Obama Stood His Ground

The health care reform bill — the Obama administration’s top priority — has passed the House of Representatives. President Obama postponed his travels to Indonesia and elsewhere in order to make the case to representatives and, by seven votes, the bill barely squeaked by. Precisely because Obama’s poll numbers fell during the polarized debate about the bill, the fact that he somehow succeeded in pulling it off will probably lead to a reassessment of his leadership.

Until now, the United States has never had universal health insurance as Japan has. Public insurance has been limited to Medicare (for those 65 and over) and Medicaid (for those with low incomes). Two-thirds of Americans are enrolled in private health insurance programs. Because they are enrolled through their jobs, when they are laid off, they lose their coverage. Forty-seven million Americans are said to be uninsured.

Because of this, many Americans pinned their hopes on Obama — who called for health insurance reform during last year’s presidential campaign — and voted him into office. The House of Representatives tackled this reform and passed a bill last November, introducing a system of public health insurance. In December, however, faced with strong opposition from the Republican Party and others, the Senate passed a modified bill that relied on private insurance.

The main provisions were (1) giving tax exemptions and subsidies to low- and middle-earners and effectively making health insurance mandatory, and (2) strengthening restrictions on the insurance industry by preventing them from denying coverage based on pre-existing conditions. Thereafter, adjustments meant to reconcile the two versions ran into difficulties. The Obama administration embarked on an all-or-nothing campaign. First, it aimed to get the Senate bill passed by the House. Then, it pushed through amendments that reflect the wishes of both houses of Congress. Those amendments look likely to pass the Senate, as well.

Why go to all this trouble? The Democrats lost a by-election for a Massachusetts Senate seat, thus dipping below the 60 seats they need to pass legislation smoothly. It appears as though they have opted for “Plan B” in order to be able to pass the bill with a simple majority.

It was a bitter struggle. They were frustrated at every turn by a conservative campaign against the bill, according to which “introducing public health insurance is a step towards socialism.” At the eleventh hour, it is said that Obama promised “no public funds would be used to fund abortions,” thus convincing conservative Democrats to support the bill.

Under the reform law, health coverage would expand from 83 percent to 95 percent. However, the legislation also contains a time bomb from the point of view of funding. Due to subsidies for low-earners and other provisions, it will cost $94 billion in public expenditure. Although taxes on the expensive insurance plans of the rich and increased efficiency in Medicare are supposed to save $138 billion, worries about the accelerating deficit cannot be waved away.

This reform has been in the works since the 1990s but had been shelved. Due to many compromises made in the midst of heated debate, the bill falls short of universal health insurance like Japan’s, but it is certainly an historic step. Obama boasted of “a victory for the American people” and “a victory for common sense.”

The focus now will probably shift to foreign policy and economic policies, such as job creation. Japan, which has the Futenma Airfield question hanging over its head, would do well to pay close attention to the momentum of change being shown by the U.S. administration.