ObamaCare's Plan to Insure 30 Million More People Leads to 30 Million More People Being Insured

Here are a few of the headlines that caught my eye on the Yahoo! newsfeed this week:

The first article points out a glitch in the law that could affect two to four million people and whether or not they receive the proper tax credits to help pay for their insurance coverage. It's a legit hole that could easily be plugged if there was support in Congress to make government work better, rather than dismantle it.

The second article, however, seems to miss the overall point of the law. Let's face it, ObamaCare was a large bill, thousands of pages long, as Republicans were always eager to point out. Surely, you can pick out any one piece of the bill and say, this will hurt this business or that sector of the health care market. But when you take the bill in its entirety it's expected to be a net-good for almost everybody.

The bulk of the increase in claims costs will largely be passed on to the states who are implementing the expanded Medicaid coverage. And the Feds will be picking up 100% of those costs now and 90% in the future. The rest of the costs will effect those who get their insurance through the individual marketplace - self-employed people or very small businesses. Those who get insurance through their employer will not be affected by these changes.

With ObamaCare in general and on this issue specifically, my initial reaction usually is "compared to what?" If the baseline is millions of people have no health coverage and receive emergency room care for everything, then that currently is already driving up the costs of: health insurance, hospital reimbursements, tests and procedures, and the subsidies the government is providing for all of that. In the long term, after the initial increase in claims costs is absorbed, costs stabilize.

Focusing on something like increasing claims cost, which are due to more claims being filed because more people will have health coverage, while the costs of which are more than offset by reductions in costs elsewhere, misses the point. Covering more people is a feature of the law, not a bug. And if it was easy and inexpensive to extend coverage to the uninsured, it would have already been done years ago. The rise in claims costs was not unexpected and was already factored into the bill.

The key point here is that ObamaCare wasn't passed to ensure that the number of medical care claims were held steady. The main goals of ObamaCare were: 1)to help give thirty million-plus more people access to health coverage, 2)to end insurance company abuses by more tightly regulating the health insurance market, and 3)by doing those previous two things and by implementing hundreds more cost control mechanisms, to attempt to eventually bring down the growth in health care costs to a more manageable number going forward, so we can deal with our long-term debt problem. You can't accomplish those goals without some minor and somewhat major changes and reforms.

Update 03/28/13: Yahoo! News continues to troll ObamaCare.....

Romney will not become President "Moderate Mitt"

David Frum believes Romney is lying and that's the reason to support him

David Brooks and David Frum, my favorite conservative pundit, both endorsed Mitt Romney in the last week, both seemingly supporting him in hopes that he is really lying and would really govern as "Moderate Mitt."

I understand this impulse. If you are one of the few prominent moderate Republicans remaining, you must convince yourself that the Presidential candidate would govern more to your liking or else there would be little reason to remain a Republican at this point. At the Congressional level, moderate Republicans are practically extinct. The last chance for a moderate Republican to have any impact on the party is at the Presidential level and he/she will have a really tough time making it through a primary. Romney, to his credit, did win the primary rather easily. But his path isn't likely to be repeated by future moderates. They just don't make many as shameless as Romney, and only someone lacking in any conviction could reinvent himself on virtually every issue in such a short period of time.

Here's the thing though, history shows us Presidents try to keep campaign promises. Frum, at least circles this square, but pointing out that with the Democrats likely to retain control of the Senate, Romney won't be able to follow through on a lot of the crazy misguided stuff he promised his base during the campaign. It's not a very comforting thought to a liberal like myself that the future of ObamaCare, Dodd-Frank, etc, may hinge on a handful of Senate Democrats not caving and voting with the Republicans.

So the argument seems to go: vote for Romney because he's really been lying to us and will govern as a moderate....oh and if he wasn't lying, well the Democrats in the Senate will save us from "Severely Conservative Mitt."

I admire the hope that Romney is secretly running to stick it to the majority of his party and will govern as a moderate. It just seems extremely unlikely. I seem to remember a lot of moderates making the same case about George W. Bush in 2000. And while Bush was more moderate when it came to immigration, since his party was more moderate on that issue at the time, he governed as advertised or even more extreme than how he campaigned on virtually every other issue. As former President Bush said, "Fool me once, shame on — shame on you. Fool me — you can't get fooled again."

Romney's Economic Plan Doesn't Actually Solve Any Problems

Here's my plan: The super rich get these big pieces of the pie. Everyone else gets the crumbs. (AP)

Many of you may recall the parable of the "streetlight effect." It goes something like this: A policeman sees a man searching for something under a streetlight and asks what he's lost. He says he lost his keys and they both look under the streetlight together. After a few minutes the policeman asks if he is sure he lost them here, and the man replies, no, that he lost them somewhere else. The policeman asks why he is searching here, and the man replies, "this is where the light is."

It highlights a bias where people only look for solutions where they are easiest or most familiar. You saw this come in to play with the invasion of Iraq, fulfilling a long-time goal of the NeoCon foreign policy intelligentsia, regardless of the facts. And in the case of Mitt Romney's economic plan it really highlights a conservative bias in recent decades, where they see lower marginal tax rates for upper income people as the solution to every economic problem, even when all objective analysis says it wouldn't actually help the current situation. The solutions to our economic problems may be over here in the dark, but conservatives prefer to push for lower taxes for rich people over there in the light.

Only a supply-side true believer could look at what has happened to economy over the last 10 years and conclude that what we really need is another round of budget-busting tax cuts for the super rich.

Greg Sargent of the Washington Post and others have been pointing this out for months.

I asked two economists to take a look at that question. Their conclusion: While both said they support some of Romney’s long term goals, they both agreed that Romney’s ideas would do little or nothing to fix the immediate crisis, and could in the short term make things worse.

He said he would tap our energy resources to “put a lot of people to work in the energy sector.” He said he’d repeal Obamacare, which is “scaring small businesses from hiring.” He said he’d balance the budget so people know “investing in America is going to yield a return in dollars worth something.” He vowed to “open up new markets in American trade.” He said he’d revamp the National Labor Relations Board and lower tax rates on employers, both of which would make it easier to hire people.

“Are all these things going to reduce the unemployment rate from eight to five in two years? No,” Joel Prakken, the chairman of Macroeconomic Advisers, tells me. He described Romney’s ideas as a “a bundle of reasonable policy proposals that could well stimulate the economy from the supply side over a number of years, but would do little to stimulate aggregate demand in the short run. The reason that unemployment is as high as it is is inadequate aggregate demand, not inadequate supply.”

“On net, all of these policies would do more harm in the short term,” added Mark Hopkins, a senior adviser at Moody’s Analytics. “If we implemented all of his policies, it would push us deeper into recession and make the recovery slower.”

Sargent's post delves into the specifics of his five-point plan. So please go read the whole column. And in fact Romney's plan is largely the same five-point plan that both George Bush and John McCain ran on in 2000, 2004, and 2008. Once again, no matter what the ailment is, Republicans offer the same old prescription every time.

Or as President Obama put it in his convention speech:

...And I ran for President because I saw that basic bargain slipping away. I began my career helping people in the shadow of a shuttered steel mill, at a time when too many good jobs were starting to move overseas. And by 2008, we had seen nearly a decade in which families struggled with costs that kept rising, but paychecks that didn’t; folks racking up more and more debt just to make the mortgage or pay tuition; put gas in the car or food on the table.

And when the house of cards collapsed in the Great Recession, millions of innocent Americans lost their jobs, their homes, their life savings, a tragedy from which we are still fighting to recover.

Now, our friends down in Tampa, at the Republican convention, were more than happy to talk about everything they think is wrong with America, but they didn’t have much to say about how they’d make it right.

(APPLAUSE)

They want your vote, but they don’t want you to know their plan. And that’s because all they had to offer is the same prescription they’ve had for the last thirty years:

“Have a surplus? Try a tax cut.”

“Deficit too high? Try another.”

(LAUGHTER)

“Feel a cold coming on? Take two tax cuts, roll back some regulations, and call us in the morning.”

(APPLAUSE)

Now, I’ve cut taxes for those who need it, middle-class families, small businesses. But I don’t believe that another round of tax breaks for millionaires will bring good jobs to our shores, or pay down our deficit. I don’t believe that firing teachers or kicking students off financial aid will grow the economy, or help us compete with the scientists and engineers coming out of China.

(APPLAUSE)

After all that we’ve been through, I don’t believe that rolling back regulations on Wall Street will help the small businesswoman expand, or the laid-off construction worker keep his home. We have been there, we’ve tried that, and we’re not going back.

We are moving forward, America.

(APPLAUSE)

I won’t pretend the path I’m offering is quick or easy. I never have. You didn’t elect me to tell you what you wanted to hear.

OBAMA: You elected me to tell you the truth.

(APPLAUSE)

And the truth is, it will take more than a few years for us to solve challenges that have built up over decades. It’ll require common effort, shared responsibility, and the kind of bold, persistent experimentation that Franklin Roosevelt pursued during the only crisis worse than this one.

Final Thoughts on the First Debate

 "My 1-point plan for winning this debate: lying." (Source: AP)

I honestly hate debate formats. As someone who is into policy more than politics, I think it's a terrible forum for understanding what the candidates would do and whether or not their plans will work as they claim. And that's not even unpacking the veracity of their claims. Debates are a fine format for electing a High School class president, but probably not so good for a leader of a country.

With that being said, here is my long summary of the debate:

1. It is important to remember that the 10% or so of the persuadable and undecided voters remaining seem to care disproportionately about the deficit for some reason. Many of these people aren't following closely and aren't wonky enough to understand that especially after a near Depression, the economy/job creation and the deficit often work in the inverse of each other. That is, it makes more sense to run short term deficits in order to continue to boost the economy until you get closer to full employment. So thus "dealing with the deficit" in the short term means lower economic growth and less job creation.

But that is why the debate focused so much time on taxes and the deficit and therefore related issues of tax reform and entitlement reform. It should be noted though, those issues will have, at best, an infinitesimal positive effect on job creation. All of the liberal wonks I follow on Twitter were pulling their hair out during this part of the discussion, but it was probably worthwhile for undecided voters.

That being said, having duel discussions about cutting spending and creating jobs, as if both things exist in an unrelated vacuum, was curious. All those budget cuts that Romney supports would lead to job losses. Take his joke about PBS. A lot of people work for PBS and if you cut their budget, people will lose their jobs. There are dozens of other examples. Somehow the job losses resulting from cutting PBS's budget are OK, but potential job losses (or slowing job growth) from, say, increasing taxes a few percent on prosperous small businesses are unacceptable.

Romney chastised Obama for not supporting Simpson-Bowles and then admitted he'd accept no debt reduction plan that raised taxes in any way, even at a ratio of 10:1 spending cuts to tax increases. A good follow-up from Jim Lehrer would have been to ask Romney how he planned to cut a deal with Congress for tax reform and debt reduction, which Democrats and Republicans could support, without including these basic compromises. It would be a question that would take a candidate out of the abstract world and into the real world how bills become laws.


2. Chris Hayes made a great point in the MSNBC recap. The Obama team feels, and has felt for 5 years, that Obama's signature "brand" and most important characteristic is his likeability. He will not risk losing that edge by unnecessarily going negative in a debate when he's leading in all of the polls. Now, should the race tighten, you will probably see a more pointed Obama in the coming two debates. We shall see. Obama's modus operandi is to present a cool, calm, confident demeanor, and then have ads and surrogates do his dirty work. That way his hands stay clean. It's tough to argue against that strategy now, seeing how it has served him well since 2007. Also, the thinking is that a continuous series of ads in swing states on a daily basis work better at persuading voters than a few forgettable debate quips. Obama's debate strategy, even against Hillary Clinton, always seemed to be to just calmly present his case and stay on message, avoiding gaffes.

It may come as a surprise to the gang on MSNBC, but a fiery black liberal probably wouldn't do as well electorally as Obama has done. If, say, Chris Matthews' style was more popular with the public at large, he'd be hosting the network Evening News, not a dinner time show for political insiders on basic cable. And I mean that as no shot at Matthews, who I generally find entertaining and knowledgeable. It's just a fact.

 "Why didn't Obama attack Romney more like I would have?" (Source: Mediate)

3. Romney comes off well in these debate settings. He sounds like he's giving a presentation to a Board of Directors. Or perhaps making the case to a financial institution to help lend him money for a leveraged buyout of a company he intends to load up with debt and bankrupt in return for huge profits.

He has figures at the ready, even though they aren't always accurate and he sounds convincing. Every bullshit artist sounds convincing. He talks in "1., 2., 3." sequences, even if he doesn't really have three different points to make. Obama could learn to use more of the "1., 2., 3." setup in his answers rather than the "...and", "and also," "and let me just add..." framework, which tends to make his answers run on longer and make them less effective. Using the "1., 2., 3." setup encourages people to listen more closely because your answers have a beginning and end to them. With the way Obama answers a lot of questions you never know when he's wrapping up his main point or beginning to make a related point. Perhaps he should read this. And that leads to my next item.


4. Debates are about style and how you say what you are saying. Fact checkers have already showed Mitt was full of shit about most of his accusations and defenses of his plans ("what plan? what plan are you talking about? that's not my plan").  Obama seemed completely unprepared to deal with this more brazen morphing of Right Wing Mitt back into Moderate Mitt. During the long back and forth over the $5T cost of Romney's proposed tax cuts, Obama seemed exasperated at times and surprised that Romney could be so bold as to completely deny the plan he's been running on for 15 months in front a national debate audience.

 "Is he really denying the existence of the tax plan he's been campaigning on for 15 months?" (Source: Daily Beast)

5. Really, going back to 2006 when Romney began running for President, he's presented a sort of Potemkin Village candidacy, saying whatever he needed to say to win voters at that particular time. And then, as Jon Lovett noted, he has this masterful tactic where he feigns offense when you bring up the fact that he just did a 180 on an issue from where he stood 15 minutes ago. Then he'll restate the current position the rest of the night as if it existed all along, rinse/repeat.


6. And because of those flip flops, Romney came off more appealing to people by conceding the policy ground to Obama and the Democrats. Romney changed or lied about his position on $5T in tax cuts and how they would be financed, his proposed cuts to education, and his non-existent health care plan to replace ObamaCare, among other things. This is hardly the victory for conservatism that Reagan's debate win in 1980 was. This was a stylistic win for Romney, where he was forced to lie about substance in order to compensate for GOP policy proposals that are unpopular.


7. I'd need several separate posts just to dissect Romney's inconsistent message on ObamaCare and Health Care overall. But here are a few related paragraphs instead. I'm still not sure how Romney's argument that "RomneyCare is a great plan but should only be adopted on a state by state basis", passes any threshold for ideological consistency.  Sick people in Massachusetts have the same problems as sick people in Montana. And the basic Actuarial Management principles at the heart of both laws apply regardless of where your reside. You can't implement any one leg of the three-legged stool without either bankrupting private insurance companies and/or making the uninsured problem worse.

In short though, it is remarkable that 15+ minutes of the debate were spent arguing over a law that both men support in private, but only one is able to support publicly. Romney is unable to admit that he really supports it and has had to create this unconvincing opposition to the law as a whole, while agreeing with nearly all of the particulars. He mainly cites the newest Conservative argument against it: the Commerce Clause. This holds that State government control of health care is a brilliant model, but Federal government control of health care is the death of freedom (meanwhile, of course in neither case does the government control health care since it is still private insurance, but anyway...). If only the Republican party didn't go batshit crazy in 2009, Romney could have proudly run on his RomneyCare record, as he did in 2007-2008, and it would be settled bipartisan consensus that the law was fine. We'd just be arguing about what, if any, tweaks to make to it.

Finally, this point cannot be overstated about ObamaCare: If Romney wins and repeals ObamaCare, PEOPLE WILL DIE as a result of it. Or as the Tea Party calls that: freedom. That is not hyperbole. Just like that ad about Bain Capital, of course Romney won't be killing them personally. But these laws effect real people, not just numbers on a balance sheet. Stacy Lihn, who spoke at the DNC, will no longer be able to get treatment for her kid if ObamaCare is repealed because of the lifetime limit on coverage. As many as 89 million people would likely be left out of Romney's plan for covering people with pre-existing conditions. If a plan leaves out 89 million people, it may be a plan in that it contains a series of words strung together to make sentences that are readable, but that's not a health care plan that actually solves a health care coverage problem. It's plan for the sake of you being able to say you have a plan. Potemkin Village Romney strikes again! That has been every Republican Presidential candidate's health care plan since the 1980's: a one-page series of words that don't really solve any of the problems - soaring costs, access to insurance, compensating outcomes rather than activity, etc., but simply allows the candidate to say he has a plan, hoping to end a discussion of the details.


8. On one of the few big issues that Romney did not reverse himself, he admitted or at the least didn't push back against the charge that he and Paul Ryan are in favor of ending Medicare as we know it for those people currently under 55 years old. Obama accurately characterized this as a voucher plan that would ultimately put Seniors at the whims of private insurance companies at their most vulnerable times. We used to have a system like that before Medicare. And that's why Medicare was passed to fix that problem. The Romney/Ryan plan essentially attempts to reduce health care spending, not by implementing any cost-saving reforms, but by just shifting costs from the government onto seniors and recreating the same problems that existed before Medicare. By sticking to this and continually emphasizing "current seniors aren't affected", Romney just wrote a campaign ad for Obama for anyone under 55 years old.


9. Obama seemed to be setting up an argument that he never got around to making, perhaps getting stuck in the weeds trying to rebut Romney's lies. But if you are making the case that "things were awful when I took over, but things are improving now, so stick with me", then you need to champion the improvements. Obama didn't mention the nearly 5 million private sector jobs created in the last 2.5 years. He didn't mention rescuing the auto industry from bankruptcy. If you want to make the case that your campaign is moving forward in the right direction and Romney would take the country back to the policies that caused the problems, then say the name "George Bush" a few times. He did reference the tax cuts in 2001 and 2003 and the lowest rate of job growth in 50 years in the early aughts after the tax cuts were passed, and then the financial collapse/Great Recession. It was a solid lawyerly argument against Romney. But people don't remember what happened a week ago. Say "George Bush" a few times at the next debate. Then undecided voters will think, "Oh right, George Bush, yeah things were really bad during those years. Romney wants to do what?"


10. In conclusion, Romney did what he needed to do. He had a good debate "performance" and won it on the strength of his energy, tone, and delivery. The fact checkers are already doing an autopsy on his statements though and it's not going well.

We'll see if Romney's debate win ends up moving enough voters in the coming days to make this a close race down the stretch. All of the instant polls showed most people believed Romney won the debate by significant margins. But the same polling and focus group anecdotes showed very little movement by anyone who was still undecided. And it showed Obama's positive favorability rating was unchanged while, Romney's negative favorability rating only improved slightly. With polling averages showing Romney trailing Obama by around 48-45, Romney would need to win the votes of over 80% of the remaining undecided voters in order to win the Presidency. It's a very tall task that even two more excellent debate performances may not be able to salvage.

Do Big Corporate Donors Matter More or Less?

 The Citizens United decision was ex-cellent

I just want to preface the following post by saying I've haven't really thought this through all the way yet, so there may be some major holes in my analysis, but this occurred to me today when I was daydreaming in line at the coffee shop.

The conventional wisdom after Citizens United was that our political system would now just be bought by the highest bidders in the corporate world. While I still think that is probably true. A few things have happened recently that changed my mind a little.

You could always determine how members of Congress and Senators voted on particular issues, just based on whatever industry had donated the most to their campaigns. In some cases a politician already supported that particular industry or issue and would just use that previous support to raise more money. In that case, the bribe kind of went in the other direction: "I already support you, but if you don't donate to my campaign, I may stop supporting you." But typically it seemed to go in the usual direction, as witnessed during the Health Care Reform debate when the last 4 Democratic holdouts in the Senate (Ben Nelson, Joe Lieberman, Blanche Lincoln, and Mary Landrieu) all happened to be huge recipients of campaign donations from Aetna, Mutual of Omaha, etc). Therefore concessions had to be made to get all of them on board. And of course with the exception of Landrieu, the others will have been voted out of office or retired without facing voters again. So congrats, you tried to make the bill worse at the behest of your campaign donors and it didn't even help your political career anyway.

But getting back to the original issue, with the exception of the vote against getting rid of tax breaks and subsidies for Big Oil, I can't think of one other vote the last few years where it was obvious the GOP was voting blindly in the interest of one of their traditional big corporate donors.

Part of the reason I was always so confident that the GOP eventually would let ObamaCare stand once it became law and validated by the SCOTUS, is that to tinker with the structure of the law at that point, could hurt Big Insurance's profits. For example if you are able to take away the mandate, but leave the other regulations in place and Big Insurance could be in a risk-management death spiral. Big Insurance fought the law and the law won. And at that point, the theory goes, having the whole law in place is better for them, than just some parts of it.

If the Republicans truly go forward with their vow to remove the mandate and possibly other parts of the law through the Reconciliation budget process that only requires 51 votes in the Senate (they'd also need a President Romney to sign that), then I think we really are seeing a party that doesn't care as much about corporate donors any more. (Caveat: maybe I'm missing something but I can't see how Big Insurance would be better off with part of the law repealed). It'll be interesting to see how it plays out. If Romney wins, will they really follow through on this or not? Is this all a ruse to fire up the Tea Party for one more election, or are they really going to try to repeal key parts of it?

It seems to me the shift we could be seeing is the GOP being able to rely more on the donations of many, many rich individuals, along with a few dozen billionaires like the Koch Brothers. The big corporations still contribute, but with other sources of unlimited campaign cash, they may not hold the same sway they used to within the party. And with Unions even weaker, that means the Democrats ultimately will be more dependent on the donations of the big corporations. In the end, the middle class will continue losing ground, until Citizens United is overturned or the campaign finance system gets repaired. And of course it's just assumed that Wall St. still has veto power over everything either party does.

For liberals like myself it's actually a much scarier world where the GOP isn't predictable when it comes tending to the whims of whoever is their highest bidder in the corporate world. That's when the political system shifts from being a conventional center-right party vs a conventional center-left party to a far right-wing party looking to implement radical change to the social democracy we've had for the last 100 years vs. a center-left party who may not have adapted to this change in the game quickly enough.