In a sense, Jonathan Gruber’s response today to the emergence of his 2012 explanation for the language in ObamaCare mirrors the attempt to get courts to ignore the plain text of the statute and instead rule based on the most current interpretation. The New Republic’s Jonathan Cohn reached out to Gruber to get his reaction to the emergence of the Nobilis video in which the architect of ObamaCare explains that the restriction of subsidies to states with their own exchanges was a rational attempt to coerce states into creating those exchanges, rather than shifting the burden back to the federal government. Gruber calls that “a speak-o — you know, like a typo”:
I honestly don’t remember why I said that. I was speaking off-the-cuff. It was just a mistake. People make mistakes. Congress made a mistake drafting the law and I made a mistake talking about it.
During this era, at this time, the federal government was trying to encourage as many states as possible to set up their exchanges. …
At this time, there was also substantial uncertainty about whether the federal backstop would be ready on time for 2014. I might have been thinking that if the federal backstop wasn’t ready by 2014, and states hadn’t set up their own exchange, there was a risk that citizens couldn’t get the tax credits right away. …
But there was never any intention to literally withhold money, to withhold tax credits, from the states that didn’t take that step. That’s clear in the intent of the law and if you talk to anybody who worked on the law. My subsequent statement was just a speak-o—you know, like a typo.
In order to believe that, though, you’d have to ignore the plain meaning of the question Gruber was asked, and the plain meaning of the answer he gave. Gruber explicitly identifies states balking at running exchanges as one of the three main threats to the success of ObamaCare, at the 28-minute mark in the full video below. Note too at the time that Gruber stressed in the presentation that ObamaCare shouldn’t be seen as a federal takeover of health care in part because ObamaCare incentivized states to deal with the exchanges, an argument made at least in parallel to the point about the political threat to the law that balking states would create.
The second question after that argument went directly to that issue, with no misunderstanding the point (around 31:20):
Q: You mentioned the health implementation exchanges in the states, and it’s my understanding that if states don’t provide them, then the federal government will provide them. What do you say to that?
GRUBER: Yeah, so these health-insurance Exchanges, you can go on ma.healthconnector.org and see ours in Massachusetts, will be these new shopping places and they’ll be the place that people go to get their subsidies for health insurance. In the law, it says if the states don’t provide them, the federal backstop will. The federal government has been sort of slow in putting out its backstop, I think partly because they want to sort of squeeze the states to do it. I think what’s important to remember politically about this, is if you’re a state and you don’t set up an Exchange, that means your citizens don’t get their tax credits. But your citizens still pay the taxes that support this bill. So you’re essentially saying to your citizens, you’re going to pay all the taxes to help all the other states in the country. I hope that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these Exchanges, and that they’ll do it. But you know, once again, the politics can get ugly around this.
This answer is not a “speak-o” any more than the statutory language on subsidies and exchanges was a “typo.” Gruber explained the coercive policy correctly and in detail, along with the stakes involved in seeing the coercion succeed. It’s not a case of just using the wrong terminology, like “market” instead of “exchange.” Gruber clearly understood the statute at this time — in January 2012 — to provide the arm-twisting needed to get states to launch their own exchanges by stiffing consumers in states without them, which would then create more pressure on those states to get them the federal subsidies that they were funding but not receiving.
That is exactly what the plaintiffs argued in Halbig, and what the court ruled to be the intent of Congress as well as the statutory reality of the ACA. Just because that arm-twisting policy failed in its goals doesn’t mean it wasn’t deliberate, rational, and very much a part of the ObamaCare strategy then, and it doesn’t make it a “typo” now — or a “speak-o” either.