If President Obama hopes to make good on his promise to retool the U.S. health system, he'll almost certainly have to talk Congress into changing the tax treatment for employer-sponsored medical coverage.

Top administration officials acknowledge that an overhaul as sweeping as Obama envisions will require policymakers to look for new sources of money to pay for the changes -- and that the most straightforward way of making the numbers work is by confronting a provision in the federal tax code that reduced tax collections an estimated $246 billion in 2007. Senior adviser David Axelrod reiterated the message Sunday on ABC's "This Week," saying health care was too important to sink on purely mathematical questions.

The tax exclusion exempts health insurance premiums paid on workers' behalf from federal income and payroll taxes. It dates to World War II, when employers subject to wage and price controls decided to plow excess profits into health benefits in order to attract and keep workers.

The question now is how would Congress reel in the tax exclusion?

House Democrats have their talking point about the cost of the climate change bill, and they’ve been hammering it all day. The average family would pay about “the cost of a postage stamp per day,” as House Majority Leader Steny H. Hoyer of Maryland said on Fox News this morning.

But House Republicans have spent the day repeating a different quote from President Obama: that “electricity rates would necessarily skyrocket” under his proposal for a cap and trade system for limiting carbon emissions. “President Obama has said himself that, under this cap-and-trade plan, electricity rates will skyrocket,” Rep. Lynn Jenkins, R-Kan., said at a press conference. Rep. Mike Rogers, R-Mich., repeated the charge on the House floor.

Oops! That wasn’t a very smart thing for Obama to say about the House climate change bill, was it? There’s only one catch: Obama wasn’t talking about the House bill, because it didn’t exist yet. The quote is from a year-and-a-half old interview Obama gave to the San Francisco Chronicle editorial board in January 2008, and it was about the more general cap-and-trade proposal he put out during the campaign.

The Obama administration is pursuing so many legislative initiatives at once that even seasoned policy wonks can find it difficult to keep track of everything.

Over in the west wing, top aides and advisers manage the task by breaking the year down into four quarters, White House Chief of Staff Rahm Emanuel explained to reporters at a press breakfast on Thursday.

Kind of like a football game. Or a longish opera.

The first quarter was focused on winning enactment of the $787 billion economic stimulus package (PL 111-5), reauthorizing and expanding the State Children's Health Insurance Program, or SCHIP (PL 111-3) and rolling out the president's fiscal 2010 budget plan. Emanuel said he's particularly pleased that the SCHIP expansion allowed legal immigrant children who have been in the United States for less than five years to enroll in the program, fulfilling a priority of Hispanic groups and immigrant advocates.

Education Secretary Arne Duncan on Wednesday showed off the early fruits of his efforts to assist higher education: a simplified Free Application for Federal Student Aid form, or FAFSA, that he said would make it much easier for students to seek federally backed loans and other assistance.

But the former CEO of Chicago Public Schools and sometimes pickup basketball partner of President Obama's told a White House press briefing that other, potentially bigger changes are in the works, including new financial incentives for colleges that keep tuition affordable.

The Obama administration wants to lean on colleges to control costs while it proposes more financial assistance for poor students. For good reason.

President Obama may have a friendly Congress controlled by his own party, but his firing of the inspector general for the Corporation for National and Community Service raised enough suspicions that the White House is trying to head off an investigation by Congress.

This morning, Rep. Edolphus Towns of New York, chairman of the House Oversight and Government Reform Committee, asked White House counsel Gregory Craig for a briefing about the president’s reasons for firing Gerald Walpin from the inspector general job. Obama notified Congress last week that he had dismissed Walpin, citing “loss of confidence” in his performance. But that explanation was so vague that even Sen. Claire McCaskill of Missouri, one of Obama’s closest Democratic allies, responded in a statement that “‘Loss of confidence’ is not a sufficient reason.”

Now, however, the White House seems to be getting some traction after issuing a lengthier, and more colorful, explanation last night.

This may be one of those legislative dances that lead to nothing, but there are more signs that Senate Democrats are at least thinking about alternatives to the government-run health care plan many had wanted to compete with private insurance.

And, at least for now, President Obama isn’t absolutely ruling out an alternative, either.

This afternoon, Sen. Charles E. Schumer of New York, who has been one of the most vocal supporters of the so-called public option, said Finance Chairman Max Baucus of Montana has asked him to talk with Sen. Kent Conrad of North Dakota about his alternative: set up publicly owned co-ops to offer health insurance, rather than a Medicare-like government plan.

It took a few months, but anti-abortion forces are set to force a showdown over the Obama administration's family planning policies.

The National Right to Life Committee and like-minded groups are pressing House members to reject a State Department reauthorization bill (HR 2410) due to be debated today, because it would create an Office for Global Women's Issues charged with promoting "women's empowerment internationally."

The groups contend this is a back-door way for American diplomats to micromanage reproductive rights abroad, particularly the right to abortion. Abortion foes have been deeply suspicious of the administration's motives ever since President Obama on his second day in office invalidated a prohibition on sending U.S. funds to groups that perform or promote abortion overseas.

President Obama continues to enjoy strong public approval ratings in virtually every category, except when it comes to spending and the deficit.

And though White House strategists swear they don't fixate on day-to-day blips in public opinion, they surely are concerned that the administration's budget proposals are projected to swell the deficit above $1.8 trillion this fiscal year -- a record in dollar terms and also the biggest deficit as a percentage of the gross domestic product since the end of World War II.

So it was hardly coincidence that Obama on Tuesday took a high-profile vow of fiscal responsibility by calling for a return to statutory "pay-as-you-go" treatment for legislation. The deficit-control rules were first written into law in the Budget Enforcement Act of 1990 (PL 101-508), but Republicans who controlled Congress for most of the current decade allowed them to lapse at the end of fiscal 2002, preferring to require offsets for new entitlement spending but not for tax cuts.

Guess the liberal House Democrats couldn’t let the centrists go unchallenged. A day after the Blue Dog Coalition declared they can only support a government-run health care plan if it has lots of limits, the Congressional Progressive Caucus said they won’t support it if it has any of those limits.

It’s not a surprise that the progressives would respond that way, but the statement is yet more proof that President Obama and House Democratic leaders will have a difficult balance to strike to get health care overhaul legislation through the House. Even though the House is considered the “easier” of the two chambers — it’s more easily controlled than the Senate, and there are no filibusters — the debate proves the White House can’t take the House for granted.

If President Obama is going to push hard for the health care bill to include a government-run plan to compete with private insurance — a goal he campaigned on and repeated yesterday — he’s not just going to have to convince Republicans. He’s also going to have to convince the Blue Dog Coalition, a group of fiscally conservative Democrats who could cause him trouble in the House.

This morning, the Blue Dogs released a set of conditions they say the so-called public option should meet, all of which are designed to make it as un-Medicare-like as possible. It’s clear that the group isn’t convinced there should be a public option in the first place, so the statement suggests that the White House and the chairs of congressional committees will have to decide how far they can really go to win Blue Dog votes.

If there is a public option, the Blue Dogs want to make sure it doesn’t use Medicare reimbursement rates as a guide for its own payment rates. They also want to make sure hospitals and doctors aren’t banned from participating if they don’t take Medicare — a condition that would remove a major source of leverage if the Obama administration wants to crack down on providers who won’t treat Medicare patients.

Utah Gov. Jon Huntsman was the kind of Republican who genuinely made Democrats nervous — a moderate governor who might have been one of the Republicans’ strongest candidates to retake the White House in 2012. So a couple of weeks ago, President Obama found a clever solution. He sent Huntsman to China.

Today, Obama again reached across the aisle for a key administration appointment — nominating Rep. John M. McHugh of New York, the top Republican on the House Armed Services Committee, to become the new secretary of the Army. Once again, Obama will get credit for stocking his administration with more Republicans. And once again, there’s a political side benefit — a chance for the Democrats to win his seat in upstate New York.