I just got done reading A Consumer’s Republic by Lizabeth Cohen. It’s a pretty interesting history of postwar consumerism in the US. One of the things it discusses is how, in the midst of a big housing shortage at the end of WWII, the government decided against simply building more housing and instead decided to send send people into the arms of the banks and developers by backing their mortgages. The result was an essentially unregulated housing boom that benefited some and grievously damaged others.

Looks like Obama’s proposed health care reform package would do something similar, trying to fix a public problem by shuttling people into the arms of private insurers. We’re told time and again that this deal, flawed as it may be, is the best that Obama could get.

Except that Obama was actually never committed to a public option:

For months I’ve been reporting in The Huffington Post that President Obama made a backroom deal last summer with the for-profit hospital lobby that he would make sure there would be no national public option in the final health reform legislation. (See here, here and here). I’ve been increasingly frustrated that except for an initial story last August in the New York Times, no major media outlet has picked up this important story and investigated further.

Hopefully, that’s changing. On Monday, Ed Shultz interviewed New York Times Washington reporter David Kirkpatrick on his MSNBC TV show, and Kirkpatrick confirmed the existence of the deal. Shultz quoted Chip Kahn, chief lobbyist for the for-profit hospital industry on Kahn’s confidence that the White House would honor the no public option deal, and Kirkpatrick responded:

“That’s a lobbyist for the hospital industry and he’s talking about the hospital industry’s specific deal with the White House and the Senate Finance Committee and, yeah, I think the hospital industry’s got a deal here. There really were only two deals, meaning quid pro quo handshake deals on both sides, one with the hospitals and the other with the drug industry. And I think what you’re interested in is that in the background of these deals was the presumption, shared on behalf of the lobbyists on the one side and the White House on the other, that the public option was not going to be in the final product.”

Kirkpatrick also acknowledged that White House Deputy Chief of Staff Jim Messina had confirmed the existence of the deal to him.

The current deal wasn’t the best they could do after giving it a fair shot. It was the best they could do while living up to the deals they made with the healthcare lobby.