SPECIAL REPORT

'Special Report' Panel on Medicare Expansion Proposal; President Obama's Peace Prize

This is a rush transcript of "Special Report With Bret Baier" from December 10, 2009. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

SEN. JOHN THUNE, R-S.D.: Someone quoted earlier today the congressman from New York in the other body who said this is the mother of all public options.

He went on to say never mind the camel's nose. We have his head and neck in the tent on the way to a single-payer system. And so obviously, there is some people here who really want to see a single-payer system.

REP. ANTHONY WEINER, D-N.Y.: I think it keeps that competition going on. And I know on the single-payer side, it's less expensive, saves us money, provides us better care.

(END VIDEO CLIP)

BRET BAIER, HOST: Well, New York Congressman Anthony Weiner became a part of the debate about health care reform and this compromise that's being talked about a Democratic proposal to allow people as young as 55 to buy into Medicare.

Weiner said in a number of interviews that "expanding Medicare like this is an unvarnished, complete victory for people like me, people like me who support single-payer systems."

So what about this? Let's bring in our panel: Steve Hayes, senior writer for The Weekly Standard; Juan Williams, news analyst for National Public Radio, and syndicated columnist Charles Krauthammer.

Charles, we should point out, single-payer means that one system, the government essentially runs health care completely.

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: As you have in Canada or in Britain. And I think what Weiner did today is he committed the classic Kinsley gaffe. Kinsley defined a Washington gaffe as a politician who accidentally speaks the truth and then you have to apologize and retract.

He spoke the truth on this because what you're getting in the bill now, if you have expansion of Medicare to include a younger decade, you have got an enormous expansion of government control. You have an expansion in Medicaid, which is for the poor, and expansion of S-chip which is for the near-poor children, and you add on to that expansion of Medicare and you have got about three quarters of the population under a direct system of government insurance.

What's left is a shrunken private sector which is heavily regulated, the insurers are heavily regulated, you have individual mandates, penalties and you have a huge amount of regulation, 118 commissions and other regulatory bodies. What you are, as Weiner has said, you're on the road, you're almost there to a government takeover.

Now, if we want to have that, there are arguments in favor of that. Canada and the U.K. are humane countries and they work with a government-run system. But we ought to have an open debate on that and not have it shoved in in the middle of the night with eight days to go in a self-imposed deadline on a radical change in one-sixth of the American economy.

The problem here is the substance and also the process, which is out of control and makes no sense at all.

BAIER: Juan, we were one of the first shows — if not the first — to run a clip from Barney Frank when he was talking about a strong public option that would lead to a single-payer system ideally in his mind.

When you hear Congressman Weiner talking like this and still see moderate Democrats who have some questions, because really there are a lot of questions about what this compromise is, what do you think?

JUAN WILLIAMS, NEWS ANALYST, NATIONAL PUBLIC RADIO: Well, the big question on the Hill today is the cost. We don't know what this would cost.

And it's apparent that the Democrats aren't letting out the details because they fear what the markup would mean, what happens if you get people from Congressional Budget Office and others saying here is the scorecard on exactly what this might cost.

Now, it's not exactly, I think, as Charles described it, because remember, when they expand it down to people who are just 55 and older, but you are between 55 and 65, not only do you have to pay to get into the system, but you have to be unemployed — someone who is unemployed or uninsured, I should say, someone who is in with a company but with less than 50 employees.

So it really is a very small universe. It's not expanding it to everybody who is 55 and over.

And there is the possibility, as the Democrats will tell you, that they're trying to, by expanding the pool, bring in those few younger people, in fact make Medicare more efficient.

Now, today the big kickback came from the people in the medical field, the doctors, the hospitals, because they're accustomed to not being paid fully by Medicare, repayment by Medicare. So they don't like this at all.

The Democrats say, you know what, we will be able to do a better job of paying doctors and hospitals instead of going, I think it's like 70 percent or so, we'll do a better job because under the new system there will be new efficiencies put in place and excess waste et cetera will be eliminated.

BAIER: If it is, Steve, such a small section, as Juan describes, to hear Congressman Weiner be so unvarnished about his complete victory if this happens is a little jarring, I guess.

STEVE HAYES, SENIOR WRITER, THE WEEKLY STANDARD: Well and it's not just Congressman Weiner. Over the past 48 hours you have seen a rather dramatic shift in the tone of the rhetoric from people who support a public option or have supported a public option.

You have seen Jay Rockefeller issue a statement saying in effect I wanted to support a public option, but at a certain point you can't hold out for what you want. You have to go for what's good.

You have seen Jacob Hacker, who is known as father of the public option, get behind this plan. You have seen Anthony Weiner, you've seen others in favor of that come out and endorse this program, or at very least decline to reject it at this point that. So I think that gives you some sense of where this is all going.

On the broader question of Medicare, this is something that only could happen in Washington. When you have a program that is going to be insolvent between five, eight, 10 years, estimates vary, could bankrupt the entire U.S. government if the spending trajectory continued through the year 2078, and you have people saying let's take that and use it as the model for reform, I mean, it is absolutely insane that they would consider doing this with Medicare, and it would be the beginning, not the end of it.

BAIER: And yet as you look at this, you think there is more of a chance today that it passes in this compromise than it has ever been?

KRAUTHAMMER: It doesn't have the word "public option" on it. It's rather stealthy, I mean, less stealthy after our show tonight, but still stealthy.

Look at the madness of this. Why are the doctors and the hospitals opposed to it? Because the existing system of Medicare repayment is ruining them.

We are killing the golden goose. We have the best doctors, the best hospitals in the world. This is going to be catastrophic. Without doctors and hospitals, you don't have a health care system. All you have are politicians in Washington...

BAIER: Here's what the supporters say. They say by doing this, by really focusing on Medicare, you turn the system around and you make the payments work.

KRAUTHAMMER: If it were that easy to abolish waste, fraud and abuse, show me the money. Show me the money!

(CROSSTALK)

WILLIAMS: You have to start somewhere.

HAYES: Why haven't they done it?

WILLIAMS: And let me just say, lots of people around the country say why don't we have the same health care provision given to members of Congress and the federal government? You know what? This is a lot like that. This is pretty much an extension of that plan.

HAYES: That's one the reasons it has tremendous appeal for the politicians because they can sell it like that. They can say, look, we're letting you in into this club. You have clamored to be let in. Here, welcome to the club.

But there's a very important point and it's not, I think, been clarified yet, as to how exactly this office of personnel management program would be run. The office of personnel management is essentially the HR department for the federal government. It is going to be the HR department for the country in some respects.

And the question is will the participating plans be required to be non-profit. You see different reporting on this.

The New York Times today called them private, non-profit participants. Politico reported it the same way. If they're non-profit and required to be non-profit, it totally eliminates the competitive market function this, the competitive focus. And that means the costs would spin out of control.

BAIER: Quickly.

KRAUTHAMMER: Well, on one point that Juan raised about all these supposed restrictions on who in their 50s, early 60s can join — once you establish the principle that you change the age at which it starts, you have made a radical reform.

All of these amendments can be changed overnight, anytime, in any congress, and they will be. There will be a clamor. It is a change in the age which is essential here. And once it happens, you have a revolution on your hands in how government administers health care.

BAIER: President Obama focused on war as he accepted the Nobel Peace prize. We'll talk about that when we come back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

PRESIDENT BARACK OBAMA: Make no mistake, evil does exist in the world. A nonviolent movement could not have halted Hitler's armies. Negotiations cannot convince Al Qaeda's leaders to lay down their arms.

FORMER HOUSE SPEAKER NEWT GINGRICH: In some ways it's a very historic speech. And the president, I think, did a very good job of representing the role of America.

(END VIDEO CLIP)

BAIER: The former House Speaker there, Republican Newt Gingrich, praising President Obama for his speech in Oslo, Norway, accepting the Nobel Peace prize. Sarah Palin, former vice presidential candidate on the Republican side obviously, also praising the speech today.

We're back with the panel. Charles?

KRAUTHAMMER: Well, I thought it was the best speech he has ever given on foreign soil. Now, I know that sounds slightly ironic and cynical because it is a low bar, but he did have a defense in the first third of the speech, which was the good part, a defense — a robust defense — of war in general as a necessity, of the Afghan war and also America's role, as he put it, in underwriting the security of the world for 60 years, something he hadn't emphasized in the past and that he did.

And it went against the grain of that audience of his, which was overdressed, over-titled, underemployed, one-world Scandinavian lefties. And they only applauded when in the second half of the speech he gave his usual shtick about Guantanamo, torture and Geneva Conventions — he got the cheap applause.

But that's old stuff he has done over and over again abroad. The new stuff was at the beginning. And I think it was a good statement and it is good that it came from him. That made it unusual. It wouldn't have been unusual out of a Kennedy or a Truman or any of his predecessors, but from him it was new and very welcome.

BAIER: Juan, a muscular defense of war as an instrument of peace.

WILLIAMS: Absolutely. And I think that's why Charles was thrilled with it. I talked to Steve Hayes earlier today and he is thrilled with it.

But I got to tell you, I think that it's real to say there is evil in the world and you have to confront evil when you see it and obviously Hitler required military effort. There was no negotiating with him, and President Obama said today there is no negotiating with Al Qaeda.

And when he mentions the U.S. role, for example, in establishing peace after World War II, he points out that wasn't just done with diplomacy. It required the blood and sweat and life of Americans as well as our treasure in order to create that world.

But when I hear this, I think to myself he is filled with ambiguity and uncertainty. Dr. King spoke of what ought to be but he is speaking about what is.

But what is is we have been involved in a war for eight years based on weapons of mass destruction that didn't exist, and now we are involved in another war here for eight years and we haven't accomplished much and we don't know where we're going or what we are doing.

He says afterwards in the press conference that getting out in 18 months is absolute. What have we heard this week? His generals have said they think we're going to be there longer than 18 months.

So to me: Lot of nice rhetoric. I think it was interesting, it's almost like the philosopher-king Obama. The philosopher king was on display today and he was resplendent. But to me, if you're talking about our situation today, I do not see it as a speech that helped to elucidate how we deal not only in Afghanistan but we deal with the nuclear threat coming from Iran.

BAIER: Steve?

HAYES: Typical Juan, always taking shots at the president, ripping on him.

(LAUGHTER)

Look, it was an important speech in that it was the president, President Obama who gave it. It was important, I think, to see that we can talk about American greatness. You can be proud of American greatness without being arrogant. And I think he pulled that off in the first third of his speech.

I do think the speech went downhill from there that the second two- thirds was filled with sort of typical Obama rhetorical flourishes and excesses. There was also part of the speech where there was a real clash between what he has done and what he is talking about.

And you saw this dating back to the Berlin speech that he gave as a candidate when he talked about human rights. He said it again today, and said we need to be on the side, we need to tell people that we're on the side of these movements of hope and history.

And you think back — he said that in the context of Iran. You think back to how he acted, in the aftermath of those elections as people were being literally killed on the streets and we said nothing. We sat on our hands. It was a disappointing disconnect, I think, in that.

But overall, the beginning of the speech was good, it was significant, and he deserves credit for doing that.

BAIER: Charles, last thing. Did he pull off humble?

KRAUTHAMMER: No, he can't, but he tried hard and got about halfway there. His introduction in which he said "Others are more deserving" was good, but short.

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