlines are in place in case the larger plan fails.” Those smaller bills could include:

• Mandating that insurance companies allow “children” up to 26 years old to be on their parents’ health plans.
• Expanding Medicaid and SCHIP beyond the massive expansions that were enacted in 2009. Medicaid expansion has been a favored coverage form by liberal Democrats.

As Heritage’s Stuart Butler recently noted in the New England Journal of Medicine, small changes to the nation’s $2.5 trillion health-care system can have dramatic results:

History shows that changing even seemingly minor features of legislation or administrative decision making with regard to health care can have major — and sometimes unintended — consequences for the system’s evolution.

Conservatives in Congress have ample policy proposals to expand patient choice and improve market competition. There is no reason why they should carefully develop and implement a grand legislative strategy of incremental conservative reform.

Co-authored by Marguerite Higgins.

After a three-week holiday break, the House of Representatives returned to session yesterday, and Speaker Nancy Pelosi (D-CA) marked the occasion with an op-ed detailing her “record of achievement” and outlining her agenda for the rest of the 111th Congress. Pelosi writes: “At the halfway mark in this Congress, our priorities are clear: strengthening the security of the American people and building a new economy that offers our families lasting prosperity.” But the 111th Congress is not the first Congress Speaker Pelosi has presided over. When Pelosi was first handed the gavel in January 2007, the U.S. economy employed 137.3 million people and our nation’s unemployment rate stood at 4.6%. According to the Labor Department’s most recent report, the U.S. economy has shed 6.3 million jobs since then, and 10% of our workforce is now unemployed.

Speaker Pelosi goes on to claim that President Barack Obama’s failed stimulus has “created or saved” 1.6 million jobs so far, but even the White House has abandoned its controversial “saved or created” jobs accounting scheme after more than 90,000 of the 640,000 jobs it claimed to create were found to be completely fraudulent. Pelosi then touts the Cash for Clunkers program as another success despite the fact the program did nothing to create auto sector jobs, led to a crash in auto sales, and did nothing to help the environment. Pelosi also celebrated the expansion of the State Children’s Health Insurance Program (SCHIP), which only further bankrupts our states and inched us ever closer to government-run health care.

Even worse than her past “accomplishments” is Speaker Pelosi’s future agenda, which basically calls for super-sizing the policy failures mentioned above. First on the agenda is President Obama’s health care plan which, like SCHIP, expands health insurance coverage through the welfare state. Both the House and Senate bills achieve over half of their health insurance expansion through Medicaid, which is a welfare program. The taxes and employer mandates used to pay for the expanded coverage are going to hit small businesses hard at a time when we desperately need them to be creating new jobs to move us out of recession.

After health care, Speaker Pelosi is promising continued action on the Waxman-Markey cap-and-trade legislation, which is built on the same failed policy ideas behind Cash for Clunkers. A Heritage Foundation analysis of the Waxman-Markey energy legislation found that for a household of four, energy costs (electric, natural gas, gasoline expenses) would rise by $436 in 2012 and by $1,241 by 2035, averaging $829 over that period. Higher energy costs would also increase the cost of many other products and services. Overall, Waxman-Markey would reduce gross domestic product by $393 billion annually and by a total of $9.4 trillion by 2035.

Finally, Pelosi promises “the most sweeping reform of the financial industry since the Great Depression.” But as Heritage fellow James Gattuso has previously demonstrated, the House financial overhaul bill would give financial regulators sweeping powers to control firms deemed “too big to fail” and establish a fund for FDIC to use to resolve the affairs of firms it takes over. The real-life effect of the new powers would be to signal to markets that firms are supported by the federal government and guaranteed against failure — thus leading them to take more undue risks, not less. Pelosi will have essentially created a permanent TARP.

We share Speaker Pelosi’s vision for “swift action to restore accountability to Washington and opportunity for the middle class, to create good-paying jobs for our workers, to use innovation to power America in a global economy and build a strong and smart national defense.” But as business owners, small and large, across the country are saying, Speaker Pelosi’s big government solutions are not the answer.

Quick Hits:

• Citing assaults from hackers on its computer systems, Google said Tuesday that it will stop cooperating with Chinese Internet censorship and is considering shutting down operations in the country altogether.
• President Hugo Chavez plans blackouts in Caracas and other cities such as oil town Maracaibo to combat nationwide power shortages.
• The Obama administration plans to ask Congress for an additional $33 billion for the wars in Afghanistan and Iraq, on top of a record request of $708 billion for the Defense Department next year.
• A Weekly Standard reporter trying to ask Massachusetts Democratic Senate candidate Martha Coakley a question was pushed to the ground outside a Washington, DC, fundraiser.
• According to a new Quinnipiac University poll, 54% of voters disapprove of President Barack Obama’s handling of the economy, 59% of voters disapprove of his plan for creating jobs, and 58% disapprove of his handling of health care.