Tom Jackson’s “The Right Stuff” blog updates throughout the week at TBO.com.
That shiver of excitement shared by Obamacare opponents Tuesday shouldn’t be mistaken for more than it is. Yes, the D.C. Circuit Court of Appeals, the second highest court in the land, dealt a blow to Obamacare when it ruled in favor of the law as it is written and against after-the-fact regulatory whim. But the setback is at most a flesh wound.
At issue is whether Obamacare applicants through federal insurance exchanges qualify for tax subsidies. The law as written lays out plainly, and by definition, only those who apply through state exchanges are eligible. Just this moment, however, 36 states have not set up their own exchanges, affecting about 4.7 million subscribers who, according to the law as the drafters imagined it, would have to forgo billions in offsets.
No matter, said the IRS, which, in consultation with officials from the departments of Treasury and Health and Human Services, reimagined the law in such a way to be optimal to Democrats worried about the 2012 election. Presto, subsidies would go to federal exchange applicants, too.
Not so fast, said the D.C. Court. Conceding the likely disruption caused by their ruling, Judge Thomas Griffith — a George W. Bush appointee known as a moderate — wrote this for the majority:
“But, high as those stakes are, the principle of legislative supremacy that guides us is higher still. Within constitutional limits, Congress is supreme in matters of policy, and the consequence of that supremacy is that our duty when interpreting a statute is to ascertain the meaning of the words of the statute duly enacted through the formal legislative process.”
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The decision was narrow — the judges split 2-1 — and the finding, wrote Griffith, was achieved, “frankly, with reluctance.” Moreover, with liberals outnumbering conservatives on the court, the White House’s new strategy is to get a review by the full D.C. circuit. Nonetheless, with the Fourth Circuit, in Richmond, Va., ruling in favor of the administration the same day, the ultimate sorting surely will happen in the U.S. Supreme Court.
In the meantime, the administration’s argument simply doesn’t wash. The disputed section of Obamacare was in no way an act of hasty oversight, but instead was brazenly purposeful. The drafters were counting on buy-in across the land marked by general rejoicing among the citizenry that would put heat on the various legislatures and governors to fall in line.
This scenario is not some desperate ex post facto invention by Republicans trampled in the 2010 yuletide rush to shove the bill across the finish line. It is, instead, precisely the understanding of those who bashed together the monstrosity, as revealed in an educational video clip from 2012 discovered by the libertarian Competitive Enterprise Institute.
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According to Jonathan Gruber, a Massachusetts Institute of Technology economist who consulted extensively with the Obama administration on the Affordable Care Act, the D.C. court’s ruling was precisely right. This was Gruber in January 2012:
“What’s important to remember politically about this is if you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits — but your citizens still pay the taxes that support this bill. So you’re essentially saying [to] your citizens you’re going to pay all the taxes to help all the other states in the country. I hope that that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these exchanges.”
Instead, little of the sort has happened. In the years since it was passed and we famously got to know what’s in it, Obamacare has not soared in the public’s esteem, but instead has remained stubbornly and broadly unpopular. Worse, exchanges proved wildly problematic, leading even states where lawmakers and governors greeted Obamacare favorably to abandon their efforts.
To say the administration didn’t see this coming is an understatement rivaling “If you like your plan, etc.” So now it’s arguing that words mean only what the White House wants them to mean at any given moment.
It’s a dice roll whether SCOTUS will stand up for dictionary definitions, thereby kicking the issue of who gets subsidized back to the legislative branch where it belongs. Either way, however, Obamacare opponents who cheered the D.C. court cannot and should not count on judicial remedies; elections have consequences, and the only sure fix for Obamacare is by restocking Washington with lawmakers willing to repeal it, and a president willing to sign its death warrant.
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