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Fight over health plan awaits Obama

L'AQUILA, Italy — Barack Obama's problems back in Washington, largely brought on by fellow Democrats, have hardly gone away while he has been off summiting in Europe and visiting Africa. In fact, they've gotten worse.

The president returns home this weekend vowing to keep fighting for his health care initiative, which has hit bumps in the Democratic-controlled House and Senate as lawmakers quarrel over what it should include and how to pay for it.

And, as Obama acknowledged Friday after the G-8 summit near Rome, the global recession continues to drive up social needs in the United States and other countries while making it tougher for governments to raise money to address them.

Obama, who will fly home late today from Ghana, spent the week working on arms control, global warming and other knotty issues with an almost dizzying succession of leaders from nearly 40 countries. But Congress "is always tougher" to deal with, he told reporters with a smile.

Those words underscored the challenges that got even more challenging in the few days he was away.

That was especially true of his efforts to overhaul the nation's health care system by covering virtually every American, streamlining medical treatments and costs and giving people more insurance options.

"It is my highest legislative priority over the next month," Obama said.

But things have not gone well lately.

Key House Democrats decided Friday to raise taxes on the wealthy to help pay for health care legislation, as House leaders tried to quell concerns among moderate and conservative lawmakers about other elements of the bill.

Democrats on the tax-writing Ways and Means Committee agreed to a new surtax that would start with households making $350,000 a year and begin in 2011, said the committee's chairman, Rep. Charles Rangel, D-N.Y.

It would raise $540 billion over 10 years, about half the cost of Obama's ambitious plan to reshape the nation's health care system and provide care to the 50 million uninsured. However, lawmakers could not provide an exact price tag of the overall bill.

The proposal faces an uncertain reception in the Senate and from moderate and conservative Democrats in the House, who rebelled Thursday over various aspects — including costs — of the plan.

Democratic leaders spent hours Friday trying to soothe those concerns without reaching resolution, even as Rangel's panel met to come up with the payment proposal.

Obama acknowledged obstacles to the legislative timetable but said failure to meet a self-imposed August deadline for moving bills through the House and Senate didn't doom the endeavor.

"I never believe anything is do-or-die," the president said in Italy. "But I really want to get it done by the August recess."

Rangel said the new surtax would be graduated, starting with households at $350,000 and then rising at $500,000 and again at $1 million. Married taxpayers earning more than $350,000 a year in adjusted gross income and single filers making more than $280,000 a year would pay a surtax of about 1 percent.

The tax levels for the other two groups, those above $500,000 and $1 million in annual incomes, are still being determined.

The tax plan faces an uncertain fate in the House and in the Senate, where Democrats and Republicans are working on their own proposals.

In the Senate, a potential bipartisan deal was undermined this week when Senate Majority Leader Harry Reid signaled displeasure with its call for a new tax on employer-subsidized health benefits.

Obama offered no new negotiating stands but indicated he would continue to press Americans at large to demand action from Congress.

"My biggest job is to explain to the American people why this is so important and give them confidence that we can do better than we're doing right now," he said.

"We are closer to achieving serious health care reform that cuts costs, provides coverage to American families" and "allows them to keep their doctors and plans," the president said. "We're closer to that significant reform than at any time in recent history. That doesn't make it easy."

Obama said he expects "tough negotiations in the days and weeks to come."

Fight over health plan awaits Obama 07/10/09 [Last modified: Friday, July 10, 2009 9:55pm]
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