Washed It!

With their eyes on the 2012 election, Republicans are preparing to maximize conflict with Democrats over healthcare in the new Congress and minimize potential compromises, according to GOP strategists, lawmakers and lobbyists.

That strategy is setting the stage for a bitter stalemate on Capitol Hill over the next two years as the president and senior congressional Democrats dig in to defend their signature achievement.

But Republican leaders and strategists think a renewed battle over healthcare will help the party expand its electoral gains and drive President Obama from the White House.

“Republicans have successfully challenged the healthcare legislation once,” said GOP strategist Frank Luntz. “They’ll do it again.”

Luntz, a leading architect of the Republicans’ successful campaign to cast the healthcare legislation as a ” Washington takeover,” said Democrats would suffer further if they tried to defend the law. “Democrats have more to lose,” he said.

In practical terms, the GOP approach will probably mean little congressional input over how the law is actually implemented. The Obama administration will retain broad authority to refine the law on its own, working with businesses, consumer groups, healthcare providers and state regulators, healthcare experts say.

While lawmakers deadlock on Capitol Hill, GOP leaders already have a target list of Democratic senators who are up for reelection in two years in traditionally red states including Missouri, Montana, Nebraska and Virginia.

“The next couple of years, in some ways, become about the 2012 elections,” Republican healthcare lobbyist Dean Rosen said last week at an Alliance for Health Reform briefing in Washington.

The GOP tactics mirror those deployed by Democrats after their 2006 electoral sweep.

Then, Democratic House and Senate leaders who had won majorities on a promise to challenge President George W. Bush’s Iraq war strategy bullied congressional Republicans by repeatedly forcing them to vote to support the unpopular war.

The Democrats’ legislative campaign ultimately collapsed. Bush used his veto pen to block legislation mandating troop withdrawals. Within a year, the Bush administration’s effort to stabilize Iraq with a troop surge showed signs of success.

Many Democrats think they too will be vindicated as the public sees more of the benefits of the new healthcare law.

Whit Ayres, a longtime GOP pollster, warned that Republicans risked a backlash if voters perceived them as more interested in scoring political points than in responding to voters’ concerns.

“There is no particular love for the Republican Party in the electorate,” he said at a recent Health Affairs forum. “Republicans are going to have to earn [voters'] support and earn their respect, and the way you do that is by governing responsibly.”

Most of the healthcare law’s major benefits — including its guarantee of coverage to all Americans — do not go into effect until 2014. And there are few signs the law is getting more popular.

In the interim, Republicans, who think the law was crucial to their electoral gains, are increasingly confident they can showcase its shortcomings and further weaken already tepid public support for Democrats.

“They are looking for ways to be very aggressive,” said Michael Franc, who works closely with congressional Republicans as head of government relations for the conservative Heritage Foundation.

Republicans provided a preview of their strategy before the midterm election as House GOP leaders forced Democrats to vote in June and September on proposals to repeal provisions of the healthcare law.

GOP leaders have indicated they intend to do more when they control the flow of legislation in the House next year, with likely votes to defund the law and excise controversial parts such as cuts in Medicare spending and a new mandate requiring Americans to get health insurance.

Republicans are spoiling for a healthcare fight

Shaken by Tuesday’s Republican landslide, Democratic fundraisers who felt hobbled by President Obama’s hard-line opposition to outside campaign spending are now planning to do what many groups did for the GOP — funnel millions of dollars into independent political advertising and voter mobilization campaigns.

Republican-aligned

President Obama announced Friday that Rahm Emanuel, his chief of staff and a fearsome White House operative, is resigning his post and would be replaced with another senior advisor.

Emanuel, who is planning to run for mayor of Chicago, departs 20 months into Obama’s presidency and leaves as one part of a staff shuffle that will bring a significant turnover at the top levels of the White House policy and economic team.

Senior presidential advisor David Axelrod is planning to leave the White House next year to begin preparations for Obama’s 2012 reelection drive, and economic advisor Lawrence Summers is quitting the White House to return to Harvard University.

Obama named senior advisor Pete Rouse to serve as Emanuel’s replacement, at least for now.

Emanuel’s departure had been expected since Mayor Richard Daley announced in September that he would not run for reelection. Obama lavished praise on Emanuel for his work at the White House.

“He just brings an unmatched level of energy and commitment to every single thing he does,” Obama said after embracing Emanuel before a cheering White House assembly.

Possible candidates for the permanent job include Thomas E. Donilon, a deputy national security advisor; Robert Bauer, White House counsel; Tom Daschle, a former Senate Democratic leader; and John Podesta, a former chief of staff to President Clinton.

cparsons@latimes.com
Obama makes it official, sends off top aide Emanuel

Pressure on President Obama to do something about the weakening economy intensified Friday with new government data showing that hiring remains lackluster, nudging the nation’s unemployment rate up to 9.6%.

With congressional elections less than eight weeks away, Obama appeared in the Rose Garden to say that he would soon propose a new package of tax cuts and other incentives to spur employment.

“We are confident that we are moving in the right direction, but we want to keep this recovery moving stronger and accelerate the job growth that’s needed so desperately,” the president said.

Obama spoke after the Labor Department reported that the nation lost 54,000 net jobs in August, fewer than economists had expected but still dismal. The private sector’s weak gain of 67,000 jobs was wiped out largely by the number of federal census jobs that ended.

The unemployment rate edged up to 9.6% from 9.5% in July, the first increase in that figure since April.

The president is expected to use a speech in Cleveland on Wednesday to outline a series of measures to kick-start the economy, which could include extending research and development tax credits for business, increasing spending on highways and other public works projects, and retaining the middle-class portion of the Bush administration tax cuts that are set to expire at the end of the year.

Many analysts believe that those measures will have only a modest effect, especially in the short time remaining before the midterm elections. But with Republicans lined up solidly against the Democratic administration on economic policy, more far-reaching proposals are considered out of the question.

“The key will be whether it’s smart — getting bang for the buck — and if it’s big enough,” said Heidi Shierholz, an economist at the nonprofit Economic Policy Institute, a liberal-leaning research group in Washington. “And I’m concerned on both of those fronts.”

One idea that has received some support from Republicans is a three-month payroll tax holiday for all workers and businesses.

That would amount to a 6.2% tax cut for each, freeing up money that employers could use for new hiring and workers could use to boost consumer spending.

But White House aides indicated that Obama will not embrace the idea. It would cost the government about $120 billion in revenue if adopted for two months — and a staggering $700 billion if continued for a full year.

Also, an unrestricted tax holiday would not be narrowly focused on Obama’s goal of adding jobs.

“I think the notion of giving payroll tax holidays is not very well targeted,” said Gary Burtless, an economist at the Brookings Institution think tank in Washington. “That’s going to go to all kinds of firms, even those that are reducing their employees.”

Instead, Alan Krueger, the Treasury Department’s chief economist, said Obama asked his economic team to “review options that are targeted and responsible” — that is, more narrowly focused and less likely to aggravate the government’s budget and deficit problems.

Recognizing that many Americans have an unfavorable view of last year’s massive stimulus program, White House Press Secretary Robert Gibbs has been taking pains to caution that “some big new stimulus plan is not in the offing.”

Among the narrower options under consideration is extending a tax break signed into law in March that exempts employers from their share of payroll taxes for the remainder of 2010 and provides other incentives if the employer hires someone who has been unemployed for at least 60 days.

The law, known as the Hiring Incentives to Restore Employment Act, or HIRE, passed with bipartisan support, and one of its main backers, Sen. Charles E. Schumer (D-N.Y.), recently urged a six-month extension.

A White House aide, Jen Psaki, would not lay out specifics, but said that “the options under consideration build on measures the president has previously proposed.”

The moves being discussed are unlikely to change the jobs picture any time soon, Burtless said. He noted that the R&D tax credit, which expired Dec. 31, has repeatedly been renewed and is expected to be extended again this year.

Obama to propose new incentives to spur employment

As employers struggle with rising healthcare costs and a sour economy, U.S. workers for the first time in at least a decade are being asked to shoulder the entire increase in the cost of health benefits on their own.

The average worker with a family plan was hit with 14% premium increase this year, pushing the bill to nearly $4,000 a year, according to a survey by the nonprofit Henry J. Kaiser Family Foundation and the Health Research and Educational Trust.

That is the largest annual increase since the survey began in 1999 and a marked change from previous years, when employers generally split the rise in the cost of premiums with their employees.

The average employer contribution to a family plan did not go up at all this year, meaning the entire increase was borne by workers.

At the same time, nearly a third of employers reported that they either reduced the scope of benefits they are offering this year or increased the amount that workers must pay out of pocket for their medical care.

Workers saw average copayments for routine office visits increase 10% and deductibles continue their surge upward.

In 2010, more than a quarter of American workers with employer-provided health coverage were in plans with deductibles of at least $1,000.

“It’s really bad news for everybody,” said Helen Darling, president of the National Business Group on Health, an organization of large employers that provide coverage to about 50 million workers, retirees and dependents.

Overall, premium growth slowed slightly this year to 3%, with the average annual cost of a family health plan reaching $13,770. Workers picked up 30% of that bill. The average plan for an individual cost $5,049.

The squeeze, reported by employers between January and May, largely reflects the fallout of the ongoing economic slowdown and may be ameliorated in future years as the new healthcare law is implemented.

But it could further complicate the Obama administration’s efforts to rally support for the law, which is expected to do relatively little in the short term to contain rising medical bills.

“There have been times when employers have been able to absorb costs. This is not one of those times,” said James Gelfand, health policy director at the U.S. Chamber of Commerce, a leading critic of the new law.

The law, which focused on expanding coverage for Americans who don’t get insurance through work, was designed to largely preserve the existing employer-based healthcare system.

Independent analyses of the law estimate that most Americans will continue to get insurance through their employer, as about 157 million do now.

Administration officials Thursday pointed to two new studies from the Rand Corp. and the Commonwealth Fund that predicted small businesses in particular would probably expand coverage in coming years, in part with help from billions of dollars of in new tax credits.

“We have really just begun our efforts,” said Nancy-Ann DeParle, director of the White House Office of Health Reform, emphasizing the growing number of tools government regulators have to control insurance premiums.

The Kaiser survey found that the percentage of firms offering health benefits rose to 69% from 60% this year, an unexpected increase that analysts speculate may reflect the failure of many businesses that didn’t offer benefits.

But the survey suggests that the coverage workers are being offered is becoming increasingly unattractive as employers try to control their costs in the down economy.

“We were all so focused on the reform debate that I think we took our eyes off the fact that what we call heath insurance in this country is changing,” said Kaiser foundation President Drew Altman. “What workers get looks less and less like the comprehensive coverage their parents had.”

U.S. employers push increase in cost of healthcare onto workers

Five years after Hurricane Katrina, President Obama recommitted the nation to ongoing repair of the Gulf Coast as the region’s fragile recovery hung in the balance and his own popularity needed shoring up amid disappointment with the administration’s handling of the gulf oil spill.

Obama underscored the optimism and ongoing frustration felt in New Orleans, a city that had shown signs of renewal despite lingering devastation.

Residents worry the nation will leave them behind, fatigued over the one-two punch of the hurricane and BP spill. Obama seemed intent on convincing them otherwise.

“I wanted to come here and tell the people of this city directly: My administration is going to stand with you – and fight alongside you – until the job is done,” Obama said at Xavier University, a historically black college where he delivered the commencement address less than a year after Katrina.

After being criticized for his administration’s slow response to this year’s BP oil spill, Obama impressed on gulf residents the improvements he had made in streamlining Katrina aid — including $1.8 billion for Orleans Parish Schools announced Friday.

Obama pledged to finish the largest civil-works project in the nation’s history — shoring up the failed levees — by next year. He noted the June groundbreaking on a new Veterans’ Administration hospital.

The White House sent top administration officials as the region held days of panel discussions, art exhibits — even a funeral for Katrina where attendees hoped to bury their grief and move on from the largest residential disaster in the nation’s history.

Yet for a president who works to separate his legacy in the gulf from that of his predecessor, President Bush, the administration’s handling of the BP spill links the two by the perceived inability of government to adequately respond to disaster.

“We are going to stand with you until the oil is cleaned up, the environment is restored, polluters are held accountable, communities are made whole and this region is back on its feet,” Obama said.

Obama made an unscheduled lunch stop before the afternoon speech, ordering a shrimp po’boy at the Parkway Bakery and Tavern, a 100-year-old restaurant in the Mid-City neighborhood of New Orleans, eating with the first lady and their daughters. The president greeted patrons with hugs and handshakes.

“We’re just going to keep on building, we’re going to keep on working, alright?” the president said, according to the pool report.
Obama, in New Orleans, promises to ‘fight alongside’ Gulf Coast

President Obama on Friday took a strong stand in favor of building a mosque near the site where Muslim terrorists flew airplanes into the World Trade Center on Sept. 11, 2001, breaking his silence on a political tempest that has left the country divided.

Speaking at a White House dinner celebrating Ramadan, Obama framed the issue as one of religious freedom.

Muslims “have the same right to practice their religion as everyone else in this country,” Obama said, according to a White House transcript. “That includes the right to build a place of worship and a community center on private property in Lower Manhattan, in accordance with local laws and ordinances.”