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Obama's $900 Billion Problem

By Philip Klein on 9.15.09 @ 6:03PM

In his speech to the AFL-CIO today, President Obama said, as he did last week, that his health care proposals would cost about $900 billion over 10 years. The problem is that by making that vow, Obama has effectively created an upper boundry to the cost of the legislation, and that will make negotiating a final package more difficult.

While the bill being unveiled by Max Baucus would reportedly cost a projected $900 billion or less, bills introduced by the House Democrats and the Senate Health, Education, Labor and Pensions Committee have both been projected by the CBO to cost over $1 trillion.

As I noted earlier, Democratic Sen. Jay Rockefeller has already indicated that he would vote against the Baucus bill in its current form, and if he doesn't speak for other members of the Senate, it's at least fair to stay that liberals in both the Senate and House have major issues with the scaled-back bill. If liberals are going to accept a bill without a government plan, they'll likely make other demands, such as more generous subsidies to purchase health coverage. The problem is, such demands will undoubtedly drive up the cost of the bill, likely above Obama's $900 billion threshold.

So this is once again an area where Obama finds himself between a rock and a hard place -- either he draws a firm line at around $900 billion, at the risk of eroding liberal support; or he allows the cost to swell above $900 billion, and he gives Republicans a sure fire line of attack. All they'd have to do is release a video of all the times Obama said the plan would cost $900 billion, and contrast that with the higher projection. It would damage Obama's credibility at a crucial time in the debate.