One key item on President Obama’s health care agenda is to “establish a National Health Insurance Exchange with a range of private insurance options as well as a new public plan based on benefits available to members of Congress that will allow individuals and small businesses to buy affordable health coverage.” The chairmen of five congressional committees have all agreed that there should be a government-run plan that competes against private health insurers and is available to all Americans. Senators Kennedy and Baucus; and Representatives George Miller, Henry Waxman, and Charles Rangel, have been engaged in secret negotiations to hammer out a deal.

The notion that the government should compete against private enterprise is championed by the Center for American Progress, whose CEO, John Podesta, chaired Obama’s transition team. Professor Jeanne Lambrew, Deputy Director of the White House Office of Health Reform, was also associated with the Center until nominated to serve in the administration. Just last month, the Center for American Progress Action Fund (CAPAF) published a report claiming that the government-run plan would deliver “market discipline” by causing private insurers to shape up or ship out. CAPAF assures us that such a plan would compete against private health plans on a level playing field.

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