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Tilting at Windmills

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June 25, 2009

UNDER THE ARBITRARY CEILING.... Max Baucus has his eye on a specific spending target, and he seems to think he'll hit it.

A senior lawmaker trying to break the logjam on health care overhaul says his committee has come up with elements of a plan that would allow them to produce a bill under $1 trillion that would be fully paid for.

Senate Finance Committee Chairman Max Baucus, D-Mont., made the announcement Thursday. Of the five congressional committees working on President Barack Obama's top legislative priority, Finance has the best chance of producing a bipartisan bill.

Baucus said the non-partisan Congressional Budget Office confirmed the $1 trillion cost over 10 years.

Now, I haven't seen any of the details on this, so I can't speak to the efforts that went into Baucus reaching the desired price tag.

But it occurs to me that it's odd, just on a conceptual level, to pick an arbitrary number and build the policy around it. We're apparently dealing with a legislative dynamic in which Senate leaders want a reform bill that costs no more than $1 trillion over the course of 10 years (or, an average, $100 billion a year). What if a good bill cost $1.1 trillion or $1.2 trillion? That's too much. Why? Because the Senate likes round numbers.

Did any of this happen during the Bush years? Did Republican senators ever say, "We'd like to fund the war in Iraq on an indefinite basis, but only if it costs less than $100 billion a year for the next decade"? Or, "We'd like to slash taxes on wealthy people who don't need a tax cut, but we're picking an arbitrary round number that the cost of the tax cut can't exceed"?

Steve Benen 4:50 PM Permalink | Trackbacks | Comments (17)

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Give Baucus some space. He just learned you shouldn't take things off the table in 'good-faith' in advance of negotiations yesterday.

He hasn't grasped that effective legislation is a better goal than an arbitrary price tag yet.

I'm sure he'll have it by 2039 or so, at the rate he's learning.

Posted by: doubtful on June 25, 2009 at 4:58 PM | PERMALINK

We're apparently dealing with a legislative dynamic in which Senate leaders want a reform bill that costs no more than $1 trillion over the course of 10 years. . . .

Not quite. We're dealing with a dynamic where Congressional leaders like Max Baccus, who received over $449,000 from insurance companies, are trying to craft a bill that looks like they're doing a lot for reform without actually doing anything that will upset their corporate masters.

http://www.consumerwatchdog.org/resources/Ins$DataSubtotals.pdf

Posted by: SteveT on June 25, 2009 at 5:03 PM | PERMALINK

Apparently, Baucus has seen one too many of Progressive's "name your price" commercials...

Posted by: Mike Lamb on June 25, 2009 at 5:03 PM | PERMALINK

I've actually got to disagree with this, in that the Bushies most definitely DID do this. That's why the tax cuts were set to expire, so it would go under an arbitrary number. Plus, it loaded the benefits to the rich at the back-end, so as to not make it look like a giveaway to them. But as liberals said at the time, once it was about to expire, Republicans would insist that these are tax increases, as a way of making them extend indefinitely. And that's exactly what we're seeing now. They insist that Obama is an evil Socialist because he's allowing part of Bush's tax cuts expire. As with Iraq, they could only sell their stupid policies if they lied to people about the costs.

And I believe the prescription drug plan, which they imagined would seal the elderly vote on their side forever, was also written with an arbitrary ceiling. And then there were all the budget tricks they used, including not including war expenses as part of the budget; in order to make them look smaller. This sort of tomfoolery isn't really new. The main difference is that when Republicans did it, it was part of a smoke & mirrors shell game. But now, we're doing it with real policy implications, encoding this stuff into law.

Posted by: Doctor Biobrain on June 25, 2009 at 5:05 PM | PERMALINK

It strikes me that Baucus has pulled some number out of his ass that he thinks will fly politically. Never mind if it addresses the nation's healthcare problems. For him it's a political problem, not a healthcare problem.

Posted by: AK Liberal on June 25, 2009 at 5:06 PM | PERMALINK

My recollection is that, during his recent speech to the AMA, Obama indicated that his proposal would cost...wait for it...one trillion dollars. He was very specific in this speech about how he would pay for it. So I'm not clear on why Baucus and others are confused.

Posted by: Chris on June 25, 2009 at 5:11 PM | PERMALINK

If we can get a real public option with teeth for 999 billion so Baucus can sleep at night I am okay with that.

Posted by: MNPundit on June 25, 2009 at 5:13 PM | PERMALINK

cmon this was so easy for him to do. all he had to do was lower the fdl% number for subsidies. in fact, that's what he had planned to do all along (from what ive been told by people in the know there was never any intention or even belief that 400% of fdl would be the final number).

its all been theater. he puts the 400% of fdl subsidy in there to deflect progressive criticism and gain some of their support. then when the numbers come in high he cuts the number in the name of compromise. since some of the progressives are already on board the idea of mandates only they cant bail.

it's our own fault for ever letting him get this far. everything he's done was clearly telegraphed in his first white paper.

Posted by: Beauregard on June 25, 2009 at 5:14 PM | PERMALINK

Why don't we simply handle it like the war. Take it off budget, then it's free!

Oh, right. Because we're not retarded.

Posted by: MikeJ on June 25, 2009 at 5:15 PM | PERMALINK

People pay how many thousands of dollars per year for health care now? And Baucus has a plan that will cost $330 per year per person (100 billion/300 million). I can't wait for the details.

Posted by: Danp on June 25, 2009 at 5:18 PM | PERMALINK

Yes, it DID happen in the Bush years.

The first tax cut had to be under a certain amount. That is why they had stupid sunset provisions. You assume the tax cut is only for 5 years or 9 years or whatever and then the the 10 year total gets under the limit you ask.

I think it was a bunch of moderate Republicans who demanded a limit on the tax cut.

Of course, the idea was that the sunset provisions would never happen so you got a bigger tax cut with a smaller price tag.

Posted by: neil wilson on June 25, 2009 at 5:22 PM | PERMALINK

As a couple have your commenters said, it definitely happened in the Bush years. The Medicare Prescription Drug bill had an initial price tag of $400 billion. When the Medicare chief actuary ran the numbers on the final bill that was to be voted on by Congress, the cost had risen to $535 billion (mostly because of more subsidies to insurance companies' "Medicare Advantage" plans). That number was suppressed, the actuary was told he'd be fired if that increase in cost were disclosed to Congress.

Posted by: KevinMc on June 25, 2009 at 5:53 PM | PERMALINK

Take anything Baucus floats with a pound of salt. His job is to put reassuring sound bites out into the ether but he will never build a sound policy that negatively impacts the insurance, hospital industry. Ever.

On the other hand, perhaps he was referring to what he wanted deposited into his offshore account and in his addled condition he dropped a couple decimal points.

Posted by: BigSky on June 25, 2009 at 5:56 PM | PERMALINK

The Bushies and the Senate had arbitrary numbers for the 2001 and 2003 tax cuts as well as Medicare drug plan. But the earlier comments that the arbitrary caps led to the 2010 sunset for the 2001 cuts is wrong. What the caps did was lead to a phasing in of provisions. The 2010 sunset is because they could not increase the deficit after 2011 because they used reconciliation (the process the Republicans are now against). When you use reconciliation you cannot increase the deficit outside the budget window which went from 2002 to 2011 that year. With respect with the 2003 tax cuts the arbitrary cap led to even earlier expirations.

Posted by: rana on June 25, 2009 at 9:00 PM | PERMALINK

(apparently I'm the *other* Chris here at the moment)

Steve, the reason this happens more for Obama is that Obama and Democrats are insecure about their reputations on economic policy (read: being afraid Republicans will call them socialists) (despite being, if anything, too conservative), while Bush, and Republicans, didn't give a flying fuck what people thought about their reputations, since they could whip *their* members into supporting the president while he drove the economy over the edge of the cliff. And they could tell the media, "You just don't understand, because you're not conservative like us. So don't even *try* to analyze what we're doing, because it's taking a side for political reasons."

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