Obama's healthcare a time bomb
As I wrote this column, and as you read it, the United States had reached the climax of the most contentious and sweeping attempt at social engineering in more than 40 years, a process that has degenerated into the abattoir of politics: bribery, chicanery and bloody-mindedness.
A deeply divided Congress mirrors a divided nation. The majority of Americans are opposed to the changes. Bipartisanship has become roadkill.
Even Australia has been a casualty of the long and tortuous battle over President Barack Obama's proposal for a significant increase in the role of government in delivering health care. Instead of addressing the Australian Parliament this week, Obama has cancelled his trip to Australia and Indonesia. He remains in Washington seeking to break a deadlock in the US House of Representatives which, at the time of writing, was locked at 212 intended votes for his health bill and 212 intended votes against. A handful of wavering Democrats will decide the outcome.
Illustration: Michael Mucci
The presidential trip has been postponed rather than cancelled, and for a compelling reason, which avoids monumental slights to America's staunchest ally and to the world's largest Muslim nation.
At home, the President has created a domestic political gamble of the highest order. In contrast to the soaring rhetoric and uplifting symbolism that carried him to the White House, Obama has engaged in old-school, bare-knuckle, divisive politics wrapped in an impossibly complex 2700-page bill loaded with accounting tricks and dirty deals.
It has been presented to Congress with the barest 72 hours' notice before it is supposed to vote (today, local time).
Thirty states, fearful of being burdened with excessive costs and resentful of the compulsory imposition of health-care costs on individuals, have threatened constitutional legal action against the legislation if it passes.
This is definitely not change you can believe in. The opinion polls are saying so. Obama's approval ratings have plunged while the Republicans have rebounded from dispirited defeat in 2008, re-energised over what they regard as a threat to the US economy.
There is a threat. The shadow looming over America is debt, greater than any time in the nation's history. The current federal budget deficit, $US1.4 trillion ($A1.52 trillion), is unprecedented. So, too, is the accumulated budget deficit of $US7.5 trillion, and rising. Total US debt, public and private, is equal to about 380 per cent of GDP. It is creating a pervading unease.
Debt and health care are interwoven. The latest issue of America's most prestigious medical journal, The New England Journal of Medicine, contains an article ominously titled, ''The Spectre of Financial Armageddon - Health Care and Federal Debt in the United States''.
It says: ''The United States has a substantial, growing structural deficit, much of which reflects current and projected increases in federal spending on Medicare and Medicaid. This federal health care spending amounted to 5 per cent of the gross domestic product (GDP) and 20 per cent of federal outlays in 2009 and is forecast to reach 12 per cent of the GDP by 2050.
''Health care spending is thus a key driver of long-term debt . . . [and] our structural deficits place us on a path of debt growth that is unsustainable, largely because of health-care programs. The sooner we start to rein in health-care spending, the less painful the changes may be . . . ''
Far from curbing America's spending, Obama, having inherited grossly undisciplined deficits and banking oversight from the Bush administration, is exacerbating the trend. About two-thirds of the increase in the federal deficit is attributed to increased spending.
This is creating a credibility chasm for the President, the growing gap between the healing rhetoric of his campaign and the bruising realities of his presidency.
America's Darwinian health-care system does need reform. (It was one reason why I left the US after living there for 10 years.) But the process of reform has been unedifying, and dangerous for the Democrats.
In the past six months, the Republicans have won a series of stunning routs in three special elections, the races for governor in New Jersey and Virginia and the special election in Massachusetts to replace the late Senator Ted Kennedy. Obama won all three states comfortably in the 2008 presidential election.
That was then. If he does win on health care and introduces almost universal health-care coverage for the first time, he may be blamed for the inevitable triage in health spending as American seeks to curb its federal deficit.
Middle-class America may also decide they have been milked by the President to pay for a historic transfer of wealth through the health-care system. Either way, the Democrats could pay with heavy losses in the midterm Congressional elections on November 2.
If, on the other hand, Obama loses this battle, he will have expended an immense amount of political capital in a damaged cause.
Although Obama will not be present in Canberra this week, his spirit will linger tomorrow as the Prime Minister and the Leader of the Opposition hold a special debate over health-care reform.
The President, for all his charisma, his ''audacity of hope'', has been battered by staking his reputation on health-care reform.
Kevin Rudd, who gets no charisma dividend, is offering his own form of audacity through sweeping reform of the hospital system. He has made similarly grand promises on education, energy, consumer protection and border integrity.
Once again, Rudd is offering big rhetoric and even bigger government, despite the parade of gold-plated debacles delivered so far via his unique penchant for conflating bureaucracy with grandiosity.