Healthcare stressed at Obama's 'fiscal responsibility summit'

02/23/2009 6:36 PM

02/24/2009 2:25 AM

WASHINGTON — President Barack Obama will convene a White House meeting next week to address runaway health-care costs. On Monday he called it key to reining in federal spending as he tries to balance plans to spend the country out of recession with shoring up its long-term fiscal health.

Obama announced his plans for the health-care meeting as he met at the White House with lawmakers, economists and union officials to discuss his promise to cut the federal budget deficit in half by the end of his first term and simultaneously start addressing longer-term problems. The event was billed as a "fiscal responsibility summit."

"We've got a lot of hard choices to make," the president said, urging a broad group to keep meeting in the weeks ahead to forge agreements on such intractable budget problems as health-care spending and shoring up Social Security. His health-care summit will be sometime in the middle of next week.

One top budget analyst told the group that health-care spending is the number one culprit.

"The single biggest factor is rising health-care costs, not just in Medicare and Medicaid, but throughout our health-care system," said Robert Greenstein, the executive director of the Center on Budget and Policy Priorities, a nonpartisan research center.

He said that health-care costs had risen faster than the economy for 30 years. Bringing health-care cost increases in line with the rest of the economy, he said, would fix the vast majority of the government's long-term fiscal problems. He didn't say how those costs could or would be controlled or how deep political divisions could be bridged to do it.

Obama made a point of inviting some of his rivals and harshest critics, using the White House to set up a framework for negotiations outside Congress.

Meeting with the group of about 130 after they'd spent the afternoon discussing federal spending, the president called first on Sen. John McCain, R-Ariz., his Republican opponent for the presidency in last November's election.

McCain called his session on Pentagon spending "very fruitful," singling out talk about cost overruns in the Defense Department and noting that a planned new helicopter for the president would cost more than the jet used as Air Force One.

Obama said he'd talked to Defense Secretary Robert Gates about the costs of the proposed helicopter and appeared to suggest that he might shelve the project. "The helicopter I have now seems perfectly adequate to me," the president said. "Of course, I've never had a helicopter before," he added to laughs.

Another Republican thanked Obama for convening the session but cautioned that the good first step would be a" sterile step" if Republicans are excluded from negotiations by House Speaker Nancy Pelosi, D-Calif.

The president called it "an important point" but said that both Democrats and Republicans had to give. "On one hand, the majority has to be inclusive," he said. "On the other hand, the minority has to be constructive."

Pelosi, who arrived late for the opening session, didn't stay for the summit and wasn't present at the closing session when the comments about her were made.

As she left, she appeared to brush off suggestions by some advocates for a bipartisan commission to examine the long-term health of Social Security, saying that she'd leave that to her committee chairmen.

"We believe that elected officials of the land, the Congress of the United States, should review this in a bipartisan way in our committees," she said. "If people want commissions they can have commissions, but that doesn't mean we're abdicating our responsibility to keep Social Security solvent, and we are committed to doing that.''

Monday's well-staged "fiscal responsibility" summit came a day before Obama is to speak to a joint session of Congress, and three days before he rolls out his broad budget plans.

He used the meeting to stress that he's more of a fiscal conservative than critics charge. He and other speakers noted that Obama didn't create the record federal budget deficits, that his $787 billion stimulus package of spending and tax cuts won't add much to that deficit long term because it's only temporary and that he wants to start cutting other spending.

"The Obama administration has inherited the worst fiscal situation in the nation's modern economic history," said Mark Zandi, the well-known chief economist at Moody's Economy.com, who was given a spot on the stage with the president.

While the deep recession has sent deficits soaring, thanks to lower tax revenues and increased costs, Zandi said they were unavoidable in the short term. "These are a problem," he said. "Problems for another day, however."

Greenstein of the Center on Budget and Policy Priorities added that "the recent economic recovery package is not driving the problem. That package is temporary, and it increased the size of the long-term fiscal gap by only about one-tenth of 1 percentage point" of the total economy.

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