Vol. 74/No. 9      March 8, 2010

Meanwhile, the president signed an order February 18 establishing a commission that he said would end the “stranglehold of debt” on the U.S. economy. These initiatives aim to accelerate cuts already being carried out in government-financed health care across the country and in other social programs.

Three days before the health-care summit, the White House released a new version of the bill, which closely resembles the one passed by the Senate in December. The legislation continues to feature an insurance mandate, which would require everyone to buy health insurance or face fines of 2.5 percent of their income or $695 per year, whichever is greater. Cuts to Medicare and Medicaid are also part of the package.

While the mandate would provide a profit bonanza for the insurance giants, the Obama administration has attempted to blunt criticism by condemning “greedy” insurance companies. He is trying to convince workers that the situation will get worse without “reform.”

“The bottom line is that the status quo is good for the insurance industry and bad for America,” said Obama in his February 20 weekly address, responding to recent moves by some insurance companies to raise their rates by more than 20 percent. “And as bad as things are today, they’ll only get worse if we fail to act.”

While the capitalist rulers are pushing their health-care “reform,” other attacks on the social wage are in the works.

The stated aim of the commission established by the February 18 executive order is to reduce the growing debt held by the federal government, which stands at more than $12 trillion. Alan Simpson, former Republican senator from Wyoming, and Erskine Bowles, former White House chief of staff in the William Clinton administration, have agreed to head up the 18-member panel.

“Everything is on the table,” said Obama after he signed the executive order.

Senate minority leader Mitchell McConnell said the panel should focus primarily on cutting spending, and that it should “come up with a way to deal with our large unfunded mandate problem: Medicare, Social Security, Medicaid.”

Medicare, which provides government subsidized health care for the elderly and permanently disabled, and Medicaid, which aids people with “low income,” were established in 1965 when the U.S. ruling class was forced to make concessions as a direct result of the massive working-class movement that brought down Jim Crow segregation, and the urban uprisings for Black rights that went along with it. Social Security was expanded in 1972 with the creation of the Supplemental Security Income program for the blind, disabled, and elderly.

A February 19 article in the New York Times reports that “virtually every state is making or considering substantial cuts in Medicaid.” The state government in Nevada, for example, is proposing to end Medicaid coverage of adult day care, eyeglasses, hearing aids, and dentures. Kansas cut Medicaid payments to providers by 10 percent as of January 1.

The unprecedented cuts in Medicaid are taking place as enrollment in the government-funded health-care program for the poorest individuals is skyrocketing. A survey by the Kaiser Family Foundation released February 18 found that a record 3.3 million people enrolled in Medicaid from June 2008 to June 2009. Enrollment rose by 7.5 percent to 46.9 million and 13 states had double-digit increases.

While cutting Social Security, Medicaid, and Medicare will be “on the table” of the bipartisan commission, two areas of government spending are not: the war budget and debt service. The interest paid to the bondholders by the federal government in 2009 was $383 billion and $451 billion in 2008.
 
 
Related articles:
EU governments push crisis on working class
Athens, Madrid, Lisbon prepare more cuts  
 
 
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