Netroots vs. Unions: Labor Pushing to Fix Rather Than Torpedo Senate Health Bill

He went on to say:

The absolute refusal of Republicans in the Senate to support health care reform and the hijacking of the bill by defenders of the insurance industry have brought us a Senate bill that is inadequate: It is too kind to the insurance industry.

Genuine health care reform must bring down health costs, hold insurance companies accountable, assure that Americans can get the health care they need and be financed fairly. 

- That’s why we are championing a public health insurance option: It is the way to break the stranglehold of the insurance industry over consumers that has led to double digit premium increases virtually every year. 

- Employers must pay their fair share.

- And the benefits of hard-working Americans cannot be taxed to pay for health care reform — that’s no way to rein in insurance companies and it’s the wrong way to pay for health care reform.

Those are the changes for which we will be fighting in the coming days.

Yet in their desire to push for reform they are not yet taking the hard line of some members of the House who declared they’d opposed the bill unless it had a public option. As the conservative Washington Examiner reported:

The leaders of the 80-plus-member liberal faction in the House say the final health care bill has to include a public insurance option, taxes on the wealthy, employer mandates and the lifting of anti-trust exemption on insurance companies.

Reps. Lynn Woolsey and Barbara Lee, both of California, said they want the House bill integrated into the version that is about to pass the Senate.

The Senate bill does not include a public option or the anti-trust exemption and it is funded in part by taxes on costly insurance plans, not an income tax on the wealthy.

“For congress to achieve true health care reform we must have a meaningful conference process that integrates both bills into the best possible piece of legislation for the American people,” they said in a statement on Wednesday.

And as Politico pointed out:

They’re not as critical of the Senate package as New York Rep. Louise Slaughter; Lee and Woolsey, who serve as chairwomen of the Congressional Black Caucus and Congressional Progressive Caucus, respectively, even go out of their way to thank the Senate majority leader and Sens. Roland Burris (D-Ill.) and Ben Cardin (D-Md.) for adding a provision on health care disparities and Sen. Bernie Sanders (I-Vt.) for helping to secure $10 billion for community health centers.

But it’s clear that they’re not going to roll over, as some senators have suggested they should.

The astute Harold Meyerson, a columnist for The Washington Post and an editor at The American Prospect, points out the dilemma facing labor unions:

The Net roots is up in arms about the Senate’s version of health-care reform, with many rooters demanding it be voted down. The liberal establishmentarians lament the compromises they were compelled to accept but support the bill’s passage. In between the two, indignant and stuck, is organized labor.

“There’s an excise tax on policies, but there’s no public option to hold down the cost of those policies,” says Leo Gerard, president of the United Steelworkers. ​“There’s no Medicare buy-in, no pay-or-play mandate for employers. There’s no Canadian reimportation to hold down drug costs, on the grounds of ​‘safety.’ No one gets sick from Canadian reimported drugs,” adds Gerard, who is Canadian. ​“I know a guy who got sick from a Chinese-made ingredient in an American drug, but there’s no restriction on Chinese drug imports.”

Gerard is hardly alone in his criticisms. Labor believes, rightly, that the cost controls in the Senate bill come chiefly from insurance policy holders (among them, labor’s members), rather than from insurance and drug companies. Both the AFL-CIO and the Service Employees International Union have condemned these provisions, while hailing the bill’s epochal creation of affordable health insurance for 30 million Americans. They’re careful, too, to exempt President Obama from their criticisms.

“I’m not blaming the president,” says Gerard. ​“He wants to believe people will do the right thing.”

The unions have few illusions that the public option will be restored in the House-Senate conference committee, but they are working to promote the chief funding mechanism in the House bill (a tax hike on individuals with incomes over $500,000 and couples with incomes over $1 million) over that in the Senate bill (a tax that, to start, will fall on health insurance policies that cost more than $23,000 for a family of four). With medical costs unchecked by a public option and drug reimportation, they fear that the value of their members’ policies will rise above the threshold by the middle of the next decade…

Politically, in fact, the tax could set in motion the kind of dynamic that undermined many Great Society anti-poverty programs: taxing the working class to provide benefits to the poor (or, in this case, the uninsured). Richard Nixon and Ronald Reagan smashed the Democrats’ New Deal coalition by fanning the racial and class tensions endemic to such programs. Does anyone believe that today’s Republicans will think better of mounting such attacks?

In theory, the House-Senate conference committee should be able to split the difference on funding by raising the Senate’s threshold on taxing insurance policies and combining it with a scaled-back version of the House’s millionaire tax. If the conference does that, raises the subsidies for people buying policies on the exchanges and extends Medicaid to more poor families, liberals and labor will likely have gotten all they can plausibly hope for, given the constraints that the Nelsons, Liebermans and Republicans have imposed on the bill.

Labor is boiling mad about those constraints, but unlike some of the Net-rooters, they can’t and won’t call down curses on the Senate Democrats – yet. ​“We’ve played an inside game,” says one of Gerard’s fellow union presidents. ​“We’ve delivered our criticisms privately.” Labor’s leaders still hope a scaled-back version of the Employee Free Choice Act (EFCA) – the bill that would restore unions’ ability to organize private-sector workers – will pass the Senate next year. They’ve seen the White House and congressional Democrats move their way on jobs legislation, and they welcomed last week’s unveiling of a $5 billion tax credit to bolster green manufacturing, a long-overdue step toward rebooting manufacturing in America. But it will take more job creation and the enactment of EFCA to motivate unions to go all out in the 2010 elections. Anything short of that, and their anger will take a toll on the Democrats’ electoral prospects.

And since some of the main benefits of health reform legislation – such as preventing health insurers from barring people based on pre-existing conditions – won’t kick in until 2014, it’s not clear that the public will see the health reform emerging from this Congress as making a huge, positive difference in their lives before the November 2010 election.