Goodbye Public Option?

by Pejman Yousefzadeh on September 2, 2009

It would appear so:

Aides to President Barack Obama are putting the final touches on a new strategy to help Democrats recover from a brutal August recess by specifying what Obama wants to see in a compromise health care deal and directly confronting other trouble spots, West Wing officials tell POLITICO.

Obama is considering detailing his health-care demands in a major speech as soon as next week, when Congress returns from the August recess. And although House leaders have said their members will demand the inclusion of a public insurance option, Obama has no plans to insist on it himself, the officials said.

“We’re entering a new season,” senior adviser David Axelrod said in a telephone interview. “It’s time to synthesize and harmonize these strands and get this done. We’re confident that we can do that. But obviously it is a different phase. We’re going to approach it in a different way. The president is going to be very active.”

Top officials privately concede the past six weeks have taken their toll on Obama’s popularity. But the officials also see the new diminished expectations as an opportunity to prove their critics wrong by signing a health care law, showing progress in Afghanistan, and using this month’s anniversary of the fall of Lehman Brothers to push for a crackdown on Wall Street.

On health care, Obama’s willingness to forgo the public option is sure to anger his party’s liberal base. But some administration officials welcome a showdown with liberal lawmakers if they argue they would rather have no health care law than an incremental one. The confrontation would allow Obama to show he is willing to stare down his own party to get things done.

Well, that would be the spin. But at the end of the day, the decision to give up on the public option is a tremendous defeat for the Obama Administration, and will likely erode the President’s standing among his base. Naturally, of course, the Obama Administration will try to get non-profit co-ops in place of a public option, and non-profit co-ops are about as bad as a public option would be. But that does not change the fact that the death of the public option means a significant setback for the Obama Administration in terms of its power and its appeal among members of its own base.

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