Key Senators React To Lieberman’s Fuzzy Public Option Logic

October 28, 2009 5:32 a.m.

One of the most puzzling things about Sen. Joe Lieberman’s opposition to the public option is that he says it’s based in a belief that a new government “entitlement” will end up being a large burden on taxpayers. In fact, the public option will be paid into (i.e. not subsidized like an entitlement) and the vast consensus among experts, partisan and non-partisan, is that a public option will save the government lots of loot. Moreover, they conclude that the bigger the plan is, the more money it will save.

Yesterday, I asked Sen. Olympia Snowe (R-ME) and Lieberman’s Connecticut colleague Chris Dodd (D-CT) what they thought of Lieberman’s backward thinking.

Singing the praises of her preferred ‘trigger’ solution, Snowe said “[triggers] obviously can have a maximum impact…certainly, not as comparable to a full public option and what they want, but on the other hand what you’re doing with the public option is basically crowding out the private sector, because of the government’s, you know, inordinate advantage in the market place.”I asked her how this view of the public option squares with Lieberman’s view that the public option will break the government’s bank. After all, if it’s driving premiums down so low that insurance companies go out of business, it’s clearly saving the government–which will be subsidizing insurance plans–significant amounts of money.

“No,” she said. The issue, she added, was that the public option “drives the industry out.”

“I believe in, to the extent possible, to allow the private sector to provide a solution,” Snowe said.

So what about a public option proponent like Dodd. What are his thoughts on Lieberman’s policy eccentricities?

“Joe and I are good friends,” Dodd told me, “and there’s a difference on this and that’s certainly his right to express it…. I’m disappointed we’re not in agreement on this, but that happens from time to time on issues.”

He did acknowledge the consensus on the public option: “I believe it brings down costs, I think it’s going to save money as well,” Dodd said. “And so I’m still hopeful that before we complete this process there’ll be a lot more support for the public option, possibly even a good colleague and friend from Connecticut.”

Lieberman’s argument is that the public option will need significant infusions of government money to survive. But here’s how Delaware Sen. Tom Carper described the plan under consideration by Senate health care principals.

The public option, he said, must “have to retain earnings, create a retained earnings pool, so that if they run into financial problems later on the financial needs of the plan could be met by the retained earnings, not by the federal government.”

Oh well.

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