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June 17, 1994
Mortgage rates rose a little this week but held in the bottom of the range of the last 60 days.
Economic data show slowing, sustainable growth: the CPI rose only .2%, Retail Sales fell .2%, and New Housing Starts gained 2.6% while new permit applications declined. Industrial Production rose .2%, but Industrial Capacity Utilization drifted down another .1% to 83.5%.
The big news happened at the health care corral, where pitiful lookin' horses lie everywhere, beaten nonetheless.
In response to quietly frantic pressure from the White House, Congressional committees have begun to vote out preliminary bills. Congress is about to escape into summer recess, and the rest of the year will be occupied by elections, not dead horse trading. If a passable hayburner doesn't emerge in the next few weeks, health care reform has had it for this year, and maybe a long time..
Wobbly livestock include the critter from Dan Rostenkowski's replacement at Ways and Means. Rep. Sam Gibbons decided to fund health care by stealing double-coverage money. In a $40 billion windfall, if your spouse was already covered pre-reform, never mind: we'll take a premium from you, too. Stamps, anyone?
Ted Kennedy's committee passed his bill, richer with benefits and taxes than the Clinton deal, and just as dead.
Senator Moynihan, Chairman of Senate Finance, the key group, held services over the remains. He told the President "Šthere is not now a majority for any planŠ."
As this adventure gradually keels over in its tracks, four thoughts dominated discussions at week's end.
David Boren (D. OK), who is leaving the Senate in frustration, said he would not join Democrats in forcing a partisan bill. He explained that without a consensus, any program would wander from political whim to whim year after year. Sorry to lose this guy.
Next, note that the last serious try at health reform was Dick Nixon's (!) 23 years ago. That try ended when the political left, led by labor unions, objected to mandatory payments by employers (!). Are we getting anywhere at all?
Third, opinion polls are showing a middle class belief that universal coverage is just another welfare program to benefit the poor and be paid for by the middle class. With all the jaw-jaw, it's a shame that the education effort has failed: the poor mostly are covered already. It's the hard-working lower middle and middle who are without insurance.
Last, many opportunities for gradualism and experiment are failing because of Mr. Clinton's silly threat to veto any bill which doesn't include universal coverage, and the gross obstructionism of Rep. Newt Gingrich (R., GA) and pals. The radicals are in charge, not the moderate center.
Oh, well. At least the bond market isn't worried about a budget-buster.
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