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Page last updated at 09:23 GMT, Thursday, 23 July 2009 10:23 UK

Washington diary: Making the sale

By Matt Frei
BBC News, Washington

It is turning out to be a week of failed sales.

Barack Obama
Mr Obama is trying to sell health care reform to Congress and the public

The first one I witnessed on Tuesday in the overcrowded, over-heated conference room of a Washington auction house.

The glitterati of the capital's real estate world had turned up for a property auction. So had dozens of journalists.

The object of their interest was the Watergate Hotel, where in 1972 four burglars spent the night before breaking into the offices of the Democratic National Committee in another part of the Watergate complex.

Two years later, after journalists followed a trail from the burglary into the heart of the White House, Richard Nixon became the first US President to be forced to resign.

No bids

The auctioneer, a pale faced veteran of his trade, did not delve into the uglier aspects of the hotel's past. He did not need to - everyone was aware of the details.

But in a country which puts a price on all aspects of fame, even infamy, he had clearly hoped that this landmark would create a forest of raised hands on the auction floor.

But the bidding got stuck where it started, at $25m (£15m).

The Watergate was bought by the very bank that had issued the loan, on which the previous owner had defaulted.

The auctioneer was practically pleading with the audience. Then panic struck and he went to a room to re-emerge with an even more urgent plea. The Watergate was not just a "Washington landmark", it was a "national landmark". He added that he had received calls from London to Dubai.

The Watergate Hotel, Washington DC
The hotel did not attract a single bidder at auction

In the end, none of this interest, notoriety and publicity translated into a solid bid.

The hotel is too run down and Washington has a glut of five star hotels struggling to fill rooms during a recession. This did not exactly persuade potential bidders to put hard cash into a piece of dubious history.

As I stood there, sweltering in the heat of an airless conference room, my mind wandered to another sale taking place in a nearby building that also was not going according to plan.

In this case, the chief auctioneer is called Barack Obama and the lot he is trying to sell is healthcare reform.

All the indications are that this sale is not being sealed as quickly as the administration had hoped.

Obama's 'Waterloo'

The summer recess beckons. Washington will soon be as deserted as a city hit by a neutron bomb and with the clock ticking, the proposals are sinking in the quicksand of Capitol Hill.

Republican lawmakers have been mounting the barricades ever since the president declared his intention to make healthcare reform a top priority.

Senator Jim DeMint throatily said the other day that if the plan failed, it would turn out to be Mr Obama's "Waterloo".

That remark made the senator look spiteful and gave the president an opportunity to hit back at his opponents.

More alarmingly, Democratic ranks also seem to be breaking.

Matt Frei in the BBC World News America studio
America is a country where people are forever chasing deals... And yet this country is curiously lax when it comes to the household cost of healthcare

Some do not like the reform plans because they think America, already up to its neck in debt, cannot afford them.

Even Nancy Pelosi, the Democratic Speaker of the House, has slammed on the brakes because she does not like the fact that universal coverage - under her House colleagues' proposals - would be paid for by a tax hike on individuals earning more than $280,000 and families earning more than $350,000

She wants that limit to be much higher, around $500,000 per individual and $1m per family. This sounds like: "Let the rich be fleeced so the poor can heal".

Broadly speaking, most polls indicate that just under two-thirds of the country are in favour of healthcare reform, the same number that still like the president.

Surely these figures have the makings of a deal.

Here is the problem. President Obama does not need to appeal to the 47 million Americans who are uninsured. He is their only hope.

He does not even need to appeal to the 25 million or so who are under-insured and are understandably bitter that they are not getting the service their premiums had led them to expect.

Ironically, this fight is about the largest group of them all, the 83% of Americans (according to a recent Washington Post-ABC News poll) who are happy with their healthcare.

Too many words

They are the ones reform opponents have been scaring with ads featuring Canada's mostly state-funded health service.

In one of them, a cancer patient explains how she would have died if she had stayed in Canada and waited for the state to cut out her tumour.

The people these ads are aimed at are the ones who cannot see what is in the reform for them.

But what is in it for them, potentially, is a huge saving.

It is calculated that the annual cost of health insurance is nearly $6,000 per capita; that is nearly twice as much as France or Germany where the majority of citizens are satisfied with their care.

Ronald Reagan
President Reagan gave 33 prime-time news conferences

Since the money is deducted from Americans at source, they never really feel the pain of the cost and they rarely see how it breaks down. This has made them lazy.

America is a country where people are forever chasing deals, shaving margins and measuring bangs for bucks. And yet this country is curiously lax when it comes to the household cost of healthcare, its second biggest annual expense after the mortgage.

In other words, Mr Obama needs to appeal to the born again stinginess of American bargain-hunters lumbered with a recession.

He needs to explain this as sparingly and reassuringly as a tax consultant. How about using a white board?

It is about the numbers, Mr President. Golden words alone will not do the trick. There have been too many already.

Mr Obama used the power of words to get himself elected. He cannot use the power of words to persuade Middle America that healthcare reform is in their best financial interest.

The president has given four prime-time news conferences in six months.

That is how many George W Bush gave in eight years. Now, to be fair, we criticised Mr Bush for giving too few and it would be churlish to slam Mr Obama for giving too many.

Ronald Reagan, the Great Communicator, stacked them like no one else. He gave 33 prime-time news conferences in his eight years in office.

The point is not their frequency. It is their potency. They do not seem to be working when it comes to selling policy.

The president is now far more popular than his policies and that is a dangerous place to be as he heads off to splash in the waves off Martha's Vineyard.

His opponents want this to be his Waterloo.

He has to be careful it does not become his unsold Watergate Hotel.

Matt Frei is the presenter of BBC World News America which airs every weekday on BBC News, BBC World News and BBC America (for viewers outside the UK only).

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