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Bernanke: Too Big Not to Fail

January 27, 2010 By: Scott Spiegel Category: Economy

Critics of Federal Reserve Chairman Ben Bernanke’s performance in his first term blame him for failing to recognize the threat of the looming subprime lending crisis; his supporters laud the aggressive policies he enacted in response to the crisis.

I fault him for both.

Before the crisis, Bernanke helped Fannie Mae and Freddie Mac executives cover up their scheme to hide trillions of dollars in junk mortgages and give themselves enormous bonuses.  In the process, he failed to address the growing housing bubble that precipitated the financial crisis.

His solution was worse.  Having learned the wrong lesson from the Great Depression—that the government prolonged it by not intervening more, rather than intervening too much—Bernanke radically expanded government’s power and “reinvented the Fed,” as Time magazine put it mildly in their recent cover story on Bernanke.

Time glowingly continued: “[H]e conjured up trillions of new dollars and blasted them into the economy; engineered massive public rescues of failing private companies… lent to mutual funds, hedge funds, foreign banks, investment banks, manufacturers, insurers and other borrowers who had never dreamed of receiving Fed cash… revolutionized housing finance with a breathtaking shopping spree for mortgage bonds; blew up the Fed’s balance sheet to three times its previous size; and generally transformed the staid arena of central banking into a stage for desperate improvisation.”

“Conjured up,” “blasted,” “engineered,” “revolutionized,” “breathtaking,” “shopping spree,” “blew up,” “desperate improvisation”—somehow these don’t sound like particularly reassuring terms for investors in the world’s largest financial system.

Bernanke isn’t finished.  The Federal Reserve has been buying up Fannie and Freddie securities to try to keep mortgage rates artificially low and stimulate the housing market.  The program is set to end in March, but Bernanke is toying with the idea of propping up the housing industry indefinitely.  Sound familiar?

The question is whether the Senate will reconfirm Bernanke for another four-year term before his first term expires on January 31.

Dumb arguments for keeping Bernanke abound:

•    The Financial Times of London reports, “Economists warned that a rejection of Mr Bernanke could be seen as a threat to the central bank’s independence.  US Treasury yields were little changed but stocks fell more than 2 per cent” due to uncertainty regarding reconfirmation.

Come on—it’s at least as plausible that stocks plummeted last week because of Obama’s announcement that he was going to impose a new tax on banks to subsidize the Troubled Assets Relief Program (TARP).  (Especially given that the Dow Jones Industrial Average slipped 219 points while Obama was still giving his speech.)

After Bernanke’s prospects improved over the weekend, Obama’s boosters at the Associated Press helpfully divined the trend in the stock market for us: “Amid the news, the Dow Jones industrial average rose 24 points.”  Well, the Dow was down 3 points on Tuesday—I think this means Bernanke’s chances are dimming.  What say ye, Associated Oracle?

•    Mohamed El-Erian, CEO of bond investor Pimco, declared, “A No vote on Bernanke would be viewed by markets as adding yet another uncertainty in an already fluid economic and policy environment.”

Give me a break: Ben Bernanke-Tim Geithner-Larry Summers form the very Axis of Uncertainty.  The Obama administration has demonstrated that it is capable of deciding, in any given week and depending on its poll numbers, to announce any manner of blanket economic policy to try to shore up its popularity.  This is exactly what causes uncertainty in the market: whimsical manipulations from disconnected puppet-masters on high.  Sowing a little uncertainty about whether King Caprice’s minions will remain in office is the surest prescription I know of for assuaging the market.

•    Obama’s team “saved” the economy, so it’s best to keep the same leadership in place.

Obama’s team didn’t save anything—it wasted a trillion dollars and slowed down the real recovery.  Obama claimed that unemployment would reach 8.0% if we didn’t pass his stimulus bill last spring.  We did, and unemployment is at 10.0% and projected to increase.  The last people who should still be in charge of our monetary policy are the people who helped Obama implement his disastrous recovery strategy.

•    Chris Dodd, the Senate banking committee’s chairman, announced that booting Bernanke would hurl our financial system into a “tailspin.”

Chris Dodd certainly knows something about sending the economy into a tailspin.  Given his role in the subprime lending crisis, I say his vote on any financial matter from now until his retirement next January ought to automatically count as a vote for the opposite of whatever side he’s on.

•    Dick Durbin, Senate Majority Whip, pointed out that conditions that led to the financial crisis were in place before Bernanke took office.

Yes, and if Noah had deliberately drilled a hole in the bottom of his ark, I think he could credibly claim that conditions that led to the Great Flood were in place before his time at sea.  But that doesn’t mean he would bear no responsibility for having made things worse.

Paul Krugman, whom I never thought I’d quote (except mockingly), recently wrote, “Before the crisis struck, Mr. Bernanke was very much a conventional, mainstream Fed official, sharing fully in the institution’s complacency.  Worse, after the acute phase of the crisis ended he slipped right back into that mainstream.”  Granted, Krugman is only partly talking about Bernanke’s failure to head off the imminent lending crisis.  He’s also talking about Bernanke’s failure to push for cumbersome bank regulations and inflate the currency, goals Krugman seems to think worthwhile (we are talking about a New York Times columnist, here); but the general characterization still applies.

Krugman continues, “During the run-up to the crisis, as financial abuses proliferated, the Fed did nothing.  In particular, it ignored warnings about subprime lending…  Mr. Bernanke didn’t acknowledge that failure, didn’t explain why it happened, and gave no reason to believe that the Fed would behave differently in the future.”

I’m mystified as to why so many in Congress are reluctant to sack Bernanke for poor performance.  Perhaps it’s because they fear it will remind their constituents that they may apply the same standard to their elected officials.

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Dems’ Options: Senate-Packing, Queen Olympia, Mass Kidnapping

January 20, 2010 By: Scott Spiegel Category: Health Care

Yesterday Democrats suffered a mortifying trouncing in Massachusetts’ special Senate election, in which Republican Scott Brown zoomed from 17 points behind Democrat Martha Coakley in the polls less than two weeks ago to winning by a handy 5%.

As AP reported, “Brown’s victory was so sweeping, he even won in the Cape Cod community where Kennedy, the longtime liberal icon, died of brain cancer last August.”

To be fair, Coakley did manage to capture 84% of Cambridge, Amherst, and Provincetown, which tend to serve as bellwethers for—well, themselves.

Coakley’s complaint that her poll numbers started to drop right after the Senate passed its version of the health care bill on Christmas rang a bit hollow, given that she campaigned vociferously to vote for that very health care bill if elected to Congress.

In the wake of the clear message sent to them by the people of Massachusetts, Democrats are slowly backing away from their suicidal insistence on passing a bill only 33% of Americans favor, considering more bipartisan/free-market solutions, and resolving to address healthcare reform in a more piecemeal fashion.

Gotcha!  Actually, Democrats are considering a number of insane, Mission Impossible-style workaround strategies to thwart the will of the people and pass their health care bill without a filibuster-proof Senate.  These include:

•    Forcing the House to pass the Senate bill, word-for-word, with nary a change in punctuation.  This option would throw out all of the heatedly negotiated agreements between the two chambers conducted in the past few weeks, including the major union employee exemption to the excise tax on “Cadillac plans.”  It would also ignore many of the other differences between the bills for which Democrats in the House say they cannot accept the House version as is, such as language on abortion funding.  House Democrat Bart Stupak, author of the Stupak Amendment, reported on Monday that “House members will not vote for the Senate bill.  There’s no interest in that.”  He added that when the notion was proposed at a caucus meeting among Democrats, “It went over like a lead balloon.”

•    Tricking the House into passing the Senate bill and promising them that it will be morphed into a bill more to their liking “later.”

•    Using the byzantine budget reconciliation process to ram the bill through.  This would subject weary Americans to several more months of reports of Democrats using sneaky, behind-closed-doors, parliamentary procedures no one understands to get their way—a surefire Democratic victory strategy for the midterm elections in November.

If these tactics don’t work, it is conceivable that Democrats may try any of the following makeshift schemes (I hate to give them any ideas, but it’s probably best that we be forewarned):

•    Abolishing the filibuster.  Democrats would of course reinstate the filibuster in time for the November elections, when they will lose one or both chambers of Congress and will need it as protection against devious, heavy-handed Republicans.

•    Concocting some fake scandal involving Scott Brown, or another Republican from a state with a Democratic governor, that forces him to resign, thus allowing the governor of said state to appoint a Democratic replacement Senator.

•    Crowning Olympia Snowe Queen of the Senate and letting her rewrite the bill to her specifications, including funding for her own blueberry farm and stock options in L.L. Bean.

•    “Packing the Senate” à la FDR’s court-packing scheme in the 1930s.

•    Kidnapping Republican legislators and replacing them with genetically engineered Manchurian candidate clones who have been brainwashed to vote for the bill.

Think these scenarios are outlandish?  Democrats have demonstrated that, as House Minority Leader John Boehner noted, “They are going to try every way, shape, and form to shove this bill down the throats of the American people.”

House Majority Leader Nancy Pelosi commented that the special Senate election is not a referendum on the health care bill, because—get this—Massachusetts already has universal coverage.  She elaborated, “Massachusetts has health care.  The rest of the country would like to have that too.  So we don’t say a state that already has health care should determine whether the rest of the country should.”  No, I think a state that has already suffered its own version of Obamacare is trying to do us all a favor by warning us about what a nightmare it would be.

Democrats have made it through the town hall gauntlet, they’ve cheated death in squeakers of votes in both chambers, they’ve gone on record in the past 48 hours insisting that they will get health care reform “one way or another” and that “health care will pass no matter what.”  Why should they stop now?

I have one more suggestion for Democrats, which they are less likely to consider than any of the ideas above, including the kidnapping plot, but which might just save some of their skins.

Listen to the American people and kill the damn bill.

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Health Care Bill Kicks Off Farewell Tour in Bay State

January 17, 2010 By: Scott Spiegel Category: Health Care

Supporters of the Democrats’ health care bill offer the following take on Tuesday’s special election in Massachusetts between Republican Scott Brown and Democrat Martha “Kennedy” Coakley, a plea they hope will draw on voters’ sense of fairness and magnanimity:

If Brown wins, the health care bill will not be passed.  It is a terrible shame that something this nation has frittered away a year debating and Congress has spent a year drafting, something that may not get another chance again—if at all—for a whole generation, could be dismantled because of the obstinacy of one man who wins a special election in a tiny state.  Brown may even derail Obama’s entire agenda.

As if it will do any good, here’s a point-by-point rebuttal of this selfless appeal by Democrats to our leftist instincts:

(1) The point of a debate is to have two sides present their cases and see which makes the better argument.  The outcome is not predetermined, much as Democrats would like it to be and have tried to make it so.  Republicans spoke, Democrats spoke, and the American people made up their minds: Republicans won.

(2) The fact that we spent a year debating this horrendous bill, in all its myriad forms, is indeed deplorable, when we could have been talking about how to encourage the Iranian protestors, win in Afghanistan, or abolish the Department of Education.  But just because gallons of ink have been spilled and billions of megabytes have been transmitted and trillions of cubic feet of C02 have been exhaled thrashing out numerous claims made by Democrats and debunked by Republicans, doesn’t mean we have to embrace the fallacy of sunken costs and pass something that stinks just to rationalize our squandered effort.

Making a $100 down payment on a $1,000 dishwasher offered by a fraudulent mail-order company that folds does not obligate us to send the company the other $900 so our first $100 isn’t wasted.  If any Democrats want to silently change their positions on the bill and pretend they felt that way all along, I promise you that Republicans will be tactful enough to go along with the charade.

(3) If it isn’t right to pass this legislation in the current generation, just as it wasn’t right to pass it in Hillary Clinton’s generation, or Truman’s generation, or FDR’s generation, then we can afford to wait at least another generation to debate it again, if liberals really insist on holding and losing this contest once more.

(4) Saying that the special election in Massachusetts could destroy the whole health care plan is like saying that the failure of an asteroid to demolish the court building where Bernard Madoff was sentenced destroyed his chance for freedom.  The success of this health care bill has been dangling like an anvil from a spider web since last summer.  The special election in Massachusetts is only the latest in many gusts of wind to threaten to crash the Democrats’ hopes to the ground.

(5) Saying that the travesty of Democrats’ health care bill not passing is due to Scott Brown’s stubbornness upon being elected is like saying that the travesty of Confederate soldiers’ dying is due to Abraham Lincoln’s stubbornness upon being elected.  In addition to its being the right course of action, if Brown wins and votes no on the bill, it will be because he was explicitly elected for that purpose alone, to take that specific action by itself.  Indeed, he barely had to say a word about any of the other issues in order to win fanatical political and financial support from Republicans, Independents, and Democrats in Massachusetts and across the country.

Promising to kill the health care bill is not just the biggest, but the only functional plank in Brown’s platform.  Senator Brown could turn around next month and introduce a bill using Medicare funds to subsidize partial-birth abortions for illegal Islamist immigrant tax cheats with Al-Qaeda ties, and he would still be Republicans’ hero for having voted down the health care bill.

(6) If Obama isn’t buried under a pile of political debris after his dustup with the 41st Senator, and dares to try to foist cap-and-trade, Stimulus II, or other reckless spending debacles onto a battered and bruised Congress, he will find it even harder to pass such legislation than he did the health care bill, and that is saying something.  Indeed, one of the fringe benefits of voting for Brown is that he will block not only the health care bill but anything like it that comes down the chute.

As an opponent of the health care bill, here’s my take on Tuesday’s election, which I hope will appeal to any remaining connection to reality liberals may have:

Even if Brown loses, the health care bill still will not be passed.  There are too many gaping discrepancies between the two versions of the bill to be reconciled; Blue Dog Democrats are too nervous about their own reelection campaigns this fall; and soon-to-be-elected Republican majorities in the House and Senate will do everything in their power to reverse any steps taken to enact this wretched bill.

They may even derail Obama’s entire agenda.

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Reid: “I Come Too Far From Where I Started From”

January 13, 2010 By: Scott Spiegel Category: Racism

Weighing in on the controversy surrounding the Senate Majority Leader’s racially insensitive remarks about candidate Barack Obama, Kanye West declared at a recent benefit for Haitian earthquake victims, “Harry Reid doesn’t care about dark-skinned black people with Negro dialects!”

According to Harry Reid’s electability criteria for black Democratic candidates—“light-skinned” with “no Negro dialect unless he wanted to have one”—I notice that the following are all A-grade presidential material: Hillary “I Don’t Feel No Ways Tired” Clinton, Rod “I’m Blacker than Barack Obama” Blagojevich, and Bill “Our First Black President” Clinton.

On the taboo list are Jesse Jackson, Al Sharpton, and Marion Barry.

Also forbidden because of their complexion are dark-skinned black Republicans Clarence Thomas, J. C. Watts, and Alan Keyes.

Democrats’ response to Reid’s outrageous remarks, which were revealed in John Heilemann and Mark Halperin’s new book “Game Change,” was to get angry at… Trent Lott.

Last week my column “Liberal Syntax: A Noun, a Verb, and a Bush Smear” offered a rule that characterizes liberals’ defense of their mishandling of national security and the economy.  For more general purposes, such as their defense of Reid’s remarks, I propose replacing “Bush” with “Republican.”

Since they brought up Lott’s comment, let’s drag it out into the light again and hold it up next to Reid’s sentiments.  Lott: “When Strom Thurmond ran for president, we voted for him.  We’re proud of it.  And if the rest of the country had followed our lead, we wouldn’t have had all these problems over the years, either.”

For starters, compared to Lott’s words, Reid’s comments were explicit and vulgar and revealed a race-obsessed mindset.  They bring to mind, not Lott’s tribute to a fellow Southerner and half-century veteran of the Senate who was practically on his deathbed, but rather Joe Biden’s condescending statement that Obama “is articulate and bright and clean” and Bill Clinton’s dismissive remark to Ted Kennedy about Obama that “a few years ago, this guy would have been getting us coffee.”  In contrast, Lott’s comment, which echoed a remark he had made in 1980 comparing Reagan and Thurmond’s small-government, fiscally responsible views, requires several questionable levels of inference before you can jump to the conclusion that Lott was endorsing a segregationist Republican platform in 2002.

Reid’s motivation for his comments about Obama was to use race to cynically calculate, for political purposes, the electability by the Democratic base of token black candidates under consideration.  Similarly, other Democrats regularly exploit blacks to get their votes, as in Hillary “Nobody Told Me That The Road Would Be Easy” Clinton’s feverish recitation of spirituals (in a Negro dialect) in black churches.  Lott’s motivation was to find something nice to say about the life work of a senator on the occasion of his retirement and 100th birthday.

This is how it always works: a Republican says something that is milder or no worse than something a Democrat says—but, due to a combination of Republicans’ sense of honor (or lack of fortitude, depending on your perspective) and Democrats’ vicious persistence, the Republican is out, and the Democrat is in.  Democrats never come to the Republican’s defense, but Republicans frequently come to the Democrat’s defense—as many have with Reid—in an attempt to be fair, a favor that is never returned.  That’s the pattern—Democrats have no honor, Republicans aren’t vicious, so Democrats get to stay and Republicans have to go.  This is then seen as evidence by the media—and biased historians with no sense of context—that the Republican was guilty after all and the Democrat did nothing wrong.

The larger issue is not whether Reid is a racist.  The issue is whether Democratic leaders have historically manipulated African Americans for political gain, offering them freebies and using their “dialect” and pretending to stand for their interests, while privately looking down on them as a dependent, infantile interest group to be pandered to.

As succinctly affirmed by Allen West, black Republican candidate for the House in 2010 from Florida, “Reid’s comments [are] indicative of the true sentiment elitist liberals have toward black Americans.  The history of the Democrat party is one of slavery, secession, segregation, and now socialism, born from the Johnson Great Society programs that have castigated blacks as victims…  I would rather be called ‘an Uncle Tom and a sellout’ than lose my self-esteem and be considered an inferior by liberals…  I am not just some articulate, clean, well spoken Negro…  [I] shall never submit to the collective progressive ideal of inferiority.”

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Liberal Syntax: A Noun, a Verb, and a Bush Smear

January 09, 2010 By: Scott Spiegel Category: War on Terror

When conservatives correctly pointed out that one disastrous terrorist attack and another potentially catastrophic but thwarted attack both happened during President Obama’s first term in office, because his agencies overlooked the perpetrators’ jihadist intentions or failed to act on relevant intelligence, liberals responded with an argument that was discredited nearly a decade ago: “But 9/11 happened on George Bush’s watch!”

Obama supporters mocked Rudy Giuliani’s recent claim to George Stephanopolous, “We had no domestic attacks under Bush,” stubbornly avoiding Giuliani’s obvious implication that he was speaking post-9/11.  Until last week, Democrats loved to excoriate Giuliani for making endless references to the terrorist attack that occurred while he was mayor of New York; now they claim he forgets it happened.  Which is it?

Conservatives’ point is that Obama has forgotten the lessons of 9/11, which Bush did not have available to him until, surprisingly—9/11.  The Ft. Hood and Flight 253 attacks happened in the first year of Obama’s administration, and 9/11 happened in the first year of Bush’s administration, but Obama had the example of 9/11 to learn from, and Bush did not.  (Even if you count the thwarted attack by the shoe bomber in December 2001, that bomber tried to strike just months after 9/11, when fully revamped security procedures were not running as smoothly as they are now; also, the bomber used the novel, unprecedented technique of wearing the bomb on his person so that it would not be detected by luggage screeners.)

Obama not only had the example of 9/11, he had seven years in which to witness and debate and vote on the implementation of the policies his predecessor devised that kept the country safe in the years after 9/11.  Obama denounced and campaigned against these tactics every chance he got.  He hasn’t revoked all of the Bush policies—upon assuming the Presidency, he must have received access to hair-raising intelligence that made him realize the suicidal folly of reversing Bush on everything—but he has slackened up enough, rhetorically and policy-wise, that our security standards have slipped and our enemies have become emboldened.

It is not enough to say that Obama has forgotten the lessons of 9/11.  He has actively rejected them.  He has argued that doing the opposite of what Bush did will keep us safer.  We are seeing how well the Obama Doctrine is working out in his first 11 months in office.

Another error in the “Bush-was-bad-so-Obama’s-off-the-hook” argument is that Bush did not do anything to actively facilitate the occurrence of 9/11.  In contrast, the Ft. Hood shootings were aided by the politically correct refusal of the U.S. Army—under Commander-in-Chief Obama—to recognize murderous jihadist sentiments expressed by Major Nidal Hasan openly and repeatedly while in medical school and residency, and the promotion Hasan received despite his poor performance reviews.  The Flight 253 near-attack was made possible by the Obama administration’s failure to act on numerous warnings available to it, such as Umar Farouk Abdulmutallab’s father having called the U.S. Embassy to report him, Abdulmutallab’s not having a passport or luggage, and his having bought a one-way ticket with cash.

But there’s an even more damning flaw to the contention that Bush should have been able to prevent 9/11, and is therefore as bad as or worse than Obama on national security.  Namely: just what would Bush opponents have preferred that he do in his first eight months in office to prevent terrorist acts, when they now scream bloody murder at the slightest suggestion of profiling at airports, call Bush Big Brother for trying to monitor terrorist communications, and express their clear disapproval of any war Bush started abroad to target Al-Qaeda?  Are liberals implying that they would have been fine with Bush doing all of these things in a pre-9/11 world?  They’re not even fine with The One doing these things in a post-9/11 world.

The left have been digging up examples of localized attacks carried out by truly isolated (not Abdulmutallab-style “isolated”) loonies—such as Bruce Ivins’ anthrax-laced letters to news broadcasters in September 2001, Hesham Hadayet’s shooting of two Israelis at LAX in July 2002, the Beltway sniper attacks in October 2002—as proof that Bush didn’t keep us safe.  Ignore for the moment that when each of these incidents happened, the same people criticized Bush for using these events to “hype” the threat of terrorism to justify extra security measures.  Instead ask: what level of government intervention into our lives would have been necessary to prevent every one of these attacks?  And how likely is it that liberals would have supported Bush’s carrying out such interventions at the time?

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The Democrats’ Tower of Babel

January 06, 2010 By: Scott Spiegel Category: Health Care

Each of the two ratified versions of the health care bill currently waiting in Congress was barely passed, by virtually the slimmest margin possible, in a hectic last-minute stampede.  Dozens of harsh compromises had to be hammered out to cobble together the fragile framework now standing in each chamber.

The two bills are like delicate Jenga towers, swaying nerve-wrackingly in the breeze, that must now be reassembled by a team of 535 clumsy attention-seekers into a tower twice as tall.  But legislators across the two chambers—and even within them—are not even speaking the same language.

Here are a few of the myriad discrepancies legislators must reconcile to ensure that their monument to Obama’s greatness doesn’t fall:

In the House version of the bill, a government-run insurance exchange is created on a national level and includes a public option.  In the Senate version, exchanges are created on the state level and do not include a public option.  Virtually identical!

The House completely bans the practice 0f charging those with preexisting conditions higher premiums.  The Senate allows insurers to offer unlimited discounts for customers who engage in subjectively defined wellness activities: say, exercising, eating healthy, “not having contracted lung cancer”…

Insurance exchanges are implemented in 2013 in the House bill and 2014 in the Senate bill.

In the House version, employers are forced to provide insurance for their employees and pay a fine if they do not.  In the Senate version, employers are not required to provide insurance, but pay a fine for employees who opt for government-run insurance and receive federal subsidies.  The House has higher penalties than the Senate.

The House version funds the bill by imposing a surtax on families making over $1 million a year.  The Senate version establishes a tax on those with “Cadillac” plans, which includes not only many union members, but millions of families who will unexpectedly find themselves unlucky Cadillac owners over the next 10 years due to the non-inflation-adjusted nature of the provision.

The House version does not tax insurance offered by employers; the Senate version taxes employer insurance above a threshold.

The House version charges older people a maximum of twice the premiums as younger people; the Senate version sets a maximum ratio of three-to-one.  The House offers fewer insurance subsidies for the middle class than does the Senate.  The Senate offers weaker measures to limit out-of-pocket costs than does the House.

The House bill covers 5 million more people than the Senate bill by expanding Medicaid to those earning up to about $2,000 more than in the Senate bill.

The Senate version gives $100 million to Nebraska for indefinite coverage of all new Medicaid enrollees in the state (to buy Ben Nelson’s vote).  The Senate bill gives $300 million to Louisiana for Medicare increases (for Mary Landrieu’s vote); $10 billion to Vermont for new public health centers (for Bernie Sanders’ vote); billions to Nebraska and Michigan to waive nonprofit insurers’ excise taxes (for Ben Nelson and Carl Levin’s votes); millions to Massachusetts and Vermont for Medicaid; and millions to Florida, New York, and Pennsylvania for Medicare Advantage.  None of these provisions is in the House bill.

The Senate version includes, per the insistence of construction unions, an important exception to the employer mandate.  As an article in the New York Times titled “In Health Bill for Everyone, Provisions for a Few” reports, “Under the Senate bill, businesses with fewer than 50 employees would be exempt from the penalties in every industry but construction.”  In the construction industry, the mandate holds for employers with as few as 5 employees.  The House includes no such provision.

Restrictions on abortion funding are tight in the House, with no federal funding allowed; and loose in the Senate, with mere separation of federal and private money, and states allowed to make up whatever rules they want regarding abortion funding.

Coverage for illegal immigrants is not disallowed in the House; it is explicitly banned in the Senate.

It should be sobering for Democrats to realize that if just one Senator or two Representatives decide they can’t tolerate the alternative version of even one of these provisions, that will be enough to topple the whole health care reform edifice.

It’s no wonder, then, that Congressional Democrats now plan to merge the bills behind closed doors, shutting out all Republicans from discussion of the reconciliation process and preventing them from using parliamentary procedures to slow consideration of the bill and allow the public to digest the proposed changes.  Talking Points Memo cites one Democratic House aide who proudly admits, “This process cuts out the Republicans.”  The House will simply take the Senate’s bill, amend it, vote on it, and send it to the Senate; who will then amend the bill, vote on it, and send it to the House; and back and forth until some hideous, lopsided, structurally unsound blueprint garners enough votes in both chambers.

If Democrats had to merge these two bills in a public conference committee—never mind on C-SPAN, as previously promised and recently offered by the network’s CEO—it would take about five minutes for the cacophonous clatter surrounding their health care Tower of Babel to bring it crashing down.

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