Tag: Patient Protection and Affordable Care Act

The Gruber Chronicles

No doubt, you’ve heard a bit about the Jonathan Gruber videos emerging this week. Gruber came to light earlier this year for videos in which he argued that the supposed “scribal error” in Obamacare was intentional — i.e, that states that do not build exchanges shouldn’t get Obamacare subsidies. These new videos show him slagging the American voter, boasting about how they deceived the public on aspects of Obamacare and basically acting like an arrogant twerp.

There’s been a small wellspring of sympathy for him, since he’s now caught up in an unexpected controversy. Personally, I find it difficult to find a lot of sympathy for a man who was paid $400,000 to help deceitfully foist Obamacare on us, but whatever.

I don’t think Gruber’s comments, however angering they are, are going to make much difference. Obamacare passed and has survived at least one SCOTUS challenge. His comments on the subsidies are a good talking point on Halbig but SCOTUS is going to base their decision on Congressional intent, not the post-facto comments of some MIT windbag. No matter how involved he was in writing Obamacare, it is the intent of the legislators that matters.

But there is one aspect of the Gruber videos that is important. It proves that not only were critics of the law right, but that the Administration knew they were right and lied and obfuscated about the law. It’s not a “scandal” in the sense that anyone broke the law. But it’s a scandal in what it reveals about Obama, the Democrats and the so-called fact-checkers.

Take the CBO scoring. One of the big selling points of Obamacare, from day one, was that it would decrease the federal deficit. Critics pointed out that it only did this because of gimmicks — the taxes penalties fines taxes phased in a little faster than the subsidies. Critics pointed out that it depended on unlikely money-saving events, such as not enacting a “doc fix” (said doc fix having been promised to the AMA in return for their support of the bill). Critics pointed out that while it was technically balanced over the ten years, by year ten, Obamacare was running a deficit, a deficit that would only increase over the years. Critics also pointed out that CBO analysis, if you dug deep, made exactly these points. While they were required by law to score it the way they did, they noted, numerous times, the flaws in their projection.

When we pointed this out, we were called liars and tools of the insurance industry. Fact-checkers rated this claim as false. Of course, time has born out our complaints. But what the video shows is that the Administration was well aware of their deceit — how could they not be? This wasn’t a quirk; this was an act of deliberate deception. And they were laughing about it all the way back to their comfy positions in academia and industry.

Another big point is the so-called “cadillac tax”, which enacts a fee on healthcare plans that cost more than a certain amount (at least, for some people). When this plan was rolled out, critics pointed out that it was indexed to inflation, not healthcare costs. This would mean that, over time, more and more plans would qualify as “cadillac plans”. The result would be to effectively eliminate the tax deduction for health insurance.

Now one can make the case that the tax deduction is bad law. But that’s not the case the Obama Administration made because they knew eliminating the tax deduction for health insurance would be extremely unpopular and likely scuttle the entire bill. So they came up with a convoluted and tangled way of doing it. And when critics pointed this out, they were called liars and tools of the insurance industry (the insurance industry having written much of Obamacare).

Now that everyone is admitting to what Obamacare does, the President’s supporters are … blaming the stupidity of the voters for making these lies necessary. We’re being told this is standard operating procedure in Washington (it isn’t), that everyone does it (they don’t) and that the critics are being hypocrites (for … um, being right all along?)

We see this over and over again with this Administration. Here is my own attempt a one-act play that encapsulated the last six years:

Obama: My law does X.

Critics: The law also does Y and Z and it doesn’t do X very well.

Obama Supporters: Tea Partiers! Extremists! How dare you come here with your astroturf talking points!

“Fact Checkers”: Obama says the law does X. We rate your claim as false.

[Three years pass]

“Fact Checkers”: Actually, the law also does Y and Z and does’t do X very well.

Critics: We told you!

Obama Supporters: Shut up! Y and Z are great policies! Obama had to lie about it because you’re so fucking stupid!

The gripping hand here is that this will not make any difference. Most of the vast American public could give two shits about Jonathan Gruber. This will not have any impact on the Halbig case or any other legal challenges nor will it play a role in any attempts to fix or repeal Obamacare. It will persuade few to repeal the bill who don’t already want to. It’s mostly Washington insider stuff. I find myself agreeing with Tyler Cowen: let’s put all this energy into explaining why these policies are so bad rather than whether Gruber is an arrogant prick or the devil incarnate.

Gruber is nothing. Obamacare is everything. We can do something about the latter. And now we can use the Administrations own words to help make it happen.

Hoist By Their Own Petard

Let’s remember, for just a moment, how Obamacare was passed. It was cobbled together by a team of industry insiders to cater to all the special interests. It was then sent to Congress, where it would be honed and passed. But when Scott Brown won the election in Massachusetts, they suddenly did not have a filibuster-proof majority. So they rushed it through on a budget reconciliation. As a result, the bill contains a lot of bad language, poor wording and unclear statutes. Nancy Pelosi famously said we had to pass it find out what was in it. And now we’re finding out that what’s in it could destroy it.

Earlier this week, the DC Circuit Court ruled that the Obamacare subsidies could not be given to people whose states had not set up insurance exchanges because the law did not specify it. Liberals screamed blue murder about activist courts and people losing insurance and other arguments from the “Oh Come On!” school of jurisprudence. They said that Michael Cannon and Cato and other people arguing that the subsidies were meant to be withheld to force states to set up exchanges were “sociopaths” who would say anything to take insurance away from the poor. They’re livid that Obamacare might be overturned by what they’re calling “a typo”:

his week, Jonathan Gruber appeared on MSNBC to assert that the DC Circuit appellate court got the ObamaCare statute all wrong in its Halbig decision. Gruber, one of the key architects of the ACA and of the Massachusetts “RomneyCare” law that preceded it, insisted that the state exchange requirement for subsidy payment was purely accidental. “It is unambiguous this is a typo,” Gruber told Chris Matthews. “Literally every single person involved in the crafting of this law has said that it`s a typo, that they had no intention of excluding the federal states.”

Even if that were true, these kind of typos are what you get when you shove a law through without reconciliation. And while “everyone” might agree that Congress intended the mandates to be universal, it’s difficult to tell what Congress intended because Congress barely debated the fucking thing.

But is it true that Congress intended the subsidies to be universal? For that, we should ask one of the architects of Obamacare such as … um … Jonathan Gruber?

Two years ago, though, Gruber gave a much different explanation for this part of the ObamaCare statute. Speaking at a January 2012 symposium for a tech organization that this was no typo. It was, Gruber said, a deliberate policy to twist the arms of reluctant states to set up their own exchanges — and that a failure to do so would mean no subsidies for their citizens.

You can go to Hot Air and watch the video, including the full video that shows this was not taken out of context. Gruber has since said his words were a “speak-o” and he was mistaken. If so, this Obamacare architect — who was paid a cool $400,000 for his contribution — now appears to have made that “speak-o” multiple times.

As Ed Morrissey points out, this doesn’t really matter for the court case. The Court will be considering Congressional intent not consultant intent. And to be perfectly frank, Gruber is a hack who will say whatever the Obama Administration wants him to say. If he got a memo saying that Obamacare was actually French Toast, he’d be handing out eggs and butter at these meetings.

But it does make for some great entertainment to watch these guys flounder around trying to explain what the bill really means.

Dueling Obamacare Decisions

Obamacare is dead!

This morning the U.S. Court of Appeals for the D.C. Circuit released its much awaited opinion in Halbig v. Burwell. In a 2-1 opinion, the Court held that the Internal Revenue Service regulation authorizing tax credits in federal exchanges was invalid. Judge Griffith, writing for the court, concluded, “the ACA unambiguously restricts the section 36B subsidy to insurance purchased on Exchanges ‘established by the State.”

Oh, wait. It’s merely pining for the fjords:

Within hours, a unanimous three-judge panel of the United States Court of Appeals for the Fourth Circuit, in Richmond, Va., issued a ruling that came to the opposite conclusion.

The Fourth Circuit panel upheld the subsidies, saying the I.R.S. rule was “a permissible exercise of the agency’s discretion.”

The language of the Affordable Care Act on this point is “ambiguous and subject to multiple interpretations,” the Fourth Circuit panel said, so it gave deference to the tax agency.

What the what?

These two rulings concern a very specific piece of wording in Obamacare. The law calls for the states to set up Obamacare exchanges. It then specifies that subsidies will be made available to people who enroll through the state exchanges. It then sets up a Federal exchange for people whose states do not set up an exchange. The plaintiffs in this case argue that because it does not specifically mention subsidies for the Federal exchange, those subsidies are illegal. The government’s case is that the wording indicates that the Federal exchanges will be the equivalent of the state ones and that the subsidies are legal. These debates over verbiage tend to happen when you pass a law hastily and through a budget procedure because Ted Kennedy died.

If the subsidies disappear, individuals who have insurance through the federal exchange — about five million of them — will suddenly be paying the full price of their insurance. It is likely that many of them will choose to pay the Obamacare penalty instead. Only sick people will stay in the individual insurance market because even unsubsidized insurance is cheaper than no insurance if you’re sick. This is precisely the “death spiral” that many have feared.

Of course, it’s unknown how the states will react if the DC Circuit’s decision is upheld. It’s possible that there will be considerable pressure on some to set up exchanges so that their citizens can get the same subsidies citizens in 14 other states are getting. It’s also possible further lawsuits will follow alleging that the citizens of the 36 unsubsidized states are being treated unequally under the law.

Given that two courts have issued opposite ruling, I expect the Supreme Court to take this up. And, gun to my head, I expect it to side with Obama.

Doug Mataconis argues that the ambiguous wording and precedent may cause the Court to rule against Obama. However, I have to disagree. The Roberts Court has a track record of deferring to lawmakers when their decisions are not blatantly unconstitutional (which makes it all the more shocking that Obama has suffered a dozen unanimous defeats in the last two years). They have taken the paeans against activist judges to heart and have explicitly said that laws should be repealed through legislatures, not through courts. I can’t see them, given the decision they made two years ago on the mandate, throwing out one of the most massive sets of laws in American history because of a disagreement over literally a single word.

Still, we’ll see what happens when this moves up.

Video Monday: Takei and Hobby Lobby

I bookmarked these two video over the weekend. The first is a TED talk from George Takei. While I’m not fond of TED talks — they often cross me as smug and overly confident in their points — this one explains why George Takei still loves the country that interred him during the war:

(I’ve found this embed tends to hang. If someone has a better link, I’ll update the post.)

This comes close to my view of America. The United States, like all human institutions, is flawed and capable of doing awful things. But the principles on which our nation is founded are a beacon to humanity. And I would take the achievements of America, its role in the world and its history over any other nation on Earth. Takei’s story sounds familiar to me — and probably to many of you as well. Both of my paternal grandparents fled the “Jewish crescent” of Eastern Europe in the early 20th century. Despite the virulent anti-semitism they encountered — they vividly remembered the Leo Frank lynching — they still believed there was nowhere else in the world they would rather be.

The second I couldn’t resist. Takei is calling for a boycott of Hobby after the Supreme Court’s narrow decision last week. This completely useless gesture would accomplish little except making liberals feel better (how many liberals actually go to Hobby Lobby?) Reason, by contrast, proposes some changes to the law that would actually do some good:

The amazing thing about Obamacare is that many liberals believed — many still believe — that Obama “stood up” to the special interests and the healthcare industry. This could not be more false. He “stood up” to the insurance industry by forcing everyone to buy their product, outlawing the cheaper versions of their product and refusing to break the intra-state cartels. He “stood up” to healthcare providers by mandating coverage of expensive procedures and not even considering obvious cost-reducing measure like making birth control available over the counter.

All three of Reasons’s suggestions would be diametrically opposed by the healthcare industry lobbyists who wrote and campaigned for Obamacare. Insurance companies don’t want to offer cheap catastrophic plans. They certainly don’t want to compete across state lines. And providers don’t want more competition And so we can expect the liberal wing to “stand up for the little guy” by continuing to acquiesce to every demand of the industry they supposedly hate.

Shifting the Numbers

We’ve gotten used to the numbers game this Administration plays with Obamacare. It was going to ensure thirty million. No twenty million. No ten million. We have seven million signed up! Well, they haven’t all paid. And five million previously had insurance. And insurance rates are going down! Well, they’re actually going up. And the number of uninsured is the lowest in five years! Well, that just brings us back to pre-recession levels — a level that meant people were dying in the streets when Bush was President but means progress now that Obama is.

Still, even with all that, this is pretty blatant:

The Census Bureau, the authoritative source of health insurance data for more than three decades, is changing its annual survey so thoroughly that it will be difficult to measure the effects of President Obama’s health care law in the next report, due this fall, census officials said.

The changes are intended to improve the accuracy of the survey, being conducted this month in interviews with tens of thousands of households around the country. But the new questions are so different that the findings will not be comparable, the officials said.

An internal Census Bureau document said that the new questionnaire included a “total revision to health insurance questions” and, in a test last year, produced lower estimates of the uninsured. Thus, officials said, it will be difficult to say how much of any change is attributable to the Affordable Care Act and how much to the use of a new survey instrument.

The Census Bureau estimates this will reduce the number of estimated uninsured by two percentage points — from 12.5% to 10.6%. That’s basically six million people — which is about two-thirds of what Obamacare is supposed to accomplish. In other words, a real decline in the uninsured of 9 million could look like 15 million or even more simply because the changes in the way the Census does things.

To be fair, these changes have been needed for a while and are driven by technical experts at the Census Bureau, not the Administration. Conservatives have long complained that the methodology overestimates the number of uninsured. But to quote Megan McArdle, it doesn’t matter if these changes are coming from elves at the north pole. It would be well within the President’s authority to delay the changes so we can get a clear read on the effects of PPACA.

Do you think any liberal pundits will take note of this? A few years ago, both the NCVS and FBI changed their methodology when calculating rape statistics. This didn’t stop feminists from jumping on the “shocking rise” in rape rates.

If the Obama Administration were confident in their program, they wouldn’t be tinkering with the definition of uninsured. If they were even curious about how well their program was working, they’d delay this. What does it tell you that they’re happy to let the waters get muddied like this?

The Triumph of Obamacare

I think it’s time for us on the blog to finally admit that Obamacare has been a roaring success, far in excess of what even the most optimistic supporters projected. I mean, just check out the numbers:

  • At least six million people have signed up for insurance on the exchanges, close to the seven million Obama hoped for. Now granted, only two million of those were previously uninsured; the rest were people who were already insured but had their plans — some of which they really liked and were much cheaper — cancelled because they weren’t compliant. And, granted, nine million previously insured people have bought policies by ignoring the marketplaces and dealing with insurance companies directly (which was a fairly typical number prior to Obamacare). But two million people! All we need is 24 more Obamacares and there will be no uninsured!
  • Actually, Obamacare is even better than that. About 4.5 million people have been swept into Medicaid. Now granted, Medicaid is not a very good insurance system. Many of the best doctors refuse to see Medicaid patients and Medicaid-intensive hospitals are some of the worst in the country. But still, that means only nine more Obamacares and we’ve got this uninsured problem licked!
  • Something less than a million people are uninsured right now because their insurance was cancelled by Obamacare regs. Meh. Serves them right for having jobs.
  • The CBO projected in February that 13 million more people would have insurance thanks to Obamacare. And here we are, two months later, and it’s looking we may actually have a whole third of that! A third! And almost all of that is by expanding the glorious Medicaid system!
  • We’ve gotten all this for the bargain basement price of, depending on who you believe, somewhere between $1 trillion and all the money in the world plus all the money on other planets that will be discovered by the James Webb Telescope. Now, granted, for that price, we could probably have bought high-deductible plans for all of the newly insured and given them a $5000 HSA to cover the deductible. That wouldn’t have disrupted anyone else’ insurance either. But then what would the poor bureaucrats do?
  • I think we all know the conclusion to draw from this: we need to now move to single payer. The success of Obamacare tells us that we need single payer. And the failure of Obamacare tells us that we need single payer. The canceling of perfectly legitimate insurance plans tells us we need single payer. The massive premium increases tells us we need single payer. Actually, when Venus is in the house of the ram, it tells us that we need single payer. When the sun rises in the east, we need single payer.

    We just need single payer dammit ‘cuz REASONS!

    Sebelius v. Hobby Lobby

    The Supreme Court heard oral arguments yesterday in the case of Sebelius v. Hobby Lobby. This case concerns whether the federal government can force an employer to provide birth control to their employees. Hobby Lobby is claiming it violates their Freedom of Religion and the Religious Freedom Restoration Act to force them to pay for a service they have a moral objection to.

    You can read some legal analysis from Mataconis and a series of posts from Stephen Bainbridge. It looks like the Court is leaning in favor of Hobby Lobby, perhaps with a narrow ruling that only addresses this particular issue.

    There are two things I wanted to note about this, however.

    First, I tend to side with Hobby Lobby on this one. My support has little to do with birth control and everything to do with opposing coverage mandates. Coverage mandates drive up insurance costs and provoke these kind of bitter arguments. It’s bad enough that the government is forcing people to provide or buy insurance. Why must it insist on specifying what the insurance will cover?

    The potential for abuse is very high here. What’s to prevent some moonbeam President from mandating coverage for pseudo-scientific gibberish like therapeutic touch or aromatherapy (as indeed, some Senators tried to do and some states actually do)? What’s to prevent a future President from forbidding birth control coverage, especially given the precedent this President has established for ad hoc rewriting of the law? It’s bad enough that employers can control our healthcare. Many employers are now mandating “wellness” programs and the like. Must we let the politicians do it too?

    Frankly, I’d prefer the Court strike down coverage mandates in general but they are not going to make such a broad ruling.

    But second, this is another reminder that although I side with the Left on a number of culture issues, I am never very happy about the company I keep. The Left Wing, with the sympathetic media in lockstep, has responded to the Hobby Lobby case with a barrage of lies about the case, the law and birth control that is really despicable. They are desperate to pretend that, if Hobby Lobby wins, this means the end of birth control. But it does not:

    The New York Times’ Adam Liptak puts it right there in the first sentence: “The Supreme Court on Tuesday will hear arguments in a case that pits religious liberty against women’s rights.” This could not be further from the truth. Women will have the same constitutional rights to acquire and use contraception regardless of whether Hobby Lobby wins or loses. More than that, they’ll have the exact same rights as they had before the contraception mandate was a gleam in Sec. Sebelius’ eye. What women won’t have is the right to force other people to pay for their contraception, but that has never been a right recognized by the Supreme Court.

    In the Bizarro World of the newspapers, not paying for someone else’s contraception is the same thing as prohibiting them from purchasing and using them themselves. This is an obviously false equivalence, but one that leftists are bent on telling themselves. No matter how many times you point out that the business owners in these cases aren’t preventing their employees from purchasing and using contraception, a smug leftist will smile and say “but women’s rights, you see,” as if these magic words excuse the lie.

    Opponents of Hobby Lobby say that, if the Court decides in their favor, this will allow employers to “impose their morality” on their employees. But there is no such imposition. Hobby Lobby can not stop their employees from buying birth control. They can’t stop them from having sex. They can’t stop them from having gay abortions while smoking pot and watching Girls.

    So why is having to pay for your own birth control oppression? Because the Left Wing has convinced itself that healthcare is a right, that health insurance is a right and therefore, if your employer refuses to pay for any healthcare service, they have deprived you of that right.

    I find this view absurdly childish. This isn’t heart surgery we’re talking about; this is birth control, which is available for a few hundred bucks a year for most women and can be replaced cheaply with condoms or withdrawal or abstinence. Claiming that you have been “deprived” of birth control because someone else won’t pay for it is no different than claiming you’ve been deprived of electricity because you have to pay your own electric bills (which are, incidentally, usually more expensive than birth control).

    If the Democrats are so passionate about birth control, why don’t they create a government program to provide it? I would oppose such a program, but it would likely be constitutional. Of course, they could never get such a program through the legislature. So they have to resort to the back door of forcing other people to pay for it.

    Let me be clear. If I ran a business, I would choose insurance that included birth control coverage. I think employers should include it, although bringing birth control into the insurance sphere will likely drive up the cost of it for everyone. But there is a distinction between thinking something should be done and decreeing that it must be done, a distinction that seems lost on the Left Wing.

    I would also point out that the “employer imposing their morality” argument only applies in this case. As Bainbridge points out, corporations debate morality all the time — whether to do business with sweat shops, whether to go green, whether to provide daycare, how much maternity leave to provide, whether to divest their funds from nefarious foreign countries.

    Large corporations are already faced with choices over whether to pursue social justice, civil rights, and environmental concerns, and with disputes over the interests of majority shareholders, proxy questions, and the like. Corporate law has extensive mechanisms in place for dealing with these scenarios. Religion as one motive among many does not change the landscape.

    In fact, religion is already part of that landscape, since state law allows corporations to pursue it among all lawful purposes. There are no practical or theoretical grounds for specifically excluding religion as a permissible basis for corporate decision- making—indeed, it would be a clear violation of the First Amendment to even try. See Emp’t Div., Dep’t of Human Res. of Or. v. Smith, 494 U.S. 872, 877 (1990) (noting that the government cannot ban “acts or abstentions only when they are engaged in for religious reasons”). Yet businesses infrequently choose to pursue religious ends.

    As a practical matter, it is hard to demonstrate any interest shown by large, publicly-traded corporations in exercising religion. Market forces tend to push such firms far away from religious controversy. It is no accident that this case and related litigation involve corporations that are closely held.

    Is Chick-Fil-A “imposing their religion” by being closed on Sundays? What if Apple announced that they would provide cars to their employees … but only if those cars were electric or hybrid cars. Would the Left Wing start screaming about Apple “imposing their morality” on their employees? What if a university were to ban Apple computers because they don’t like the work conditions in Apple’s factories? There would be some vigorous debate — I would oppose it. But would people think the federal government should step and force the university to use Apples? What distinguishes these moral decisions from a moral decision about what kind of health insurance to provide?

    If Hobby Lobby — an ostensibly non-religious organization — were forbidding their employees from obtaining or using birth control pills, I’d be on the side of their opponents. But all they are asking for is to not have to pay for it.

    In fact, the Left Wing’s arguments are so disingenuous, I think we are seeing a degree of hysteria. I think they are scared because if the Court strikes this down, it will endanger all coverage mandates. Their ability to dictate every detail of our insurance coverage — to effectively create single payer through mandates and restrictions — will be badly damaged.

    But I also think there’s a more concrete motive. The Democrats are pushing this issue and lying about it because, as I pointed yesterday, the polls are not looking good for them. They are worried they are going to lose the election in 2014 and possibly in 2016. And so they are dragging the “War on Women” back out.

    Am I too cynical? I don’t think so. This issue has reached a fever pitch at almost the same moment that pundits are projecting a Republican Senate in the fall. The attempts to stuff what is ultimately a business issues into a “War on Women”-shaped hole has almost exactly paralleled the rising unpopularity of Obama and Obamacare. And frankly the Democrats have a long and ugly history of trying to terrify the populace — especially the distaff part of it — with scary stories about how Republicans, if elected, will take away their Medicare, their Social Security, their Obamacare, their birth control, their abortion, their education and their dental fillings if they fall asleep.

    So, in the the end, this really isn’t about birth control. If the Democrats really cared about access to birth control, they’d be talking about the solution many libertarians favor — make birth control available over the counter. That would do far more to make birth control available to women than a coverage mandate. No, this about politicizing the hell out of women’s reproductive systems in the hope of holding off electoral defeat.

    The Republicans may or not be fighting a “war on women”. But the Democrats are using them as vehicles for their own political gain. I don’t see that that’s any better.

    The Pledge

    As you know, Obama invoked his imperial executive powers to delay the employer mandate for businesses with 50-99 employees. One aspect of it, however, has not caught much attention. In order to qualify for the exemption, businesses must certify, under penalty of perjury, that they did not cut down on employment to get under the 100 employee cap:

    This week, the Obama administration finalized a regulation that delays enforcement of the employer mandate until 2015 for companies with 50 to 99 workers. Contained in the regulation was the clearest admission to date that Obamacare, and its employer mandate in particular, will indeed have a negative effect on jobs: To qualify for the delay, employers must certify that they haven’t reduced the number of workers in their company, or the total hours of service of its employees.

    Put another way, if employers are going to take advantage of the one-year delay in enforcement of the employer mandate, they have to attest (under penalty of perjury) that they aren’t cutting jobs or reducing hours because of Obamacare. By pointing this out as a possibility — or an outcome to be avoided — the administration is acknowledging what it long denied: The law creates incentives for employers to cut hours and jobs.

    Chen goes on to point out that this attestation of faith is purely political. Obama wants to be able to say that no business is cutting employees or hours to comply with Obamacare — and he has their own sworn statements to prove it!


    Think about how lunatic this is. There is nothing even faintly illegal about businesses’ – indeed, all economic actors’ – making financial decisions based on tax consequences. (And remember, notwithstanding Obama’s misrepresentations to the contrary, Obamacare mandates are taxes – as Obama’s Justice Department argued and as Chief Justice Roberts & Co. concluded.) The tax consequences of Obamacare are profound – that is precisely the reason that Obama is “waiving” them. No responsible officers in a corporation of relevant size would fail to take them into account in making the decision to staff at over or under 100 employees; in determining whether some full-time employees should be terminated or shifted to part-time; or in making any number of the decisions Obamacare’s mind-numbing complexity requires.

    The officers’ responsibility is to the owners of the company, the shareholders. The business exists to create value, not to provide employment – employing workers is a function of the value added to the enterprise, not the need to create a more favorable election environment for the statist political party. Corporate officers who overlooked material tax consequences would be unfit to be corporate officers.

    What is illegal and irrational is not a company’s commonsense deliberation over its costs, it is Obama’s edict. And look what attends this one: criminal prosecution if Obama’s Justice Department decides the business has falsely certified that its staffing decision was not motivated by Obamacare.

    Think about that for a second. The waiver is illegal. It flouts the language of the Obamacare statute, under which the employer mandate is required already to have been implemented by now. There is nothing in the law that empowers Obama to waive the mandate, much less to attach lawless conditions to such a lawless waiver. A business that seeks the waiver and fails to pay the mandated tax (in lieu of providing the required coverage) is in violation of federal statutory law, regardless of its compliance with Obama’s outlaw edict. The payments required by the statute, after all, are owed to the public, not to Obama – he’s got no authority to deprive the government of these funds just because it would harm Democrats to collect them.

    I think the later point is very very important. Remember what I wrote a couple of weeks ago about Obama saying he won’t prosecute people who sell legal marijuana in Colorado and Washington? Obama is creating a system where people can be violate a stupid law but he will not prosecute them. For now. However, this waiver can be removed at any time at his pleasure. He invites companies to break the Obamacare law and then puts them at his mercy. Holder recently said banks could process funds for legal marijuana business but the banks are hesitant because they are not that stupid. They know the Feds could turn on them at any moment and seize all of their assets, claiming they are laundering drug money (and indeed, they would be, under federal law).

    I realize that Congress is in a do-nothing mode. Having passed a budget and raised the debt ceiling, there are now rumbling that they are basically done with legislation for the year (note: they will still be paid as if they were legislating). Tax reform, immigration reform, Obamacare overhaul … all of these look like they will never happen. We have an absentee government.

    Normally, that might not be such a bad thing. But we have a number of critical issues that need to be addressed. If Obama says he will waive Obamacare requirements for smaller businesses, Congress should pass a law (and remove the oath part). If Obama says we shouldn’t prosecute legal pot business, Congress should pass that into law. Without the protection of Congressional legislation codifying these things, everyone is at the President’s mercy.

    Does anyone doubt there will be political games and favoritism in who is and isn’t prosecuted for violating the 100-employee rule? Does anyone doubt that political games and favoritism will play into which legal pot shops are prosecuted? Executive rule is arbitrary rule. It is no longer rule of law, it is the rule of man … a very specific man who has given little reason to believe he can be entrusted with that kind of discretionary power.

    As I have said many times, this isn’t a partisan issue. Liberals shouldn’t want that kind of authority given to President Rubio in 2016. Congressional Democrats shouldn’t want their power usurped. Legal marijuana supporters shouldn’t want pot shops to be operating under the mercy of the President. Forget the letter next to the guy’s name. This is wrong and this is dangerous. It’s time to put a stop to it.

    Meanwhile, businesses that qualify for the Obamacare waiver should refuse to take advantage of it. This will hurt and they will have to fire employees. But it’s better than swearing an oath that can’t possibly be true, violating a law passed by Congress and putting themselves at the mercy of the President.

    The CBO Is About to Get Droned

    That sound you heard was the White House trying to spin the CBO’s latest report on Obamacare.

    The Affordable Care Act will reduce the number of full-time workers by more than two million in coming years, congressional budget analysts said Tuesday in the most detailed analysis of the law’s impact on jobs.

    After obtaining coverage through the health law, some workers may forgo employment, while others may reduce hours, according to a report by the Congressional Budget Office. Low-wage workers are the most likely to drop out of the workforce as a result of the law, it said. The CBO said the law’s impact on jobs mostly would be felt after 2016.

    This is triple their previous estimate. The reason for that change is that their previous analysis just looked at how many employers would lay off people because of the employer mandate. This analysis looks at people who will choose to stop working due to the effects of the law (more on that in a second).

    The 2.5 million fewer workers it the banner headline, but the report is even worse than that. Two million fewer people will gain insurance thanks to the botched rollout of Obamacare. All told, this program will add $1.4 trillion in debt over the next decade (we can add that to the $1 trillion the newly-minted farm bill will add). Our deficit, which is now below the 3% of GDP that economists consider “sustainable” will soon start rising again, thanks at least in part to Obamacare.

    Remember when Obamacare was passed, the Democrats claimed that it would decrease the deficit? They could claim this because the CBO is only allowed to project budgets a decade into the future and the Democrats delayed all the big spending until year 11 (I’m not making that up). The CBO tried to warn us that budget was gimmicked and the long-term outlook was a lot worse. But no one listened.

    Now the CBO’s projections should always taken with a good dose of salt. But I think it’s very unlikely they are far off in their projections. Their analysis is consistent with other economists and think tanks are getting.

    Unbelievably, the Democrats aren’t shooting the messenger this time and accusing CBO of being a Right-Wing cabal. They’re not even blaming Republicans, if you can imagine that. Instead, they are … embracing this, arguing that it’s a good thing that people can quit their jobs and not worry about insurance. I’ve rarely seen someone throw the logic of the welfare state out there so nakedly.

    But they are also full of shit. As the CBO notes, the reason people will leave the workforce is because, if they work, they lose Obamacare subsidies and are subject to a massive marginal tax rate that, at certain income points, exceeds 100%. This is exactly what conservatives and libertarians have been warning about for years — the danger of creating a system where it is more profitable to not work than to work. Thanks to Obama, we now have it.

    So, should we give up hope? Well, maybe not. The Republicans have proposed a healthcare overhaul of their own — a “repeal and replace” that would leave enough parts of Obamacare intact to get Democrat support but make enough changes so that the system doesn’t completely crash and burn. One of the biggest changes is that you could not be denied insurance for a pre-existing condition … provided you had maintained coverage. This would mean that changing jobs or even losing your job would not necessarily cost you your healthcare. But it would make it impossible to simply go uninsured until you get sick. It would also eliminate the mandates and pare back the subsidies. The result would be a much more workable and much less expensive system that cost a lot fewer jobs.

    Is the Coburn-Burr-Hatch bill ideal? Not by a long shot. But it’s the first proposal I’ve seen so far that could get Democratic support and still turn us back from the abyss. And the CBO has just shown us that the Obamacare abyss is very very deep.

    The Wrong Skew

    Well, it seems like Obamacare is finally working. Two million people are signed up, so obviously this is … oh:

    Now that more than 2 million people have signed up for private insurance plans created by President Barack Obama’s healthcare law, a crucial next check-up for the new marketplace will be to see how old customers are.

    Early data from a handful of state exchanges shows the administration needs more young adults to sign up in the next three months to help offset costs from older enrollees and prevent insurers from raising their rates.

    Critics of Obama’s Affordable Care Act say the market won’t attract enough young people to keep it financially viable, putting more pressure on government funds to compensate for any insurer losses.

    Data from seven states and the District of Columbia, which are running their own marketplaces, show that of more than 200,000 enrollees, nearly 22 percent are 18 to 34 years old, according to a Reuters analysis.

    The administration had hoped that over 38 percent, or 2.7 million, of all enrollees in 2014 would be 18 to 35 years old, based on a Congressional Budget Office estimate that 7 million people would sign up by the end of March.

    Now, to be fair, these are early numbers and there is some data showing that the most recent signups skew as young and healthy as Obama wants them to. However, we are once again seeing how this Obamacare thing is like a house of cards. The insurers offered rates based on a projection of seven million signups with 2.7 million of those from young healthy people. That lower number is a critical card in the house. Without young people paying identical rates to older ones but using less care, the system becomes a massive money pit. Suddenly, you’ve got a way more expensive group of patients than you anticipated.

    That leads to another card: an insurer bailout. To keep the insurance market from completely imploding, the government is poised to bail out their losses if this happens (these bailouts are euphemistically called “risk corridors”). Republicans want to repeal this, which would bring the entire house crashing down. But really, it’s a matter of timing. You can’t go on forever with a zombie insurance industry.