Obamacare and Cronyism
A free-for-all of special interests is having catastrophic results.

Sen. Max Baucus


Once upon a time, there was a theory of government called “interest-group liberalism,” which held that a workable American democracy could be based on an infinite number of special interests’ elbowing each other in their battle to get to the government trough or to grab control of some regulatory apparatus.

Once upon a time — which is to say, now.

Sometimes this theory analogizes the political jostling of interest groups to the rough-and-tumble of the free market, but in fact it represents a dark parody. In a market, people promote their self-interest by providing goods and services that other people value and buy voluntarily. In interest-group liberalism, players make shifting power alliances so as to loot other players, or more often to loot those not in on the deal, which is usually the public.

The accurate Washington aphorism is, “If you are not at the table, you are on the menu,” and if this seems cynical, remember the words of comedian Lily Tomlin: “No matter how cynical you get, it is impossible to keep up.”

With luck, Obamacare will represent both the acme and the beginning of the end of the delusion that government by special-interest collision and collusion is a viable political system, and will trigger a return to the appreciation of limited and prudent government working within the framework of the free market and laws of general applicability.

After passage of Obamacare in 2010, Senate grandee Max Baucus recounted the history of the law. He lauded his staff, particularly the chief health counsel, who, he said, put together the white paper that became “the blueprint from which almost all health-care measures in all bills on both sides of the aisle came.”

Baucus’s staffer certainly did know the health industry. She had worked for Baucus earlier in the decade, but moved over to insurance giant WellPoint, where she became chief lobbyist. She returned to the Senate to work on the Obamacare legislation, moved on to HHS to help craft the implementation process, and, in December 2012, left government to work for health and drug company Johnson & Johnson. J&J is also part of the crony health cabal; it is a member of the PhRMA industry group, which supported the passage of Obamacare with a $150 million advertising campaign.

Baucus runs a famous revolving door. As the Huffington Post noted: “According to congressional staff records, 34 former Baucus staffers are currently registered to lobby Congress, and almost a third of them work on health-care issues, including [three] former Baucus chiefs of staff . . . [and a] former legislative director.”

For those unfamiliar with Washington, the way such arrangements usually work is that it becomes generally known that the way to reach Senator X, and the only way, is through one of his former staffers who is now on K Street. It is also known that there will be a price, in terms of campaign contributions and high fees. What happens to all those fees is something the sensible client does not want to know. Whether this description applies to the Baucus machine, I cannot say, but in Washington it is safest to apply a presumption of guilt.

It would be a mistake to think that the insurers alone wrote the bill, because the health industry has many other powerful players, and you can be sure that every one of them got a chance to grab the pen — big pharma; hospitals and other care providers; AARP, unions, feminists, and other lobbyists for selected beneficiaries; device makers; software companies. Obamacare is largely the product of the cronyism (the “Corrupt Bastards Club,” or CBC, in Sarah Palin’s phrase) that has become routine in Washington.

And routine not only in Washington, but in the states. Palin coined the term “CBC” for Alaska, and my state senator in Montana says that he deals with 63 lobbyists for the health industry and each of them is devoted to one cause: badgering the legislators for more dollars from the state.