Morning Jay: Obama has Failed by His Own Standards

This year, net confidence in the government hit a recent low. That suggests to me that Obama has failed by his own standards.

Let’s recall the meta-narrative of the Obama 2008 campaign, which he laid out in the first couple pages of the Audacity of Hope. Contrasting the “dirty and nasty” elements of politics, Obama praised its more noble side:

Obama’s purpose was to “excavate” the lost nobility of American politics, emphasizing the public good over special interests. In Obama’s estimation, it is the dominance of such interests – be it partisan absolutists, lobbying groups, or whatever – that has driven us apart, and eroded the public faith in our institutions. Obama would change all that, and restore confidence in the government.

The chart from Gallup tells us that faith in the government has most certainly not been restored, and a review of the Obama administration’s actions to date reveals a White House that time and again has chosen the special interests over the public good.

The problem began right away, as Obama outsourced the drafting of most legislation to Congress. This was a grievous mistake because Democrats in Congress are now hopelessly dependent upon PAC money from unions, environmentalists, feminists, trade groups, and businesses. It’s almost inconceivable that, left to their own devices, congressional Democrats would emphasize what “binds us together.”

Thus, we saw a similar result with the stimulus, financial reform, cap and trade, and above all health care. Let’s look at that last item in more detail, as it’s a perfect metaphor for how far short the president has fallen from the lofty rhetoric of The Audacity of Hope.

The Obama administration made a conscious effort to court various interest groups in designing health care reform. The goal was to prevent the “stakeholders” from launching attacks on reform efforts. Contrary to our common left-right conception of interest groups, the White House created a “strange bedfellows” coalition that included, for instance, Walmart and the SEIU, both of which believed they could gain something from Obamacare.

The consequence was that many of the major groups won big time payoffs. For starters, the public option never had a real shot at becoming law, considering none of the big groups wanted it (Obama telegraphed his willingness to drop it as early as April 2009). Beyond that, the pharmaceutical industry, the hospitals, the doctors, the AARP, and the labor unions all made concessions and in return had an opportunity to influence the bill. Even as Obama was publicly blasting the insurance companies, his team was working hard behind closed doors to cut a deal with them.

So in the end, health care reform was very good for plenty of special interests. But what about the public interest? Consider the following:

1) To lure the special interests to the table, they had to enact an individual mandate, which Obama opposed during the campaign (owing no doubt to its massive unpopularity) and is of questionable constitutionality.

2) To create the illusion of cost control, they had to implement Medicare reforms that the chief actuary of Medicare & Medicaid Services says are completely unsustainable.

(3) They implemented a watered-down employer mandate that will drive people off their current health insurance, even though the president promised again and again that wouldn’t happen. If the worst case scenario turns out to be true, the budget deficit will explode as tens of millions would be dropped from employer insurance and become eligible for federal subsidies on the exchanges.

(4) They created a scheme in which most Americans will see no substantial reduction in their insurance costs, and millions will see substantial increases.

(5) They created a completely unsustainable long-term care entitlement – known as the CLASS Act – that might cost the government billions down the road, but is magically considered a deficit reducer in the bill. [It was via similar hocus pocus that they could claim that the bill cost less than $1 trillion.]

(6) They junked 18 million more people on to Medicaid, a program that many doctors already won’t participate in.

(7) They created terrific uncertainty in the business community, inhibiting the recovery.

(8) They emphasized cost control during the campaign for passage, but when the dirty deed was finally done, a key Senate aide admitted, “This is a coverage bill, not a cost reduction bill.”

In other words, the winners in this scheme are the special interests that came to the table and people who do not have health insurance (assuming they can find a doctor who accepts Medicaid). The rest of us appear to be losers, as we’ll have higher taxes and premiums, and we might lose our current coverage. People might not understand the specific reasons why Obamacare is such a rotten piece of legislation, but they know it is.

[Note that we’ve put aside the conservative-liberal debate for the sake of argument here. You don’t have to oppose more government intervention in health care to see just how terrible all this is.]

So, I would say that Obama has done the exact opposite of what he promised. Rather than restore confidence in the government by pursuing the public good over special interests, he has sacrificed the public good for special interests, and public confidence in the government has accordingly plummeted.