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Backfire: Dems beg Manchin to use reconciliation to rescue them from ObamaCare trap

AP Photo/J. Scott Applewhite

Spend a couple trillion in haste, repent at leisure. Joe Biden thought he could buy votes with his American Rescue Plan (ARP) in March 2021, especially with a key ObamaCare expansion that provided even more subsidies to enrollees. And it worked — in the short term. Millions of enrollees took advantage of the subsidies, just as they did with the stimulus spending.

Of course, what everyone ended up getting out of the reconciliation-passed ARP was 40-year highs in inflation, broken supply chains, and the exposure of the Biden administration’s utter incompetence on economics. Most of the votes that Biden thought he’d bought with ARP have apparently fled from his catastrophic governance. And it’s about to get worse, Politico reports this morning, thanks to his temporary ObamaCare expansion:

Just six months out from the midterms, Democrats increasingly fear they’ll fail to renew those generous subsidies, which expire at the end of the year, triggering sudden spikes in insurance premiums and wiping out one of Biden’s signature health care accomplishments.

The price hikes would hit an estimated 13 million people across the country, potentially adding hundreds of dollars to families’ monthly expenses. And in a painful twist for a White House already struggling to contain anger over rising household costs, voters would begin receiving notices about their premium increases in October — around the same time they’re starting to cast their midterm ballots.

What genius thought up that plan? Oh, Biden. Right. Excuse me, but … I just can’t resist:

Presumably, Biden’s Build Back Better bill would have resolved this issue, tucked into the $5 trillion of additional off-budget spending that would have made our current level of inflation look like deflation. They would have had to pass such a continuation under reconciliation for the same reason Biden added it to the ARP, even though it wasn’t related to the COVID-19 pandemic. Republicans wouldn’t vote for an ObamaCare expansion then, and they won’t vote for it now.

However, Biden wrote a check that he can’t cash, and voters will start seeing it bounce just as they’re going to the midterm polls. So how can they rescue themselves from their own American Rescue Plan? They need to ask Joe Manchin to save them — and they need to act fast to do it, too:

Despite the urgency, Democrats acknowledge there’s only one way to avert disaster: Strike a deal with Sen. Joe Manchin (D-W.Va.) on a reconciliation package.

Maintaining the subsidies is projected to cost tens of billions of dollars per year. And with Republicans uniformly opposed to continuing them, tucking an extension into the broader partisan bill is the last available option before the midterms.

That’s added yet another wrinkle to a negotiation between Manchin and Democratic leaders that has so far focused on just three areas: climate provisions, drug pricing and deficit reduction. …

Senate Democrats also are anxious about the impact a rate shock could have on their ability to keep control of the chamber. The worry has further fueled the desire to pass a reconciliation bill by July 4, just before insurers in many states begin locking in their rate hikes.

Will Manchin go along with this? He has insisted on an upper cap ($1.8 trillion) on any reconciliation package thanks to the runaway inflation Biden catalyzed, and that problem is getting worse rather than better. If Democrats throw this into the mix, Manchin seems likely to demand that they take something else out. That something else would probably be climate-change projects, an area of only mild interest to Manchin in the first place. Manchin spent yesterday using Interior Secretary Deb Haaland as a proxy punching bag for Biden’s idiotic energy policies.

Manchin’s probably sympathetic to ObamaCare spending, but even he will have to see the trap being laid here. Politico doesn’t have the actual costs of this subsidy program in a reconciliation package, but they note that the program will cost “tens of billions of dollars per year.”  How many years will a reconciliation bill fund? If they craft this for a ten-year window, then it’s well over a trillion dollars even before they get to any other components in reconciliation. Manchin balked at spending any more than $1.8 trillion before, and he wanted a good portion of that to go to deficit-reducing activities. Not only will this be difficult to offset in a reconciliation bill, it will make deficit spending worse.

And worse yet, there will be no end to the exact same situation Democrats now face. Those subsidies will run out again, and it will create yet another political emergency for Democrats, and the only solution will be more spending. Manchin’s already not in the mood for structural deficit spending, or so he says. And finally, Manchin has to wonder what other “emergency” his fellow Democrats demand that he rescue them from in this reconciliation bill.

Perhaps Manchin should just let Biden and Schumer take the consequences of their stupidity in the American Rescue Plan. If Manchin’s seeing this clearly, it will be his only choice. They’re going to get shellacked anyway — this won’t help them pull votes back across the aisle, only prevent them from losing more — so why agree to even more economic damage at this point?

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John Sexton 8:00 PM | December 13, 2024
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