Wednesday, June 10, 2015

John Barrasso's tell: King is a fraud

In his determination to accent the negative in characterizing the ACA, Senator John Barrasso has exposed the absurdity -- in fact the fraud -- at the heart of the King v. Burwell suit.

Here's how Barrasso characterizes the IRS rule allowing subsidies to flow through the federal exchange:
“Instead of bullying the Supreme Court, the president should spend his time preparing for the reality that the court may soon rule against his decision to illegally issue tax penalties and subsidies on Americans in two-thirds of the country,” he said in a statement. “Congress will not pass a so-called ‘one-sentence’ fake fix.”
The fix is "fake" because, according to this party line, Congress never intended for the federal exchange to be empowered to credit subsidies. But Barrasso leads with "penalties" because it's more fun to emphasize the stick than than the carrot. The individual mandate is the flip side of the subsidies: without subsidies, the vast majority of the uninsured would be exempt because coverage would not be affordable.

Thus Barrasso is arguing that Congress intended for the individual mandate to be all but inoperative in states that declined to build their own exchanges. This is actually the party line, voiced by none other than King mastermind Michael Cannon. When flogging Jonathan Gruber's misstatement about the exchanges last summer, Cannon said this about Gruber:
He knew the feature he was describing essentially gave each state a veto over the PPACA’s exchange subsidies, employer mandate and to a large extent its individual mandate. He knew that could lead to adverse selection. 
But if the ACA drafters gave states an effective veto over the mandate, then the constitutional challenge to the mandate in 2012 was bogus. The 26 states supporting that suit argued explicitly that states do have the authority to mandate a purchase -- only the federal government lacks it. The King proponents and their allies are arguing that the states werer granted an effective veto over the mandate -- snatched away by the IRS when it ruled that the federal exchange could credit subsidies.

The broader and glaringly obvious fact is that the ACA cannot function without subsidies or the individual mandate* --they're Siamese twins -- and that the drafters intended both to be operative in every state. Suggesting that it was only the IRS that imposed the mandate in states that opted out of exchange building highlights the fraud on which the King narrative about congressional intent is based.

* More precisely, without the mandate or a substitute measure to push the uninsured into the subsidized private market -- which a state could conceivably implement via a Section 1332 innovation waiver.

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