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How JFK Would Have Handled the Health Insurers

November 22, 2013

As he tries to right the course with the troubled launch of the Affordable Care Act, President Barack Obama finds himself at the mercy to the American insurance industry. And that's not a good place for him--or the American people--to be. After all, while Obama now needs the insurers to work overtime to manually enroll new insurance customers and integrate with the erratic Healthcare.gov website, he is dependent on the same industry that pledged its support in 2009 for his health care reform initiative it later spent tens of millions of dollars to defeat. Worse still, with their new tactics of policy "cancellations," physician network "narrowing" and insurance "exchange-skipping," the carriers are once again maximizing their profits at the expense of American consumers.
On this 50th anniversary of the assassination of John F. Kennedy, it's worth pondering how JFK would have handled the situation. As it turns out, Kennedy's use of the bully pulpit in the steel industry crisis of 1962 could provide a helpful lesson to Barack Obama and his Democratic successors.
In April 1962, union steel workers at the behest of the Kennedy administration agreed to modest contract increases in order to tamp down inflation. But U.S. Steel nevertheless raised its prices $6 a ton. In response, a furious President John F. Kennedy publicly blasted the company for its treachery:

"Simultaneous and identical actions of United States Steel and other leading steel corporations, increasing steel prices by some 6 dollars a ton, constitute a wholly unjustifiable and irresponsible defiance of the public interest...At a time when restraint and sacrifice are being asked of every citizen, the American people will find it hard, as I do, to accept a situation in which a tiny handful of steel executives whose pursuit of private power and profit exceeds their sense of public responsibility can show such utter contempt for the interests of 185 million Americans."

In a statement delivered before his April 11, 1962 press conference, President Kennedy warned Big Steel that "The Department of Justice and the Federal Trade Commission are examining the significance of this action in a free, competitive economy" and hinted that price could controls were on the table. In an eerily parallel to today's massive profits and shareholder payouts at BP, Kennedy noted:

"The industry's cash dividends have exceeded 600 million dollars in each of the last five years, and earnings in the first quarter of this year were estimated in the February 28th Wall Street Journal to be among the highest in history."

An enraged Kennedy insisted that the American people had a right to expect a "higher sense of business responsibility for the welfare of their country than has been shown in the last two days." He concluded his statement:

"Some time ago I asked each American to consider what he would do for his country and I asked the steel companies. In the last 24 hours we had their answer."

For his efforts, as Joseph Palermo noted in December 2009, President Kennedy was rewarded by the American public. U.S. Steel backed down and JFK's popularity jumped up. "The public supported Kennedy's tough stand by a margin of 58 to 22 percent," Palermo wrote, "and the President's approval rating stood at 73 percent."
In 1965, JFK biographer Arthur Schlesinger Jr. recounted Kennedy's reaction to being betrayed by U.S. Steel. JFK told him:

"My father always told me that all businessmen were sons of bitches, but I never believed it till now."

Fifty years later, those words must ring true to Barack Obama.


About

Jon Perr
Jon Perr is a technology marketing consultant and product strategist who writes about American politics and public policy.

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