Tag Debt Ceiling

The Obamacare Fight May Not Be Over

Danny Vinik Leave a comment

Yesterday, Steve Benen wrote a post titled, “ACA repeal crusade over, ‘delusional folks notwithstanding’.” Here’s part of it:

Last year, Republican officials up and down the ballot argued the 2012 elections were the party’s last chance to derail the Affordable Care Act. Once they lost those elections, Republican officials declared, “Never mind what we said before; this budget fight really is our last chance to derail the Affordable Care Act.” And now they’ve lost this round, too.

There won’t be a third. The repeal crusade was a flop.

Sure, it’s possible congressional Republicans will vote a few more times to gut the law — at last count, I think we’re up to 46 repeal votes in the House — but it’s slowly dawning on the party that their dream will not be realized.

They can try to go through the motions in the months and years ahead, but it’s more likely to create eye-rolling than results.

I’m so tempted to agree with Benen. The law has been through so many challenges the past couple of years that it is just about set in stone. But I see one more possibility for how Republicans could derail it:

We’re two weeks into the open-enrollment period for Obamacare. This period lasts until March 31 and it’s the time when individuals can sign up for health insurance on the exchanges. On January 1st, Obamacare goes live and those health plans kick in. That’s when the law really starts. Right now, we’re still in the sign-up phase. So far, that sign-up phase has been an unmitigated disaster. If you’re an Obamacare supporter, you should be very, very concerned. By all accounts, the flaws in the online exchanges aren’t a result of traffic overload or glitches. They are much more systemic and widespread and will require a huge amount of work to get them operating properly. The Administration still has a lot of work to do.

In addition, the government shutdown has masked these problem. Some people think the problems are actually a result of the shutdown, which isn’t true. Once we’re past these fiscal fights, the media’s attention will turn to the mass problems with the exchanges. People will start realizing that there are serious issues here.

The question is how long they will last. If December comes and there are still issues, the Administration should become very worried that people will start seriously turning against the law. Of course, it will have nothing to do with the policy behind Obamacare, but a technical failure can still switch public opinion fast. If people lose faith that the government has the capability to implement it. they may give up. Imagine January 1st coming and people still having trouble signing up on healthcare.gov. That would be a colossal failure.

Two weeks after that, the continuing resolution in the Reid-McConnell plan expires. This would give Cruz and Co. yet another chance to try to spur grassroots support and demand a delay in Obamacare in exchange for funding the government. That plan blew up in their faces the last couple of weeks, but the Tea Party would have a lot more support this time around. Independents may start looking at those demand as reasonable if the exchanges are still having major troubles.

This is the final challenge for Obamacare: does it work? For months, the focus has been on rate-shock and whether the policy would help most Americans. Few people wondered whether the exchanges would actually function correctly. Now, that question is at the forefront of the debate. Under normal circumstances, a Democratic president and Democratic Senate would ensure that the law has plenty of time to work out its kinks, well past January 1st if necessary. They would accept the bad media coverage and keep working on healthcare.gov until they got it right. But the McConnell-Reid deal presents a potential opportunity for Cruz and the Tea Party to mount a grassroots effort that really could force the president to reexamine his greatest legislative achievement. It’s timed perfectly for Republicans to mount a serious challenge to defund or delay the law on legitimate grounds. The Administration ultimately controls the viability of this challenge, but the McConnell-Reid makes it possible. The Obamacare battles never seem to end.

Would Democrats Support a Six-Month Clean CR?

Danny Vinik Leave a comment

It seems like we are slowly inching towards a compromise between Senate Democrats and Senate Republicans. Majority Leader Harry Reid (D-NV) has issued a new offer that includes a nine-month debt ceiling hike, a six-week clean continuing resolution, a delay of the medical device tax, greater income verification for Obamacare subsidies, a formal budget process and a yet-to-be-decided Republican concession. It’s unclear what that concession will be. But if you take the Democrat’s position that they will not negotiate over the debt ceiling or a clean CR, here’s what the deal looks like from their perspective:

Republicans get:                                                           Democrats Get:

  • Delay of medical device tax                                        •  Unknown Concession
  • Greater income verification
  • Formal budget process

The clean CR and debt ceiling increase are not part of the deal as they were never negotiated upon (although Republicans can return to their constituents and say they broke Obama’s promise not to negotiate on the debt ceiling, even if it isn’t actually true). John Boehner will break the Hastert Rule and allow something like this to pass, because he knows we can’t default. That’s how Democrats envision the final deal, at the moment.

But Republicans are upset. They think that Democrats are moving the goal posts on them by demanding a six-week, instead of a six-month, CR. Here’s Sen. Lindsey Graham:

You can blame us, we’ve overplayed our hand, that’s for damn sure. But their response, where the president and [Senate Majority Leader Harry Reid] basically shutting everybody out, and when you try to negotiate, they keep changing the terms of the deal … it’s very frustrating.

So, what terms of the deal does Graham think Democrats changed? He doesn’t specify, but I think this all comes down to what Democrats thought they meant when they said they wanted a clean CR. They meant a CR that lasted six-weeks, or at least they are saying that’s what they meant. Republicans think Democrats meant that they would support a clean CR for any period of time. This is how Reid’s offer looks to them:

Republicans get:                                                           Democrats Get:

  • Delay of medical device tax                                       •  Six-week clean CR
  • Greater income verification                                        •  Unknown Concession
  • Formal budget process

This is the main sticking point right now. Republicans see the six-month CR as something Democrats said they would agree to by itself. Thus, the six-week continuing resolution is a concession for them. Meanwhile, Democrats see the opposite. The six-month clean CR would be a concession. When Democrats originally were calling for Republicans to open government, they didn’t say for how long. The House continually passed bills for six-week CRs that had absurd conditions on them. Democrats may have assumed that any CR would last for six weeks – but they never said so publicly (at least that I can find). Instead, they hammered the Republicans by telling them to pass a clean CR and reopen government, without any time horizon on those demands. Republicans want that clean CR to last six-months to lock in sequestration for longer. Democrats, of course, don’t.

There’s an easy way to figure out what Democrats would accept: Boehner could bring up a clean six-month CR in the House. Would Senate Democrats reject it? If so, it would contradict everything they have said about wanting Republicans to pass a clean CR. If they passed it, it would lock-in the cuts, a current goal of Senate Minority Leader Mitch McConnell. Unfortunately for him, Boehner won’t bring such a bill to the floor due to the internal political dynamics of House Republicans.

Instead, McConnell has limited power to achieve a six-month CR. Americans overwhelmingly blame Republicans for the shutdown and the October 17 debt ceiling deadline is a few days away. He must make a deal and has limited leverage to do so. Meanwhile, Harry Reid truly believes that a six-month CR is not what Democrats meant when they said they’d support a clean CR. If he agreed to a deal with a six-month CR instead of a six-week one, this is how it would look to him and Senate Democrats:

Republicans get:                                                           Democrats Get:

  • Six-month clean CR                                                      •  Unknown Concession
  • Delay of medical device tax
  • Greater income verification
  • Formal budget process

That’s not acceptable to them. That’s the impasse we’re at now. It has nothing to do with Obamacare. Instead, it’s all about how long the clean CR should be and what Democrats meant when they said they wanted a clean CR. And the only person who can force Democrats to answer that question has his hands tied by extremists in his caucus. All as the clock slowly ticks towards a self-inflicted financial crisis.

The GOP Leadership’s Strange Obsession with the Medical Device Tax

Danny Vinik 4 Comments

John Boehner and the rest of the Republican leadership are searching for any possible Obamacare-related concession that the Tea Party will see as substantial and President Obama won’t. Defunding or delaying the entire bill meets that first condition, but not the second. A clean debt ceiling increase does the opposite. The problem is, as Greg Sargent points out, there is no middle ground here. Whatever the Tea Party would accept,

Why so much focus on repealing the medical device tax?

Why so much focus on the medical device tax?

President Obama won’t accept and vice versa. Instead, Boehner and Co. have settled on the repeal of the medical device tax, which does just about nothing to substantially undermine Obamacare, but is still supposed to appease the Tea Party. It’s not going to work.

The Tea Party is happy to dismantle any part of the law, so on its own, they support repealing the medical device tax, but they are looking for much, much more out of these fiscal fights. This small gesture doesn’t cut it. The reason it doesn’t cut it though is more complicated than it being only a minor concession. It’s also because it’s a minor concession that helps corporate welfare and does nothing to help those afflicted by the law.

Put yourself in the mind of a Tea Party supporter. You want your representatives to do everything in their power to stop Obamacare – including shutting down the government and risking a possible default. You don’t care about the potential negative side effects; stopping Obamacare is what matters. You also probably think Boehner has no backbone and will eventually cut a terrible deal. You continue to pressure your representative and go to rallies to show that you really care about this, but you know Boehner will probably cave and all you’ll get is a minor concession. Now, you find out that the minor concession you receive is the repeal of a tax on an industry that will significantly benefit from Obamacare. You expected to get very little out of this standoff, but that’s still a terrible outcome. You want small government, but you are also sick of K Street and big business using their money to rig government in their favor. Repealing the medical device tax is a continuation of that. Lobbyists are using grassroots anger to help pad the pockets of big business. You don’t like the medical device tax and understand that repealing it helps unwind a bit of Obamacare, but it does nothing to help main street America. That’s what you really want.

That’s what’s so interesting about the repeal of the medical device tax. It’s a fig leaf to the Tea Party, but it disregards what they really want. Yet, House Republican leaders have settled on it, because they want some concession from the president that relates to Obamacare and Obama signaled an openness to it. But this will not satisfy the Tea Party in any way.

Now, there may not be any concession that Obama would accept that the Tea Party would deem to help everyday Americans. He’s not signing any bill that limits or repeals the Independent Payment Advisory Board, a longtime Tea Party fixation. He’s not going to delay the individual mandate. The Vitter amendment may be the closest thing that would make Tea Party conservatives happy and Obama would sign. Of course, it’s a horrible idea and would quickly lead to an exodus of hill staffers to K Street. But Republicans have spun it as a bill that would eliminate an exemption for lawmakers and their aides at the expense of ordinary Americans. That’s what the Tea Party is looking for if they are going to receive just a minor concession from these fiscal fights. Instead, House Republican leaders are infatuated with repealing a tax on big business. That’s fundamentally misaligned with the Tea Party’s goals regarding Obamacare and yet it has become the GOP’s top demand.