Friday, June 26, 2015

Lily, Rosemary & the Jack of Hearts

Longtime KPC friend and advisor @GaddieWindage interrupted his pilgrimage to St. Andrews to commune with us about SCOTUS, the ACA, and the GOP.

Here’s Keith:

Why was a vague liberal law passed by Congress upheld by a conservative Court?

And why is Congress actually lucky that the Court upheld the law?

Precedent and legislative intent saved the law.  The Court, confronted with ambiguity in the law, looked to the broader structure of the law.  Chief Justice Roberts and the 6-3 majority assessed Congress’s intent, determining that it “passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible, we must interpret the Act in a way that is consistent with the former, and avoids the latter.” 

In looking at the act, the Court determined that ‘inartful drafting’ of the massive law was insufficient grounds to strike down a key provision.  Congress’s larger intent was to have all Americans be eligible for insurance tax credits, regardless of technical failures in the legislative language.

The outcome saved the Republican-controlled Congress from a potentially disastrous situation. Had the Court overturned the PPACA tax credit for individuals covered by the national health exchange, it would have wiped out expanded coverage for millions of low-income earners. The result would be two health insurance systems: one made of state health exchanges where people had broad-based coverage and also received a national subsidy; and another made up of states with far more uninsured who nonetheless paid taxes to subsidize healthcare elsewhere.

The chaotic disruption of the marketplaces in those states would have created a ‘death spiral’ for insurers who had organized and invested based on the new regulatory regime. Those insurers are also major campaign donors.  If Congress failed to restore the tax credit, voters who lost health coverage might have mobilized against congressional Republicans in the 2016 elections.

I have seen a lot of people excoriating John Roberts and talking about how liberal SCOTUS has turned under his leadership, but I am not buying it.

This decision was a no-brainer, and was far from a liberal decision, just as the ACA is not really a liberal policy.

Here’s Keith again:

It is, in many ways, a conservative decision. The Court has moved to protect a rent-seeking market.

Indeed.  The ACA is a massive, fugly, boondoggle that just backs more voters and more firms up to the trough.

A liberal policy would be government-run single-payer with tough price controls that ate into the incomes of doctors and cut the profits of big medicine.

A libertarian policy would be to stop the AMA from shrinking the supply of doctors, loosen licensing on many types of health care, allowing interstate competition among insurers, and so on.

The ACA is rent seeking on steroids. You know, just the way most conservatives like things.


Anonymous said...

"The ACA is rent seeking on steroids. You know, just the way most conservatives like things."

Sorry, but your suggestion that rent-seeking is more characteristically conservative than progressive doesn't hold water.

mgillesp said...

Well maybe not conservative in principle but certainly in practice since its the big hogs who are getting the vast majority of the slop and most of them are (very) wealthy and Republicans.

Gene Callahan said...

Anonymous, "conservative" is a term with many meanings. Rent-seeking is "conservative" certainly in the sense of "the way things are usually done."

From whence the title? (I know the song, I'm just wondering how it is connected to the post.)