Sunday, March 1, 2015

The Political Disaster of the 18 Month Extension, Or Demagogues Wanted, Quantity Valued Over Quality You

So, one Republican proposal if the Supreme Court cuts off the subsidies is to extend them for another 18 months to give Congress time to come up with an alternative.  The Supreme Court is expected to come out with its decision in June.  That will make 18 months fall around the beginning of 2017. This has the advantage (from the Republican perspective) of kicking the can down the road until after the next election.  It has the distinct disadvantage of requiring action to be taken immediately after the 2016 election.  Which will, in turn, make "what next" a major election issue.  That is bound to be awkward.

As Democrats have learned the hard way, proposals to change the healthcare system tend to run into a lot of resistance.  People fear losing what they have and want to hold onto it.  And, this proposal would make Democrats, probably for the first time, champions of keeping what we have the Republicans the ones who threaten it.

But Obamacare remains unpopular, you may say.  Running in favor of it is a surefire loser.  It might start to look different, though, if ending Obamacare starts to mean in any concrete and realistic way stripping millions of their health insurance, as it will is the Supreme Court cuts off the subsidies.

If the Supreme Courts decides against the subsidies and Congress passes an 18-month extension, the question of what next will loom large in the election. Democratic candidates will simply say that they favor making the current extension of subsidies permanent so things can continue as they are, and then go on to paint in lurid detail all the things Republicans are threatening to disrupt if they win out. Republicans will have grave difficulty offering any sort of coherent answer.  And any Democrat with an ounce of sense should be able to dig up any number of quotes (or better recordings) of, if not candidates, then top Republican policy wonks or advisers talking about their eagerness to induce a death spiral and cause insurance rates to spiral out of everyone's price range and force the Republican into embarrassing disavowals.

Some article (which, alas, I can no longer find) says that, except in the unlikely circumstance of Democrats winning the triple crown in 2016, an 18-month extension will almost certainly end up leading to an endless serious of 18-month extensions, rather like extensions of the debt ceiling or of adjustments to Medicare reimbursement rates.  I am inclined to agree.

On the subject of Greece, I said that in case of the Grexit, Greece will need a first rate team of economic advisers to manage the devaluation and a top-notch demagogue to convince people to endure the ensuing hardship without an explosion.  As for US health insurance, I can only say to the Democrats that if the Republicans hand you this prize, any fourth-rate demagogue should be able to make hay out of it.  You just need to ensure that you have at least one in each election.

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