Fault Lines
Page 38
Santelli’s proposal for “tea party” protests against the Obama administration quickly spread. As the income tax deadline of April 15, 2009, approached, plans for roughly 750 different demonstrations were coordinated, thanks to the financial backing of FreedomWorks, a group led by former GOP House Majority Leader Dick Armey. The conservative personalities at Fox News quickly adopted the cause as their own, advertising the rallies on the network as “FNC Tea Parties” and broadcasting live from several. “Bring your kids and experience history,” Glenn Beck encouraged Fox viewers, inviting them to join him for a protest at the Alamo in San Antonio. “Our kids are being sold into slavery,” he insisted, and they had a duty to stop it. Other Fox personalities followed suit. Host Neil Cavuto and conservative commentator Michelle Malkin headlined the protest in Sacramento, for instance, while Sean Hannity aired his program live from the protests in Atlanta. CNN and MSNBC covered the protests more critically, understanding them as a product of their competition. Susan Roesgen of CNN, covering a Chicago protest, shouted at demonstrators and said the gatherings were “anti-government, anti-CNN.” In the end, media critic David Carr concluded, “The Tax Day Tea Party was all but conceived, executed and deconstructed in the hothouse of cable news wars.” Despite its origins in cable news, though, the “tea party” protests tapped into a wellspring of populist resentment.23
Emboldened by the protests in the public and the press, Senate Republicans went to new lengths to stall the work of the Obama administration. The use of “holds” on presidential appointments, for instance, reached new heights, keeping the administration from staffing key positions. For instance, throughout the middle months of 2009, as the government sought to rebuild the financial sector, the Treasury Department had a stunning number of high-ranking policy positions still vacant because Obama’s nominees had been stalled in the Senate. As a result, Treasury Secretary Timothy Geithner had to reckon with the largest financial crisis since the Great Depression with a skeleton staff: no deputy treasury secretary, no undersecretary for international affairs, no undersecretary for domestic finance, no assistant secretary for tax policy, no assistant secretary for financial markets, no assistant secretary for financial stability, and no assistant secretary for legislative affairs. Astonishingly, six of these roles were still unfilled at the start of 2010. Paul Volcker, who led the Federal Reserve during the Carter and Reagan administrations, was stunned. “How can we run a government in the middle of a financial crisis,” he asked, “without doing the ordinary, garden-variety administrative work of filling the relevant agencies?” 24
Meanwhile, the Senate drastically increased the use of the filibuster. For most of the chamber’s history, filibusters and the cloture motions needed to end them were exceedingly rare. In the 1970s, they happened once or twice a month; over the 1980s and 1990s, they became much more frequent. Over these decades, the filibuster turned into a normal tool of partisan combat, a method of obstruction on major legislation as well as smaller issues, even a mechanism to achieve personal vendettas.25 As with every aspect of partisanship, this rapidly accelerated after 2008 as a new generation of senators—many of whom had gotten their start in the rougher politics of the House a decade or so earlier—arrived in the Senate ready to use these methods without remorse and without restraint. In the Obama era, the number of cloture motions increased to roughly two or three a week. Much like the increased use of holds, the rise in filibusters and forced cloture votes had a significant impact on the administration’s ability to make appointments, especially to the judiciary. Filibusters against judges had happened in the past, but usually only against nominees for whom there was serious opposition. In this new era, filibusters became commonplace, even against candidates for whom there was literally no opposition at all. Judge Barbara Keenan, picked to fill a vacancy on the US Court of Appeals for the Fourth Circuit, found her nomination widely praised and then advanced to the full Senate by a unanimous vote in the Senate Judiciary Committee. Nevertheless, it still took 169 days for her to go from nomination to confirmation, due to a filibuster that delayed things considerably. The motion for cloture to end the filibuster passed 99–0, and she was confirmed by the full Senate again by a vote of 99–0. “By our estimate,” political analysts Norm Ornstein and Tom Mann marveled, “a process that the Senate could have handled in a few weeks, from formal nomination to committee hearing to confirmation, took almost half a year and wasted dozens of hours of floor time.” Scorched earth politics had now become the norm.26
Health Care and Financial Reform
Meanwhile, the president decided to tackle a policy problem that Democratic presidents had been pursuing for half a century: national health care reform. Harry Truman had tried to enact a federal health insurance program twice during his administration, but his plans had been defeated when the American Medical Association mobilized in opposition and branded them “socialized medicine,” a kiss of death during the Cold War. Two decades later, Lyndon Johnson worked with huge Democratic majorities in Congress to pass Medicare, an addition to the Social Security system that would provide health insurance to the elderly, as well as Medicaid, a means-tested program for the poor. The advances made a significant difference in the provision of health care, but millions of working Americans were still left without access to insurance. In 1993 and 1994, Bill Clinton had attempted to push through a Democratic Congress a system of regulated health care markets to lower costs. Though there was strong public support, Republicans in Congress mobilized against the bill and effectively killed it.
Despite the long odds and an already crowded agenda, Obama decided that he would make health care reform a policy priority. The rising cost of insurance premiums had been a major factor in escalating business and government expenses. Between 2002 and 2008 alone, average family premiums had increased by 58 percent. To bring down these costs, the administration looked to innovative state models like the one tried in Massachusetts. There, Republican governor Mitt Romney passed a measure that imposed an individual health insurance mandate on residents and created a statewide insurance exchange. A free-market alternative to state-run health care, Romney’s plan won plaudits from across the political spectrum. The Obama White House assumed that embracing a similar approach to reform, with the same mix of government mandates and private insurance, could work in Washington just as it had in Boston.
The president articulated his vision to a joint session of Congress in February 2009, and by July a number of bills were circulating. Rather than sending legislators a specific plan, as Clinton had done to no success, Obama provided broad outlines but asked legislators to write the bill themselves. The White House, seeking to contain the kind of opposition that sank Clinton’s legislation, placed control in Congress’s hands and made it clear it was willing to make concessions from the start. Senate Democrats again tried to work with Republicans like Olympia Snowe to find potential areas for bipartisan compromise. The Patient Protection and Affordable Care Act that resulted was, in essence, made up of components from two conservative models from the past—first, the proposals that Senate Republicans had made as an alternative to Clinton’s 1993 plan and, second and more significant, the program that Governor Romney had launched in 2006 in Massachusetts. In the gruff assessment of MIT’s Jonathan Gruber, who had helped draft both the Romney and Obama plans, there was “zero difference” between the two. “They’re the same fucking bill.” 27
Indeed, analysis of the two showed they had a great deal in common. The individual mandate, a requirement that citizens obtain health insurance or else pay a fine, was the linchpin to both pieces of legislation, with an unmistakably conservative lineage. It had first been proposed by the Heritage Foundation in 1989 and had been championed in ensuing years by Republican leaders including George H. W. Bush, Dan Quayle, Newt Gingrich, and Bob Dole.28 In July 2009, Romney himself urged Obama to embrace the individual mandate in an op-ed piece in USA Today.29 That same summer, Republican Senator Chuck Grassley of Iowa insisted that
the individual mandate was uncontroversial and that there was a broad bipartisan consensus behind the idea—because liberals had finally come around to accept an idea that was once only championed by conservatives. But once Obama embraced the idea too, some of these same men denounced it. Indeed, just months after he repeatedly insisted that the individual mandate was constitutional, Grassley reversed himself and claimed it was fundamentally “unconstitutional.” 30
Even though the Affordable Care Act had a seemingly conservative lineage, Republicans fought it all the way. As they had with the stimulus, congressional leaders resolved to do all they could to deny the president a single Republican vote, solely to keep him from being able to claim a bipartisan accomplishment. As Senate Minority Leader McConnell explained to the New York Times in a March 2010 interview, “It was absolutely critical that everybody be together because if the proponents of the bill were able to say it was bipartisan, it tended to convey to the public that this is O.K., they must have figured it out. It’s either bipartisan or it isn’t.” 31 But this was something Senate Republicans admitted only after the law had been passed. Until then, they kept up appearances of bipartisanship, both in an attempt to maintain good public relations but also to slow the progress of the bill down considerably. As a result, the Affordable Care Act was subject to seemingly endless debate and discussion. The House held 79 different hearings over the course of a year, with testimony from 181 different witnesses; the Senate, meanwhile, had roughly another hundred hearings, roundtables, and other meetings. During that time, liberal proposals like a single-payer approach or a “public option” that would compete with private insurance companies were dismissed. Meanwhile, large numbers of Republican amendments were accepted.32
The key site of this last effort at bipartisanship was the Senate Finance Committee, where chairman Max Baucus of Montana, a red-state moderate Democrat, and Senator Grassley of Iowa, the ranking Republican, seemingly worked together to find common ground for the bill that would attract Republican votes. Baucus and Grassley held dozens of congressional hearings. They released joint “policy option” papers that were meant to suggest compromises. And in the end, they held thirty-one different meetings with the so-called “Gang of Six”—Baucus and Grassley, plus two moderate Democrats and two moderate Republicans—in order to find a compromise that would attract GOP votes. For his part, Baucus accepted every single proposal from the Republicans in the Gang of Six. But in return, none of them voted for the bill.33
The opposition was even more evident at the grass roots. When legislators went back to their districts in August 2009 they encountered fierce resistance to the legislation. The Tea Party movement, a campaign of grassroots conservatives that had formed in opposition to TARP, now took on this bill. Believing that the key to successful opposition lay in local politics, they focused on targeting members in their individual districts to negate any sense of common ground they might have had with colleagues in Washington. They mobilized supporters during the town hall meetings that legislators held in their home districts, getting into heated exchanges with the cameras rolling. In several instances, the encounters turned hostile. When Florida Democrat Kathy Castor met with constituents in Tampa, for instance, conservative protesters flooded the event. When hundreds were turned away after the room reached capacity, they banged on the door and yelled “Tyranny!” Pennsylvania Republican senator Arlen Specter, a seventy-nine-year-old legislator, had to leave a meeting after he was booed and shoving broke out in the crowd. The Tea Party anger was fueled by conservative media, which offered ongoing coverage of these protests. While organizers insisted the rallies were “nonpartisan,” Fox News again ran numerous stories about the alleged threats the administration proposal posed to health care. Sarah Palin, now a frequent guest on the network, picked up on a provision enabling doctors to discuss possible end-of-life options for elderly patients. She branded them as “death panels” in August 2009. From there, the term spread across the still rising set of conservative media outlets on radio, TV, and the internet.34
President Obama tried to dispel the growing rumors and rancor by delivering an address to a joint session of Congress in September 2009. When the president assured legislators that, contrary to conservative complaints, undocumented immigrants would not be insured by the plan, South Carolina Republican Joe Wilson interrupted the president’s speech, yelling out “You lie!” Wilson was formally rebuked by the House for his unprecedented breach of decorum, but the vote broke down along party lines. Unbowed, Wilson proceeded to highlight the fact that he’d called the president a liar in his fund-raising pitch—even though fact checkers like Politifact quickly showed that Wilson was misinformed, and the president had not lied. No matter. Within weeks, Wilson had raised over a million dollars off his outburst.35
As the final touches were placed on the health care bill, House Democrats added to the legislation a “public option” that meant consumers would be able to purchase insurance through the federal government if they did not like what was available in the private market. The main goal was to create pressure on private companies to lower costs so that they could meet the federal competition. The public option became a rallying cry for many liberals who believed that this aspect of the plan best carried forward the single-payer insurance idea that had fallen by the wayside. The House passed the bill by a vote of 220 to 215. In the Senate, it became bogged down in partisan battle. To overcome a filibuster, Democratic leaders conducted negotiations with members whose support would be essential. Ted Kennedy had died of brain cancer on August 25, 2009, leaving Democrats without their most vocal supporter on the Hill and one vote short of the sixty-vote threshold for ending filibusters. Accordingly, the administration turned to conservative Democrats like Ben Nelson of Nebraska. The administration won Nelson’s support by agreeing to provide higher rates of Medicaid funding in Nebraska, a concession opponents mocked as the “Cornhusker Kickback.” Though derided as pure pork, it did the job. The Senate voted to end the filibuster on December 23, 2009, by 60 to 39, and then passed the bill the following day, 60 to 39 again.36
On January 19, 2010, Massachusetts voters elected Republican Scott Brown to fill Kennedy’s seat. The election changed the political calculus considerably, giving the GOP enough votes to sustain a filibuster. It also served as a symbolic blow to supporters of health care reform. In response to the upset, the president backed away from his insistence that the Senate include a public option in its final bill. Moreover, he decided to hold a televised meeting—a health care summit—where he fielded questions from House Republican legislators about the bill for more than an hour. His performance won widespread praise as he was able to deflect some of the staunchest points of criticism, while his opponents in the House likewise drew praise for the civilized discussion. “President Obama denied he was a Bolshevik,” the New York Times report began, “the Republicans denied they were obstructionists, and both sides denied they were to blame for the toxic atmosphere clouding the nation’s political leadership.” 37
Senate Democrats, working closely with Speaker of the House Nancy Pelosi, decided that strong-arm tactics would be needed to move the bill through the Senate. On March 11, 2010, Senate Majority Leader Harry Reid announced that the bill would be considered as part of the budget reconciliation process, which prohibited filibusters. Republicans were livid. They complained that this would undercut democratic debate and stifle the rights of the minority. “If this bill is passed,” McConnell said, “in the next election every Republican candidate will be campaigning to repeal it.” The House passed the final bill by a narrow margin of 219 to 212 on March 21, 2010. It did not receive a single Republican vote, the first time that any major piece of domestic reform had passed on strictly partisan lines. The Senate passed the bill on the next day; Obama signed it into law on March 23, 2010.38
The partisan battles that began with the 2008 financial meltdown, and accelerated with health care reform, then came full circle as Congress set to work to c
onstruct new financial regulations to prevent another meltdown in the future. President Obama promised to overhaul the financial system in a way that was comparable to what occurred during the New Deal. The proposal, first introduced by the president in June 2009, contained a number of measures that aimed at preventing another sudden collapse. Massachusetts congressman Barney Frank and Connecticut senator Christopher Dodd then sponsored a bill that would reduce the number of high-risk investments that were permissible. Among other things, Dodd-Frank set to impose stricter regulations on financial markets, including restrictions on the sale of derivatives, and the creation of a new consumer protection board that would guard middle-class investors. As the bill moved slowly through Congress, the Senate added a provision called the Volcker Rule—in honor of former Federal Reserve chairman Paul Volcker—which reimposed the New Deal–era restrictions that had prevented depository banks from engaging in proprietary trading. After considerable delays, the Senate finally passed the bill 60 to 39 in June 2010, once again largely along party lines. The House likewise passed the bill in a partisan fashion, with Republicans standing in united opposition.
Despite the partisan fighting over the financial reforms, Obama insisted they would bring stability to the struggling economy. Dodd-Frank, he assured the nation, would “protect consumers and lay the foundation for a stronger and safer financial system, one that is innovative, creative, competitive, and far less prone to panic and collapse.” While the legislation left considerable space for interest groups to rework and challenge the law, stimulating an entire industry of financial service lawyers who were devoted to lobbying Washington for lenient treatment under the policy, the framework put into place some of the toughest regulations in decades. The Consumer Financial Protection Bureau, the brainchild of Harvard professor and future senator Elizabeth Warren, was a centerpiece of the bill. It aimed to protect middle-class citizens from the kinds of abuses in mortgages that had produced the collapse as well as in credit card lending. It also created two new government bodies, the Financial Stability Oversight Council and the Office of Financial Research, that were given the authority to monitor and regulate this sector of the economy. Under the legislation, the government gained the power to close down financial companies that found themselves in economic trouble as had occurred with Lehman Brothers.39