Will President step up to plate to fight for change?

A year since his election, Barack Obama's 'change' programme is facing unprecedented opposition from an alliance of Republicans and conservative Democrats, writes US correspondent Jim Dee

Saturday, 31 October 2009

Many abroad, including the prestigious Nobel committee, hail Barrack Obama's multilateralism as a refreshing sea-change in American foreign policy.

Back home, many supporters increasingly fret that his promised 'change' agenda may founder on the jagged rocks of Republican healthcare intransigence - unless Obama and Congressional Democrats employ more unilateralism.

President Obama has shown signs that he's growing weary of playing nice with everyone - particularly Wall Street executives who continue to draw mind-boggling bonuses after driving their corporations, and the world's economy, over a cliff.

On October 22, Kenneth Feinberg, the Treasury official appointed by Obama to police some Wall Street fat cats' pay packets, announced that salaries for 25 top executives at seven companies that received billions in government bail-out money will be cut by 90% (although pre-November earnings won't be affected).

The news was widely welcomed in an America where, according to a recent Time Magazine poll, 67% of people back forced pay-cuts on high-flying Wall Street CEOs and 59% want greater regulation of the financial and banking sectors.

However, the same poll found that 75% believe that Wall Street will ride out the storm of anger and then carry on as usual.

That cynicism is no doubt bolstered by the news that insurance giant AIG - which pocketed more than $140bn in bailout cash - is readying to pay a second round of bonuses next March to the tune of $198m (this on top of the $168m it splashed out earlier this year).

Meanwhile, while the 90% CEO pay-cut move may signal a toughening of Obama's strategy towards Wall Street, his Democratic allies on Capitol Hill still aren't acting like a party with significant majorities in both chambers of Congress.

Democrat Nancy Pelosi, the Speaker of the House of Representatives, unveiled a new version of a healthcare overhaul bill on Thursday. It contains the government-run 'public' option that liberals and progressives want.

However, after conservative Democrats vowed to join Republicans in opposing it, a provision to allow the government to set the rates paid to doctors and hospitals was scrapped. Instead, the government will have to negotiate rates - a scenario which critics say will undercut any effort to control rapidly spiralling costs.

Over in the Senate, majority leader Harry Reid, a Democrat, also announced that he'll soon be putting forward a bill containing the 'public option'. His sop to Senate Republicans (who all oppose the provision) was a pledge that individual states will be able opt out of the public option.

Not good enough, said Joe Lieberman, a senator who's become a poster child for politics-as-usual in Washington and a walking, talking litmus-test as to whether or not Senate Democrats have a backbone.

In 2006, Lieberman, a Democrat who staunchly backed 'Dubya' Bush, lost the Primary in Connecticut. Ignoring calls from party top brass, he turned independent and then easily won a three-way race that November to retain his seat.

When Democrats took control of the Senate last year, in return for a pledge to caucus with Democrats, Harry Reid - in spite of huge opposition from Democrats angered by Lieberman's backing of John McCain - gave Lieberman the chairmanship of Senate Committee on Homeland Security and Governmental Affairs.

How did Lieberman repay the favour? Within hours of Reid's announcement last week, Lieberman was publicly vowing to join Republicans in a filibuster of any bill if that contains a public option. That would leave Democrats shy of the 60 votes needed to end the talk-the-bill-to-death tactic.

But Senate Democrats do have an ironically-titled device known as 'reconciliation' at their disposal. It allows a straight majority of 51 votes, and not the preferred 60, to pass contentious legislation.

So far, Democrats have been timid in using the tool Republicans used to pass welfare reform in 1996 and George W Bush's 2001 tax cuts (largely benefiting the wealthy).

The question now is: will Lieberman's latest aisle-skipping move get their back up enough to use 'reconciliation'? Or will they back away from a fight?

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