Stephen’s Posterous

Karl Rove says that President Obama's problem is that his Magic Kingdom Health Care World is colliding with reality.

There is a big cost to any large government expansion and the ways to cover the cost of Mr. Obama's plan are limited, unpopular, and sure to anger Americans once they are fully understood.

Negotiations over the real health care bill can now begin according to Karl Rove, the former senior adviser and deputy chief of staff to President George W. Bush.

Democrats face a central problem for any governing party on how to pass a major piece of legislation when there are a lot of varying ideas about what should be in the bill.

Members of Congress will take a hard stand on a particular portion of a controversial bill. This allows them to show a little independence and make a plausible claim to have influenced the outcome.

The problem for Mr. Obama is that the Baucus bill is being sold on the strength of accounting tricks that make it appear that it won't add to the deficit.

If fiscally conservative Democrats sign on to the bill now after publicly saying they are doing so because it doesn't add to the deficit, they may end up bailing once the tricks are revealed to the public.

Mr. Rove says that one trick is that the bill imposes tax hikes and benefit cuts right away, including $121 billion of Medicare reductions between 2011 and 2015. New spending doesn't start until five years out and isn't fully operational until 2017. The bill uses 10 years worth of tax hikes and benefit cuts to fund a few years worth of benefits.

Mr. Rove points out that the Congressional Budget Office (CBO) released a report last week claiming the bill won't add to the deficit, but this assumes that employers who dump employee coverage under the Baucus bill will then increase worker paychecks by an amount equal to what they had spent on health care.

This replaces a nontaxable event with a taxable one magically producing $83 billion in revenues. Without this, the Baucus bill adds billions of dollars to the federal deficit in the first decade.

Under questioning at a Senate hearing Tuesday, CBO Director Douglas Elmendorf admitted that the $500 billion in tax hikes in the Baucus bill would be passed onto consumers, increasing insurance premiums.

Democrats who support any final bill are at risk. They will be held responsible for the mess when premiums rise, taxes balloon, deficits soar, mandates expand, and government power grows.

Mr. Rove says that the President who never stopped campaigning hasn't made the sale to Americans because he's forgotten a central rule of campaigning: Your arguments have to be clear and credible if voters are to believe them.

Mr. Obama's attempt to sell health care is neither. He still may win passage of a bill, but he's lost the public's enthusiastic backing.

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Karl Rove, the former senior adviser and deputy chief of staff to President George W. Bush, says that the GOP is winning the health-care debate.

According to recent Fox News surveys, the number of independents who oppose health care reform reached 57% at the end of September 2009, up from 33% in July 2009. Independents are generally a quarter of the vote in off-year congressional elections.

Among college graduates, opposition to health care reform is now 50%, and only 33% support it, according to Gallup's September 24, poll. College graduates are slightly more than a quarter of the off-year electorate.

Among seniors, opposition to ObamaCare hit 63% in last month's Economist/YouGov Poll. Forty-seven percent of seniors said they strongly oppose health care reform, 27% strongly support it. Seniors will likely cast about 20% of the votes next year.

In 2006, the year the GOP lost control of Congress, Democrats enjoyed a double-digit lead in several generic ballot polls, a measure of voters' party preference. Democrats held that lead until 2009. Today, Gallup's generic ballot shows Democrats have a thin 46% to 44% edge. According to Gallop's numbers, independents now favor Republicans by nine points.

Congressional Democrats could also be the first to feel a backlash against rising federal spending. An early September 2009 Gallup poll found that 38% approve and 58% disapprove of Mr. Obama's handling of the deficit from 49% approve, 44% disapprove in March 2009.

In September 2009, a Fox News poll found that 61% of independents think the Obama administration wants to increase spending too much, 29% thought the amount of spending Mr. Obama wants is about right.

After a $787 billion stimulus package and other spending this year that have the administration planning to double the deficit in five years, many voters are worried about the amount of red ink being spilled.

President Obama's job approval rating appears to be stabilizing. The Rasmussen tracking poll for October 2-3, shows 46% of likely voters approve and 50% disapprove of his performance, unchanged over the past month.

This battle is far from over. Mr. Rove says that Democrats should keep in mind that there are two battles here, one for health care, and the other for keeping control of Congress. By fighting on health care, they may lose the second battle, keeping control of Congress.

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President Barack Obama idea of going on five Sunday morning talk shows was a classic mistake according to Karl Rove, former senior adviser and deputy chief of staff to President George W. Bush.

A politician should not jump in front of a bunch of cameras without having something fresh to offer. Instead of showcasing Mr. Obama's passion, intelligence, and persuasive abilities, it put him on the defensive.

Mr. Rove says that health insurers have a 3.3% profit margin, which is less than the 4.6% average profit margin for all businesses in the U.S.

Drug companies enjoy an average of a 17% profit margin, but software companies average a 22% profit margin. With drug companies paying for ads favoring ObamaCare, it would be ironic if drug companies succeed at increasing their own taxes.

Mr. Rove says that Mr. Obama could look at other options like allowing Americans to buy insurance across state lines, permit small businesses to pool risk to get the same discounts large employers receive, and focus on medical liability reform.

According to recent polls, Americans do not like ObamaCare. Mr. Obama's continuous talking about his plan is making him look boring and stale. This makes him less interesting, according to Mr. Rove

Mr. Obama does not need more television air time. He needs a new health care plan that comes from true bipartisan negotiation and compromise.

Mr. Obama is certainly capable of flooding the airwaves with his eloquence of words, but what he really needs is a message that wins the attention and support of Americans.

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Karl Rove, the former senior adviser and deputy chief of staff to President George W. Bush, says that it is becoming clear that President Obama's speech did not rally voters and it failed to inspire Democrats to follow their president's lead.

A Gallup poll the week of September 14, 2009, found that 38% of Americans say their representative should vote for ObamaCare, but 40% want their member to vote against ObamaCare. The respective figures were 37% and 39% the day before Mr. Obama spoke.

Mr. Rove believes that Mr. Obama's issue is his language; his speech did not have new information and his tone was not presidential. Mr. Obama did not bind Americans, but called legitimate concerns misinformation, false, and tall tales.

Mr. Obama had said earlier that some concerns brought up by people were lies. For example, Mr. Obama said that illegal aliens would not receive free health care, but after the speech, the White House announced that proof of citizenship would be required to enroll in the president's health plan.

The political landscape can change when the pool of people who vote changes. In 2008, five million more people voted than in 2004 when Mr. Obama drew two million more African-Americans to the polls.

Mr. Obama also had more younger voters at the polls, those aged 18-24, who supported Democrats by 66% to 32% for Republican, compared prior to 54% Democratic, and 45% Republican.

Mr. Obama's approval among young voters is down 10 points since July 2009, according to Gallup polls. This may drop more when younger voters find out that they could be fined up to $950 for not being insured.

Mr. Obama's health care plan starts running annual deficits in its third year, accumulates $219 billion in its first decade, and could add $1 trillion to the debt in its second decade.

The recent grassroots rally against ObamaCare in Washington was a sign that voters are getting active to oppose the president's agenda. Mr. Obama will appear on five news shows on Sunday, September 19, hoping to get more support for ObamaCare.

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Karl Rove, the former senior adviser and deputy chief of staff to President George W. Bush, says that more time needs to be spent in crafting the best consensus policy with bipatisanship for a solution to health care. House Democrats should not push through legislation, which was done with the cap and trade bill now stalled in the Senate.

At the moment, with Ted Kennedy's senate seat open and Robert Byrdnot being able to attend and vote, there are not enough Senate Democrats to invoke cloture.

Mr. Rove says it is riskier to be at odds with American opinions rather than stand by as an unpopular proposal loses steam. Americans are increasingly concerned that a takeover of health care will spend too much money, create too much debt, and give Washington too much power.

Mr. Rove says that the Obama Team is arguing that forcing a controversial health care bill is better than not passing anything. This is based on the death of HillaryCare in 1994, but Mr. Rove says that trying to pass HillaryCare was what brought down the Democratic Party.

At a Labor Day union picnic in Cincinnati, President Obama said his health critics were spreading lies and that opponents to health reforms wanted to not do anything. Mr. Rove says that this does not show a spirit of bipartisanship and doesn't create a foundation for dialogue.

Mr. Rove says that the greatist political risk for Democrats in among seniors. A July 2009 Gallop poll shows that this group were the least likely to believe that health care reform would improve medical care.

The latest Pew poll, August 20-27, found that 30% of seniors supported health-care reform while 54% were opposed. In July 2009, Pew showed 29% in favor and 48% opposed. Mr. Rove says that seniors make up a disproportionate share of the off-year vote.

Congressional Democrats will be under great pressure to stand with President Obama, but Mr. Rove says that the prospects of their own political future may affectr their actions.

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Karl Rove, the former senior adviser and deputy chief of staff to President George W. Bush, believes that President Obama has been focusing on health care when Americans are more concerned with the economy and jobs.

Americans are also not buying ObamaCare and many believe that the plan comes with a huge price tag and concerns that they will loose their current coverage.

Health care providers believe they will be forced to a one size fits all scenario while seniors are worried about the cuts to Medicare and Medicare Advantage.

Nine out of 10 Americans state that they have coverage and are happy with it. Of the 46 million people uninsured, 9.7 million are not U.S. citizens, 17.6 million have incomes of more than $50,000, and 14 million qualify for Medicaid or other programs.

Medsphere Systems Corp. has raised $12 million in combined equity as well as debt financing.

The health-care battle is far from over says Karl Rove, the former senior adviser and deputy chief of staff to President George W. Bush. The healthcare battle will continue when President Obama returns from vacation.

In a recent ABC/Washington Post poll, 45% approved of Mr. Obama's plan while 50% opposed it, and 40% strongly opposed the plan.

A Fox/Opinion Dynamics poll said "the health care reform legislation being considered right now" is opposed by 21% of Democrats, 50% of Independents, and 81% of Republicans. Only 37% of Democrats and 15% of Independents believe their families would be better off if it passed.

Mr. Rove says that it is smart for Mr. Obama to take a vacation this week on Martha's Vineyard because his staff needs time to repair his praised message machine.

Mr. Obama has said that health insurance reform would be paid for by cuts in Medicare Advantage. White House Senior Adviser David Axelrod has refuted that message.

In a White House fact sheet titled "Paying for Health Care Reform," it notes that the Obama administration would cut $622 billion from Medicare and Medicaid, with much coming from Medicare Advantage.

Medicare Advantage was enacted in 2003 to allow seniors to use Medicare funds to buy private insurance plans that fit their needs and their budgets. An estimated 10.2 million seniors have enrolled in Medicare Advantage.

Mr. Obama is proposing to cut the Medicare Advantage program by nearly 20%, which would reduce the amount of money everyone will have to buy insurance. Roughly 23,400 seniors on average in a congressional district who have Medicare Advantage.

Mr. Obama's problem, according to Mr. Rove, is that he lacks credibility when he asserts his plan won't add to the deficit or won't lead to rationing; that people can keep their health plans; that every family's health care will be better, not worse; and that a government run plan isn't a threat to private insurance.

The Obama Team will be back in Washington next week to continue their work on messaging.

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Karl Rove, the former senior adviser and deputy chief of staff to President George W. Bush, writes in his weekly opinion piece in The Wall Street Journal that President Barack Obama is losing control of his health care agenda and resorting to rhetorical tricks and evasions.

The Obama Administration is substituting a weekly dose of opinion surveys as thoughtful consideration. White House aides are now seeking to find new scapegoats whenever administration policy initiatives get into trouble.

This is evident on health care reform, which was renamed during Mr. Obama's campaigning to health insurance reform.

Many Americans remember Mr. Obama started his health care push by saying it would cover the uninsured and reduce costs, but there is now a trillion-dollar-plus price tag, an intrusive expansion of government into patient-doctor decisions, huge cuts in Medicare, and tax increases.

Mr. Obama has now recast the debate as an attack on insurance companies, but Mr. Rove says this would be more credible if he hadn’t surrounded himself with insurance CEOs and lobbyists when he kicked off his effort in March 2009.

The Obama campaign team is intent upon protecting a pledge driven by its 2008 campaign polls of promising never to raise taxes on anyone making less than $250,000 a year. But the House version of Mr. Obama’s healthcare has four taxes that will largely be paid by people making less than $250,000 a year.

There’s $8.2 billion in taxes for using health savings accounts and other tax-free medical savings vehicles to purchase over-the-counter drugs. There’s an 8% tax on employers who don’t offer insurance. The Congressional Budget Office says workers in those businesses would pay the $163 billion cost via lost wages.

There’s a 2.5% "Tax on Individuals Without Acceptable Health Care Coverage" in the House bill that applies to people who either don’t have insurance or whose policies the government deems inadequate. And there’s a $2 billion Comparative Effectiveness Research Tax on all private and public option insurance policies.

The president will break his tax pledge several more times while adding trillions to the deficit, while dismantling the best elements of our health-care system and slashing Medicare.

Mr. Obama has set in motion events he is unable to control and commitments he can't keep. Great communicators succeed when the ideas they are communicating are sound. Tax-and-spend liberalism doesn’t work, no matter how pretty its package.

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Karl Rove, the former senior adviser and deputy chief of staff to President George W. Bush, writes in his weekly column in The Wall Street Journal that President Obama is now using fear to sell his health care plan.

On the campaign trail last year, Barack Obama promised to end the politics of fear and cynicism, but now he is now trying to sell his health-care proposals on fear.

At his news conference the week of July 20, Mr. Obama said "Reform is about every American who has ever feared that they may lose their coverage, or lose their job...If we do not reform health care, your premiums and out-of-pocket costs will continue to skyrocket. If we do not act, 14,000 Americans will continue to lose their health insurance every single day. These are the consequences of inaction."

Responding to a White House proposal to create an independent panel to recommend Medicare cuts, the Congressional Budget Office (CBO) said on July 25, 2009, that the probability is high that no savings would be realized in the next decade, while entitlement spending would rise $1.042 trillion. The CBO did say there might be $2 billion in savings in the second decade of the program.

White House Budget Director Peter Orszag reponded to the CBO with a blog posting on the White House’s Web site saying that the point of the proposal was never to generate savings over the next decade. But yet, the White House rolled out the proposal hoping to give cover to Blue Dog Democrats in Congress complaining about the cost of overhauling health care.

Mr. Rove says that the House version of ObamaCare adds to the deficit even though the new taxes to pay for part of it begin two years before the program itself kicks in. That head start puts ObamaCare in the black through 2013, but net new spending after that overwhelms future revenue to add to the deficit each year.

Keith Hennessey, who was a National Economic Council director for George W. Bush, estimates the annual deficits in Mr. Obama’s plan will grow to $64 billion a year by 2019. This assumes that Mr. Obama gets all the tax increases and Medicare cuts he wants.

On July 26, 2009, the CBO reported it would "probably generate substantial increases in federal budget deficits during the decade beyond the current 10-year budget window." The CBO does not believe that Mr. Obama’s proposal bends health-care spending down, as the president has repeatedly claimed it would. The CBO says it escalates above today’s rate.

By 2029, Mr. Hennessey estimates that new taxes will bring in $143 billion a year, while net new health spending will have increased by $348 billion a year.

Mr. Rove says that nine out of 10 Americans would likely get worse health care if ObamaCare goes through. Of those who do not have insurance, approximately one-fifth are illegal aliens, nearly three-fifths make $50,000 or more a year and can afford insurance, and just under a third are probably eligible for Medicaid or other government programs already.

Mr. Rove says that for the slice of the uninsured that is left, about 2% of all American citizens, Team Obama would dismantle the world’s greatest health-care system. That’s a losing proposition, which is why Mr. Obama is increasingly resorting to fear and misleading claims. It’s all the candidate of hope has left.

According to a new Wall Street Journal/NBC News poll, support for President Barack Obama's health-care effort has declined over the past five weeks, particularly among those who already have insurance.

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