The Sebelius Thugocracy: "They're more subtle than this in Caracas".

In other administrations you would expect news like this to turn up in a parking garage somewhere delivered by an anonymous "Deep Throat." Not so in the Obama administration, where thugocracy reigns supreme; we find this news in the Wall Street Journal instead:

'As a consequence of us getting 30 million additional people health care, at the margins that's going to increase our costs—we knew that," President Obama said at his press conference Friday in response to a question about rising health spending.

That wasn't how he sold the plan, but, anyway, that's a truism. Here's another: The White House was always going to blame insurance companies for any cost increases, even when its own policies cause them.

Witness Kathleen Sebelius's Thursday letter to America's Health Insurance Plans, the industry trade group—a thuggish message even by her standards. The Health and Human Services secretary wrote that some insurers have been attributing part of their 2011 premium increases to ObamaCare and warned that "there will be zero tolerance for this type of misinformation and unjustified rate increases."

Zero tolerance for expressing an opinion, or offering an explanation to policyholders? They're more subtle than this in Caracas.

What Ms. Sebelius really means is that the government will prohibit insurers from doing business if reality is not politically convenient for Democrats. ObamaCare includes a slew of mandated benefits for next year, such as allowing children to remain on their parents' plans until age 26 and "free" preventative care (i.e., no direct out-of-pocket cost sharing for consumers). The tone of Ms. Sebelius's letter suggests that she doesn't understand that money is exchanged for goods and services, and that if Congress mandates new benefits, premiums will rise.

No wonder the economy is in the crapper with this group of thugs threatening business at every turn.  As if the Obama health care agenda hasn't gone out of its' way to make life miserable for insurers already; insurers are now prevented from explaining the consequences of this outrageous law to their customers.  I guess they should write a letter explaining they are all money grubbing whores hoping to profit off the misery of the American people in justification for rate increases necessitated by the health care law.

Shhh, don't look now but the 1099 insurrection is underway:

You might not have seen it reported, but the Senate will vote this morning on whether to repeal part of ObamaCare that it passed only months ago. The White House is opposed, but this fight is likely to be the first of many as Americans discover—as Nancy Pelosi once famously predicted—what's in the bill.

The Senate will vote on amendments to the White House small business bill that would rescind an ObamaCare mandate that companies track and submit to the IRS all business-to-business transactions over $600 annually. Democrats tucked the 1099 reporting footnote into the bill to raise an estimated $17.1 billion, part of the effort to claim that ObamaCare reduces the deficit by $100 billion or so.

Much like the rest of the miraculous deficit reducing powers of the health care law, the onerous provision requiring business to file truckloads of 1099's would produce the $17.1 billion Dems claimed only in a mythical beltway fantasy land.  Instead it will bury business and the IRS in paperwork and increased costs.

The provision is such a failure that even the White House is quietly backing its removal from their grotesque law.  They're not backing the repeal of the provision, however, for fear that would set repeal fever in motion:

Most Democrats now claim they were blindsided and didn't understand the implications of the 1099 provision—which is typical of the slapdash, destructive way the bill was written and passed. As the critics claimed, most Members had no idea what they were voting on. Some 239 House Democrats voted to dump the 1099 provision in August, and the repeal would have passed except Speaker Pelosi rigged the vote procedurally so it needed a two-thirds majority. She thus gave Democrats the cover of a repeal vote without actually repealing it.

In the Senate today, Nebraska Republican Mike Johanns will offer his amendment to scrap the new 1099 rules altogether. But the White House is opposing this because it fears it would set a precedent for repealing the larger health bill. Over the weekend the Treasury Department pronounced the Johanns amendment "not acceptable in its current form."

Yesterday the White House endorsed a competing proposal from Florida Democrat Bill Nelson that would increase the 1099 threshold to $5,000 and exempt businesses with fewer than 25 workers. Yet this is little more than a rearguard action in favor of the status quo; the Nelson amendment leaves the basic architecture unchanged while making the problem more complex.

Businesses would still have to track all purchases, not knowing in advance which contractors will exceed $5,000 at the end of the year. It also creates a marginal barrier to job creation—for a smaller firm, hiring a 26th employee would be extremely costly. The Nelson amendment also includes new taxes on domestic oil production, as every Democratic bill now seems to do.

If this weren't all so dire, it would almost be comical the lengths this administration will go to throw barriers onto business for job creation.  No doubt some administration official will take it upon themselves to pen a letter to business threatening them to keep quiet about why they have zero incentive to hire new people.  Never fear America, we have the new improved empathetic Obama to "stand in the hot sun" with us - in unemployment lines presumably - as he "feels our pain."

UPDATE:  Wyblog reports Senate Dems refuse to repeal the 1099 reporting requirement:

The Barack Obama Death to Small Business Tax Reporting Act of 2010 will stand.

Senate Democrats successfully defeated an amendment offered by Senator Mike Johanns (R-Neb) that would have repealed an Obamacare provision which requires all businesses to file Form 1099 with the IRS for every vendor that sells them more than $600 in goods.

Death to small business seems to be their middle name.

More on this at Memeorandum

Kathleen Sebelius Clueless on Costs for High-Risk Pools

Naked Emperor News has a clip from Kathleen Sebelius' testimony before the Appropriations Committee yesterday. Sebelius has been given enormous power under the new health care legislation. Given her enormous involvement in the health care legislation process, there is no excuse for her to be unable to justify and explain all aspects of the legislation particularly the costs used to justify the whole sham as deficit neutral.

The provision of the legislation that guarantees coverage for high-risk citizens has been widely touted as a key feature of the bill. That Sebelius has absolutely no clue what such coverage will cost or any idea how many will need to be covered reveals how shaky are the underpinnings of the entire cost analysis of the bill. Yet here we see the most powerful HHS Secretary admit the administration has no idea how much high risk pools will cost nor can she explain why the money appropriated will not even make it to 2012 when the pools are not scheduled to be operational until 2014. Audacity:

Shocking News Item: Sebelius Threatens Insurers

Kathleen Sebelius penned a threatening note to Karen Ignagni, lobbyist for AHIP (health insurance) warning insurers they dare not try to take advantage of the Democrats' failure to include the exclusion for pre-existing conditions in their prized piece of legislation.  Why should the disapprobation of the insurers stop now, after they willingly cooperated with Democrats for more than a year?  Chief Cheerleader for all things health care at The Washington Post gives the alternate title: Sebelius to Insurers: Make my day.  These are the children in charge of the country.

Sebelius absurdly threatens to do what Democrats seem to specialize in these days, issue an executive fiat to paper over their ineptitude at governing.  If that doesn't work they can always drag a few holdouts before Congress for a bit of public humiliation.  Ezra Klein counts the many ways insurers lose because Democrats can't keep track of what they included and/or promised in their mountainous legislation:

The losers here are actually the insurers. As far as I can tell, their reading of the law is legitimate. And they have a lot to lose from a fight with the administration. It's not obvious that Sebelius actually can change this with a stroke of her pen, but there are plenty of other things she can do with a stroke of her pen that will make the insurance industry's life very, very difficult. And since this policy actually isn't a very big deal -- fairly few kids are uninsured because their preexisting conditions are keeping them off their parents' plan -- I'd guess that the administration and the insurers reach some sort of accord on this.

I am still baffled why Democrats think none of this will backfire on them when a HHS Secretary is given this much power under a Republican administration.  Sebelius can't force the insurers help cover over Democrats' failure to write coherent legislation, though she isn't above trying.  Surely, *asking* for the insurers to cooperate in light of the Democrats own blunder is too much to hope for.  The only alternative this administration finds acceptable is to run roughshod over whoever or whatever is in their way.  What will they ever do about themselves?

Life Support for the Public Option?

Remember the words of caution about declaring victory in the war on the "public option?" Mark Ambinder has this report in "The Atlantic:"

An administration official said tonight that Health and Human Services Secretary Kathleen Sebelius "misspoke" when she told CNN this morning that a government run health insurance option "is not an essential part" of reform. This official asked not to be identified in exchange for providing clarity about the intentions of the President.

Ambinder reports the official claimed Kathleen Sebelius had intended to echo the President's message and there was no intention to change the White House messaging. What exactly is that message you might ask? Good question, make sense of this confused message if you can:

the public option is a tough sell in the Senate and is, at the same time, a must-pass for House Democrats, and is not, in the president's view, the most important element of the reform package.

Good thing they didn't pass tort reform, I think I might sue for whiplash. Hold on to your neck brace, there's more:

A second official, Linda Douglass, director of health reform communications for the administration, said that President Obama believed that a public option was the best way to reduce costs and promote competition among insurance companies, that he had not backed away from that belief, and that he still wanted to see a public option in the final bill.

So who do we believe the anonymous official or Rita Skeeter?

Ambinder reported earlier in the day:

Before the health care debate began in earnest, I can tell you that very senior White House officials believed that some form of public plan was absolutely necessary to ensure that the overall bill would be seen as a cost-cutter. That opinion changed roundabout three months ago when it became clear that even a public plan with a trigger mechanism -- Rahm Emanuel's preferred option -- just didn't have the votes.

This supports what Kent Conrad said "to Chris Wallace today as well. Clearly the White House will not stand or fall over the public option; failure to pass reform of any kind would be a huge loss for this President.

If HuffPo is any indication of the outrage on the liberal left, it is worth noting this story had over 17,000 comments. Many commenters vowed to bombard the White House with letters of protest. It could easily be an effort to assuage their outrage. HuffPo's headline now is in bold red: Mixed Messages. Holy cow, I agree.