Friday, October 16, 2009

Erstwhile Health Care Advocate Olympia Snowe, The $1.42 Trilliion Deficit, The New Old Obama Numbers

Next time: NJ and VA Governor's race update (not much new to say since my last blog on the subject anyhow) and Fiscal 2010 Appropriations updates (regrettably, the same is true there)

For now:
Finance Committee, Check, On to the Senate with....Something
After a somewhat over dramatized debate, the Senate Finance Committee passed its version of Health Care reform by the exact margin that I had projected, with every Democrat voting in the affirmative, joined by lone Republican Olympia Snowe of Maine.

The real debate now begins, with Senate Democratic leadership having a mess of a job of combining the more moderate bill passed out of the finance committee, which does not contain an employer mandate or a public option, with the more liberal bills passed out of other committees.

It seems highly likely that the bill debated on the floor will look a lot more like the Finance bill than those other bills. While liberals hate the thought of excluding a public option, I can't see another conceivable path to 60 votes in the Senate.

House Democrats won't like this solution, either, but at some points, Democrats will have to decide between a bill that is less than they would like or no bill at all. Blue Dogs in the House and moderates such as Ben Nelson and Joe Lieberman in the Senate are probably not going to vote for the more liberal bill and it is tough to see a path to passage without their votes.

$1.42 Trillion -- This Is Actually Good News!
Okay, I know that I sound like a nut saying that I'm happy that the deficit for the fiscal year that just ended on September 30th is ONLY $1.42 trillion, but as depressing as this figure is, it is actually far less than we had feared only months ago, when a $1.7 trillion figure was projected.

In Fiscal 2009, the Federal Government collected $2.10 trillion in taxes and spent $3.52 trillion. It sounds bad to have 40% of government spending and 10% of GDP being charged on the credit card, but when you strip out the extraordinary spending -- including both rounds of TARP, much higher unemployment costs and the stimulus bill and add back in more ordinary tax revenues from individuals and corporations, we aren't as far off as it looks -- or wouldn't be if we didn't have a Medicare nightmare headed our way.

Unfortunately, it doesn't look from what is likely to materialize in the health care bills that we will get serious cost containment of medical inflation. The Democrats have shown little will to unite to take on private insurance companies or big pharma. So, as I wrote before, we may get expanded coverage, but we won't solve the other really big problem -- cost inflation that will carry health care to more than 20% of our economy by 2020. And that's the one that will bankrupt us.

Obama -- Near His Lows, Still Above November
In the last week, President Obama's numbers have slipped back a bit, with his latest figures showing his approve minus disapprove at just over +10%, still a few points north of his November vote totals, but revealing a continued division in the voting public.

His monthlies have also slipped somewhat since the last posting, with his numbers now showing a slight decline versus last month.

More to come soon.

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