William Greider sums it up. Go read.
Barack Obama mainly did this to himself. To avoid the accusation of socialized medicine, he intentionally shrouded his objectives in bureaucratic euphemisms like "public option." What the hell does that mean? It doesn't mean anything. The vagueness allowed anyone to fill in the blanks and anxious people did so in apocalyptic ways. The original idea, after all, was making something similar to Medicare available to anyone between childhood and old age who was either shut out by high prices or abused by insurance companies policing the system. This approach--call it Medicare Basic--would in theory give government the greater leverage needed to control the price inflation and reshape the system in positive ways. If you told people "public option" was a Medicare equivalent, the polls would demonstrate the popularity. Instead, that objective is now at risk. The right still calls Obama a covert socialist.
There is a more cynical interpretation of Obama's flexibility. He is coming out right about where he wanted to be.
I am simply appalled by how much of our discourse fails to take into account this simple, obvious fact about "Public Option": "It doesn't mean anything. The vagueness allowed anyone to fill in the blanks...."