Obama Warned That GOP's 'Government Takeover' Attack Won't End If Public Option is Dropped

Sept. 3, 2009— -- As President Obama prepares to talk health care reform on Sept. 9 at a joint session of Congress, he is being warned by several of his own allies not to walk away from a government insurance option.

"Why would the White House step away from something that is going to weaken their side and that isn't going to pick up a single vote on the other side?" asked Richard Kirsch, the national campaign manager of Health Care for America Now, in an interview with ABC News.

Some of Obama's progressive allies are questioning whether the president is preparing to back down from a fight over a public option in the wake of White House adviser David Axelrod suggesting in an interview with ABC News' Ann Compton that "the spirit," but perhaps not the substance, of a public option would survive in the Senate, where a handful of moderate Democrats have refrained from stating their support for the concept.

"I understand the impulse to regroup and scale back but I think it's premature," said Peter Dreier, an Occidental College professor of public policy who served on the Obama campaign's urban policy task force and did some training in Los Angeles for Camp Obama. "I'm not against compromise when it is necessary, but you have to test the power of the opposition first and I don't think that's happened yet."

Referring to the handful of Senate Democrats who have refrained from endorsing a public option, Dreier, who co-authored a Sunday story in the Washington Post that challenged Obama for not showing sufficient "audacity" on health care, said, "We haven't tested whether they can be turned around. It's too early to let the insurance industry win a victory."

Kirsch: Dropping the Public Option Won't Slow Republican Critics

Kirsch, whose group has aired television ads and mobilized activists to attend local town-hall meetings, said White House officials and moderate Senate Democrats are making a mistake if they think that dropping the public option will slow Republicans from charging that Democrats are proposing a "government takeover over health care."

"Republicans are still going to attack government-run health care," said Kirsch.

Even if a public option were dropped from Democratic health-care proposals, there are still multiple provisions that Republicans would likely use to portray the overall package as a "government-takeover" of health-care reform.

One big target in Democratic proposals that would remain for Republicans is a government requirement that employers contribute to the cost of their workers' health-care coverage.

Republicans view an employer mandate as a "job killing" measure despite Democratic plans to exempt the smallest businesses; Democrats, by contrast, view an employer mandate as an essential element of "shared responsibility."

Another target is the bill's hefty price tag and the corresponding reductions in Medicare spending.

Even if Congress does not enact a government insurance option, the bill could still be portrayed as a "big government" program because it would provide sliding-scale subsidies to help Americans comply with a new government requirement that everyone carry insurance.

A third ripe target for opponents of government involvement in health care is a Democratic proposal to standardize the health-care benefits that private insurance companies are allowed to offer.

Republicans claim that this measure will eventually "outlaw" the insurance policies that some Americans currently hold. Democrats note that insurers will have several years to comply with the new standards and say that this provision will help the "underinsured" by guaranteeing more generous benefits and lower out-of-pocket costs.

Asked on Wednesday if House Republican Leader John Boehner would be able to get behind HR 3200, the Democratic health-care proposal in the House, if the public option were dropped, his spokesman made clear that the government takeover concerns went beyond the public option.

GOP Senator Says The Public Option Only One of Many Concerns

"There are a number of additional problems with H.R. 3200," said Boehner spokesman Michael Steel. "We don't need to fiddle around the edges of the Democrats' flawed legislation, we need to start over on a real, bipartisan plan to control costs and expand access."

Boehner's spokesman was echoed by Senate Minority Leader Mitch McConnell, R-Ky.

McConnell told ABC News on Wednesday that he believes there are more flaws in the Democrats' health-care reform plan than just the public option.

"There are other problems in the bill," said McConnell. "Tax increases on small businesses; half a trillion dollars in cuts to Medicare -- there are plenty of areas of concern here."

ABC News' Z. Byron Wolf contributed to this report.