Good news: Leader of Romney's transition wants to implement ObamaCare exchanges

Remember, under ObamaCare states have a “choice” of either introducing their own exchanges — subject to federal regulations, natch — by 2014 or letting their citizens participate in the new federal exchange when it finally comes online. If you’re a Republican governor who opposes O-Care, the obvious move is to do nothing. By creating a state exchange now, you’re legitimizing Obama’s pet boondoggle before Republicans in Congress get a serious crack at repealing it and burdening yourself with a program that may yet be micromanaged by federal regulators even if the mandate is struck down by the Supreme Court. Resist implementation as long as you can and hope for the best in November.

Romney’s point man on his presidential transition, former Utah Gov. Mike Leavitt, disagrees. Ben Domenech explains:

One can argue about the merits of an exchange absent Obamacare’s rules, regulations, authority shifts, price controls, and taxpayer funded subsidies. But the overwhelming majority of conservative policymakers understand that Obamacare’s exchanges are nothing more than delivery mechanisms for massive taxpayer-funded subsidies and bureaucratic regulations from Washington. What’s more, states which avoid implementing exchanges may be able to avoid the implementation of Obamacare almost in its entirety…

What’s most concerning about all of this is not that Romney selected one of the few Republicans in the country who backs implementation of Obamacare’s exchanges. It’s what the selection of Leavitt means as an indication of how Romney would potentially “fix” Obamacare if repeal proves impossible. According to Politico, “already, plugged-in Republicans from Washington to Salt Lake City are buzzing that Leavitt could make his own transition next January into the job of White House chief of staff or as a Valerie Jarrett-like personal counselor to a President Romney.”

Should the Supreme Court strike down only a portion of Obamacare, it seems clear Leavitt would be a major voice in deciding how to replace it. And he is convinced that “exchanges are part of the future, no matter what.”

Team Mitt answered an e-mail about this from Matt Lewis by insisting that they’re committed to repeal, but that’s a dodge. A four-seat pick-up in the Senate in November isn’t guaranteed, and even if it happens, it’s not fully clear which parts of ObamaCare can be repealed via reconciliation, which requires just 51 votes, and which can’t. Domenech’s worry, quite understandably, is that if full repeal ends up being derailed due to procedural roadblocks, Leavitt will convince Romney to keep both the exchanges and the federal “oversight” mechanisms that govern them. Imagine how useful those mechanisms will prove to the next Democratic administration that wants to reclaim the dream of top-down command and control of health-care policy.

It gets worse. Turns out that Leavitt’s consulting firm has done some nice business in advising states on … how to set up health care exchanges. Philip Klein marvels at the possibility of Romney’s decisions on one of his key vulnerabilities being driven by the magical combo of big-government impulses and crony capitalism:

Romney has been incredibly vague about how he would reform the health care system in the absence of Obamacare. The danger is that he could end up replacing it with a system that still has exchanges, but exchanges that are billed as having fewer regulations, lower subsidies and giving more flexibility to states. The problem is that this would still put the basic exchange infrastructure in place that a future Democratic administration could build on so the country would eventually wind up with Obamacare anyway – or something worse.

Beyond the health care issue, there’s the cronyism issue involved. One of the biggest dangers of a Romney “CEO presidency” is that his business background would make him conflate being pro-business with being pro-free market. But as we’ve seen time and again, these are two separate things. As somebody who stands to personally profit if more states implement Obamacare exchanges, Leavitt clearly comes from the tradition of a Republican Party that’s perfectly okay with expanding government in the name of helping business. This is something we saw during the Bush administration, most prominently, with the subsidies for drug companies in the Medicare prescription drug law (which Leavitt helped implement ass HHS Secretary) and the Wall Street bailout.

Follow the last link for background on Leavitt’s time as governor. As Klein puts it, “Leavitt, in short, was exactly the type of Republican the Tea Party was founded to oppose.” The only reassurance I feel that Mitt won’t follow him down the path to supporting federally-managed state exchanges is that he simply can’t afford to. He has no political capital to spend on defending Obama’s signature government expansion given the suspicions that surround him because of RomneyCare. And he also won’t be able to count on this issue fading into the background after he takes office. The Supreme Court’s going to force it front and center in the next few weeks with its ruling on O-Care; unless the law is upheld in its entirety and the GOP fails to win a Senate majority in November, Romney will have to deal with either repealing or “fixing” the statute ASAP after he’s sworn in next year. If he betrays the right straight out of the gate, he’ll be left with no base of support for his presidency virtually from day one. And the risk of a primary challenge in 2016 is more real for him than it’s been for incumbent presidents past. The tea party proved its staying power by knocking off Lugar and propelling Deb Fischer to victory, and there’s already speculation that Rand Paul and Paulworld might be ready to challenge Romney if he veers too far left. Frankly, I wonder if some grassroots conservatives might not relish the chance to primary Mitt if he betrays the cause, partly to make up for him having won the nomination this time and partly because there’ll be no fear of a new Obama term in 2016 if a primary battle weakens Romney. (There may, however, be fear of a Hillary term.) Exit question: Can he really afford to alienate his base on something this huge and visible? C’mon.

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