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Schumer: Opt-Out Public Option Gaining Steam

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We're chasing the ball on a new idea (is it a trial balloon? is it the magic answer?) to pass a health care bill with a public option that states--likely small, and conservative states--could choose not to participate in.

As I reported last night, the idea comes from Sen. Tom Carper (D-DE), and is being pushed by Sen. Chuck Schumer (D-NY)--a man with no shortage of clout on the Hill. Appearing on MSNBC a few moments ago, Schumer said the idea's gaining traction.

"That's one of the things being very seriously considered," Schumer said. "I'm not going to -- we have a range of things we're considering. Senator Carper and I met for quite a while last night and made progress and talked to a large number of members last night, yesterday. And I am optimistic that there will be some kind of public option in the bill the president signs. I'm very optimistic."

That's important. Looks like they're really selling this idea pretty hard. Some key questions, which we'll try to answer today: Who's been approached about this? Will it assuage conservative Democrats who've been resistant to the public option? And will progressives, particularly in the House, be satisfied by a public option that may not be national, but that would leave that tough political decision to the governments of conservative states? We'll try to get you answers to all those questions.

Late update: Here's video.

Join the Conversation!

103 comments

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October 8, 2009 11:12 AM   

Okay, here's something everyone should consider.

Yes, this plan is brilliantly devious. Yes, it's Machiavellan. Yes, it has the potential to make a strong public option available to a large majority of Americans. And, yes, down the line it can reap big electoral dividends by making an incredibly sharp electoral issue for state-level Democrats.

But it's still very disturbing. The precedent that comes to mind is FDR's compromise with racist Southern Senators in the 30s to pass Social Security. Yes, they would vote for it, but in exchange the bill would have to be modified to purposefully exclude blacks.

When you're pushing this compromise, what you're essentially voting to do is give cheap affordable health insurance to everyone except poor Southern blacks and Hispanics, for the reason that certain Senators just don't want those dark-skinned types to have health insurance.

Whatever happened to solidarity with even the least of us?

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October 8, 2009 11:20 AM    in reply to Zephyrus

Which isn't to say that it's an evil or even bad idea. It's just lots of people are looking at the upside without considering the full implications of what they're doing. Which is more than just making red state conservatives eat the shit they vote for. Breaking news: most Republicans in red states can already afford health insurance. It's the people who vote against this shit that are going to suffer.

It might still be better, though, than an impotent public option that helps no one. But what I'm saying is that it's still worth putting serious effort into making a robust public option available to everyone, not just those who are lucky enough not to be ruled by racist lunatics, instead of taking the easy route out and trying to split the difference.

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October 8, 2009 11:28 AM    in reply to Zephyrus

Most Republicans cannot afford insurance in Southern States. It's not just the Dems who can't afford it. There are plenty of poor white Republicans without health insurance.

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October 8, 2009 12:18 PM    in reply to Zephyrus

No matter how Red the state is, once the bill is signed, even the biggest deathers will understand that it's actually a good thing for them. I don't see any State opting out.

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October 8, 2009 12:43 PM    in reply to impik

Or, at least, opting out for very long.

I can't imagine most of these states' citizens sitting back and watching fellow states reap the benefits of a public option and not wanting to jump in once it becomes clear the government hasn't started offing grandma.

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October 8, 2009 1:34 PM    in reply to SchrodingersCat

Texas, Kansas, Oklahoma and many more states will see a mass exodus if they refuse the public option while other states accept it. Not only the working class, but the entrepreneurs who depend on them, will go to those states where the public option is available.

These Republican controlled state legislatures have proven time and again they have no compassion for anyone but their country club fellows. And they arrogantly uphold their ridiculous partisan policies out of pride and power-hunger, no matter what the results are for the well being of their respective states.

The academic drain Kansas experienced during those disastrous years when the state Board of Education was promoting poorly interpreted scripture over proven science is a very good example. When this public option is rejected, expecxt Kansas to lose a congressional district, while Iowa and other more-progressive states retain theirs, because small businesses, and the workers they hire, can survive better when healthcare ceases to be their burden.

If each of these states (or any state, blue, red or purple) had the guts to demand a fair share of tax revenue from those corporations who benefit most from our consumer nation, none of this would be an issue. But, as our latest manifestation of the Supreme Court proves every time they get a chance, corporations have more rights than We, the People.

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October 8, 2009 2:26 PM    in reply to JEP07

To them, I say "now you know how we feel" up here in the Northeast as we welcome our prodigal children back home, snow shovel in hand.

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October 8, 2009 1:36 PM    in reply to Zephyrus

This is actually brilliant. There are enough large states that would certainly opt-in and definitely not opt-out (California, New York, Massachusetts, Michigan, Pennsylvania) that it would be large enough to get the necessary scale. Then, the rest of the states can sit back and see if it works. If it's a failure, half the country avoids having to take part in the experiment. If it's a success, then the rest of the country will quickly join in.

In fact, if I were a pure good government type and could be assured that enough time would be given to allow success, I'd prefer a small pilot system that started with 10 states and let it run 3-5 years before expanding it. That won't work with our political system, so in my mind this is not only a more politically viable solution, but I prefer it over an immediate national public option. Let's see how it works.

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October 8, 2009 1:49 PM    in reply to fname

I agree - for the same reasons. The worst thing that would happen would be to have an entire nation-wide program .... that failed. And there are powerful interests wanting it to fail. At least some of those interests will have to be diverted to those opt-out states to 1) keep them out of the system and 2) come up with a good system for those states to show how they can (dare I say it?) compete.

This is different than the FDR situation, because the decision here will ultimately be in the hands of the people ............ and you may find a lot of tea-party types who are presented with a real choice. Half (or more than half) of their anger is about feeling left out, powerless, etc., etc. Some won't move from where they were but some are going to calm down enough becasue they are being given power to actually think about the options. -----

Also, in any event, I agree whole-heartedly with LJG (below). If I lived in one of the states where opting-out was possible or likely, I would still be very much in favor of this compromise. Relief is going to come a lot more quickly with the rest of the country moving down the road than if we are all stagnated.

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October 8, 2009 2:32 PM    in reply to fname

If you do that, you will see insurance companies fleeing the test program states. Kind of how, when South Carolina said all auto insurance companies have to write a policy to everybody with a license, no matter how bad their driving records were, most of them left the state. If it's strictly opt-out, the opt-out states won't represent a big enough pool of customers for this to happen.

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October 8, 2009 6:02 PM    in reply to fname

I have to agree with you. It would be nice to see this in action for a few years to see if the government can stay on budget and actually reap the savings from fraud and what not from medicare/medicade. I'm skeptical and cannot see just taking their word for it.

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October 8, 2009 2:46 PM    in reply to Zephyrus

Why should the need for health insurance be left up to the states?

Why not leave it up to the individuals.

Whatever happened to government "of the people, by the people, and for the people."

Allow people to govern their own lives and let them choose whether they want to join a public option or continue with a private health insurer.
.

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October 8, 2009 3:46 PM    in reply to Zephyrus

I don't think Republicans who can afford 1200 per month for insurance will reject similar coverage at 800, just because its called a public option.

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October 8, 2009 11:23 AM    in reply to Zephyrus

Well, I disagree.

First of all, this idea most closely resembles the implementation of Medicaid. Medicaid is an opt-in program that took nearly two decades to go fully national. I think that's the closest analogy, especially since we're not talking about providing a benefit to one population while denying it to another within the same state.

Second, the overall cost reduction coming from the participation of larger states would allow subsidies to be raised, indirectly benefiting lower income families in the handful of states that do opt out.

Third, if we're talking this idea vs. a national co-op or even a highly restrictive public option, the utilitarian calculation still falls on the side of having a robust program that benefits the largest population centers, even if that means temporarily restricting it to a couple of low population states.

Fourth, as a Southerner, I don't think you would see the deep south opt out. I think the likely opt out states are Mormon belt anti-government states like Utah, Wyoming, Idaho, and Montana. While the south is culturally conservative, we also have a strong populist streak in Appalachia. In many deep red districts, people still have a strongly favorable opinion of FDR.

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October 8, 2009 11:27 AM    in reply to Stroszek

You might get some Republicans in power in the south kick and scream about it, but it wont last long, just like their reaction to the stimulus money.

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October 8, 2009 11:44 AM    in reply to musgrove

Agreed. This opt-out adds another level of electoral accountability. The leaders from states that opt out do so at their peril. Here's your "state's rights," Republicans. Ante up or fold.

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October 8, 2009 11:30 AM    in reply to Stroszek

Heck, you may also see states with awesome healthcare already, like Vermont, opt out and not the ones everyone assumes will.

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AJM

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October 8, 2009 2:40 PM    in reply to Stroszek

Mormon belt pays what would be their taxes to the Mormon Church and largely takes care of Mormons.

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October 8, 2009 11:26 AM    in reply to Zephyrus

It's true that many of the reddest states may opt out, but that isn't a guarantee. With stories like this one ranking health care amongst states getting out there, maybe the people in the states where health care sucks most will pressure their state to opt in. Maybe. (Ignoring the fact that the poorest people are often the ones least politically active).

Even if what you say is true and the states in most need of health care opt out, well the southern states have Social Security now right? If it works, they'll switch over. And the overarching bill has other provisions (yes, dare I say it? mandates) that will still improve their lives, just probably not as efficiently.

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October 8, 2009 11:44 AM    in reply to Zephyrus

Tough call, but I don't see it that way. Look at what happened in Alaska, South Carolina and Texas when the governors -- and I use that term loosely with regards to Palin, Perry and Sanford -- tried to decline Obamabucks under the stimulus. Forget the legality of their botched attempt to rise up against federal oppression, their own legislatures shouted them down, and we're talking Republican legislatures. The states that decline to participate will be very small in number and, yes, that's tragic, but the most fragile among their populace won't be disadvangated because the poor and the elderly will have Meicaid and Medicare, respectively, plus SCHIP for working class kids. The ones who really get thumped are the working poor, likely the rock-ribbed base for the local GOP. How does a blue collar dad worried about his family respond to that?

Machiavellian, indeed, but it should get the job done fairly completely.

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October 8, 2009 1:01 PM    in reply to Doc Magnus

Can it really be called Machiavellian to allow people to choose not to do something that is in their best interest. It is just letting them live with the consequences of their own actions. How Republican is that? Electing jackasses leads to life sucking.

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October 8, 2009 1:33 PM    in reply to fpie

Call it "double bluff Machiavellian": Making people live by their own words and follow their own rules until you get exactly what you want. It's freakin' deadly and so obvious that most of the time the strategy is overlooked.

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October 8, 2009 2:02 PM    in reply to Doc Magnus

Love it. The Smart Party finally making some smart moves.

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October 8, 2009 2:29 PM    in reply to Doc Magnus

Some will pack up and move. Others will stay, but will remember how their elected representatives screwed them over next Election Day.

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October 8, 2009 12:01 PM    in reply to Zephyrus

The fact of the matter is that a proper, national, public option is simply more efficient.

There is no state that will choose to opt out if that decision has be made at the state level. The three reasons this option is getting this much resistance are.... 1). Republicans in the south are under no pressure to act in the best interest of there constituents because racism prevents those constituents from voting for a Democratic Senator i.e. the southern strategy is still in effect. 2). Lobbyists are buying Senators pure and simple. 3). Senators have personal cover because a US Senator is not someone that the people know because they are elected in statewide elections, and from the view of most people, live across the state. All of those realities are necessary to resist a public option.

By contrast, a state rep or state senator lives in your town. You know where he works; you know where his wife works; you know how much money he makes. You know when he is being bought, and you know who bought him because his voters see him everywhere he goes. If a state rep votes to take his people out of the public option those people will ride him out of town on a rail.

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October 8, 2009 1:39 PM    in reply to Darrius

Well said. In my first comment, way above, I responded to someone who was concerned about citizens in deep red states suffering. I pointed out that the poor, the elderly, and working class children are all protectec by Medicaid, Medicare, and SCHIP (notably, all owe their existence to the Government of Delegated Powers). What an "opt-out state legislator" does is leave his or her own working-class, rock-ribbed, voting age base out of the health care mix.

How well do you think that's going to go over at the next Fourth of July picnic or high school graduation?

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October 8, 2009 12:10 PM    in reply to Zephyrus

The Social Security Act excluded all kinds of people at first and could hardly be used as an example of compromise that only supported racist southern senators in the end. From a recent post by Paul Begala:

It excluded agricultural workers -- a huge part of the economy in 1935, and one in which Latinos have traditionally worked. It excluded domestic workers, which included countless African Americans and immigrants. It did not cover the self-employed, or state and local government employees, or railroad employees, or federal employees or employees of nonprofits. It didn't even cover the clergy. FDR's Social Security Act did not have benefits for dependents or survivors. It did not have a cost-of-living increase. If you became disabled and couldn't work, you got nothing from Social Security.
Clearly the biggest special interest lining up to oppose Social Security were the businesses that would have to contribute to the fund on behalf of workers they considered expendable.

Smart compromise right now to get the ball rolling will lead to significant and progressively exponential change over the coming decades. Like every other successful effort in our nation's history, health care won't be solved by a single piece of legislation alone.

That isn't even accounting for the massive cultural shift with regards to food that must take place to ensure the reforms are sustainable.

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October 8, 2009 12:19 PM    in reply to jason everett miller

But where's the genie to make it happen because I want it my way, now?

I still don't know enough to know if this is a good idea and if it would work good enough to get the ball moving. But it is an idea that many hadn't considered before. I know I hadn't.

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October 8, 2009 1:22 PM    in reply to jason everett miller

Thank you for pointing out how different social security was when it first passed from what it is today. FDR knew that he had to get something and we could make it better along the way. There were tons of liberals who were furious at him for not getting more.

Same thing with LBJ's Medicare.

That's exactly what's going on now. We have to get whatever HCR we can get and keep making it better. These "all or nothing" people are either clueless or insurance shills.

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October 8, 2009 2:34 PM    in reply to FreeRider

You have to lay the foundation before you can build the house.

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October 8, 2009 6:13 PM    in reply to FreeRider

Except Nancy Pelosi is one of the all or nothing. She has said many times she won't sign without a public option. Maybe this is enough of an option for her???

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October 8, 2009 8:01 PM    in reply to JoJo6

Actually, that's not what Pelosi said. She said she CAN'T pass a bill in the House without a public option. She's saying that the democratic house caucus won't go along with it.

This is her way of getting the most liberal bill possible out of the house so that when they go to conference, the end result will be a pretty liberal bill.

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October 8, 2009 12:15 PM    in reply to Zephyrus

Well, it just might cause those mo-fo's down in the Red States to lose some elections. After all, poor people CAN still vote there, and at some point those nasty wedge issues are going to start to smell even to them, when they see their neighbors actually going on Dr. visits and not getting "wedged" out by guvmint.

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October 8, 2009 2:25 PM    in reply to Zephyrus

The difference is that black and brown people didn't have the vote in the 1930s, owing to the Jim Crow laws that effectively disenfranchised them. You could pass any "fvck the poor" law you wanted to back then in certain (read: southeastern) states, and not only get away with it, but be rewarded for it.

Things are different now.

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October 8, 2009 11:14 AM   

Based on the response I've seen on the blogs, I'd say a slim plurality of progressives support this idea with a majority at least viewing it favorably.

These were the results of an (unscientific) DailyKos poll:

For: 29% (608 votes)
Against: 7% (152 votes)
Maybe: 10% (209 votes)
As a last resort to avoid a filibuster: 22% (449 votes)

I think this is probably the best you're going to get. Some progressives basically just want to kill the bill now, so if the positive is outweighing the negative among the most dedicated ideologues, I'd say you're in good shape.

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October 8, 2009 11:20 AM   

Wait a imnite - Yesterday it was a "robust public option with opt out" now it's some kind of public option? This is nothing but the classic bait and switch.

It was a trial balloon floated that people decided they could live with, not they're walking it back and watering it down.

Forget this.

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October 8, 2009 11:24 AM    in reply to Walter Mitty

Ah yes because he didn't say "robust" during that interview this morning that means the entire bill has changed compared to yesterday. Or he just didn't say "robust" during the interview.

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October 8, 2009 11:27 AM    in reply to Walter Mitty

No, he said the robust PO with opt out is one of the plans being seriously considered. They likely know it's also the only plan that will get a significant degree of support from progressives.

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October 8, 2009 11:39 AM   

I need to move away from Texas. We'll never get it here.

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October 8, 2009 11:44 AM    in reply to fcleff

Unless Perry calls a special session, the Legislature won't even be in session again until 2011, and it will be in place for a year at that point. By then it will be accepted.

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October 8, 2009 12:05 PM    in reply to Frog Leg

I wouldn't put it past Perry to call a special session.

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October 8, 2009 1:03 PM    in reply to Frog Leg

Perry would call a special session to have someone tie his shoes for him if he could. Don't count it out.

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October 8, 2009 1:43 PM    in reply to fcleff

You will. If not right away, then very quickly.

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October 8, 2009 11:41 AM   

This is a classicly rotten Democratic compromise that gives to the Republicans and the insurance interests yet another chance to strangle the baby in the crib. What would it take to "opt out"? A legislative majority in a state? If so, everyone living where a state legislature is controlled by Republicans gets screwed. Would it require a super majority in a legislature to opt out? At least that way Democrats would have to acquiesce, but think about how much less it costs to buy state Reps and Senators than it does on the Federal level? Insurance companies would have a ball and people would suffer because of it. The states that need a public option the most are those in the south and they are all controlled by Republicans. Are we to abandon the poor and middle class in that section of the country? I think not.

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October 8, 2009 12:11 PM    in reply to oleeb

Take a deep breath and relax. Republican legislatures will find it extremely politically unpalatable to actually opt-out of this. The public option is popular basically everywhere. Furthermore, there's not really any upside for state Republicans aside from carrying a bunch of water for the national party in their fight with Obama. They aren't going to take that kind of risk just to help out Mitch McConnell.

My bet would be on zero states opting out. Maybe one or two, max.

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October 8, 2009 11:43 AM   

At the very least it is something that offers a public option now and the chance for further gains amongst the red state uninsured and the ability to adapt to political changes in the future. Sometimes just gaining a foot hold is enough to win the day if you are persistent. Besides, IF this form of public option is signed into law, and IF the anti-reform states eventually opt in (even partially), any attempt to later opt out or repeal health care reform will probably be met with harsh electoral reactions.

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October 8, 2009 11:44 AM   

In Josh's front page post on this same subject (which we can't comment on, so I'm commenting on it here), he says:

We've already gotten a few emails from people in states like South Dakota and Louisiana, saying, hey, this compromise is awful for us. What's great about a compromise that gives me no option at all?
The great thing about it, for you, is that it will encourage your neighbors to vote for sane people instead of extremist right wing zealots, after which you will get health care just like the rest of us. Good luck!

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October 8, 2009 11:52 AM    in reply to Zell

How many States opted out of taking the Stimulus money? Moderate Republicans will not vote against their pocketbook to make an ideological stand. The opt-out would be by referendum or state legislature vote, and in the latter case I think it would be political suicide to vote to opt-out.

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October 8, 2009 11:53 AM    in reply to Zell

Absolutely. It could mean electoral gains for Democrats, or even - gasp - it could result in the GOP becoming a saner, more viable opposition party.

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October 8, 2009 11:53 AM    in reply to Zell

That is a terribly selfish point of view.

That is why this approach to pass the bill is cowardly and just makes those who support this equally as cowardly.

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October 8, 2009 12:01 PM    in reply to rbeats

And no public option whatsoever is good for everybody?

Drop the self-serving invective and get real.

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October 8, 2009 12:09 PM    in reply to rbeats

Right now it's just an idea being tossed around. We don't have all of the details, know what kind of bill this would eventually lead too, if it did at all, and what consequences and benefits it would bring. There are positives and negatives, one positive being that it could get past filibuster and end up being the de-facto policy (if the bill were written so that universal health care works). Two negatives being that many people would see little change and the fact that they opted out means that public option is less effective in states that have it because there's one less state in participation.

But calling people weighing this cowards is a bit of a stretch, dontchathink?

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October 8, 2009 12:25 PM    in reply to rbeats

Oh, please. No it's not. The alternative seems to be no public option at all, since Baucus and his ilk may very well support a filibuster. Compared to that, the proposal is great. Yes, it sucks that people in crazy states won't get a public option, but they won't get it anyway.

And the benefit that I mentioned is merely icing on the cake.

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October 8, 2009 1:36 PM    in reply to rbeats

You act like the Democrats in Congress are the ones taking the public option away from these states. They aren't. The only way to opt-out is via a duly-elected state legislature or a public referendum. Either way, the people of the state made their choice. It's not our fault they elected a bunch of reactionary classist thugs.

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LFC

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October 8, 2009 11:47 AM   

I'd love to see a good public options with opt out. It would let the GOP controlled states prove to the country just how well their market forces approach would work. <&/snark;>

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October 8, 2009 11:52 AM   

I'd like to see the public option that goes along with this.

Make the madate opt out as well. If a state opts out of the public option, they should opt out of the mandate as well.

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October 8, 2009 2:14 PM    in reply to Indie Pro

I agree totally on the first point. As to the second, I see your point but I'm not sure I agree. Yes, it does seem unfair that citizens of opt-out states would still be required to get insurance entirely in the private market. But that is also how it will work in the end, I think, assuming, as I do, that the public plan will significantly reduce health insurance premiums. If Texas, for example, opts out and Texas residents end up paying twice as much for their health insurance compared to residents of opt-in states there will be insurmountable pressure on Texas to opt in. Eventually, probably within a couple of years, the system will be fully national. Or am I missing something?

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October 8, 2009 2:34 PM    in reply to wbgonne

And if there is value in a comparison, then it should be apples to apples. Everyone would be on the same footing -- i.e., having to buy insurance -- and they could then see how the folks next door are doing with the same ground rules.

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October 8, 2009 2:51 PM    in reply to wbgonne

insurance companies are all ready saying that premiums are going up under the Baucus plan. Insurance will be more expensive under the Baucus plan.

I can not be cavalier about people being forced to buy a product by the govt. One that is all ready expensive, and one where the price is going up. Whether red state or blue state, people in power should be working hard to make sure they are not burdening an all ready over burdened people.

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October 8, 2009 11:54 AM   

There are two dynamics going on here. It's not only that people in states that opt out would not have a PO. Remember that the primary purpose of the PO is to lower rates for private insurance. Are insurance companies going to charge one rate in states with a PO and a higher rate in states that opt out? I can't think of anything that would infuriate voters in those states more.

I find it virtually impossible to believe that states will opt out but if they do there's no way they would not be able to hold out for long.

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October 8, 2009 12:22 PM    in reply to mans_best_friend

Agreed! The sole reason for the Public Option is to provide good insurance at a lower cost, thus forcing Insurance Companies to compete and provide the same insurance at the same low cost. If 75% of the states accept this plan, the cost for health insurance will be under downwards great pressure in all states. Don't forget that there are other provisions to be in the bill, including some that should prevent Insurance companies from charging more in one state than in another.

A relative of mine earns mega bucks in the health insurance business. He tells me most insurance companies will simply opt out of providing a health insurance product if something like this is passed. That is a sure route to single payer health care, which is the ultimate goal anyway. So, I say lets get behind this idea.

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October 8, 2009 2:11 PM    in reply to hoppycalif2

I'm not so sure that there is any correlation between premiums in various states. I would think instead the insurance companies, acting in the best interest of their shareholders and highly-paid executives, would milk whatever customers they can.

And as people in deep red states apparently don't know squat about what benefits them economically, they won't peep but will insist, instead, that they have the best health care in the country. It costs the most so it must be the best, no?

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October 8, 2009 12:01 PM   

Folks...the details need to be flushed out before everyone jumps on board to think this is a great idea....I'm concerned that the final writing of this will impose many restrictions on a state based PO and how will it compete in an exchange. Shumer is a sly pol who sells out when he needs to and don't forget that the SEN from WVA is opposed to this idea. This compromise comes from Carper who wants lobbyists to preserve the deals made w/ the White House...

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October 8, 2009 12:03 PM    in reply to Obama1st

The idea is not for state-based programs but a federal program available to the states that want it. I agree that this is only a trial balloon, but praising a trial balloon is vastly different than committing to a final amendment.

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October 8, 2009 12:06 PM   

lemme see . . .

a plan offered by PHRma Bff Carper, designed to cover Ben Nelson and Mary Landrieu's asses, and divide the progressives ??

perfect !

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October 8, 2009 12:10 PM   

oh and yes, by all means, place a rather powerful obstructioniust club in the hands of otherwise powerless and recalcitrant blocs in state leg's all over the country

a gold plated bargaining chip, by all means yes

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October 8, 2009 12:15 PM   

I do not understand the people who are portraying this as a betrayal of the sane people in the states that might opt out. This outrage seems to rest on the assumption that once they opt out, there is no going back.

This is not the case unless the bill is specifically written that way--which it is not, and which it will not be. Such a provision would be politically impossible.

So what would happen if states did opt out?

First, it's necessary to understand the importance of this being "opt out" rather than "opt in". An opt-in program starts with the default position of nobody participating--placing the burden of action on those who want to be a part of it to take action. An opt-out program is just the opposite: the default at the beginning is everyone participating, and that places the burden of action on those who reject it--forcing them, not us, to take a politically risky stand.

But let's assume a few states do opt out. What happens then?

One of two things: the public option is successful, or it is not.

If it is not, then there is something wrong with it and it's right and proper that it be fixed before expecting reluctant states to come on board. If the PO, as first implemented, is a failure, then you're not missing out on anything by not having it as an option.

But if the PO is, as it is expected to be, overwhelmingly successful, then any politician who voted to opt their state out of it will be lucky to keep their jobs. Once the savings and benefits of the PO become too great to ignore, voting against the PO will be as nearly impossible as voting against the fire department. Social Security was a third rail of politics for decades for a very good reason: everyone except the most extreme anti-government jihadis love it.

And what you'll end up with in the end is not only a national public option, but a number of red states which are quite a bit bluer now that the pitchfork-wielding mobs have voted the crazies out of office.

I don't see a downside to this, as long as it's written properly and with a robust, comprehensive public option. It is absolutely brilliant politics that provides cover for the Blue Dogs and moderate Republicans while putting all of the pressure and political risk on those opposed to reform.

Win.

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October 8, 2009 3:11 PM    in reply to Catsy

Couldn't have said it better. It all depends on how it is written though. Written correctly this could be masterful politics

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October 8, 2009 7:01 PM    in reply to theone718

Yup, depends how it's written. But I think (I hope) Obama and the Dems are smart enough to realize that if it isn't good value for money and leaves too many people out, they'll bomb. Obama said it: 'I own this.' They have every interest in getting it right. And right, in this case, is government run, national in scope, open to everyone who wants in and generous. It will have to be reformed, improved upon, changed, rendered more efficient and fairer over time. But they should be thinking in very broad terms on this one. They may not have this opportunity again. Strategically, I'd use the 'opt out' idea as a bargaining chip to improve the option's policies, financing and universality where it is offered. Once it is as - OK, 'robust' - as possible, it sells itself. Those that opt out will soon be back to get in.

Potentially historic legislation. Dems have been on the defensive ever since Ronald Reagan sold his crabbed, selfish vision to the American people. This promises to change that, bring us back to the 50's, 60's and 70's vein of social legislation that brought out the best in this country.

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October 8, 2009 12:19 PM   

Wouldn't this put more cost on all the other states that don't opt out? The very sick and medically needy will move to a state that offers the plan while those red state that opt out will not have their share of caring for a segment of their original population. These states are part of the union & therefore should have to respect majority rule.

I never supported the Iraq (Bush's) War, yet my tax dollars were spent making Halliburton and other bush/cheney war profiteers filthy rich, and they never even legitimately won the election!

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October 10, 2009 9:25 PM    in reply to verite

The very sick and needy will not be in any shape either physically or financially to move to any other place, unless it is a nursing home. You can argue that the states with the best homeless program will get the homeless from nearby states, but I can't see this argument holding water when considering the very sick and needy.

Furthermore, this is a federal program, where the cost to the federal government is the same, or close to it, whether the sick and needy are in Mississippi or in California. And, of course, any state government that votes to opt out, can quite easily opt back in the following week. This just gives those demagogues in the conservative states an excuse for voting for the bill - I can't believe anyone seriously believes that those demagogues actually believe the nonsense they spout about socialized medicine.

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October 8, 2009 12:27 PM   

As long as the public option the bill DOES contain is otherwise unencumbered, this sounds like a very good idea at first mention.

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October 8, 2009 12:34 PM   

My god. For us progressives here in the deep south who are fighting tooth and nail to elect Democrats to replace these Demopubs. We NEED to be able to show how Obama has helped us with Healthcare at the very least. IF it happens that we are shut out of it... That will be a disaster in many ways. I am wondering if Obabma could ever get re-elected as it is now - the way he's let the Bush cronies STAY in the justice dept. Let them Politically railroad our last Democratic Gov, protected Bush's and Rove's emails and torchure activities, and now even my 17 year old son is hating on him for wanting to cut out some of his (getting shorter every year) summer vacation days. In my state we have NO competition in the health insurance field right now. If Obama allows this to happen, I'm going to work hard to replace him - and I was a huge supporter and gave a lot of money (for what I earn) to help him get elected.

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wyt

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October 8, 2009 12:44 PM    in reply to McRocken

Maybe it's the other way around. Consider a world in which the Northern Tier (what I prefer to call "Loyal America") has a solid public option in virtually every state, but in the South Republicans have deprived their citizens of that. Doesn't this become a perfect platform to utterly destroy the last Republican stronghold in the South?

We have a far larger problem than health care. It's the Republican Party. When a political party makes it its first priority to destroy our president, all sane Americans must join in making it our first priority to destroy that party. The opt-out proposal may be a perfect way to do that, as it will force a majority, even in the South, to realize that the Republicans are the personal enemies of their families and themselves.

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October 8, 2009 6:29 PM    in reply to wyt

That is just hilarious and you can't be serious. After the smearing of GW by liberals.

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October 10, 2009 9:33 PM    in reply to wyt

You are, of course, right, that baiting the Repubs to deprive their constituents of government benefits is an effective way to consign them to the trash barrel of history. Perhaps we should try to sugar coat this a bit, but why? It is a little like the formerly Communist countries having to sit and watch as neighboring countries experienced economic growth, great standards of living, and enjoyable lives, while they had to grit their teeth and brag that at least they had Communism. Look how that worked out. I look forward to tearing down the Mason Dixon wall in my lifetime!

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October 8, 2009 7:13 PM    in reply to McRocken

Do you really think Southern Democrats will blame Obama for 'opting' their States out? They can't be that dim. It's their representatives who are going to have to do it, by active choice. The idea is that it's given them and they have to refuse.

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October 8, 2009 12:37 PM   

This is a dreadful idea, because it will drive up costs. Not just for people who may have to move to get decent health care as per Verite, but for everyone, because cost-efficient health insurance is based on a broad and diverse risk pool. The fewer people who have access to the public option, the smaller the risk pool will be, and potentially the costs could go up for everyone. The Democrats are closer than ever to making a decent public option possible; why they keep trying to weaken it in order to placate people who are simply wrong is beyond me.

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October 8, 2009 12:56 PM    in reply to cassady

The risk pool will be HUGE. Among the 15 or 20 most populous states, Texas may be the only real opt-out candidate.

Among the states that won't opt out: all of New England and the mid-Atlantic (NY, NJ, PA), the Great Lakes and the West Coast. Add those up and you've got probably two-thirds of the U.S. population. And that's just for starters.

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October 8, 2009 1:01 PM    in reply to cassady

A little correction- it won't drive up costs, it will decrease costs less

It may seem like a small thing, but it is incredibly important.

Also, if the choice is between a weak PO and a robust PO with the opt-out option, I'd argue that a robust one would lead to more cost savings, particularly since states could eventually opt in to a stronger option than the one in the alternative.

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October 8, 2009 4:48 PM    in reply to drhgl19

OK, that's a good point, I imagine it would still drive costs down (well, provided enough good diverse populous states sign up as Ann Arbor says). In fact, now that I think about it, it may increase pressure on states that do opt out to opt in, if insurance companies that operate in those markets raise rates there to mitigate loss of revenues elsewhere and there's no competition to force them to keep prices down. Maybe it isn't such a bad idea.

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October 10, 2009 9:35 PM    in reply to cassady

Ok, let's say Wyoming opts out. That huge, and I mean huge reduction in citizens in the health care pool will have major....wait, what's the population of Wyoming again?

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October 8, 2009 12:39 PM   

I think because insurance is regulated on a state-by-state basis, the Republicans and any corporate-compliant politician thinks expanding coverage can be fought more successfully at the local level than the national. I think this Schumer-Carper idea stinks to high heaven.

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October 8, 2009 1:01 PM   

An Opt-Out Trigger!

The counter proposal to the State Opt-Out plan is to combine it with a reverse version of Olympia Snowes trigger.

By combining the Opt-Out concept that allows states to opt out of a public Option, with a reverse Olympia Snowe trigger, AND a very strong public option, I think we can come up with a politically acceptable proposal that would provide the type of coverage we all want, and would make it politically insane to oppose.

1. We need a strong public option, we still need to keep a very close eye on this as it works it's way through the process. It must start from Day 1.

2. The Snowe trigger. Take Olympia's snow proposal, and her numbers EXACTLY, EXACTLY, EXACTLY, notice the importance I put on her numbers, and make it a reverse trigger. If the insurance companies don't perform as she defined, THAN AND ONLY THAN, individual states may choose to Opt-Out of the public option.


These are the conditions, that Olympia Snowe herself along with the support of Blue Dog Dems, that define non acceptable performance of the Insurance Companies. With the Opt-Out trigger, her definition would stand, and any opposition after previous support would be so blatantly dishonest that even the general public would see it.

Checkmate!


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October 8, 2009 2:18 PM    in reply to we_are_toast

I'm seeing a very complicated dive in my head right now. Ta, very much. :-)

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October 8, 2009 1:21 PM   

Political "incrementalism" at it's finest.

This opt-out scheme may just weed out some state-level obstructionists in the process, but it still represents our lawmakers falling way behind the public will.

We, the People, think and act by leaps and bounds, as our lawmakers work with incremental changes.

Maybe Jefferson and some of the founders wanted it that way, but if they saw how stretched out that slinky gets, with the lawmakers at the tail and the public at the head, they might have been more deliberate and included some sort of public referendum in the voting process, to which the lawmakers' antics could be compared and their real representation measured.

We have the tools to do it, but taking that power away from big money is like pulling a grizzly cub away from it's momma.

We are seeing these greedy HMOers getting slowly, inexorably backed against the wall, and we all need to remember how desperate a cornered beast can be. They have committed to an all-out, all-or-nothing fight against healthcare reform, almost to the point it seems like they know their end is near.

So all I can say, again, "beware the cornered beast."

They are their most dangerous when realize they are mortally wounded, (the election of 2008) and facing annihilation (public opinion swiftly gaining for a public option, which might just open the floodgates to single-payer.)

Expect much worse from them before this is over.

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October 8, 2009 1:26 PM   

I really don't care one way of another on this, but is sounds like capitulation to the Tenthers who've been saying that public health insurance violates the Tenth Amendment. Our Governor, Timmy Palenty (Minnesota) has made noises about it and was supposedly looking a passing a law to prevent Federal intervention in our state. Like I said, it sounds like a capitulation to these crazies.

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October 8, 2009 1:28 PM   

PS; does anyone know if the public option is supposed to cover viagra or rogaine or facelifts and nosejobs? Just what would the coverage cover, and couldn't much of that cost be controilled by limiting care to essential and preventative procedure?

I realize "essential" is interpretable, but there's a pretty clear line between medical necessity (say, a liver transplant) and medical hype. So much of the burgeoning medical costs seem to be for vanity drugs and procedures, surely these types of medication and procedures shouldn't be included, it only drives up the cost of other medical treatment.

Just wondered what the plans might entail, if they are that far along.

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LJG

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October 8, 2009 1:32 PM   

The comparison with FDR getting social security passed by reluctantly going along with racist southern State senators to effectively exclude poor Black people is compelling, especially to me since I live in South Carolina, a state that could easily opt out. Nevertheless, politics ain't pretty. If you aren't willing to get your hands dirty, you will never be effective in government. The bottom line is that poor minorities in the South and everywhere else DO now have social security. None of us would have this excellent government program if FDR hadn't made this unsavory deal. In the 30s I would have held my nose and voted for FDR's social security bill (though Elanor Roosevelt would have screamed at me), and I would today hold my nose and vote for the current bill with a strong public option, but a provision that allows states to opt out. Hopefully, the opt-out provision could be repealed in the future. It looks like the alternative would be a terrible bill or no bill at all. I do have my limits. I would vote no if the bill ended up with no public option or a weak public option. It could be many years before we have another chance at this.

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October 8, 2009 3:02 PM    in reply to LJG

That article was convincing but his end premise wasn't (we should take whatever we can get). Our line should be the PO PERIOD. I think if we got a PO or an opt out with a ROBUST PO we could build on that. I hear NO PROGRESSIVE TALKING ABOUT HC RIGHT NOW would have accepted Social Security as it was written.

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October 8, 2009 2:08 PM   

This smells like a philosophical cop-out and a slave states, free states approach. I'm not even sure that the New York State Legislature won't opt out.
Plus the insurance companies will see 50 juicy apples ripe for the picking at their leisure (or 30, assuming the Deep South and Mountain state apples just fall to the ground without having to be picked). A concentrated PR/misinformation effort in one state gets them an apple, then they move on to the next state.

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October 8, 2009 2:18 PM    in reply to Bnad

I'm not so sure. I can't imagine NY or any Northeast state opting out. Or the west coast. Or the mid-west. Let's face it: we're talking about the Deep South and maybe a couple of Rocky Mountain states declining to participate. I don't think that's sufficient to gum up the works. And, assuming premiums are substantially lower in opt-in states, the opt-out states will capitulate. Probably very quickly.

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October 8, 2009 2:20 PM   

I don't quite understand the proposal.
A state Legislature can vote to let citizens die in the gutter without health care, but what is the upside for opting-out states? Would they be paying less?

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October 8, 2009 2:36 PM    in reply to ericAZ

They will get to stand up to the tyranny of the Federal government and say that they preserved freedom. For the glory of God.

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October 8, 2009 2:23 PM   

"what is the upside for opting-out states?"

Preventing socialism. That will sound good -- in some states -- for one election cycle. But once Texans see that they're paying twice what Floridians are, game over.

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October 8, 2009 2:38 PM   

Practical question -- if we assume that the Finance Committee bill is passed by the Senate, the next step would be conference between the House bill(s) and Senate bill, correct? Given the content of the bills that would be before the conference, could the conference committee emerge with a "robust public option with an opt-out provision"?

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October 8, 2009 3:08 PM   

A couple of observations:

- in Texas, most if the districts are fixed, there will be no change.
Remember Perry called THREE special sessions to fix the boundaries

- I assume most employees (like myself) would prefer to continue my
probably superior insurance, rather than drop to the PO

- the poor will need the PO, but they cannot dislodge the entrenched
republicans

- meanwhile, people will continue dying without insurance

So we will end up paying taxes to cover people in other states; I bet
that will be Perry's next move: to somehow challenge that.

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October 8, 2009 3:18 PM   

I think this is absolutely heinous! The longer this goes on the bigger the capitulation is to the party of NO, and the weaker the reform gets every time. And for WHAT?

Schumer's version of the public option in the Senate Finance Committee had more support amongst this conservative group because it made the option a LESS powerful competitor against private insurers; and now he wants to further diminish the effects of an option by severely reducing the potential risk pool and thereby damaging its viability too? What of the disenfranchised citizens who want this choice in the states that opt-out? I'm pretty sure the parameters of an 'opt-out' will be harsh too. I'm cringing just thinking about a state's inability to enter the option (for so many years, etc...) after it has opted out; how permanent will THAT be?

I'd say this capitulation only amounts to another victory for private insurers, who will maintain their tyranny in states that opt-out. I say no, or rather, HELL NO!

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October 8, 2009 4:37 PM    in reply to Progressive Mews

This isn't capitulation! This could practically be a coup for progressives. It gives conservative dems the cover they need to vote for the bill, but the public plan will inevitably extend to all states over time. Do you really think voters in South Carolina are going to be okay with paying double the premiums of their neighbors to the north, just so their elected officials can protect them from the spread of socialism? This is seriously good news...

Sometimes I get the feeling there are many on the left who are so used to losing that they don't even see a win when it's staring them in the face.

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October 8, 2009 4:53 PM    in reply to sexysadie

"Sometimes I get the feeling there are many on the left who are so used to losing that they don't even see a win when it's staring them in the face." Amen.

Although ...... maybe it's a good thing if some on the left keep screaming - just to reassure those who wouldn't want to agree with them.

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October 8, 2009 4:11 PM   

The opt-out is electoral poison for the current iteration of the GOP. Those rural counties aren't going to stay Republican strongholds for long once they see what their representatives are voting away from them.

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October 8, 2009 7:35 PM   

It always puzzled me: to see folks in poor, Southern States voting against their own economic interests, always based on fear of the unknown. Well, they must know a good deal when they see one. Whatever shade of ideological spectacles you may wear, you're not going to pay $700 for something you see your neighbor getting for half that...or not for long. This is political jujitsu. I don't think many will opt out. Those that do, it will be out of sheer cussedness. They'll lose their seats and their successors will opt right back in. There's no reason to make it hard to opt in: the bigger the pool, the lower the cost. The only potential snag is that the option has to be very good benefits for very little money. And with a huge risk pool, there's no reason to think that can't be accomplished. Hat's off to whoever thought of this.

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October 10, 2009 9:42 PM   

One thing I am still looking for is the Insurance Company response to this idea. If they like it, praise it, and don't campaign against it, I am 100% opposed to it. If they grumble and spout nonsense about socialism, I'm for it. If they mount a massive ad campaign to discredit it, I am 100% for it.

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