Pressure grows for Obama to leap into healthcare fray

Largely avoids volatile debate on plan’s costs

Up to now, President Obama has championed healthcare overhaul in speeches, but dodged questions on funding. Up to now, President Obama has championed healthcare overhaul in speeches, but dodged questions on funding. (Mannie Garcia/Bloomberg News)
By Susan Milligan
Globe Staff / July 15, 2009
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WASHINGTON - Even while delivering impassioned speeches and trying to light a rhetorical fire under Congress, President Obama has stayed away from the politically treacherous question of how to pay the nearly trillion-dollar cost of healthcare overhaul.

The president has a plan that would raise hundreds of billions by limiting charitable deductions for the wealthy, but he has not pushed it on Congress, at least not publicly, even as lawmakers in both parties remain deeply divided over where they can find the cash to extend healthcare coverage to all Americans.

Obama’s role as healthcare’s cheerleader-in-chief makes sense from a political standpoint, analysts say, because it allows him to avoid angering the rich or other interest groups. But just weeks before Obama’s August deadline for passing legislation in both the House and Senate, pressure is growing on the president to get more personally involved and stop leaving all the painful details to Congress.

“I believe the time is going to come soon when he’s going to have to start drawing some lines in the sand,’’ said Alan Charney, program director for USAction, a liberal group advocating a tax on wealthier Americans to pay for the plan.

Obama has thus far kept most detailed discussions private, between himself and lawmakers and health reform specialists.

“At some point in the process, the president will undoubtedly go from chief sponsor of healthcare reform to chief sponsor of the health reform legislation itself,’’ said Drew Altman, president of the Kaiser Family Foundation, a healthcare policy group.

Yesterday, the White House deflected suggestions that the president should be more involved with the details; press secretary Robert Gibbs said Obama had articulated “very strong principles’’ about healthcare and was meeting regularly with congressional leaders to discuss them. But publicly, Obama rarely mentions the matter of raising revenue.

Obama has proposed limiting income-tax deductions for those making more than $250,000 a year. Although taxpayers would still be able to deduct items such as charitable donations, many other forms of deductions would disappear.

The Office of Management and Budget calculates that Obama’s proposed change would raise $267 billion over 10 years. Other, smaller tax changes, such as closing certain tax loopholes, would boost total new revenue to $325 billion over a decade.

The rest of the money for the overhaul, which the administration estimates at $950 billion, would come from cost savings in healthcare, according to Obama’s estimates. Obama often mentioned such savings while he was campaigning in 2008.

House Democratic leaders unveiled a healthcare plan yesterday that would impose a new tax surcharge on Americans who make more than $280,000 a year. The tax would be set on a graduated scale, ranging from 1 percent at the low end up to 5.4 percent on taxpayers earning more than $1 million a year.

That idea is opposed by the GOP, and Senate Democrats are lukewarm at best about the plan. “There’s not a lot of support for it here’’ in the Senate, said Senator Ron Wyden, Democrat of Oregon.

The Senate Finance Committee has yet to unveil its plan for paying for the overhaul. Meanwhile, some Republicans want to impose a tax on healthcare benefits, an idea both Obama and key Democrats in Congress dislike.

Just 1.2 percent of taxpayers would be hit with the House’s surcharge tax, but “people believe they’re going to be there someday,’’ said Senator Ben Nelson, Democrat of Nebraska. The money “doesn’t come from somewhere, it comes from someone,’’ he added. “And there’s the rub.’’

Even after a year of derivatives-trading scandals and billion-dollar Ponzi schemes, levying any new taxes is unpopular on Capitol Hill and will prove to be a tough vote.

Liberals point to polls suggesting that Americans believe the wealthier should shoulder more of the burden for healthcare overhaul. But still, “there’s a nervousness among Democrats . . . because there’s a fear [among the public] that today, they’re going to come after the wealthy, but tomorrow, they’re going to come after you,’’ Charney said.

Republicans are eager to slap Democrats with a tax-and-spend moniker, and the proposed House surtax has given them an opening.

“This is not the time to be raising taxes,’’ a grim-faced House Minority Leader John Boehner, Republican of Ohio, said as he strode into the House chamber yesterday. “I thought they were trying to create jobs in America. You can’t tax the job-creators.’’

Obama, for the moment, has been spared from the attacks and counter-attacks on how to pay for it. Democrats say they are prepared to defend their tax proposals on their own.

“He was the architect; we are the construction crew,’’ said Representative Richard Neal, Democrat of Springfield and a member of the Ways and Means Committee, which is helping to write the bill.