President Obama’s plan to overhaul the nation’s healthcare system and create a public insurance option has been dealt a possible setback in the Senate. A bipartisan group of six senators on the Senate Finance Committee has been working in secret for weeks to draft an alternative to Obama’s plan. The alternative legislation under consideration would not require businesses to offer healthcare coverage to their workers and would not contain a public insurance option, despite support for such an option from American voters. The Senate legislation was drafted during meetings in the office of Montana Democrat Max Baucus, the chair of the Senate Finance Committee. The senators crafting the legislation have received support in their secret efforts from the US Chamber of Commerce. Last month, the Montana Standard reported Max Baucus has received more campaign money from health and insurance industry interests than any other member of Congress. In the past six years, nearly one-fourth of every dime raised by Baucus and his political action committee has come from groups and individuals associated with drug companies, insurers, hospitals, medical supply firms, health service companies and other health professionals.

In related news, the National Journal reports twenty-two groups related to healthcare spent at least $1 million on lobbying during the second quarter. The Pharmaceutical Research and Manufacturers of America, or PhRMA, spent $6.2 million in lobbying expenditures. Pfizer spent $5.6 million, and the American Medical Association spent $3.9 million. Since 1998, the health sector has put $3.4 billion into lobbying efforts, ranking second only to the financial industry.

In other health news, researchers warned Monday that obesity is a major reason for the nation’s rising health costs. The Centers for Disease Control and Prevention said medical costs of treating obesity-related diseases soared as high as $147 billion last year, or nine percent of all US medical costs. In the eight years leading up to 2006, the proportion of Americans weighing in as obese shot up 37 percent. Doctors said the average healthcare costs for obese individuals are nearly twice as high as those for individuals who are not obese. The average American is about twenty-three pounds overweight. Proposals to counteract obesity have included banning televisions from children’s bedrooms, taxing sugar-sweetened beverages, and making it easier for people to buy fresh produce.

The New York Times reports a shift in authority has given military officials at the White House a bigger operational role in creating a shadow government if the nation’s capital were “decapitated” by a terrorist attack or other calamity. The move was made in the closing weeks of the administration of President Bush, and the Obama administration had left the plan essentially intact. Under the revamped structure, the White House Military Office will play a more central role in setting up a temporary government, performing duties previously handled by civilians at other agencies, including FEMA, the Federal Emergency Management Agency. Critics of the plan say the move was part of the Bush administration’s broader efforts to enhance the power of the White House and that the new structure places too much power in the hands of too few people inside the White House.

President Barack Obama called for the strengthening of US-China relations on Monday during the US-China Strategic and Economic Dialogue in Washington. Obama urged China to forge deeper ties with Washington on the economy, climate change and nuclear proliferation.

President Obama: “The United States respects the progress that China has made by lifting hundreds of millions of people out of poverty. Just as we respect China’s ancient and remarkable culture, its remarkable achievements, we also strongly believe that the religion and culture of all peoples must be respected and protected and that all people should be free to speak their minds. And that includes ethnic and religious minorities in China, as surely as it includes minorities within the United States.”

China is the world’s biggest holder of US Treasury bonds, which heightens Beijing’s influence over Washington. The Financial Times reports Chinese officials discussed on Monday a desire to “reform the international monetary system” in closed door meetings. In March, China’s central bank governor floated the idea of a new reserve currency to replace the dollar.

Defense Secretary Robert Gates has arrived in Iraq on an unannounced trip. Gates is meeting Iraqi Prime Minister Nouri al-Maliki and discussing possible arms deals. Iraq has expressed interest in purchasing F-16 multirole fighter jets built by Lockheed Martin. On Monday, Gates also discussed arms deals while in Israel. At a news conference, Gates said, “We will continue to ensure that Israel has the most advanced weapons for its national defense.” On July 1, Israel formally submitted a letter outlining its intention to buy the F-35 Joint Strike Fighter, also made by Lockheed Martin.

As President Obama escalates the presence of US troops in Afghanistan, the military may hire a private contractor to provide full-time security at dozens of bases there and protect vehicle convoys traveling in the country. The Army published a notice on July 10 notifying security contractors that it was considering a contract for “theater-wide” security. Robert Gates has called private contractors “vital” to supporting US bases in Afghanistan, contradicting earlier claims that he intended to decrease their presence in US military operations and despite continued controversy over the conduct of private contractors in Iraq.

The Senate Judiciary Committee is preparing to vote today on the nomination of Supreme Court nominee Sonia Sotomayor. Several Republicans on the panel, including Jeff Sessions of Alabama and Chuck Grassley of Iowa, say they’ll vote against her, but Republicans do not appear to have enough support to block her confirmation.

The Wall Street Journal reports an Obama administration effort to reduce home foreclosures by lowering the mortgage payments of struggling borrowers is failing to help as many people as expected. Administration officials have summoned executives of twenty-five mortgage-servicing companies to Washington today to discuss efforts to help borrowers. Bank of America is only this month beginning to implement the Obama plan for all at-risk borrowers. Wells Fargo didn’t begin offering some at-risk borrowers loan modifications under the Obama plan until early June. Meanwhile, the Washington Post reports government initiatives to stem the country’s mounting foreclosures have also been hampered because banks and other lenders in many cases have more financial incentive to let borrowers lose their homes than to work out settlements.

The country’s second-largest telecommunications firm, Verizon Communications, has announced plans to cut more than 8,000 jobs. The company made $1.4 billion in the second quarter. The company laid off the same number of workers last year, as well.

The Cambridge Police Department has released the 911 tapes in the Henry Louis Gates case. Gates is the African American Harvard scholar arrested inside his own home after police responded to a report of a possible breaking and entering at his home in Cambridge, Massachusetts. On the 911 call, the woman told the dispatcher she saw two men try to barge into a home, but said she had no idea if the two men were breaking in. She did not say that either of the men were black. One of the men turned out to be Gates trying to get into his own house.

Caller: “It’s 17 Ware Street. It’s a house. It’s a yellow house. Number 17. I don’t know if they live there and they just had a hard time with their key, but I did notice that they had to use their shoulder to try to barge in, and they got in. I don’t know if they had a key or not, ’cause I couldn’t see from my angle. But, you know, when I looked a little closely, that’s when I saw —”

Dispatcher: “They were white, black or Hispanic? Are they still in the house?”

Caller: “They’re still in the house, I believe, yeah.”

Dispatcher: “Are they white, black or Hispanic?”

Caller: “Well, there were two larger men. One looked kind of Hispanic, but I’m not really sure.”

A new study warns of the dangers of texting and driving. The Virginia Tech Transportation Institute found that truckers who were sending text messages on their phones were twenty-three times more likely to be involved in a collision than when they weren’t texting. Despite the danger, texting while driving is still legal in thirty-six states.

A boat carrying Haitian migrants capsized and sank off the Turks and Caicos Islands. Up to eighty-five people are missing. Rescuers found 113 survivors stranded on two reefs. The boat had been at sea for three days.

In news from Africa, at least 100 people have died in Nigeria in two days of clashes between Muslim fighters and government forces. Security forces in Nigeria have been placed on high alert, and armed police are patrolling the streets of Kano, northern Nigeria’s largest town.

In news from Africa, the International Committee of the Red Cross says cases of rape and sexual violence are on the increase in the Democratic Republic of Congo as fighting between the army, foreign rebels and home-grown insurgents continues. In a recent survey in the country, 28 percent of people interviewed said they knew someone who had been a victim of sexual violence, and 76 percent said they had been affected in some way by the armed conflict.

Nadine Puechguirbal of the International Red Cross: “When committed in connection with armed conflict, sexual violence is a war crime prohibited by international humanitarian law, and as such, I think it’s very important that sexual violence must not be considered as a by-product of war. On the contrary, it can and it must be prevented, and the fight against the impunity of the perpetrators must be given priority.”

One rape victim, known as “Esther,” described a brutal attack on herself and her family.

“Esther”: “They came to the house, opened the door, while beating me up and beating all the children, too. They took everything out. That is when they caught me. I tried to scream and struggle, but it did not help. They took my arms and pulled me like this. My arm got injured. They raped me. I had a big son who was twenty and wanted to get married soon. They killed him.”

The media watchdog group Fairness and Accuracy in Reporting and New York-based healthcare advocacy groups are planning to deliver a petition to ABC News today demanding that the TV networks include discussion of a single-payer option in their coverage of the national healthcare debate. The petition’s 11,000 signatories include filmmaker Michael Moore, former MSNBC host Phil Donahue, Doctor Quentin Young and actors Tim Robbins and Susan Sarandon. President Obama’s former physician, Dr. David Scheiner, also signed the petition. ABC News disinvited Dr. Scheiner from its recent town hall meeting on healthcare reform, where he had planned to ask President Obama about single payer.

And the pioneering choreographer and dancer Merce Cunningham has died at the age of ninety.