The Law of Unintended Consequences

In my previous post, I suggested that President Obama's intimation that the creation of a government controlled public-option would not be a sticking-point in the ongoing negotiations between the Senate Finance Committee's "gang-of-six" on a health care reform draft bill was a shrewd tactic designed to galvanize his liberal base of supporters.

According to an article published today in the Washington Post, the White House has been taken aback by the fury expressed by its allies in the Congressional Progressive Caucus, AFL-CIO, et al. at the notion that a public-option may be scuttled.

An article in today's copy of the New York Times states that the White House has determined what they had long suspected, and quite frankly, feared: The Republican Party has no desire to forge bipartisan health care reform legislation, and seeks to politically damage President Obama.

Its claim has been advanced in recent days by the public comments of both Sen. Jon Kyl (R-AZ) and Sen. Chuck Grassley (R-IA) on the palatability of any compromise bill to Senate Republicans. Additionally, House Minority Leader John Boehner (R-OH) recently wrote a letter to PhRMA CEO, Billy Tauzin, advising him against abiding by the terms of the agreement to reduce prescription drug costs that was reached between the pharmaceutical lobby and the president.

Unfortunately, President Obama has equivocated on his support for a health insurance exchange that includes a public-option, and now there is criticism abound regarding a perceived lack of intestinal fortitude by him.

I firmly believe that the president believes strongly in the merits of a public-option; as opposed to a cooperative. However, he seems to be willing, as a matter of practicality, to make some concessions in his effort to advance long advocated health care reform.

As a supporter of his, I would be extremely disappointed if he were to sign a reform bill that did not include a public-option, but I am not prepared to concede the public-option to either health insurance providers, corporately funded conservative interest groups, centrist Democrats, or Republicans without a fight. If Americans want a public-option, then they must be willing to go outside of their homes, beat the streets, and fight for it; because no one is going to deliver health care reform to them on a silver platter.

"I need your help. Change is never easy – and it never starts in Washington. It starts with you. I need you to knock on doors, talk to your neighbors, and spread the facts."

- President Barack Obama (Belgrade, Montana - August 14, 2009)

Public Debate

This past weekend, President Obama and officials of his administration suggested that a federally administered "public-option" is not an integral component for health-care reform legislation. Today, many of the president's liberal supporters are dismayed, if not outraged, that the White House may be intimating a willingness to concede on the creation of what they argue is a vital cost-controlling mechanism for any revamped health-care system. Some have said that any legislation devoid of a public-option that is enacted would not constitute reform.

I do not share these sentiments.

Contrarily, I wonder if President Obama is attempting to galvanize his liberal base; spurring them to mobilize and challenge the scurrilous accusations leveled at him by his political opponents.

One can only hope.

This Ain't No Game

I am neither an economist nor a financial expert, but I can say with total certainty that our workforce, the beating heart of America's economy, is dying.

Whatever the arguments against President Obama's stimulus plan, some qualified; others not, the government must act. The people demand it.

It can be agreed that robust debate and good faith negotiation are essential requirements for the passage of any legislation that can truly be deemed effective.

However, the arguments that are cited, either in support or opposition of a measure, must be relevant to the issue being addressed. Moreover, they must be dictated by the facts that bear themselves out over time; be it through the gathering of data, or mere observation.

These are the facts:

1. We are in a national state-of-emergency.

2. The size of America's economy is literally shrinking.

3. Only the federal government has the resources that are necessary to stem the tide of the economic tsunami that is threatening to engulf the country.

4. Government spending will incur greater deficits, and thus greater national debt; but the solution must be comparable to the size of the problem. Half-measures will not mitigate the damage that has already been wrought; much less reverse the effect.

5. If action is not taken soon, then our economy will collapse.

Please, don't take my word for it...

"The House stimulus plan will not reverse the current recession, but it will provide a vital boost to the flagging economy. Without stimulus, unemployment will rise well into the double digits by this time next year, and the economy will not return to full employment until 2014."

- Mark Zandi (Chief Economist and co-founder of Moody's Economy.com). "The Economic Impact of the American Recovery and Reinvestment Act." Moody's Economy. January 21, 2009.

"We’re already closer to outright deflation than at any point since the Great Depression. In particular, the private sector is experiencing widespread wage cuts for the first time since the 1930s, and there will be much more of that if the economy continues to weaken.
As the great American economist Irving Fisher pointed out almost 80 years ago, deflation, once started, tends to feed on itself. As dollar incomes fall in the face of a depressed economy, the burden of debt becomes harder to bear, while the expectation of further price declines discourages investment spending. These effects of deflation depress the economy further, which leads to more deflation, and so on."

- Paul Krugman. "On the Edge." The New York Times. February 5, 2009.

"CBO anticipates that implementation of H.R. 1 would have a noticeable impact on economic growth and employment in the next few years."

- Congressional Budget Office Cost Estimate. "H.R. 1, American Recovery and Reinvestment Act of 2009." January 26, 2009.

"According to Gallup trends, the American public has been consistent in its reaction to the concept of a major economic stimulus package since the start of the new Congress in early January. A slight majority of Americans favor Congress passing such a plan...Moderate senators eager to contribute positively to the debate and to potentially influence the bill's provisions have made the case for a smaller version of Obama's package...However, at this point, the more talked-about $800 billion-plus plan receives slightly more public support than the smaller plan."

- Lydia Saad. "Public Support for Stimulus Package Unchanged at 52%." Gallup. February 5, 2009.

The oft-uttered refrain by the recovery plan's most vocal critics in Congress that economic stimulus must be "timely, targeted, and temporary" is mostly correct.

Nonetheless, the following should be noted:

"While there will be much more discussion about the size and mix of government spending increases and tax cuts to include, the House Democratic plan is a very good starting point. This is important, for while such debate is necessary it must be resolved quickly. Unless a stimulus plan is implemented beginning this spring, its effectiveness in lifting the economy will be significantly muted."

- Mark Zandi (Chief Economist and co-founder of Moody's Economy.com). "The Economic Impact of the American Recovery and Reinvestment Act." Moody's Economy. January 21, 2009.

Stimulus now.

The Presidency of Barack Hussein Obama

President Barack Obama faces the most daunting challenges ever experienced by an American president in modern history. Our nation's armed forces have been stretched virtually beyond their capacity as they continue to prosecute two separate wars on two vastly different terrains. America's economy has been imperiled by a phenomenally crippling recession. The habitability of this planet is under increasing threat because of the radical changes to its climate. We are undoubtedly in the midst of a period lacking in certainty.

Barack Obama was not elected to the Oval Office with the expectation that he would work miracles. As he stated on the night of his election, "The road ahead will be long. Our climb will be steep. We may not get there in one year or even one term...There will be setbacks and false starts. There are many who won’t agree with every decision or policy I make as president, and we know that government can’t solve every problem. But I will always be honest with you about the challenges we face."

In this era of immeasurable strife it is incumbent upon us to be patient with our government as it works diligently to resolve these conflicts.

It is also incumbent upon us to be demonstrative in the manner that we express our opinions on the myriad of issues that affect both our lives and livelihoods; especially when we take exception.

Americans should insist that their representatives in government act sensibly as they work alongside President Obama to address these concerns, and seek to work in concert with him whenever possible.

Liberal or conservative, Democrat or Republican, our fates are intertwined.