Sen. Webb's response to State of Union speech

Democratic Response of Senator Jim Webb to the President's State of the Union Address
t r u t h o u t | Statement

Wednesday 24 January 2007

Good evening.

I'm Senator Jim Webb, from Virginia, where this year we will celebrate the 400th anniversary of the settlement of Jamestown - an event that marked the first step in the long journey that has made us the greatest and most prosperous nation on earth.

It would not be possible in this short amount of time to actually rebut the President's message, nor would it be useful. Let me simply say that we in the Democratic Party hope that this administration is serious about improving education and healthcare for all Americans, and addressing such domestic priorities as restoring the vitality of New Orleans.

Further, this is the seventh time the President has mentioned energy independence in his state of the union message, but for the first time this exchange is taking place in a Congress led by the Democratic Party. We are looking for affirmative solutions that will strengthen our nation by freeing us from our dependence on foreign oil, and spurring a wave of entrepreneurial growth in the form of alternate energy programs. We look forward to working with the President and his party to bring about these changes.

There are two areas where our respective parties have largely stood in contradiction, and I want to take a few minutes to address them tonight. The first relates to how we see the health of our economy - how we measure it, and how we ensure that its benefits are properly shared among all Americans. The second regards our foreign policy - how we might bring the war in Iraq to a proper conclusion that will also allow us to continue to fight the war against international terrorism, and to address other strategic concerns that our country faces around the world.

When one looks at the health of our economy, it's almost as if we are living in two different countries. Some say that things have never been better. The stock market is at an all-time high, and so are corporate profits. But these benefits are not being fairly shared. When I graduated from college, the average corporate CEO made 20 times what the average worker did; today, it's nearly 400 times. In other words, it takes the average worker more than a year to make the money that his or her boss makes in one day.

Wages and salaries for our workers are at all-time lows as a percentage of national wealth, even though the productivity of American workers is the highest in the world. Medical costs have skyrocketed. College tuition rates are off the charts. Our manufacturing base is being dismantled and sent overseas. Good American jobs are being sent along with them.

In short, the middle class of this country, our historic backbone and our best hope for a strong society in the future, is losing its place at the table. Our workers know this, through painful experience. Our white-collar professionals are beginning to understand it, as their jobs start disappearing also. And they expect, rightly, that in this age of globalization, their government has a duty to insist that their concerns be dealt with fairly in the international marketplace.

In the early days of our republic, President Andrew Jackson established an important principle of American-style democracy - that we should measure the health of our society not at its apex, but at its base. Not with the numbers that come out of Wall Street, but with the living conditions that exist on Main Street. We must recapture that spirit today.

And under the leadership of the new Democratic Congress, we are on our way to doing so. The House just passed a minimum wage increase, the first in ten years, and the Senate will soon follow. We've introduced a broad legislative package designed to regain the trust of the American people. We've established a tone of cooperation and consensus that extends beyond party lines. We're working to get the right things done, for the right people and for the right reasons.

With respect to foreign policy, this country has patiently endured a mismanaged war for nearly four years. Many, including myself, warned even before the war began that it was unnecessary, that it would take our energy and attention away from the larger war against terrorism, and that invading and occupying Iraq would leave us strategically vulnerable in the most violent and turbulent corner of the world.

I want to share with all of you a picture that I have carried with me for more than 50 years. This is my father, when he was a young Air Force captain, flying cargo planes during the Berlin Airlift. He sent us the picture from Germany, as we waited for him, back here at home. When I was a small boy, I used to take the picture to bed with me every night, because for more than three years my father was deployed, unable to live with us full-time, serving overseas or in bases where there was no family housing. I still keep it, to remind me of the sacrifices that my mother and others had to make, over and over again, as my father gladly served our country. I was proud to follow in his footsteps, serving as a Marine in Vietnam. My brother did as well, serving as a Marine helicopter pilot. My son has joined the tradition, now serving as an infantry Marine in Iraq.

Like so many other Americans, today and throughout our history, we serve and have served, not for political reasons, but because we love our country. On the political issues - those matters of war and peace, and in some cases of life and death - we trusted the judgment of our national leaders. We hoped that they would be right, that they would measure with accuracy the value of our lives against the enormity of the national interest that might call upon us to go into harm's way.

We owed them our loyalty, as Americans, and we gave it. But they owed us - sound judgment, clear thinking, concern for our welfare, a guarantee that the threat to our country was equal to the price we might be called upon to pay in defending it.

The President took us into this war recklessly. He disregarded warnings from the national security adviser during the first Gulf War, the chief of staff of the army, two former commanding generals of the Central Command, whose jurisdiction includes Iraq, the director of operations on the Joint Chiefs of Staff, and many, many others with great integrity and long experience in national security affairs. We are now, as a nation, held hostage to the predictable - and predicted - disarray that has followed.

The war's costs to our nation have been staggering. Financially. The damage to our reputation around the world. The lost opportunities to defeat the forces of international terrorism. And especially the precious blood of our citizens who have stepped forward to serve.

The majority of the nation no longer supports the way this war is being fought; nor does the majority of our military. We need a new direction. Not one step back from the war against international terrorism. Not a precipitous withdrawal that ignores the possibility of further chaos. But an immediate shift toward strong regionally-based diplomacy, a policy that takes our soldiers off the streets of Iraq's cities, and a formula that will in short order allow our combat forces to leave Iraq.

On both of these vital issues, our economy and our national security, it falls upon those of us in elected office to take action.

Regarding the economic imbalance in our country, I am reminded of the situation President Theodore Roosevelt faced in the early days of the 20th century. America was then, as now, drifting apart along class lines. The so-called robber barons were unapologetically raking in a huge percentage of the national wealth. The dispossessed workers at the bottom were threatening revolt.

Roosevelt spoke strongly against these divisions. He told his fellow Republicans that they must set themselves "as resolutely against improper corporate influence on the one hand as against demagogy and mob rule on the other." And he did something about it.

As I look at Iraq, I recall the words of former general and soon-to-be President Dwight Eisenhower during the dark days of the Korean War, which had fallen into a bloody stalemate. "When comes the end?" asked the General who had commanded our forces in Europe during World War Two. And as soon as he became President, he brought the Korean War to an end.

These Presidents took the right kind of action, for the benefit of the American people and for the health of our relations around the world. Tonight we are calling on this President to take similar action, in both areas. If he does, we will join him. If he does not, we will be showing him the way.

Thank you for listening. And God bless America.

Bush's War on the Republic, by Robert Parry

Bush's War on the Republic
By Robert Parry
Consortium News

Wednesday 24 January 2007

From the beginning of the "war on terror," George W. Bush has lied to the American people about the goals, motivation and even the identity of the enemy - a propaganda exercise that continued through his 2007 State of the Union Address and that is sounding the death knell for the Republic.

Since 2001, rather than focusing on the al-Qaeda Sunni fundamentalist terrorists behind the 9/11 attacks, Bush has expanded the conflict exponentially - tossing in unrelated enemies such as Iraq's secular dictator Saddam Hussein, Shiite-led Iran, Syria and Islamic militants opposed to Israel, like Hezbollah in Lebanon and Hamas in Gaza.

In effect, Bush has transformed what began as a definable military objective - the defeat of "terrorist groups with global reach" - into an endless war against what he regards as evil, a conflict so vague that it is claiming as collateral damage America's "unalienable rights" and the Founders' checks and balances on the powers of the Executive.

In Bush's State of the Union speech on Jan. 23, there could be heard a requiem for the Republic.

"The evil that inspired and rejoiced in 9/11 is still at work in the world. And so long as that's the case, America is still a nation at war," Bush told Congress.

But that "evil" will always be "at work in the world," so America will always be "a nation at war" and thus, under Bush's theories of unlimited Commander-in-Chief powers, the American Republic will be banished permanently.

Bluntly put, Bush and his neoconservative legal advisers don't believe in the "unalienable rights" guaranteed by the U.S. Constitution, including ones as fundamental as the habeas corpus right to a fair trial and protections against warrantless searches and seizures. [See, for instance, Consortiumnews.com's "Gonzales Questions Habeas Corpus."]

The Bush administration may make grudging concessions in these areas when faced with determined opposition in the courts or from the public, but they hold these liberties to be subordinate to Bush's "plenary" - or unlimited - powers as Commander in Chief.

Beyond this disdain for fundamental American liberties, Bush has contempt for any meaningful public debate. Though he talks about compromise and consultation, his view of national unity is to have everyone shut up and get in line behind him, "the Decider."

Since the 9/11 attacks, Bush has overseen a bare-knuckled political strategy of bullying anyone who disagrees with him and marginalizing their voices. From the Dixie Chicks to former Ambassador Joseph Wilson, from France to United Nations weapons inspectors, those who have dared to cross the President have faced ridicule and reprisals.

These ugly attacks have become so much a part of the American political landscape that the news media treats them as unexceptional, as if it's normal for a President to coordinate with powerful media allies to silence dissent.

For instance, there was no media outcry in April 2003 when Bush gave a wink and a nod to a retaliatory boycott against the three-woman Dixie Chicks band because the lead singer, Natalie Maines, had criticized the President.

"They shouldn't have their feelings hurt just because some people don't want to buy their records when they speak out," Bush said. "Freedom is a two-way street."

So, instead of encouraging a full-and-free debate about an issue as important as war and peace, Bush made clear that he saw nothing wrong with his followers punishing Americans who disagree with him.

"Democrat Party"

While Bush may have softened his belligerent style slightly since the Republican defeat in the November 2006 elections, he still couldn't muster enough politeness to refer to the "Democratic" Party in his State of the Union.

For years, tough-talking Republicans have made it a point of insult to drop the "-ic" and use "Democrat" as the adjective. This phrasing has become a mark of the swaggering Republicans who have dominated this era of U.S. politics. It's the partisan equivalent of willfully mispronouncing the foreign-sounding name of a disliked neighbor.

So, even as Bush was supposedly trying to be gracious to House Speaker Nancy Pelosi, he couldn't stop himself from congratulating the "Democrat majority."

More significantly, however, Bush continues to demean the Constitution. Despite having sworn "to preserve, defend and uphold the Constitution" as his preeminent duty, Bush keeps insisting that the highest obligation of government is to keep the people safe.

He repeated that mantra in his State of the Union. "For all of us in this room, there is no higher responsibility than to protect the people of this country from danger," he said.

In other words, Bush believes security - or at least his view of security - trumps everything, including constitutional rights.

But that concept turns upside down more than two centuries of U.S. history and tradition. Instead of Patrick Henry's exhortation of "give me liberty or give me death," the Bush dictum could be summed up as "just make sure I'm safe driving to the mall."

Bush apparently sees the American people as a pudgy bunch of consumers as soft in the head as in their bellies. In the State of the Union, the President didn't hesitate to again lay out his distortion of the threat the nation faces.

To heighten the fears of Americans, he again misrepresented the goals, capabilities and even the identities of the enemy. He blurred diverse and even antagonistic Muslim Sunni and Shiite groups, shoving them under the umbrella of "the Islamist radical movement."

"The Shia and Sunni extremists are different faces of the same totalitarian threat," Bush said. "Whatever slogans they chant, when they slaughter the innocent they have the same wicked purposes. They want to kill Americans, kill democracy in the Middle East, and gain the weapons to kill on an even more horrific scale."

But this depiction is a continuation of Bush's tendency to misstate the key question of what's motivating Islamic militancy.

In September 2001, Bush claimed that the motive behind the 9/11 attacks and other manifestations of anti-Americanism in the Middle East was that Islamic extremists "hate our freedoms." Now, he says they want to "kill" Americans, democracy and anything else that gets in their way.

However, this distortion of what drives the swelling anti-Americanism in the Middle East is not only wrong, it's dangerous. It guarantees an expensive, bloody and endless war. It also could ensure eventual defeat for legitimate U.S. interests in the region.

Diverse Motives

The truth is that the motives of Islamic militants are much more complicated and diverse than Bush wants the American people to know.

In Iraq, Sunni insurgents are killing Americans because the United States invaded their country and handed the reins of power over to rival Shiites, while Shiites are using "death squads" to consolidate their authority by killing Sunnis. Along the Mediterranean, other Islamic militants have fought against Israeli occupation of Palestinian territory and Lebanese land.

Some Middle Eastern militants are resentful of U.S.-backed autocrats like those governing Egypt and Saudi Arabia; many object to the corruption that has surrounded the region's oil wealth; others want a return to more traditional Islamic religious values; some actually favor democratic elections because they expect to win and want to unseat corrupt pro-American leaders.

In the Palestinian territories, Hamas did win an election. In Lebanon, Hezbollah is a powerful political force. In Iran, radical president Mahmoud Ahmadinejad gained office through a limited democratic process.

Even al-Qaeda has far more limited objectives than Bush has claimed. Despite Bush's oft-stated assertion that - if the United States retreats - al-Qaeda will form a caliphate stretching from Spain to Indonesia, no credible analyst believes that.

Intercepted al-Qaeda documents actually reveal leaders fretting about how fragile their position in Iraq would be if the United States withdrew. According to one captured letter, "Atiyah," a senior aide to Osama bin Laden, stressed the need to exploit the continued American presence so al-Qaeda can put down roots in Iraq.

"Indeed, prolonging the war is in our interest," Atiyah wrote. [For details, see Consortiumnews.com's "Al-Qaeda's Fragile Foothold."]

Yet, even as Bush's Iraq War strategy plays into the hands of al-Qaeda, the President told Congress and the American people that he intends to confront radical Shiite movements in the region with determination equal to that aimed at Sunni extremists. Bush said:

"In recent times, it has also become clear that we face an escalating danger from Shia extremists who are just as hostile to America, and are also determined to dominate the Middle East. Many are known to take direction from the regime in Iran, which is funding and arming terrorists like Hezbollah - a group second only to al-Qaeda in the American lives it has taken."

But Bush left out the history about those American deaths. He was referring primarily to the 241 U.S. soldiers who died in 1983 when a suicide bomber destroyed the Marine barracks in Beirut, after the Reagan administration had intervened in Lebanon and taken sides in the civil war.

By definition, terrorism is a violent attack on civilians to achieve a political end. Hezbollah's attack in 1983, therefore, was not an act of terrorism as lamentable as the military deaths were. Bush, however, blurs the point by associating the bombing with al-Qaeda's 9/11 attacks on civilian targets inside the United States.

Although the U.S. and Israeli governments list Hezbollah as a terrorist organization, the European Union does not. While some of its actions such as its missile attacks on Israel in summer 2006 could be categorized as terrorism because of the loss of civilian life, Hezbollah also is a broad-based political and social movement.

Guaranteeing Defeat

Lumping Hezbollah, Iran, Syria, Iraqi insurgents and others together with al-Qaeda underscores the risks - and almost certain futility - of Bush's expanding "war on terror." With anti-Americanism across the Middle East often registering in the 90 percentiles, Bush's strategy is more likely to accelerate Islamic extremism than put a brake on it.

Bush also finds himself caught in a contradiction between his rhetorical embrace of Middle East "democracy" and his reliance on "moderate" - i.e. autocratic - regimes that engage in political repression and have defied popular sentiment to cooperate with Bush.

At one point in his State of the Union speech, Bush denounced extremists who seek to "overthrow moderate governments" but returned to his lofty rhetoric about democracy and freedom as vital components in defeating the extremists.

"To prevail, we must remove the conditions that inspire blind hatred," Bush said. "What every terrorist fears most is human freedom. … The great question of our day is whether America will help men and women in the Middle East to build free societies and share in the rights of all humanity. And I say, for the sake of our own security, we must."

Though a surefire applause line, Bush's praise of liberty represents possibly the most insidious lie from his "war on terror." As U.S. intelligence is well aware, free democratic elections in countries such as Egypt and Saudi Arabia would represent a disaster for U.S. foreign policy by likely putting into power Islamic militants like the Muslim Brotherhood.

As was obvious during Secretary of State Condoleezza Rice's trip to the Middle East, the U.S. diplomatic position is precariously dependent on kings, princes and despots who favor regional stability for reasons of their own self-interest.

Bush's exhortations about human freedom therefore are galling to many in the world who see Bush himself as the world's most notorious autocrat, violating international law at his personal whim and overriding the constitutional liberties of Americans at home.

Bush is the personification of what recent polls of global opinion have registered as a leading complaint about America - hypocrisy, espousing concepts of liberty while denying even basic human rights to suspects swept up in the "war on terror."

There is also no end in sight, Bush made clear.

"The war on terror we fight today is a generational struggle that will continue long after you and I have turned our duties over to others," Bush told Congress. "And that's why it's important to work together so our nation can see this great effort through."

But the bottom line for Bush's "war on terror" is that it won't just cost countless lives and hundreds of billions of dollars; it also is doomed to fail, at least as presently constituted. If it lasts much longer, it is certain, too, to deliver a death blow to the noble American Republic.

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Robert Parry broke many of the Iran-Contra stories in the 1980s for the Associated Press and Newsweek. His latest book, Secrecy & Privilege: Rise of the Bush Dynasty from Watergate to Iraq, can be ordered at secrecyandprivilege.com. It's also available at Amazon.com, as is his 1999 book, Lost History: Contras, Cocaine, the Press & 'Project Truth.'

The Urge to Surge, by Paul Craig Roberts

January 6 / 7, 2007
Political Cover or Escalation?
The Urge to Surge

By PAUL CRAIG ROBERTS

The new year began on the hopeful note that Bush's illegal war in Iraq would soon be ended. The repudiation of Bush and the Republicans in the November congressional election, the Iraq Study Group's unanimous conclusion that the US needs to remove its troops from the sectarian strife Bush set in motion by invading Iraq, Donald Rumsfeld's removal as defense secretary and his replacement by Iraqi Study Group member Robert Gates, the thumbs down given by America's top military commanders to the neoconservatives' plan to send more US troops to Iraq, and new polls of the US military that reveal that only a minority supports Bush's Iraq policy, thus giving new meaning to "support the troops," are all indications that Americans have shed the stupor that has given carte blanche to George W. Bush.

When word leaked that Bush was inclined toward the "surge option" of committing more troops by keeping existing troops deployed in Iraq after their replacements had arrived, NBC News reported that an administration official "admitted to us today that this surge option is more of a political decision than a military one." It is a clear sign of exasperation with Bush when an administration official admits that Bush is willing to sacrifice American troops and Iraqi civilians in order to protect his own delusions.

The American establishment, concerned by Bush's egregious mismanagement, moved to take control of Iraq policy away from him.
However, recent news reports and analysis suggest that Bush has turned his back to the American establishment and his military advisers and is throwing in his lot with the neoconservatives and the Israeli lobby. This will further isolate Bush and make him more vulnerable to impeachment.

In the January 5 issue of CounterPunch John Walsh gives a good description of the struggle between the American establishment and the neocons.

Peter Spiegel, the Pentagon correspondent for the Los Angeles Times, reported on January 4 that the neocons have used the failure of the administration's policy in Iraq to convince Bush to launch an aggressive counterinsurgency requiring the buildup of troop levels by extending deployments beyond the agreed terms.

Raed Jarrar (CounterPunch, January 4) suggests that the Shi'ite militias, such as the one led by Al-Sadr, are the intended targets of the "surge option." There seems no surer way to escalate the conflict in Iraq than to attack the Shi'ite militias. For longer than the US fought Germany in WW II, 150,000 US troops in Iraq have been thwarted by a small insurgency drawn from Iraq's minority population of Sunnis. It hardly seems feasible that 30,000 additional US troops, demoralized by extended deployment, can succeed in a surge against the Shi'ite militias when 150,000 US troops cannot succeed against the minority Sunnis.

The reason the US has not been driven out of Iraq is that the majority Shi'ites have not been part of the insurgency. The Shi'ites are attacking the Sunnis, who are forced to fight a two-front war against US troops and Shi'ite militias and death squads.The US owes its presence in Iraq, just as the colonial powers always owed their presence in the Middle East, to the disunity of Arabs. Western domination of the Muslim world succeeded by not picking a fight with all of the disunited Arabs at the same time.

Attacking the Shi'ite militias while fighting a Sunni insurgency would violate this rule. If Bush ignores US military commanders and expert opinion and accepts the surge option advanced by the delusional neocon allies of Israel's right-wing Likud Party, US troops will be engulfed in general insurgency. This is why General John Abizaid resigned on January 5. He wants no part of the Republican Party's sacrifice of US soldiers to sectarian conflict.

In recent Senate Armed Services Committee hearings, Republican Senator John McCain, who believes in the efficacy of violence and not in diplomacy, pressed General Abizaid to request more US troops to be sent to Iraq. General Abizaid replied as follows:

"Senator McCain, I met with every divisional commander, General Casey, the core commander, General Dempsey, we all talked together.
And I said, in your professional opinion, if we were to bring in more American troops now, does it add considerably to our ability to achieve success in Iraq? And they all said no."

Bush is like Hitler. He blames defeats on his military commanders, not on his own insane policy. Like Hitler, he protects himself from reality with delusion. In his last hours, Hitler was ordering non-existent German armies to drive the Russians from Berlin.

By manipulating Bush and provoking a military crisis in which the US stands to lose its army in Iraq, the neoconservatives hope to revive the implementation of their plan for US conquest of the Middle East. They believe they can use fear, "honor," and the aversion of macho Americans to ignoble defeat to expand the conflict in response to military disaster. The neocons believe that the loss of an American army would be met with the electorate's demand for revenge. The barriers to the draft would fall, as would the barriers to the use of nuclear weapons.

Neocon godfather Norman Podhoretz set out the plan for Middle East conquest several years ago in Commentary Magazine. It is a plan for Muslim genocide. In place of physical extermination of Muslims, Podhoretz advocates their cultural destruction by deracination.
Islam is to be torn out by the roots and reduced to a purely formal shell devoid of any real beliefs.

Podhoretz disguises the neoconservative attack against diversity with contrived arguments, but its real purpose is to use the US military to subdue Arabs and to create space for Israel to expand.

Not enough Americans are aware that this is what the "war on terror" is all about.

Improving Medicare Now

st, Do Less Harm
By Paul Krugman
The New York Times

Friday 05 January 2007

Universal health care, much as we need it, won't happen until there's a change of management in the White House. In the meantime, however, Congress can take an important step toward making our health care system less wasteful, by fixing the Medicare Middleman Multiplication Act of 2003.

Officially, of course, it was the Medicare Modernization Act. But as we learned during the debate over Social Security, in Bushspeak "modernize" is a synonym for "privatize." And one of the main features of the legislation was an effort to bring private-sector fragmentation and inefficiency to one of America's most important public programs.

The process actually started in the 1990s, when Medicare began allowing recipients to replace traditional Medicare - in which the government pays doctors and hospitals - with private managed-care plans, in which the government pays a fee to an H.M.O. The magic of the marketplace was supposed to cut Medicare's costs.

The plan backfired. H.M.O.'s received fees reflecting the medical costs of the average Medicare recipient, but to maximize profits they selectively enrolled only healthier seniors, leaving sicker, more expensive people in traditional Medicare. Once Medicare became aware of this cream-skimming and started adjusting payments to reflect beneficiaries' health, the H.M.O.'s began dropping out: their extra layer of bureaucracy meant that they had higher costs than traditional Medicare and couldn't compete on a financially fair basis.

That should have been the end of the story. But for the Bush administration and its Congressional allies, privatization isn't a way to deliver better government services - it's an end in itself. So the 2003 legislation increased payments to Medicare-supported H.M.O.'s, which were renamed Medicare Advantage plans. These plans are now heavily subsidized.

According to the Medicare Payment Advisory Commission, an independent federal body that advises Congress on Medicare issues, Medicare Advantage now costs 11 percent more per beneficiary than traditional Medicare. According to the Commonwealth Fund, which has a similar estimate of the excess cost, the subsidy to private H.M.O.'s cost Medicare $5.4 billion in 2005.

The inability of private middlemen to win a fair competition against traditional Medicare was embarrassing to those who sing the praises of privatization. Maybe that's why the Bush administration made sure that there is no competition at all in Part D, the drug program. There's no traditional Medicare version of Part D, in which the government pays drug costs directly. Instead, the elderly must get coverage from a private insurance company, which then receives a government subsidy.

As a result, Part D is highly confusing. It's also needlessly expensive, for two reasons: the insurance companies add an extra layer of bureaucracy, and they have limited ability to bargain with drug companies for lower prices (and Medicare is prohibited from bargaining on their behalf). One indicator of how much Medicare is overspending is the sharp rise in prices paid by millions of low-income seniors whose drug coverage has been switched from Medicaid, which doesn't rely on middlemen and does bargain over prices, to the new Medicare program.

The costs imposed on Medicare by gratuitous privatization are almost certainly higher than the cost of providing health insurance to the eight million children in the United States who lack coverage. But recent news analyses have suggested that Democrats may not be able to guarantee coverage to all children because this would conflict with their pledge to be fiscally responsible. Isn't it strange how fiscal responsibility is a big concern when Congress is trying to help children, but a nonissue when Congress is subsidizing drug and insurance companies?

What should Congress do? The new Democratic majority is poised to reduce drug prices by allowing - and, probably, requiring - Medicare to negotiate prices on behalf of the private drug plans. But it should go further, and force Medicare to offer direct drug coverage that competes on a financially fair basis with the private plans. And it should end the subsidy to Medicare Advantage, forcing H.M.O.'s to engage in fair competition with traditional Medicare.

Conservatives will fight fiercely against these moves. They say they believe in competition - but they're against competition that might show the public sector doing a better job than the private sector. Progressives should support these moves for the same reason. Ending the subsidies to middlemen, in addition to saving a lot of money, would point the way to broader health care reform.

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For America's Sake, by Bill Moyers

For America's Sake
By Bill Moyers
The Nation

22 January 2007 Issue

The following is an adaptation of remarks made by Bill Moyers to a December 12 gathering in New York sponsored by The Nation, Demos, the Brennan Center for Justice and the New Democracy Project. - The Editors

You could not have chosen a better time to gather. Voters have provided a respite from a right-wing radicalism predicated on the philosophy that extremism in the pursuit of virtue is no vice. It seems only yesterday that the Trojan horse of conservatism was hauled into Washington to disgorge Newt Gingrich, Tom DeLay, Ralph Reed, Grover Norquist and their hearty band of ravenous predators masquerading as a political party of small government, fiscal restraint and moral piety and promising "to restore accountability to Congress...[and] make us all proud again of the way free people govern themselves."

Well, the long night of the junta is over, and Democrats are ebullient as they prepare to take charge of the multitrillion-dollar influence racket that we used to call the US Congress. Let them rejoice while they can, as long as they remember that while they ran some good campaigns, they have arrived at this moment mainly because George W. Bush lost a war most people have come to believe should never have been fought in the first place. Let them remember, too, in this interim of sweet anticipation, that although they are reveling in the ruins of a Republican reign brought down by stupendous scandals, their own closet is stocked with skeletons from an era when they were routed from office following Abscam bribes and savings and loan swindles that plucked the pockets and purses of hard-working, tax-paying Americans.

As they rejoice, Democrats would be wise to be mindful of Shakespeare's counsel, "'Tis more by fortune ... than by merit." For they were delivered from the wilderness not by their own goodness and purity but by the grace of K Street corruption, DeLay Inc.'s duplicity, the pitiless exploitation of Terri Schiavo, the disgrace of Mark Foley and a shameful partisan cover-up, the shamelessness of Jack Abramoff and a partisan conspiracy, and neocon arrogance and amorality (yes, amoral: Apparently there is no end to the number of bodies Bill Kristol and Richard Perle are prepared to watch pile up on behalf of illusions that can't stand the test of reality even one Beltway block from the think tanks where they are hatched). The Democrats couldn't have been more favored by the gods if they had actually believed in one!

But whatever one might say about the election, the real story is one that our political and media elites are loath to acknowledge or address. I am not speaking of the lengthy list of priorities that progressives and liberals of every stripe are eager to put on the table now that Democrats hold the cards in Congress. Just the other day a message popped up on my computer from a progressive advocate whose work I greatly admire. Committed to movement-building from the ground up, he has results to show for his labors. His request was simple: "With changes in Congress and at our state capitol, we want your input on what top issues our lawmakers should tackle. Click here to submit your top priority."

I clicked. Sure enough, up came a list of thirty-four issues-an impressive list that began with "African-American" and ran alphabetically through "energy" and "higher education" to "guns," "transportation," "women's issues" and "workers' rights." It wasn't a list to be dismissed, by any means, for it came from an unrequited thirst for action after a long season of malignant opposition to every item on the agenda. I understand the mindset. Here's a fellow who values allies and appreciates what it takes to build coalitions; who knows that although our interests as citizens vary, each one is an artery to the heart that pumps life through the body politic, and each is important to the health of democracy. This is an activist who knows political success is the sum of many parts.

But America needs something more right now than a "must-do" list from liberals and progressives. America needs a different story. The very morning I read the message from the progressive activist, the New York Times reported on Carol Ann Reyes. Carol Ann Reyes is 63. She lives in Los Angeles, suffers from dementia and is homeless. Somehow she made her way to a hospital with serious, untreated needs. No details were provided as to what happened to her there, except that the hospital-which is part of Kaiser Permanente, the largest HMO in the country-called a cab and sent her back to skid row. True, they phoned ahead to workers at a rescue shelter to let them know she was coming. But some hours later a surveillance camera picked her up "wandering around the streets in a hospital gown and slippers." Dumped in America.

Here is the real political story, the one most politicians won't even acknowledge: the reality of the anonymous, disquieting daily struggle of ordinary people, including the most marginalized and vulnerable Americans but also young workers and elders and parents, families and communities, searching for dignity and fairness against long odds in a cruel market world.

Everywhere you turn you'll find people who believe they have been written out of the story. Everywhere you turn there's a sense of insecurity grounded in a gnawing fear that freedom in America has come to mean the freedom of the rich to get richer even as millions of Americans are dumped from the Dream. So let me say what I think up front: The leaders and thinkers and activists who honestly tell that story and speak passionately of the moral and religious values it puts in play will be the first political generation since the New Deal to win power back for the people.

There's no mistaking that America is ready for change. One of our leading analysts of public opinion, Daniel Yankelovich, reports that a majority want social cohesion and common ground based on pragmatism and compromise, patriotism and diversity. But because of the great disparities in wealth, the "shining city on the hill" has become a gated community whose privileged occupants, surrounded by a moat of money and protected by a political system seduced with cash into subservience, are removed from the common life of the country. The wreckage of this abdication by elites is all around us.

Corporations are shredding the social compact, pensions are disappearing, median incomes are flattening and healthcare costs are soaring. In many ways, the average household is generally worse off today than it was thirty years ago, and the public sector that was a support system and safety net for millions of Americans across three generations is in tatters. For a time, stagnating wages were somewhat offset by more work and more personal debt. Both political parties craftily refashioned those major renovations of the average household as the new standard, shielding employers from responsibility for anything Wall Street didn't care about. Now, however, the more acute major risks workers have been forced to bear as employers reduce their health and retirement costs-on orders from Wall Street-have made it clear that our fortunes are being reversed. Polls show that a majority of US workers now believe their children will be worse off than they are. In one recent survey, only 14 percent of workers said that they have obtained the American Dream.

It is hard to believe that less than four decades ago a key architect of the antipoverty program, Robert Lampman, could argue that the "recent history of Western nations reveals an increasingly widespread adoption of the idea that substantial equality of social and economic conditions among individuals is a good thing." Economists call that postwar era "the Great Compression." Poverty and inequality had declined dramatically for the first time in our history. Here, as Paul Krugman recently recounted, is how Time's report on the national outlook in 1953 summed it up: "Even in the smallest towns and most isolated areas, the U.S. is wearing a very prosperous, middle-class suit of clothes, and an attitude of relaxation and confidence. People are not growing wealthy, but more of them than ever before are getting along." African-Americans were still written out of the story, but that was changing, too, as heroic resistance emerged across the South to awaken our national conscience. Within a decade, thanks to the civil rights movement and President Johnson, the racial cast of federal policy-including some New Deal programs-was aggressively repudiated, and shared prosperity began to breach the color line.

To this day I remember John F. Kennedy's landmark speech at the Yale commencement in 1962. Echoing Daniel Bell's cold war classic The End of Ideology, JFK proclaimed the triumph of "practical management of a modern economy" over the "grand warfare of rival ideologies." The problem with this-and still a major problem today-is that the purported ideological cease-fire ended only a few years later. But the Democrats never re-armed, and they kept pinning all their hopes on economic growth, which by its very nature is valueless and cannot alone provide answers to social and moral questions that arise in the face of resurgent crisis. While "practical management of a modern economy" had a kind of surrogate legitimacy as long as it worked, when it no longer worked, the nation faced a paralyzing moral void in deciding how the burdens should be borne. Well-organized conservative forces, firing on all ideological pistons, rushed to fill this void with a story corporate America wanted us to hear. Inspired by bumper-sticker abstractions of Milton Friedman's ideas, propelled by cascades of cash from corporate chieftans like Coors and Koch and "Neutron" Jack Welch, fortified by the pious prescriptions of fundamentalist political preachers like Jerry Falwell and Pat Robertson, the conservative armies marched on Washington. And they succeeded brilliantly.

When Ronald Reagan addressed the Republican National Convention in 1980, he a told a simple story, one that had great impact. "The major issue of this campaign is the direct political, personal and moral responsibility of Democratic Party leadership-in the White House and in Congress-for this unprecedented calamity which has befallen us." He declared, "I will not stand by and watch this great country destroy itself." It was a speech of bold contrasts, of good private interest versus bad government, of course. More important, it personified these two forces in a larger narrative of freedom, reaching back across the Great Depression, the Civil War and the American Revolution, all the way back to the Mayflower Compact. It so dazzled and demoralized Democrats they could not muster a response to the moral abandonment and social costs that came with the Reagan revolution.

We too have a story of freedom to tell, and it too reaches back across the Great Depression, the Civil War and the American Revolution, all the way back to the Mayflower Compact. It's a story with clear and certain foundations, like Reagan's, but also a tumultuous and sometimes violent history of betrayal that he and other conservatives consistently and conveniently ignore.

Reagan's story of freedom superficially alludes to the Founding Fathers, but its substance comes from the Gilded Age, devised by apologists for the robber barons. It is posed abstractly as the freedom of the individual from government control-a Jeffersonian ideal at the root of our Bill of Rights, to be sure. But what it meant in politics a century later, and still means today, is the freedom to accumulate wealth without social or democratic responsibilities and the license to buy the political system right out from under everyone else, so that democracy no longer has the ability to hold capitalism accountable for the good of the whole.

And that is not how freedom was understood when our country was founded. At the heart of our experience as a nation is the proposition that each one of us has a right to "life, liberty, and the pursuit of happiness." As flawed in its reach as it was brilliant in its inspiration for times to come, that proposition carries an inherent imperative: "inasmuch as the members of a liberal society have a right to basic requirements of human development such as education and a minimum standard of security, they have obligations to each other, mutually and through their government, to ensure that conditions exist enabling every person to have the opportunity for success in life."

The quote comes directly from Paul Starr, one of our most formidable public thinkers, whose forthcoming book, Freedom's Power: The True Force of Liberalism, is a profound and stirring call for liberals to reclaim the idea of America's greatness as their own. Starr's book is one of three new books that in a just world would be on every desk in the House and Senate when Congress convenes again.

John Schwarz, in Freedom Reclaimed: Rediscovering the American Vision, rescues the idea of freedom from market cultists whose "particular idea of freedom...has taken us down a terribly mistaken road" toward a political order where "government ends up servicing the powerful and taking from everyone else." The free-market view "cannot provide us with a philosophy we find compelling or meaningful," Schwarz writes. Nor does it assure the availability of economic opportunity "that is truly adequate to each individual and the status of full legal as well as political equality." Yet since the late nineteenth century it has been used to shield private power from democratic accountability, in no small part because conservative rhetoric has succeeded in denigrating government even as conservative politicians plunder it.

But government, Schwarz reminds us, "is not simply the way we express ourselves collectively but also often the only way we preserve our freedom from private power and its incursions." That is one reason the notion that every person has a right to meaningful opportunity "has assumed the position of a moral bottom line in the nation's popular culture ever since the beginning." Freedom, he says, is "considerably more than a private value." It is essentially a social idea, which explains why the worship of the free market "fails as a compelling idea in terms of the moral reasoning of freedom itself." Let's get back to basics, is Schwarz's message. Let's recapture our story.

Norton Garfinkle picks up on both Schwarz and Starr in The American Dream vs. the Gospel of Wealth, as he describes how America became the first nation on earth to offer an economic vision of opportunity for even the humblest beginner to advance, and then moved, in fits and starts-but always irrepressibly-to the invocation of positive government as the means to further that vision through politics. No one understood this more clearly, Garfinkle writes, than Abraham Lincoln, who called on the federal government to save the Union. He turned to large government expenditures for internal improvements-canals, bridges and railroads. He supported a strong national bank to stabilize the currency. He provided the first major federal funding for education, with the creation of land grant colleges. And he kept close to his heart an abiding concern for the fate of ordinary people, especially the ordinary worker but also the widow and orphan. Our greatest President kept his eye on the sparrow. He believed government should be not just "of the people" and "by the people" but "for the people." Including, we can imagine, Carol Ann Reyes.

The great leaders of our tradition-Jefferson, Lincoln and the two Roosevelts-understood the power of our story. In my time it was FDR, who exposed the false freedom of the aristocratic narrative. He made the simple but obvious point that where once political royalists stalked the land, now economic royalists owned everything standing. Mindful of Plutarch's warning that "an imbalance between rich and poor is the oldest and most fatal ailment of all republics," Roosevelt famously told America, in 1936, that "the average man once more confronts the problem that faced the Minute Man." He gathered together the remnants of the great reform movements of the Progressive Age-including those of his late-blooming cousin, Teddy-into a singular political cause that would be ratified again and again by people who categorically rejected the laissez-faire anarchy that had produced destructive, unfettered and ungovernable power. Now came collective bargaining and workplace rules, cash assistance for poor children, Social Security, the GI Bill, home mortgage subsidies, progressive taxation-democratic instruments that checked economic tyranny and helped secure America's great middle class. And these were only the beginning. The Marshall Plan, the civil rights revolution, reaching the moon, a huge leap in life expectancy-every one of these great outward achievements of the last century grew from shared goals and collaboration in the public interest.

So it is that contrary to what we have heard rhetorically for a generation now, the individualist, greed-driven, free-market ideology is at odds with our history and with what most Americans really care about. More and more people agree that growing inequality is bad for the country, that corporations have too much power, that money in politics is corrupting democracy and that working families and poor communities need and deserve help when the market system fails to generate shared prosperity. Indeed, the American public is committed to a set of values that almost perfectly contradicts the conservative agenda that has dominated politics for a generation now.

The question, then, is not about changing people; it's about reaching people. I'm not speaking simply of better information, a sharper and clearer factual presentation to disperse the thick fogs generated by today's spin machines. Of course, we always need stronger empirical arguments to back up our case. It would certainly help if at least as many people who believe, say, in a "literal devil" or that God sent George W. Bush to the White House also knew that the top 1 percent of households now have more wealth than the bottom 90 percent combined. Yes, people need more information than they get from the media conglomerates with their obsession for nonsense, violence and pap. And we need, as we keep hearing, "new ideas." But we are at an extraordinary moment. The conservative movement stands intellectually and morally bankrupt while Democrats talk about a "new direction" without convincing us they know the difference between a weather vane and a compass. The right story will set our course for a generation to come.

Some stories doom us. In Collapse: How Societies Choose to Fail or Succeed, Jared Diamond tells of the Viking colony that disappeared in the fifteenth century. The settlers had scratched a living on the sparse coast of Greenland for years, until they encountered a series of harsh winters. Their livestock, the staple of their diet, began to die off. Although the nearby waters teemed with haddock and cod, the colony's mythology prohibited the eating of fish. When their supply of hay ran out during a last terrible winter, the colony was finished. They had been doomed by their story.

Here in the first decade of the twenty-first century the story that becomes America's dominant narrative will shape our collective imagination and hence our politics. In the searching of our souls demanded by this challenge, those of us in this room and kindred spirits across the nation must confront the most fundamental progressive failure of the current era: the failure to embrace a moral vision of America based on the transcendent faith that human beings are more than the sum of their material appetites, our country is more than an economic machine, and freedom is not license but responsibility-the gift we have received and the legacy we must bequeath.

In our brief sojourn here we are on a great journey. For those who came before us and for those who follow, our moral, political and religious duty is to make sure that this nation, which was conceived in liberty and dedicated to the proposition that we are all created equal, is in good hands on our watch.

One story would return America to the days of radical laissez-faire, when there was no social contract and the strong took what they could and the weak were left to forage. The other story joins the memory of struggles that have been waged with the possibility of victories yet to be won, including healthcare for every American and a living wage for every worker. Like the mustard seed to which Jesus compared the Kingdom of God, nurtured from small beginnings in a soil thirsty for new roots, our story has been a long time unfolding. It reminds us that the freedoms and rights we treasure were not sent from heaven and did not grow on trees. They were, as John Powers has written, "born of centuries of struggle by untold millions who fought and bled and died to assure that the government can't just walk into our bedrooms and read our mail, to protect ordinary people from being overrun by massive corporations, to win a safety net against the often-cruel workings of the market, to guarantee that businessmen couldn't compel workers to work more than forty hours a week without extra compensation, to make us free to criticize our government without having our patriotism impugned, and to make sure that our leaders are answerable to the people when they choose to send our soldiers into war." The eight-hour day, the minimum wage, the conservation of natural resources, free trade unions, old-age pensions, clean air and water, safe food-all these began with citizens and won the endorsement of the political class only after long struggles and bitter attacks. Democracy works when people claim it as their own.

It is only rarely remembered that the definition of democracy immortalized by Lincoln in the Gettysburg Address had been inspired by Theodore Parker, the abolitionist prophet. Driven from his pulpit, Parker said, "I will go about and preach and lecture in the city and glen, by the roadside and field-side, and wherever men and women may be found." He became the Hound of Freedom and helped to change America through the power of the word. We have a story of equal power. It is that the promise of America leaves no one out. Go now, and tell it on the mountains. From the rooftops, tell it. From your laptops, tell it. From the street corners and from Starbucks, from delis and from diners, tell it. From the workplace and the bookstore, tell it. On campus and at the mall, tell it. Tell it at the synagogue, sanctuary and mosque. Tell it where you can, when you can and while you can-to every candidate for office, to every talk-show host and pundit, to corporate executives and schoolchildren. Tell it-for America's sake.

Health Care for all, by Nathan Newman

Health Care for All Debate Gets Real

Health care reform may be stalled in the DC swamp, but at least some states and local governments are getting real in debates and actions to deliver health care for all in our nation.

Last week, the San Francisco Board of Supervisors voted to create a health care plan to provide health care coverage for the 85,000 uninsured residents of that city. While there are additional votes needed to finalize the bill, with a unanimous vote and the endorsement of the mayor, the proposed ordinance is expected to become law with no problem. The San Francisco Health Access Plan is the first health care law in the nation that might actually achieve universal health coverage in a jurisdiction, but it caps a year when the debate to achieve health care for all became far more real in a number of states than in the past.

2006 became the year when Maryland kickstarted a national debate on employer responsibility for health care costs, Vermont and Massachusetts enacted new plans that each promised significantly expanded health care coverage, and Illinois finalized details on its AllKids program to provide affordable health care for all children in that state. And it was a year when serious campaigns in both California and Wisconsin to create integrated universal health care systems moved forward, emphasizing how states aren't waiting for the federal government to shake up our health care system.

San Francisco's Landmark Law

The ordinance approved by the San Francisco Board of Supervisors is the first law to pull together all the elements needed for universal coverage-- combining existing state and federal insurance funds, money already being spent on the uninsured showing up at public facilities, a solid employer contribution to cover costs, and reasonable fees paid by consumers based on their ability to pay. It's estimated that covering the 85,000 uninsured in the city will cost $200 million per year:

* A large chunk of that amount will come from the $104 million already spent by the city at city clinics and hospitals -- with the goal that the new system will contain costs better compared to the present disorganized and costly emergency care emphasis of most current help to the uninsured.
* Along with consumer premiums and copayments, additional funds for the new system will come from a new requirement that employers not providing health care pay into the public system. The legislation requires businesses with more than 50 employees to contribute $1.60 per hour worked by employees beginning in July, 2008. Businesses with from 20 to 50 workers would pay $1.06 per hour starting July, 2009. The ordinance caps employer contributions at $180 per month per worker.

It is still unclear how expensive premiums will be, although a key part of the ordinance requires that coverage be offered regardless of preexisting medical conditions. And the largest limitation on the plan is that all medical care will be provided only at city facilities, so no coverage under the plan will be available for health care needed when out-of-town. But it's a good foundation model for policy around the country.

Vermont and Massachusetts: Partial Steps to Universal Coverage

Vermont and Massachusetts both billed their plans as aiming for universal coverage. The Vermont plan has far clearer standards for heatlh care affordability and, while the Massachusetts plan had important provisions expanding coverage, it also has elements that policymakers probably should reject, especially the individual mandate Governor Romney insisted be part of the plan.

The new Vermont "Catamount Health" law subsidizes private sector health plans for the uninsured up to 300% of the poverty line ($29,400 for individuals, $60,000 for family of four) with a sliding scale of premiums from $60-$135 per month-- along with even lower premiums for children in that income range. The law also includes an assessment of $365 per employee per year on irresponsible employers who don't provide health care for employees, a low amount and not much of a deterrent to employers dropping coverage, but it at least establishes the principle of employer accountability.

The Massachusetts plan enacted this Spring is a more complex amalgam of program changes, including expansions of existing Medicaid and child health care programs, the promotion of a "Health Insurance Connector" to promote more affordable health plans, health care subsidies for citizens who earn up to 300% of the poverty line, a $295 charge per employee per year charge on employers not providing health care, and a potential mandate on all residents to get health care-- the last feature the biggest worry for middle class families if no affordable health plans get developed. But at least the state is aiming for universal coverage.

Illinois: Covering AllKids By expanding coverage for children, Massachusetts this year joined New Jersey, Connecticut, Maryland, New Hampshire, and Vermont which had already extended subsidized coverage to kids in families at 300% of the poverty level or higher.

Taking a step farther, Illinois enacted the AllKids program last year to extend health care coverage to children throughout Illinois. State officials this year finalized the table of premiums for families and launched the program on July 1-- and the results are an impressive model for affordability. Families of four making up to $30,000 per year will pay no premium for kids health care, while families making from more will pay from $25 for two kids (up to $40,000 annual income) to $100 per month per child for families making $99,000 per year.

What is impressive about the Illinois program is that it converts health care from a quasi-poverty program to a general health plan for all kids, much as Medicare is a general plan for the elderly. Which means that working families will no longer face the dilemma of a raise at work potentially meaning the loss of affordable health coverage for their children.

Exact funding sources for the AllKids program has to be worked out, but if there was a strong employer contribution included, there's no reason a similar model could not be extended to coverage of working adults, with a sliding scale of premiums for all families and with employers picking up part of those premiums.

California and Wisconsin: Proposals for Comprehensive Reform While not near passage, activists in both California and Wisconsin are promoting bold plans for integrated health care systems. Last year, California's State Senate approved SB 840, a Canadian-style "single payer" health plan, to create a single health care system for that state, an exploratory proposal that still needs a funding mechanism but it's opening up the debate in that state.

And this year in Wisconsin, Sen. Russ Decker (D-Schofield) and Rep. Terry Musser (R-Black River Falls), introduced SB 698, a plan to provide coverage for all working families in the state, including the 500,000 current residents without health insurance. The idea is to create an integrated plan that could better contain costs and deliver an affordable plan, including offering the same low-cost plan to small as to large firms, which would be financed jointly by employers and employees.
Conclusion

Most of these plans built on previous efforts that had expanded coverage in those states over many years. But what they have in common is an understanding that our current heatlh care system is not just punishing to working families but also incredibly wasteful. What is clear is that any viable solution will combine a more rational allocation of funds currently spent by governmenta, a fair contribution to costs from all employers, and contributions from families based on their ability to pay.

Nathan Newman is a lawyer, policy analyst and longtime community and labor activist. He is Policy Director for the Progressive States Network, a nonprofit that supports state legislative campaigns for economic and social justice. He can be contacted at nnewman@progressivestates.org.

Going Universal, by Ezra Klein

Going universal
The American healthcare system is, simply put, a mess, but we may finally be ready to fix it.
By Ezra Klein, EZRA KLEIN is a writing fellow at the American Prospect and a blogger at www.EzraKlein.com.
December 26, 2006

THE STATISTICS, by now, are well known. Forty-seven million uninsured Americans. Premium increases of 81% since 2000. Small businesses failing, big businesses foundering, individuals priced out and, amid all this, skyrocketing profits for insurers, hospitals and pharmaceutical manufacturers.

The American health system, put simply, is a mess. An expensive one. Indeed, in 2002, we spent $5,267 per capita on healthcare — $1,821 more than Switzerland, the nearest runner-up. And yet we had higher infant mortality, lower life expectancy, more price inflation and an actual uninsured population, a phenomenon virtually unknown in the rest of the developed world, where universal healthcare is, well, universal.

These are unsustainable trends. The U.S. healthcare system cannot, in its current form, go on forever, or even for very much longer — employers can't afford it, individuals can't handle it and the country's conscience won't countenance it.

And change may come sooner than most think. Across the country there are unmistakable signs that the gridlock and confusion sustaining our sadly outdated system are coming to an end and that real reform may finally emerge, possibly even starting in California, where Gov. Arnold Schwarzenegger is promising to spend his upcoming State of the State speech explaining how he will push the Golden State closer to universal healthcare in the coming year.

And it's about time. Few mention this, but the American healthcare system is something of a mistake. It blossomed out of a World War II tax reform meant to guard against corporate war profiteering. Liberals, with their usual combination of good intentions and inadequate foresight, imposed massive marginal tax rates on corporations, effectively freezing their profits at prewar levels. But the law had a loophole: Corporations could funnel their wartime riches into employee benefits, such as healthcare, thus putting the cash to use within their company. And so they did, creating the employer-based healthcare system.

But healthcare was simpler in the 1940s, and far less expensive. In the 21st century, it's not simple at all. Once a perk of employment, health insurance is now a necessity, and a structure that dumps such power, complexity and cost in the laps of employers is grotesquely unfair to both businesses and individuals. There's no logic to an auto manufacturer running a multibillion-dollar health insurance plan on the side; it should stick to making cars. There's no excuse for pricing the self-employed and entrepreneurial out of the market. And there's no reason the owner of a three-employee start-up should have to go to bed with a heavy conscience because his coffee shop can't pay for chemotherapy.

But health insurance is not only the inexplicable responsibility of business; it is a big business, which is why the system survives. The medical-industrial complex is a massive, remarkable beast, consuming a full one-ninth of the American economy and offering astonishing profits to many of the participants (indeed, Big Pharma was the most profitable industry in the U.S. from the 1980s until 2003, when energy companies wrested away the top spot). As with any lucrative industry, the winners are resistant to reforms, and they have a formidable army of politically lobbyists, PR specialists and image consultants helping to preserve their position, to preserve a mistake.

But there is evidence, finally, that their castle is being stormed. Massachusetts has passed the nation's first near-universal healthcare plan, creating a structure that should cover 95%-plus of its citizens by making healthcare as mandatory as car insurance. Nationally, the Democratic resurgence has returned universal healthcare to the agenda and its advocates to power. In the House, Rep. Pete Stark (D-Fremont), a staunch Medicare-for-all advocate, is expected to be chairman of the health subcommittee.

Surrounded by an unlikely array of union leaders and corporate chief executives, Sen. Ron Wyden (D-Ore.) has unveiled an inventive, comprehensive reform plan that would end the employer system forever. What businesses pay in employee premiums would be redirected to employee raises; insurers would offer their plans through state associations that would no longer allow price discrimination for reasons of health or job status; and everyone would have to buy in. Universal coverage would be achieved in under two years.

The most compelling evidence that resistance to reform is futile, however, is coming from the insurers themselves. Cognizant that Congress and the nation are tiring of the current dystopia, the insurance industry recently released its own plan for universal healthcare.

It's a bad plan, to be sure. Its purpose is more to preserve the insurance industry's profits than improve healthcare in this country. But the endorsement of universality as a moral imperative, and the attempt to get in front of the coming efforts at reform, mark the emergence of a distinct rear-guard mentality within the insurance industry. Their game is up, and they're turning some of their attention to shaping their future rather than betting that they can continue protecting their present.

SOME OF THE industry's more enlightened members are going even further. In California, the heads of Kaiser Permanente — a historical "good cop" insurer amid the almost cartoonish villainy of the industry — have proposed a serious, albeit extraordinarily complicated, plan for achieving universal coverage in the Golden State. The details of the plan are unimportant; it's the constructiveness of the proposal that matters.

And joining them in calling for reform is Schwarzenegger, who recently seized on a report by the New America Foundation showing that cost-shifting caused by the uninsured population costs each family in the state the equivalent of $1,186 in annual premiums. His plans for reform will be announced at the State of the State address Jan. 9.

The work is not done, of course. There are arguments yet to be had, wars yet to be fought.

Insurers want to retain their ability to discriminate against the ill and the old; conservatives want individuals to assume more risk and expense in order to force wiser health decisions; liberals want the government to guarantee universality and utilize its massive market power to bargain prices down to levels approximating those paid by other developed countries.

What's important, though, is that for the first time since the early years of the Clinton administration, these arguments are being made, and employers, insurers, politicians and, most crucially, voters are making their way back to the table.

The realization that our illogical, mistaken healthcare system can't go on forever has dawned, and so it will end. The question now is what replaces it.

A Healthy New Year, by Paul Krugman

A Healthy New Year
By Paul Krugman
The New York Times

Monday 01 January 2007

The U.S. health care system is a scandal and a disgrace. But maybe, just maybe, 2007 will be the year we start the move toward universal coverage.

In 2005, almost 47 million Americans - including more than 8 million children - were uninsured, and many more had inadequate insurance.

Apologists for our system try to minimize the significance of these numbers. Many of the uninsured, asserted the 2004 Economic Report of the President, "remain uninsured as a matter of choice."

And then you wake up. A scathing article in yesterday's Los Angeles Times described how insurers refuse to cover anyone with even the slightest hint of a pre-existing condition. People have been denied insurance for reasons that range from childhood asthma to a "past bout of jock itch."

Some say that we can't afford universal health care, even though every year lack of insurance plunges millions of Americans into severe financial distress and sends thousands to an early grave. But every other advanced country somehow manages to provide all its citizens with essential care. The only reason universal coverage seems hard to achieve here is the spectacular inefficiency of the U.S. health care system.

Americans spend more on health care per person than anyone else - almost twice as much as the French, whose medical care is among the best in the world. Yet we have the highest infant mortality and close to the lowest life expectancy of any wealthy nation. How do we do it?

Part of the answer is that our fragmented system has much higher administrative costs than the straightforward government insurance systems prevalent in the rest of the advanced world. As Anna Bernasek pointed out in yesterday's New York Times, besides the overhead of private insurance companies, "there's an enormous amount of paperwork required of American doctors and hospitals that simply doesn't exist in countries like Canada or Britain."

In addition, insurers often refuse to pay for preventive care, even though such care saves a lot of money in the long run, because those long-run savings won't necessarily redound to their benefit. And the fragmentation of the American system explains why we lag far behind other nations in the use of electronic medical records, which both reduce costs and save lives by preventing many medical errors.

The truth is that we can afford to cover the uninsured. What we can't afford is to keep going without a universal health care system.

If it were up to me, we'd have a Medicare-like system for everyone, paid for by a dedicated tax that for most people would be less than they or their employers currently pay in insurance premiums. This would, at a stroke, cover the uninsured, greatly reduce administrative costs and make it much easier to work on preventive care.

Such a system would leave people with the right to choose their own doctors, and with other choices as well: Medicare currently lets people apply their benefits to H.M.O.'s run by private insurance companies, and there's no reason why similar options shouldn't be available in a system of Medicare for all. But everyone would be in the system, one way or another.

Can we get there from here? Health care reform is in the air. Democrats in Congress are talking about providing health insurance to all children. John Edwards began his presidential campaign with a call for universal health care.

And there's real action at the state level. Inspired by the Massachusetts plan to cover all its uninsured residents, politicians in other states are talking about adopting similar plans. Senator Ron Wyden of Oregon has introduced a Massachusetts-type plan for the nation as a whole.

But now is the time to warn against plans that try to cover the uninsured without taking on the fundamental sources of our health system's inefficiency. What's wrong with both the Massachusetts plan and Senator Wyden's plan is that they don't operate like Medicare; instead, they funnel the money through private insurance companies.

Everyone knows why: would-be reformers are trying to avoid too strong a backlash from the insurance industry and other players who profit from our current system's irrationality.

But look at what happened to Bill Clinton. He rejected a single-payer approach, even though he understood its merits, in favor of a complex plan that was supposed to co-opt private insurance companies by giving them a largely gratuitous role. And the reward for this "pragmatism" was that insurance companies went all-out against his plan anyway, with the notorious "Harry and Louise" ads that, yes, mocked the plan's complexity.

Now we have another chance for fundamental health care reform. Let's not blow that chance with a pre-emptive surrender to the special interests.

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