THE MORNING PLUM:
Now that the GOP plan to wipe out Obamacare lies in smoking ruins, President Trump is mulling a new and fiendishly clever scheme: allow the law to collapse, or even further undermine it through executive action, and pin the blame for the resulting human toll on Democrats. As it happens, Trump does have the tools to inflict immense damage on the Affordable Care Act and hurt a lot of people in the process.
But once you subject this strategy to a moment’s scrutiny, it becomes obvious that it will not bring about the result Trump wants. Indeed, the thinking here reflects a resolute refusal to appreciate an important reason the repeal effort melted down in the first place.
Over the weekend, Trump tweeted: “ObamaCare will explode and we will all get together and piece together a great healthcare plan for THE PEOPLE.” This reaffirmed what he’d said on Friday, which is that the law will soon “cease to exist” — that Democrats will own the fallout and will be desperate to deal. As many quickly pointed out, this suggested Trump may go further than merely standing by as the law supposedly implodes, as he had previously contemplated doing, and may seek to actively harm the law. On “Fox News Sunday,” Reince Priebus declined to divulge the strategy.
If Trump wants, he can unleash serious damage by undermining the individual markets in three ways. Insurers currently making decisions will closely scrutinize signs from the administration to gauge those markets’ long-term viability. His administration can weaken the individual mandate through various mechanisms, which would mean fewer younger and healthier people and higher premiums. It can pull back on all forms of outreach designed to get people to enroll on the marketplaces. Or it can stop paying “cost-sharing reductions” to insurance companies, which enable them to reduce out-of-pocket costs for lower-income enrollees, which may encourage insurers to flee the markets.
This could strand many of the 12 million people who have gotten coverage on the individual markets, according to Larry Levitt, a senior vice president at the Kaiser Family Foundation. They could be left with “no insurers in the marketplaces, no way to get tax credits, no way to get coverage at all,” Levitt tells me, adding that the insurer exodus could also prevent people who individually obtain coverage outside the exchanges from doing so: “You’re talking about small business owners, farmers, self-employed people, early retirees — who would have no way of getting health insurance.”
This is all bad enough. But here’s the real rub: There’s no reason to believe such an outcome would actually force Democrats to cooperate on health reform on the GOP’s terms.
One of the hidden morals of the Great Republican Health Care Crackup of 2017 is that the American people flatly rejected replacing the ACA with something substantially more regressive. The GOP plan would have cut Medicaid spending by $800 billion, leaving 14 million fewer people with Medicaid coverage, while delivering an enormous tax cut to the rich. Americans clearly disapproved of this outcome. A recent Quinnipiac poll found that a majority opposed the GOP plan, but more to the point, 74 percent of voters, including 54 percent of Republicans, opposed cutting Medicaid. The public broadly opposed the GOP plan’s most prominent mechanism for rolling back spending to cover poor people.
The rejection of the GOP plan is an important historical marker in our interminable health-care debate. The American people were presented with the first genuine effort at a GOP consensus ideological alternative to Obamacare — one that would do away with the ACA’s effort to guarantee free or affordable coverage through government spending and regulations — and decided they preferred sticking with the latter. The Quinnipiac poll also found that 51 percent oppose repeal and 61 percent disapprove of Trump’s handling of the issue. As Jonathan Cohn puts it, the ACA “has shifted the expectations of what government should do ― and of what a decent society looks like.” There are zero indications that Trump and GOP leaders are capable of acknowledging this possibility.
What’s more, while House conservatives did kill the GOP bill, it’s important that many moderate Republicans — senators, governors and even some in the House — opposed the plan precisely because it would take coverage from lower-income people. Indeed, we’ve now learned that there may be a hidden majority in both houses of Congress (Democrats plus moderate Republicans) behind leaving in place the type of spending and regulations (with the exception of the mandate) that broadly make up Obamacare. The genuine moderate Republican opposition to such cruelly regressive policy is a pleasant surprise.
Thus, the Trump strategy — allow the ACA to collapse, and profit — makes little sense. Nothing further to the right than the GOP plan can pass, because that would alienate still more moderate Republicans. The only thing that could conceivably pass is something that would have Democratic and moderate Republican support, and thus would be more liberal than the GOP plan. That should theoretically give Democrats leverage to demand fixes to the ACA on their terms — fixes designed to incentivize more enrollment to the markets and further expand Medicaid in states that haven’t opted in — even if Trump is successful in sabotaging the individual markets.
Trump has persuaded himself that the public will blame Democrats for tanking the markets, thus forcing them to the table. But that is fanciful, because Republicans currently control everything. If this strategy produces anything, it’s most likely to be a set of compromises that would give both Democrats and Republicans some concessions while preserving and perhaps growing the ACA’s coverage expansion — which would be broadly unacceptable to many ideological conservatives, and would require Trump to cut them loose.
* SCHUMER SAYS TRUMP WILL HAVE TO DITCH THE RIGHT: On ABC’s “This Week,” Democratic leader Chuck Schumer laid down the conditions for Democratic cooperation with Trump on health care:
“If he changes, he could have a different presidency. But he’s going to have to tell the Freedom Caucus and the hard right special wealthy interests who are dominating his presidency … he can’t work with them and we’ll certainly look at his proposals. But it’s going to be guided on our values.”
As noted above, Democrats will have leverage in this scenario.
* DEMOCRATS SEE NO NEED TO COMPROMISE ON TAX REFORM: The New York Times reports that Democrats are newly emboldened by the GOP defeat on health care, and see no need to compromise on further Trump proposals, especially tax reform. Chuck Schumer:
“We’re not going to sacrifice our values for the sake of compromise. You think people from red states are going to be for tax reform with 98 percent of tax breaks going to the top 1 percent?”
In other words, Democrats will proceed from the premise that, just as on health care, GOP ideas on taxes will also be deeply unpopular, even among Trump voters.
* TOP CONSERVATIVE SAYS TAX CUTS DON’T HAVE TO BE PAID FOR: On ABC’s “This Week,” Rep. Mark Meadows, the head of the Freedom Caucus, which just helped kill the GOP health plan, said he won’t hold out for tax cuts to be paid for.
“I think there has been a lot of flexibility in terms of some of my contacts and conservatives in terms of not making it totally offset. And that’s a move that we’re trying to do to provide real relief and economic growth. When we start to grow the economy at 4, 4.1 percent, it actually not only increases wages, but it puts more money in Americans’ pockets each and every day.”
In other words, the GOP tax reform plan — which will include massive tax cuts for the rich — will probably run up the deficit, and conservatives will be fine with that. Shocking!
* THERE’S NO MANDATE FOR THE GOP AGENDA: Nate Silver looks at the health-care debacle and concludes that not only was the GOP plan unpopular; but it’s also clear that neither Trump nor congressional Republicans have any mandate:
Trump was elected without much of a mandate, given his narrow margin in the Electoral College and his loss in the popular vote. But congressional Republicans didn’t have much of a mandate, either. Although people seemed to forget about it as they focused on Trump’s upset win at the top of the ticket, Republicans lost seats in both the House and the Senate in last year’s elections.
If Ryan moves toward tax reform that deeply cuts taxes on the rich, we may see a rerun of the health debacle. The question is whether Trump continues tethering himself to Ryanism.
* HOW DEMOCRATS SHOULD PROCEED NOW: E.J. Dionne charts the path forward for Democrats, now that it looks like the ACA is here to stay for the foreseeable future:
Democrats can celebrate, but they cannot be complacent. They will have to expose and fight any efforts by the Trump administration to sabotage the Affordable Care Act through regulation. They should propose a package of improvements to make the ACA work better and dare Trump — and the dozen or so non-right-wing Republicans who helped block the Trump-Ryan bill — to join them.
It is not likely that any of those ideas will go anywhere, but doing this would demonstrate to voters that the law can be made to work better for them.
* BRING BACK THE PUBLIC OPTION! Paul Krugman points out that if Trump really wanted to fix Obamacare, he could do so, by spending more money and taking other steps to remedy the fact that insurers have pulled out of the market in certain geographic areas:
One important answer would be to spend a bit more money. … Better subsidies would help enrollments, which in turn would probably bring in more insurers. But just in case, why not revive the idea of a public option — insurance sold directly by the government, for those who choose it? At the very least, there ought to be public plans available in areas no private insurer wants to serve.
And so, if Trump really wants to cut deals with Democrats, there are options out there.
* TRUMP WAS ‘SULLEN’ ABOUT DEFEAT: CNN reports that Trump’s reaction to the big loss “surprised” some aides, who expected him to explode:
He did not vent or rage. Instead in the Oval Office afterward Trump was “sullen and quiet” as he contemplated his first blow, dealt by the Washington swamp he had vowed to drain, one insider source said. The President was well aware he failed to deliver on an issue that stirs the passions of his political base. He was also mindful that the health care disaster would make his quest to tackle a behemoth tax package that much more difficult, the source said.
Is there any chance that Trump contemplated the possibility that not caring about the policy details in the least might also have helped produce defeat?