Economy & Budget

The House Democrats' healthcare reform bill is "the greatest thing" to come along for small business, on Democratic lawmaker claimed Wednesday.

Rep. John Yarmuth (D-Ky.), a key House centrist whose vote could be decisive in passing healthcare legislation, took aim at a central claim of Republican opponents of the legislation, who allege that the surtax on the wealthy contained in the package would disproportionately hurt small business.

"This is the greatest thing for small business that ever came down the road," Yarmuth said during an appearance on the Fox Business Network.

"What we're trying to do is make an option available, a plan so that competition brings prices down, small businesses will be able to provide insurance and afford insurance for their employees," Yarmuth said in defense of the plan introduced yesterday. "And if they can't, then they can go into the marketplace and buy affordable insurance for themselves."

The House bill creates a public (or "government-run") option for consumers, and includes a surtax on top earners to help finance the system.

"What we're proposing is to start acting right now to bring down costs," Yarmuth argued. "What we're asking the very wealthiest Americans to do is to give up some of those Bush tax cuts to help pay for the system."

President Obama praised healthcare reform legislation introduced by House Democrats on Tuesday, though he conspicuously eschewed commenting on new taxes on the wealthy contained within the proposal.

The bill contains up to a 5.4 percent surtax on taxpayers making over $1 million a year to help finance the legislation, which, at least in the House proposal, would create a public (or "government-run") option for consumers.

Obama still lavished praise on the legislation, saying it would "lower costs, provide better care for patients, and ensure fair treatment of consumers by the insurance industry."

Members of Congress on both sides of the aisle have signaled that they expect quick movement on the proposal in order to meet self-imposed deadlines before the August recess. Several House committees are expected to hold overlapping mark-ups of the legislation on Thursday.

Obama singled out several elements of the House proposal for praise, but made no mention of the reported tax increases. The president praised the expected $500 billion in savings from Medicare, guarantees of coverage despite pre-existing conditions, and the public option contained in the bill.

"The House proposal will begin the process of fixing what's broken about our health care system, reducing costs for all, building on what works, and covering an estimated 97 percent of all Americans," Obama said. "As this process moves forward, I look forward to continuing to work with all House members in ensuring this legislation helps all Americans and plays an essential role in reducing deficits and bringing fiscal sustainability to our nation."

There will have to be tax increases on wealthy Americans to finance healthcare reform, longtime Rep. John Dingell (D-Mich.) declared Tuesday.

Dingell, the Dean of the House whose career has been devoted to healthcare reform, said that tax increases are art of the formula to pay for healthcare legislation during an appearance on ABC's "Top Line" webcast.

"I think that this means there will be modest increases on taxes for persons in the upper-income brackets, yes," Dingell said.

In terms of timing, Dingell added that the opportunity is ripe for healthcare reform.

"Everybody in the Democratic caucus wants a bill on this point," the veteran lawmaker explained. "The question isn't so much sticker shock, as much as how the healthcare changes we have to make must be financed."

Democratic leaders in the House have floated tax increases for top earners as a way to pay for their reforms, alongside cuts and savings in other programs. However, some leaders in the Senate have been reluctant to sign onto tax increases, fearing it could scuttle passage of a final package.

For his part, Dingell said that the time is now for healthcare reform -- particularly a package that creates a public (or "government-run") option for consumers.

"I don't see any way around it," Dingell said of the necessity of including a public option. "I won't say it isn't going to happen, but it's going to be a while before the stars are in proper constellation again."

It's official: "Earmark" is now in the dictionary.

Merriam-Webster added the word, along with just over 100 others, to its latest edition. Politically charged terms like "waterboarding" and "carbon footprint" were also included in this round of updates.

The definition of 'earmark' reads: "A provision in Congressional legislation that allocates a specified amount of money for a specific project, program, or organization."

Rep. Jeff Flake (R-Ariz.), one of the biggest opponents of earmarks in Congress, seized on the news to press for a cut in pork barrel spending.

"Appropriators have been trying to find the word 'earmark' in the Constitution for years. At least now they'll be able to find it in the dictionary," said Flake. "Now that 'earmark' is in the dictionary, maybe we can get earmarks out of Congress."

Republicans see potentially fertile political ground in the debate over healthcare, judging by polling they have conducted about policies and messages in the reform battle raging in Congress.

Elements of the Obama administration's proposal to reform healthcare is being met with increasing skepticism from voters, according to an Republican National Committee (RNC) poll conducted by OnMessage.

Among key findings were that 50 percent of voters either somewhat or strongly disagreed with the Obama administration's argument that creating a public (or "government-run") insurance option for consumers would bring down healthcare costs. 38 percent somewhat or strongly agreed.

Republicans see concerns over the plan's costs and effects as driving down enthusiasm for the program, with little appetite for new taxes or cuts in existing programs like Medicare to finance the program.

The strategic foothold comes as healthcare reform has started to become mired in disputes between the House and Senate -- and committees within each chamber -- over how a final deal should be structured, as well as how it should be financed.

And while the RNC found that there is a strong consensus on the need for healthcare reform, the GOP is arguing that cost, not access, is driving the national appetite for healthcare reform.

The poll, conducted June 15-17 but released to reporters on Monday, has a 2.95 percent margin of error. The poll respondents were 42 percent Democratic, 34 percent Republican, and 22 percent independent. The poll, as well as memos based on the poll, have been distributed to members of Congress and party officials in states across the country.

The fiscal conservative group Americans for Tax Reform (ATR) put lawmakers on notice Monday, saying that a vote in favor of a surtax on healthcare benefits would violate any pledges they'd made to not raise taxes.

The group, which circulates anti-tax pledges for members of Congress, warned signatories of their pledge against voting in favor of a surtax to help finance healthcare reform legislation.

House Ways and Means Committee Chairman Charlie Rangel (D-N.Y.) has proposed doing such a thing, but Democratic lawmakers in the Senate have been skittish to sign onto Rangel's initiative.

(Rangel is expected to trek to the White House today to discuss his proposal.)

ATR, though, drew a line in the sand for lawmakers on the fence about the surtax, warning that the "surtax to pay for government medicine is a taxpayer protection pledge violation."

ATR was founded by conservative activist Grover Norquist.

A "more conservative approach" to raising revenues to finance healthcare reform will probably be needed in the Senate's proposed legislation, Senate Majority Whip Dick Durbin (D-Ill.) said Monday.

Durbin seemed to nix a House-led proposal to impose a surtax on wealthy Americans in order to pay for healthcare reform, a top initiative for President Obama and Democrats in control of Congress.

"We, of course, are hoping for bipartisan support which means probably a more conservative approach when it comes to revenue," Durbin said of the progress on healthcare legislation in the Senate during an appearance on MSNBC.

Healthcare reform has flailed in the Senate during an ongoing bid to win over centrist Democrats and Republicans. Chief among the stumbling blocks are the inclusion of a public (or "government-run") option and how to finance the bill.

"I think it may be different than what the House is proposing, which is a tax on people in higher income categories alone," Durbin said of his expectations for the Senate bill.

The Illinois Democrat said that Senators evaluated taxing healthcare benefits for the wealthy, but that it wasn't a viable solution.

"the general consensus was: Let's not do it," he said. "Neither party really wanted to move forward with that as a major part of the program."

Michigan's unemployment rate could hit as high as 20 percent with the Obama administrationto blame, one Michigan congressman warned Friday.

Rep. Thaddeus McCotter (R-Mich.) said that Michigan's unemployment -- already the highest in the country at 14.1 percent -- could go even higher as General Motors and Chrysler continue to shed jobs after their government-financed bankruptcies.

"Sadly, we've seen estimates, because of the radical restructuring that the auto task force demanded, that this year, Michigan wind up over 20 percent unemployment," McCotter said during an appearance on a conservative news radio program.

The Wolverine State hasn't yet exceeded its previous record for unemployment in modern history, when it reached 16.9 percent in November of 1982.

McCotter warned that the effect of such a high jobless number could spread to other states and cities.

"That cascading effect throughout the entire economy -- and throughout other states -- that rely in many ways on the manufacturing base is going to have devastating effects not only to state government, it's going to have devastating effects for local government," McCotter explained.

President Obama now "owns" the economy as a political issue, one Appropriations Committee Republican asserted Friday.

"The economy now belongs to Barack Obama, and I think everybody in the country is starting to believe that, and starting to know that," said Rep. John Carter (R-Texas) in an interview. "And that's why his poll numbers are going down."

The comments reflect a push by Republicans to tie the Obama administration more closely to a persistently dismal economy as the GOP also argues that the administration's trademark $787 billion stimulus package has been a failure.

The White House and congressional Democrats, for their part, have maintained that they had inherited a poor economic situation created in previous administrations.

Carter, who serves on the Appropriations Committee as well as the conference secretary for House Republicans, was unequivocal about laying the blame.

"He's creating it, he owns it, he's got to take credit for it," he said of the president's economic stewardship.

Democrats are organizing efforts to make any Republicans who claim the stimulus has been a failure "pay a political price" in the lawmaker's own back yard.

The Democratic National Committee (DNC) has targeted two senior Republicans, Senate Minority Whip Jon Kyl (R-Ariz.) and House Minority Leader John Boehner (R-Ohio), in recent days as part of a concerted effort to respond to Republicans' attacks on the stimulus plan.

For Boehner, that's meant a conference call and web video released by the DNC. For Kyl, the same. Even Vice President Biden visited Boehner's district to argue for the success of the stimulus, though it's not clear that visit was coordinated in any way.

"Any Republican who goes after the stimulus in a hypocritical way will pay a political price for attacking job creation in their own backyard," said a Democratic Party source.

Republicans have ramped up their criticism of the stimulus in recent days as some economic indicators remain dismal. Many have characterized the stimulus as having failed.

For their part, Republicans have hit back against the Democratic offensive. After having been targeted by the DNC, House Minority Whip Eric Cantor's (R-Ca.) office targeted DNC Chairman and Va. Gov. Tim Kaine's economic stewardship.

"Based on this curious statement from Governor Kaine's DNC, the question must be asked: Does Governor Kaine believe 8.1% unemployment in the Richmond area is a stimulus success?" Cantor's office asked.

Update, 11:08 a.m.: National Republican Congressional Committee (NRCC) spokesman Paul Lindsay comments: "The only ones paying a political price for the stimulus are the congressional Democrats who passed this misguided bill and are now engaged in a desperate PR campaign to salvage their plummeting ratings as a result of it. With a skyrocketing unemployment rate, Democrats have yet to answer the fundamental question: Where are the jobs?"

Update, 1:04 p.m.: The DNC's Hari Sevugan responds: "After championing the Bush-Cheney Economic policies, and continuing to plead for more of the same, it's the height of hypocrisy for Eric Cantor to criticize anyone for working to create jobs in Virginia. Even before the Economic Recovery Act was written Cantor said the Republican strategy was to just say no to action to rebuild the economy he and his colleagues pushed to the brink, but then he takes credit for projects funded by a bill he opposed. The only person's stewardship who should be questioned is Eric Cantor's -- both as a Republican leader and as a Congressman who is supposed to represent his constituents instead of playing politics."