Reality For Radicals

Reality For Radicals




Investor's Business Daily. All Rights Reserved.
December 26, 2008 4:20 PM PT

Transition: During the campaign, Democrats pledged radical change. But recession has forced them to rein in their agenda, from soaking the rich to nationalizing health care. How the worm turns.

In debate after debate, Barack Obama assured voters he'd pay for his national health care plan by taxing the rich. But now that appears unreasonable even to the fawning reporters who cover him.

"How are you actually planning to fund your health care program?" asked one earlier this month. "It has been estimated that it could cost up to $65 billion, and you had planned originally to fund it through getting rid of the tax cuts to the wealthy. But in the current economic situation, maybe that's not so reasonable?"

Obama stammered before answering, "I have not made yet a determination in terms of how we're going to deal with the rollback of the Bush tax cuts for the wealthiest Americans." He allowed that he may need "additional dollars to pay for some investments."

In other words, he's hard-pressed for revenues to fund his ambitious spending programs. Redistribution's no fun in a recession.

His health care plan, which was supposed to at least cover all children, has been reduced to a medical cost-savings program that includes modernizing doctors' antiquated medical records systems. Somehow "health IT," as Obama calls his savings program, wasn't the health care reform Moveon.org had in mind.

"We can't simply insure everybody under the current program without bankrupting the government or bankrupting business or states," Obama said, "So our starting point is savings."

The president-elect is also having to rethink his anti-industry energy policies. With crude under $40 a barrel, he won't pursue a windfall-profit tax on oil companies, which he'd hoped would fund new green initiatives and other domestic programs.

And a planned assault on the coal industry is also on the back burner. It would likely mean higher utility bills and more pain for depressed regions that depend on coal mining.

The cooling climate is also giving Obama fits. With snow falling from New Orleans to Las Vegas and Malibu, Calif., efforts to cut greenhouse gas emissions now seem forced.

What's more, we have it on good authority that Obama's promised support for a card-check system for unions trying to organize a new workplace is also a nonstarter. That, too, had been a priority.

Obama owes unions, big-time, but he's also rethinking his plan to add labor, as well as environmental, protections to NAFTA. The Democrat-controlled Congress is also backing off pro-union, anti-trade measures for fear of delaying the economic recovery.

"Card check, tax increases, major moves to the left are off the table," a Republican leader on the Hill told us.

Just months ago, Democrats were toying with the idea of taxing 401(k)s. Now that's dead in the water. So is the Global Poverty Act, a bill Obama co-sponsored in the Senate.

One by one, Obama is backing off campaign promises as his radical agenda runs into the buzz saw of reality. That doesn't mean he's changing his agenda, but he admits "we're going to have to prioritize" as conditions change. Call it the education of Barack Obama.



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