ObamaCare, the decision, and austerity

posted at 6:46 pm on July 2, 2012 by Karl

There is no government mandate requiring people to write about the Supreme Court decision upholding Obamacare, but you wouldn’t know that from visiting the internet. I briefly considered refereeing some of the fine points of the debate over whether there are Silver Linings in that decision. However, people’s opinions seem so entrenched for the time being that writing that sort of piece seems rather pointless. It might be more useful to look at Obamacare and the decision upholding it in the context of the future of American politics.

The central feature of those politics is the unsustainable increases in our debt and unfunded liabilities. Our future politics is likely to be dominated by the politics of loss. This has near-term implications for the fate of Obamacare, but the ramifications go beyond that.

After all, even an incipient fiscal crisis is unlikely to cause Democrats to convert to conservatism or libertarianism. In the debt-fueled political battles to come, most Democrats will likely cling to their traditional tax-and-spend philosophy. They will want to address the debt with the highest ratio of tax increases to spending “cuts” as they can extract politically. They will want to pretend taxes are not taxes and spending is not spending. They will try to devise ways of moving their agenda forward without taxes. They will try to devise ways to burden others with the costs of their agenda.

From this perspective, we can learn much from Obamacare and the decision upholding it. Knowingly or not, Obamacare is a bit of a trial run for the sort of tactics Democrats may increasingly employ as our fiscal crisis grows. In this context, the Supreme Court’s willingness to characterize the mandate penalty as a tax may encourage further dishonesty from the Democrats. In another sense, it is regrettable that if the mandate penalty is considered a tax, it is not considered as simply a lesser tax paid by those who opt out of our newly quasi-socialized health insurance program. Democrats likely colluded with the CBO to prevent the ostensibly private health insurance industry from becoming part of the federal budget — and as long as the same ol’ insurance companies remain in place, the right will be unlikely to get most Americans to realize what actually happened.

On the other hand, the decision that the mandate is a form of tax — as opposed to a regulation of commerce — helps ensure that the Democrats’ agenda will carry an economic and political price. Moreover, it is not as though Democrats were not already dishonest about the nature of the mandate. They insisted it was not a tax, then went to court arguing it was a tax and won. That history ought to shred Democrats’ credibility in similar future battles. That the Obama administration is still trying to claim it is not a tax is their tacit admission they will have an increasingly difficult time selling taxes going forward.

Even more broadly, regardless of its label, the mandate by any other name smelled as rank to most Americans. I read commentary suggesting that if Obamacare ever gets fully phased in, there will be no getting rid of it. I think that perspective does not account for the fact Social Security and Medicare were popular when passed, whereas Obamacare was not. That perspective also fails to account for the fact Social Security and Medicare were passed during an era where American politics were dominated about carving up America’s prosperity instead of accounting for America’s debts. That perspective further fails to account for the fact Social Security and Medicare are structured as traditional government entitlements, while Obamacare retains the facade of capitalism, which makes it much more vulnerable to repeal/replacement/reform not just next year, but every year. This is why so many Democrats loathe Rep. Paul Ryan’s Medicare reforms, despite their similarities to Obamacare.

The establishment may prefer a Grand Bargain based on the recommendations from the chairmen of the Bowles-Simpson commission on the debt crisis, which would retain Obamacare and impose further taxes. A majority of voters prefers neither retaining Obamacare nor increasing taxes. Moreover, the Bowles-Simpson recommendations seek to raise revenue through 1986-style tax reform: broadening the tax base while curtailing tax deductions. This approach runs contrary to the approach of Obamacare and Democrats generally (even the supposedly more responsible Bill Clinton) of engineering social policy and paying off favored party clients via the tax code. The Obama approach on taxes, while representing the core constituencies of the Democratic Party, is outside the establishment’s center-left approach.

Lastly (for now), the Supreme Court ruling that states have the ability to opt out of Obamacare’s expansion of Medicaid may lead to substantially higher costs for the federal government. However, that is not an entirely bad thing going forward. If Obamacare will leave the taxpayer on the hook for an additional $500 billion or so in federal costs over the first decade, national Democrats ought to have to answer for it. As Justice Kennedy might say, federalism preserves liberty in part by preserving separate lines of political accountability. Restraining attempts by Washington to strong-arm state governments into bearing the burden of the Democrats’ national agenda likely will be increasingly important in the battles to come. How committed the Court will be to these principles remains to be seen; the right needs to be committed to them well before future disputes wind up in court.

This post was promoted from GreenRoom to HotAir.com.
To see the comments on the original post, look here.


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Comments

…don’t want to think about this anymore!

KOOLAID2 on July 2, 2012 at 6:50 PM

…want to get the POS out of the White House…and put more R TURDS in the Senate!

KOOLAID2 on July 2, 2012 at 6:51 PM

If you don’t write about the decision you might be taxed. Or are you taxed writing about the decision?

pat on July 2, 2012 at 6:53 PM

Restraining attempts by Washington to strong-arm state governments into bearing the burden of the Democrats’ national agenda likely will be increasingly important in the battles to come. How committed the Court will be to these principles remains to be seen; the right needs to be committed to them well before future disputes wind up in court

…the right needs to get some ba_ _s…but only our women have those…so? What principles?

KOOLAID2 on July 2, 2012 at 6:55 PM

Since a penalty is now a tax, I’m gonna put those traffic tickets in the “Taxes Other” category on my 2012 taxes.

J_Crater on July 2, 2012 at 6:55 PM

No word on whether the NHL will have a “Tax Box” when the next hockey season starts up. If so, the paper work to get back on the ice could be overwhelming.

J_Crater on July 2, 2012 at 6:57 PM

There is no government mandate requiring people to write about the Supreme Court decision upholding Obamacare…

Really? You wouldn’t know that by visiting Hot Air since Thursday.

Flora Duh on July 2, 2012 at 6:59 PM

Etch eh Sketch Eric Fehrnstrom now blurts out that Romney doesn’t think that the O-Care mandate is a tax, but that Romney is on Obama’s side, that it is a penalty. Crazy Fehrnstrom, who also is the star of this democratic underground story: Romney campaign Über-Do@che Eric Fehrnstrom: Outsourcing are people too, my friends!
Fehrnstrom has gone off as a loose-lipped clown one too many times. Romney, either fire him, or insist he never talk to the press, or anybody, ever. Is Romney’s cronyism all that is important to him? As Murdoch says get rid of the incompetent old friends, and get some top professionals. The future of this nation is at stake. Loose lips sink campaigns. Enough is enough.

anotherJoe on July 2, 2012 at 6:59 PM

If you don’t write about the decision you might be taxed. Or are you taxed writing about the decision?

pat on July 2, 2012 at 6:53 PM

Probably both.

squint on July 2, 2012 at 7:05 PM

The future of this nation is at stake. Loose lips sink campaigns. Enough is enough.

anotherJoe on July 2, 2012 at 6:59 PM

Absolutely….3 days after we all have our collective hammers on the head of the Obama nail, this jackazz (Fehrstorm) decides to sh*t down his leg on national tv….

jeebus….

get on message and stay on message…

Tim Zank on July 2, 2012 at 7:12 PM

Illegal aliens still don’t have to pay for health care by going to the Emergency Room…

… After all of this, we still have to pay their tab.

Wasn’t this one of the major causes in the increase of health care costs that started this whole thing in the first place…?

Seven Percent Solution on July 2, 2012 at 7:15 PM

According to Boehner, it’s just gonna be too hard to repeal Obamacare.

http://www.whas11.com/news/local/McConnell-says-he-will-work-to-repeal-Obamacare-161089795.html

silvernana on July 2, 2012 at 7:17 PM

Oops, meant according to McConnell>

silvernana on July 2, 2012 at 7:18 PM

Oops, meant according to McConnell>

silvernana on July 2, 2012 at 7:18 PM

Then dump that sorry politico and find someone with the guts and determination to take on the fight. The first thing these sorry politicians do is attempt to cover their worthless butts. This poor sick Republic is in deep trouble.

rplat on July 2, 2012 at 7:26 PM

They will try to devise ways of moving their agenda forward without taxes.

Their agenda is to gain and keep power with the use of bribes paid for by taxpayers. If those payments cease, so does power.

JIMV on July 2, 2012 at 7:29 PM

rplat on July 2, 2012 at 7:26 PM

They’re not going to fight Obamacare. With the Romney crowd saying it’s not a tax, there goes the only sliver of hope to try and overturn it at the polls. They just showed they’re not willing to take it on. Sad, sad day.

silvernana on July 2, 2012 at 7:33 PM

I’m kind of looking forward to the spectacle of watching the government trying to hide all of this from an increasingly suspicious populace.

I think the real tipping point will be when they try to seize the IRA’s and 401K’s.

Make no mistake. They will do anything to keep this circus going on for even one more week.

trigon on July 2, 2012 at 7:42 PM

According to Boehner McConnell, it’s just gonna be too hard to repeal Obamacare.

http://www.whas11.com/news/local/McConnell-says-he-will-work-to-repeal-Obamacare-161089795.html

silvernana on July 2, 2012 at 7:17 PM

I’m concerned. Even if we win the presidency and take the Senate, do you really think this GOP leadership and Romney have the fortitude to repeal Obamacare? I certainly hope so – but we’re gonna need some strong, courageous leadership to get it done. Personally, I’d love to see Jim DeMint as Senate Majority Leader.

TarheelBen on July 2, 2012 at 7:56 PM

Gee Karl, I’ve been writing about this VERY F-ING subject for months. You’re just now getting on board with this ?

Cheeeeee~flucking~~~~~~rist

DevilsPrinciple on July 2, 2012 at 8:11 PM

George W. The gift that keeps on giving.

/s/ Harry Reid, Nancy Pelosi, Hillary Clinton, etc.

Labamigo on July 2, 2012 at 8:14 PM

The Dems will press on until the entire country collapses under catastrophically delusional debt like a self-bankrupted California municipality finally realizing that its entire budget going to union retiree pensions is a tad unrealistic.

Nothing will teach the Dems but utter, impoverishing, grim, implacable calamity.

And if enough imbeciles play along, we’re marching to serfdom and Balkanization and national oblivion.

Thanks John Roberts, Esq.

profitsbeard on July 2, 2012 at 8:20 PM

TarheelBen on July 2, 2012 at 7:56 PM

That’s the point I’m trying to make. I don’t think they have the spine to do it. I agree with you on DeMint. Boehner and McConnell have to go or we’ll never even have a chance to get anywhere.

silvernana on July 2, 2012 at 8:24 PM

TarheelBen on July 2, 2012 at 7:56 PM

The polling will be a 2×4. It’s negative and it’s been negative.

Some of Congress has principles, and the rest will have to be reined in by fear of voters’ wrath.

INC on July 2, 2012 at 8:28 PM

Illegal aliens still don’t have to pay for health care by going to the Emergency Room…

… After all of this, we still have to pay their tab.

Wasn’t this one of the major causes in the increase of health care costs that started this whole thing in the first place…?

Seven Percent Solution on July 2, 2012 at 7:15 PM

Yep, the numbers of uninsured will grow, possibly doubling.

The illegal aliens will continue to get it free, because nothing is cheaper than free.

The mythical uninsured is just a hammer to hit us with.

slickwillie2001 on July 2, 2012 at 8:57 PM

Medicaid cost 20% of state budgets across the land…Since Obamacare includes a huge expansion in those eligible for Medicaid, what will be the new figure for state budgets? I was surprised that governors were not more vocal in opposition to O’care before it became law. Participating states will have to raise taxes to cover increases in Medicaid spending. This monstrous over-reach of the Federal government has more tentacles than an octopus. Governor Scott in Florida is taking the lead in resisting Medicaid expansion. We need the rest to follow suit…There is no money for this thing.

Nozzle on July 2, 2012 at 9:31 PM

Medicaid cost 20% of state budgets across the land…Since Obamacare includes a huge expansion in those eligible for Medicaid, what will be the new figure for state budgets? I was surprised that governors were not more vocal in opposition to O’care before it became law. Participating states will have to raise taxes to cover increases in Medicaid spending. This monstrous over-reach of the Federal government has more tentacles than an octopus. Governor Scott in Florida is taking the lead in resisting Medicaid expansion. We need the rest to follow suit…There is no money for this thing.

Nozzle on July 2, 2012 at 9:31 PM

Yep, that’s what we are drifting away from here, the first problem with Obamacare is that we can’t afford it. We is broke.

slickwillie2001 on July 2, 2012 at 9:48 PM

DOn’t worry SCott won’t be the last – less than 5 states will take the deal and if they’re smart none. It means bankruptcy. ANd for those staes foolish enough to do a complete dismantling of their tax base as business runs for the hills.

The beauty of this is that we will either ration care heavily or go broke with Obamacare – probably both. At that time it will be open season on democrats and GOP types who believe in money trees.

Zomcon JEM on July 2, 2012 at 10:15 PM

If ZeroCare gets fully implemented, it will result in the sharp increase in premiums, insurance companies driven out of business, and calls for a government takeover of the mess. That is the plan.

As for Zero, I’m not convinced that to him this isn’t a push in the direction of Cloward-Piven at a time when our economy is in peril and our debt is beyond staggering, again perhaps because of a previous stab at Cloward-Piven known as Stimulus.

Four more years of this and our economy is shot to hell. Is that the plan?

hillbillyjim on July 2, 2012 at 11:37 PM

I think the real tipping point will be when they try to seize the IRA’s and 401K’s.

Make no mistake. They will do anything to keep this circus going on for even one more week.

trigon on July 2, 2012 at 7:42 PM

If THAT happens and the pitchfork & torch brigades don’t start showing up, they never will.

MelonCollie on July 3, 2012 at 12:23 AM

They will want to address the debt with the highest ratio of tax increases to spending “cuts” as they can extract politically.

This is true, but it’s not complete. Democrats aren’t at all reluctant or afraid to cut social budgets. Just look at OCare, which cut Medicare $500 billion over ten years as a primary funding device. That’s just about equal, I believe, to the tax increases in the bill.

So, Damnocrats are happy to cut social spending. The catch is that they want to see those cuts spent only on new programs, on new entitlements, and never on debt or tax reduction. It gives them and their constituencies a false sense of having “accomplished something”.

MTF on July 3, 2012 at 6:34 AM

Sorry, but ANYTIME the government sticks it’s hand in my wallet (or purse), it’s a damn tax…whether it’s a license fee, a permit, or what have you…I do not care about the niceties. They take money from me, it’s an effing tax, period.

sage0925 on July 3, 2012 at 8:14 AM