TPM reports that Reid is close to pulling off senatorial support for the public option - and the White House wants Olympia Snowe's trigger option instead.

In other words, the White House wants the plan that won't work, so they can claim it's a bipartisan plan. Or is it that the administration wants a plan that won't really work, and they're using bipartisanship as a cover? Just asking the obvious question, here:

Multiple sources tell TPMDC that Senate Majority Leader Harry Reid is very close to rounding up 60 members in support of a public option with an opt out clause, and are continuing to push skeptical members. But they also say that the White House is pushing back against the idea, in a bid to retain the support of Sen. Olympia Snowe (R-ME).

"They're skeptical of opt out and are generally deferential to the Snowe strategy that involves the trigger," said one source close to negotiations between the Senate and the White House. "They're certainly not calming moderate's concerns on opt-out."

This new development, which casts the White House as an opponent of all but the most watered down form of public option, is likely to yield backlash from progressives, especially those in the House who have been pushing for a more maximal version of reform.

It also suggests for perhaps the first time that the White House's supposed hands off approach that ostensibly allowed the two chambers in Congress to craft their own bill has been discarded.

High level White House officials have floated the trigger idea a number of times, and it seems they continue to do so, even at this, crucial stage of the health care reform process, when their involvement is greatest. That has senators who support the public option concerned.

UPDATE: Big Tent Democrat has another take. So does Nate Silver.

So Senate Democrats on the Finance Committee offered an amendment that would enable the federal government to bargain for lower drug prices for their bulk purchasing, a direct assault on the White House/Big Pharma deal from a few months back. Basically it would shift poor seniors back onto Medicaid for their drug purchasing, where the government can negotiate discounts. This would save the government over $80 billion dollars.

And Tom Carper of Delaware defended the secret deal in the most amazing of ways:

I was not involved in negotiations with PhRMA but I believe that the administration was, obviously PhRMA was, and I presume this committee was involved in some way in those negotiations.

And what PhRMA agreed to do through those negotiations is to pay about
80 billion dollars over 10 years to help fill up half the donut hole. That's my understanding. And they are prepared to go forward and to honor that commitment. As I understand it, the commitment from our colleague Senator Nelson would basically double what was negotiated with PhRMA.

And whether you like PhRMA or not -- remember I talked earlier today in our opening statements, I talked about four core values, and one of those is the golden rule, treat other people the way I want to be treated?

I'll tell you -- if someone negotiated a deal with me and I agreed to put up say, 80 dollars or 80 million dollars or 80 billion dollars and then you came back and said to me a couple of weeks later -- no no, I know you agreed to do 80 billion and I know you were willing to help support through an advertising campaign this particular -- not even this particular bill, just the idea of generic health care reform? No, we're going to double -- we're going to double what you agreed in those negotiations to do. That's not the way -- that's not what I consider treating people the way I'd want to be treated.

That just doesn't seem right to me.

This is incredible. The deal is transparently one to protect drug industry profits. There's just no doubt about this. Carper is saying that it's more important to get a few generic ads in support of health care reform than to save the US taxpayers $80 billion dollars. Backroom deals must be honored even if they hurt people. That's the "golden rule" in Washington.

Did Carper not know that cameras were rolling when he said this?

This is encouraging, because untying the public option to Medicare virtually guaranteed no significant cost savings:

Speaker Pelosi is nixing a deal she cut with centrists to advance health reform, said a source familiar with negotiations.

Pelosi’s decision to abandon the agreement that was made with a group of Blue Dogs to get the bill out of committee would steer the healthcare legislation back to the left as she prepares for a floor vote.

Pelosi is planning to include a government-run public option in the House version of the healthcare bill. She wants to model it on Medicare, with providers getting reimbursed on a scale pegged to Medicare rates.

"The speaker is full-steam-ahead," said a senior Democratic aide.

Blue Dog Democrats, many of whom represent rural districts where Medicare reimbursement rates are low, vehemently oppose tying the public option to Medicare.

Rep. Mike Ross (D-Ark.) and a group of fellow Blue Dogs had negotiated a deal with Energy and Commerce Committee Chairman Henry Waxman (D-Calif.) in July that would remove the link to Medicare. Under that plan, officials with the government-run plan would negotiate individually with providers.

That move, which drew howls of protest from liberal members, prevented the bill from getting stuck in committee. But Ross returned from the August break saying he couldn't support a public option under any circumstances, essentially withdrawing his support for the deal.

Pelosi is now effectively withdrawing her support. In leadership meetings last week, she said the public option in the House bill should be linked to Medicare.

Other Blue Dogs involved in the deal have said they realized the public option they negotiated was likely to change before it went to the floor.

Pelosi has also told her fellow leaders she still wants an income surtax on the wealthy, rather than a tax on "Cadillac" health plans, as a means to help pay the $1 trillion cost of the bill. The rest is to be made up with savings in Medicare by eliminating wasteful spending.

Our Future: The mugging of the common good

Dusty Rice: Wingers have trouble counting

Connecting.the.Dots: Uncovering the race card

Mike Whitney: The real lesson of Lehman's fall

Amygdala: Reagan was a Leninist

Opinions You Should Have: Kanye West interrupts delicate Senate Finance Committee negotiations, scuttles health care bill

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(Celebrating a few days early)

Back to basic history today - August 10, 1945 was when everyone got their hopes up World War 2 was finally over.

Well, no - not for a few days. Speculation was rife that the Japanese Government had accepted the Allied ultimatum, hot on the heels of the Atomic bomb attacks on Hiroshima and Nagasaki only days earlier.

But negotiations dragged on for several more days until the final acceptance came.

Lots of anticipation and lots of breathless speculation as this newscast and commentary by H.V. Kaltenborn and Cesar Searchinger illustrates.

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Sen. Kent Conrad, D-N.D., chairman of the Senate Budget Committee and the author of the meaningless "co opt" plan appeared on ABC's THIS WEEK and said that even with a 60 vote majority in the Senate a health care bill can't get passed without Republicans.

It's just not possible to have a Democrat-only bill?" I asked Sen. Conrad.

"No, it is not possible," he told me, "and perhaps not desirable either. We're probably going to get a better product if we go through the tough business of debate, consideration, and analysis of what we're proposing."

Conrad would not commit to Obama's August recess deadline for health reform legislation.

"Look the critical think is that we do get this right. This is going to affect every American. Very few legislative initiatives affect every single American. And it's one-sixth of the national economy, so it's critically important we get it right. But that shouldn't be used as a pretext to kill it," Conrad told me on "This Week."

Conrad added, "Jim, I think has been very clear, he wants to kill it. And I think that would be a tragedy because we've got a crisis here for the country."

The follow up question should have been "why can't Democrats pass health care legislature with a 60 vote majority?" That would be asking a little too much. The conservative Dems are destroying any real chance we have at reform. Here's a memo to these bipartisan trolls. Republicans want to kill the bill and destroy President Obama's presidency. Wingnutter Jim DeMint from SC already said it so why does Conrad feel that he can work with them? Orrin Hatch dropped out of the negotiations for a reason. I'll be calling Conrad's office on Monday and ask him to work through the August recess if they try to stall the bill.

It's nice to know that as Americans struggle with unemployment and lack of health insurance, at least one worthy group of lads are doing well!

American International Group is preparing to pay millions of dollars more in bonuses to several dozen top corporate executives after an earlier round of payments four months ago set off a national furor.

The troubled insurance giant has been pressing the federal government to bless the payments in hopes of shielding itself from renewed public outrage.

Uh, hon? We don't care if the Pope himself blesses you. We're not going to be happy about this. Nope.

The request puts the administration's new compensation czar on the spot by seeking his opinion about bonuses that were promised long before he took his post.

AIG doesn't actually need the permission of Kenneth R. Feinberg, who President Obama appointed last month to oversee the compensation of top executives at seven firms that have received large federal bailouts. But officials at AIG, whose federal rescue package stands at $180 billion, have been reluctant to move forward without political cover from the government.

"Anytime we write a check to anybody" it is highly scrutinized, said an AIG official, who declined to speak on the record because the negotiations with Feinberg are ongoing. "We would want to feel comfortable that the government is comfortable with what we are doing."

I don't know about you, but I'm not feeling all that comfortable with this.

The payments coming due next week include $2.4 million in bonuses for about 40 high-ranking executives at AIG, according to administration documents from earlier this year. Though the actual sum may have changed since then, the payments are much smaller than those that caused the upheaval in March.

To those of us who are lucky enough that they're still employed, I'll bet they're thinking about that past ten years of one- and two-percent raises, wondering how to get on that magical merry-go-round. Dream on!

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(An army of cripples, an army of mourners and an army of thieves)

When the Korean War finally came to an end, the agreed dividing line between North Korea and South Korea was the 38th Parallel - the dividing line which exists today. The armistice took effect on July 28, 1953. With negotiations for the Armistice taking place, CBS Radio did a documentary on how the Korean war affected the lives of people living along the 38th Parallel in the U.S.

Hosted by Will Rogers Jr. the one hour documentary goes from coast to coast, collecting thoughts, opinions and experiences of the average American on what the war meant to them.

Yesterday, Paul Sheehan of the conservative Sydney Morning Herald had a piece focussing onIsraeli hardliners in perpetual launch mode -

Last week I met the Boogie Man, the former head of the Israeli Defence Forces, General Moshe "Boogie" Ya'alon, who is preparing the political groundwork for a military attack on Iran's key nuclear facilities. "We have to confront the Iranian revolution immediately," he told me. "There is no way to stabilise the Middle East today without defeating the Iranian regime. The Iranian nuclear program must be stopped."

Defeating the theocratic regime in Tehran could be economic or political or, as a last resort, military, he said. "All tools, all options, should be considered." He was speaking in the tranquility of the Shalem Centre in Jerusalem, where he was, until last Thursday, one of Israel's plethora of warrior-scholars, though more influential than most.

Could "all options" include decapitating the Iranian leadership by military strikes, including on President Mahmoud Ahmadinejad, who has called for Israel's destruction? "We have to consider killing him," Ya'alon replied. "All options must be considered."

Ya'alon is currently running as a Likud MP. Sheehan also spoke to other like-minded Israeli rightwingers, all ready to say that Israel must attack Iran and was preparing to do so.

But then again, yesterday TIME magazine's Tim McGurk wrote that an attack isn't on the cards .

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