* Obama pushes healthcare, but reduces priority
* Says he still wants overhaul passed
By John Whitesides
WASHINGTON, Jan 28 (Reuters) - President Barack Obama encouraged the U.S. Congress on Wednesday not to walk away from his stalled healthcare drive, but made it clear it would no longer be the focus of his legislative agenda.
After six months of heated political battle on the issue he made his top domestic priority in 2009, healthcare was not mentioned in his State of the Union address until the halfway point and followed a long list of priorities led by job creation, financial regulatory reform and education.
With Democrats clamoring for Obama to focus on job creation and the economy, Obama said lawmakers should let “temperatures cool” and then take a fresh look at his healthcare plan.
“He tried to signal he wasn’t quitting, but healthcare is not what he wants to be judged on in 2010,” said Bob Blendon, a health policy and politics analyst at Harvard University. “It’s not going to get the attention and focus it did last year.”
Many Democrats in Congress have become pessimistic about finding a quick way forward for healthcare after a months-long effort to pass a comprehensive overhaul stalled last week when a Massachusetts election loss robbed Democrats of the crucial 60th Senate vote needed to pass the measure.
Senate Majority Leader Harry Reid said on Tuesday there was “no rush” to find a new healthcare strategy, although House of Representatives Speaker Nancy Pelosi reiterated that Democrats still intend to pass some form of healthcare reform.
“Do not walk away from reform. Not now. Not when we are so close. Let us find a way to come together and finish the job for the American people,” Obama said in a line that drew one of the biggest cheers of the night from Democrats.
William Galston of the Brookings Institution, who was a policy adviser at the Clinton White House, said Obama resolved a debate within his administration about whether to push ahead with a broad overhaul or back a more incremental approach.
“The president made clear he wants to get the legislation to the finish line as nearly intact as possible,” he said, calling it “about as much clarity as Democrats could hope for.”
Republican Senator John McCain said he was surprised Obama wanted to push ahead with a comprehensive overhaul. “What I thought he would have said was ‘Look I hear the message from the Massachusetts election, now let’s start over,’” McCain said. “Frankly, that would’ve put the burden on us.”
The stock market expected the reduced priority for the healthcare drive, with health insurer stocks getting a bump ahead of the speech on Wednesday.
Democrats did not expect Obama to provide specific guidance on how to break their healthcare stalemate and he met those expectations, steering clear of any suggestions on how to steer the bill through its procedural quagmire.
Obama also did not list specific elements of the overhaul he wanted to see survive, continuing his policy of leaving the heavy-lifting of crafting the bill to congressional leaders.
He said the ugly legislative process had contributed to the bill’s growing unpopularity, which also has faced heavy and unified Republican criticism.
“I take my share of the blame for not explaining it more clearly to the American people,” Obama said. “I know that with all the lobbying and horse-trading, this process left most Americans wondering what’s in it for them.”
Obama even managed a joke about the grueling six-month healthcare battle and the toll it has taken on his declining approval ratings and on his fellow Democrats in Congress who face a potentially ruinous November election.
“I did not choose to tackle this issue to get some legislative victory under my belt. And by now it should be fairly obvious that I didn’t take on healthcare because it was good politics,” Obama said to laughter.
Obama repeatedly challenged Republicans to do more than obstruct the healthcare bill, a move that might change his political ratings but is certain not to change any Republican minds.
“It was an indirect appeal. It was very clever,” said David Kendall, a health policy analyst at the moderate think tank Third Way, who said Obama’s speech could help shift momentum toward finding some way to pass healthcare reform.
Democratic Representative Anthony Weiner, a healthcare supporter who told reporters on Tuesday that Obama should give lawmakers some marching orders on the issue, said he was satisfied with Obama’s stance.
“I am fine with it,” he told MSNBC. “He said he’s going to fight for it. I’m going to take him at his word.” (Editing by Eric Walsh)