Liberal Democrats threaten to reject House healthcare deal

After months of marching in line as senior Democrats worked with the White House to develop healthcare legislation, liberal lawmakers from solidly Democratic districts are threatening a revolt that could doom President Obama’s bid to sign a major bill this year.

In the House, liberals are furious at their leaders for striking a deal with conservative Democrats that would weaken the proposal to create a government insurance program, a dream long cherished on the left.

On Thursday, 57 of these liberals sent a letter to Speaker Nancy Pelosi (D-San Francisco) warning that they would vote against any bill that contained the terms of the deal.

“We have compromised and we can compromise no more,” an angry Rep. Lynn Woolsey (D-Petaluma) said at a raucous news conference outside the Capitol.

Meanwhile in the Senate, a growing number of Democrats and Republicans were taking aim at an effort led by finance committee Chairman Max Baucus (D-Mont.) to develop centrist healthcare legislation that could attract GOP support -- in part by eliminating a government plan entirely.

The rising tide of liberal anger sent the White House scrambling, with Obama calling at least one left-leaning lawmaker to offer reassurance before Congress leaves town for its August break.

On Thursday, Pelosi and other House Democratic leaders also met privately with a group of labor leaders, consumer advocates and AARP to enlist their support.

Ever since the Democrats won congressional majorities in 2006, party leaders have struggled to balance the demands of their liberal and more conservative members.

And although the leadership has more than a month to rally enough votes to pass healthcare bills when Congress returns in September, the latest unrest is raising a menacing specter for the president and his allies. Some worry about a possible repeat of the healthcare debacles in the early 1970s and ‘90s, when divisions within the party helped doom bids to create universal coverage.

“Historically, the good has become the enemy of the perfect,” warned Ron Pollack, a veteran of past healthcare battles who heads the consumer group Families USA. “I’m afraid we have seen that repeated a little bit in the past several days.”

Scores of liberal Democrats favor a single-payer system similar to those in Canada and Britain, where the government controls the delivery of healthcare. (Eighty-six House Democrats are cosponsoring a bill to create a single-payer system in the U.S.)

But most, eager to break the decades-long logjam blocking a healthcare overhaul, decided that they would have to compromise this year.

During the presidential campaign and after taking office, Obama voiced his support for liberal healthcare principles. And many lawmakers put their faith in liberal leaders such as Pelosi and Reps. Henry A. Waxman (D-Beverly Hills), Charles B. Rangel (D-N.Y.) and George Miller (D-Martinez), the three committee chairmen who wrote the bill being debated in the House.

That measure -- and a similar one developed by Sen. Edward M. Kennedy (D-Mass.) and his staff -- includes a provision creating a government-run insurance plan as an alternative to private coverage.

“What the American people want, very clearly, is a Medicare-type public option in 50 states in this country which will give them the choice against private insurance companies,” said Sen. Bernie Sanders, an independent from Vermont who caucuses with the Democrats. Polls have shown consistently that a large majority of Americans favor such a plan.

But senior House and Senate Democrats are contending with a growing cadre of party centrists, many of whom are uneasy about expanding government’s role in healthcare.

“It’s the moderates that give [Democrats] their majority,” said Will Marshall, president of the centrist Progressive Policy Institute. “The bigger the Democratic majority grows, the more moderate it becomes. Democrats are a center-left coalition, so big legislative initiatives need to be shaped accordingly.”

House leaders bowed to that idea this week. Facing the prospect that a group of conservative Democrats in the 52-member Blue Dog Coalition might block a healthcare bill from moving through the energy and commerce committee, they modified the bill.

The backlash was swift and severe.

“We’re at a point where there’s no retreat, and we can and must hold the line,” said Rep. Raul M. Grijalva (D-Ariz.), co-chairman of the liberal Congressional Progressive Caucus.

In a letter, liberal lawmakers attacked the deal.

“We regard the agreement reached by Chairman Waxman and several Blue Dog members of the committee as fundamentally unacceptable,” they wrote. “This agreement is not a step forward toward a good healthcare bill, but a large step backwards.”

In the Senate, John D. Rockefeller IV (D-W.Va.), a widely respected, longtime advocate of a healthcare overhaul, took aim at a key part of the Baucus efforts to craft a bipartisan bill: a proposal to create a system of insurance cooperatives in place of a government plan.

“We cannot afford to hang our hat on any unproven, unregulated or unreliable model for health insurance coverage,” said Rockefeller, who also expressed his expectation that Baucus’ effort would fail to produce a bill before the August recess.

“I have a sense the tide is moving the other way,” he said.

Pelosi, meanwhile, was left to try to downplay the divisions in her party.

“We have tremendous diversity, whether it is generational, geographic, philosophical, ethnic, gender, you name it,” she said. “It is a great kaleidoscope.”

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noam.levey@latimes.com

joliphant@latimes.com

Janet Hook in the Washington bureau contributed to this report.

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Blue Dog Coalition: a primer

It calls its members moderates, centrists and fiscal conservatives. In a Democratic Party well-stocked with liberal lawmakers, the Blue Dog Coalition of 52 House members has aimed, in its own words, to “bridge the gap between ideological extremes.”

History

The group has focused mostly on budget issues -- asking Congress, for example, to adopt “pay as you go” rules to limit deficit spending.

The Blue Dogs have been an important faction of the party since forming in 1995, but rarely in recent years have they been so blunt in confronting the liberal-dominated party leadership.

Healthcare debate

This week, the 15-year-old coalition claimed a success in the most important legislative fight of the moment: the battle to draft an overhaul of the U.S. healthcare system. After holding up the legislation for more than a week, a faction of the Blue Dogs won concessions from Democratic leaders Wednesday that could give the overhaul a more centrist bent.

It was a significant moment for the coalition, and one that has prompted an angry backlash from more-liberal House Democrats.

Due to pressure from the Blue Dogs, the House healthcare package might scale back the ability that a government-run insurance plan would have to compete with private insurers. The coalition also won an agreement to exempt more small businesses from a requirement that they provide health insurance to their employees or pay a financial penalty. And the Blue Dogs negotiated to delay a House vote until September, which will give lawmakers more time to understand the complex bill -- but will also give opponents more time to rally against it.

Member breakdown

Most of the coalition’s members come from rural and suburban districts, many in the South. According to the Blue Dogs’ website, their name is taken from the South’s longtime description of a party loyalist as someone who would vote for a yellow dog if it were on the ballot as a Democrat. Members chose the “Blue Dog” moniker, the website said, because they had been “choked blue” by more-liberal colleagues for their moderate and conservative views.

In recent years, many Blue Dogs have come from districts that until recently were dominated by Republicans. These members could be vulnerable at election time if they are too closely identified with a liberal agenda.

Source: Aaron Zitner, Los Angeles Times