The Obama administration has long seen this issue as another in the long tradition of corporatism, a staple feature of what Jonah Goldberg calls liberal fascism since the days when Big Meat co-opted the Teddy Roosevelt adminstration. One of the adminsitration’s main strategies on ObamaCare has been to pay off the “stakeholders”, i.e., the special interests most affected by the bill. Big health insurers, Big Pharma, AARP, doctors, etc. — have all been promised goodies under this approach. The point of friction with the “stakeholders” has been the public option, which is opposed by the insurers and the Business Roundtable (a major player which is otherwise with the SEIU and AARP on ObamaCare). This is implicit in McArdle’s analysis (though it is not entirely clear that the Dems have lost insurers, provided the Dems can fool AHIP into believing the mandates and penalties will be stiffened and enforced).
The history of the 20th century shows that progressives have generally been content to pursue corporatism clothed as “reform.” So why are liberals not content to let health insurance companies become the premium collectors for the welfare state?
Two possible answers leap immediately to mind.