Patterico's Pontifications

5/26/2015

NYT: How “Established by the State” Ended Up in ObamaCare

Filed under: General — Patterico @ 7:36 am



It’s a question I have asked Halbig hacks ever since I first heard of the case: how did those words “established by the state” end up in the law anyway? The New York Times says it kinda sorta has the answer:

The answer, from interviews with more than two dozen Democrats and Republicans involved in writing the law, is that the words were a product of shifting politics and a sloppy merging of different versions. Some described the words as “inadvertent,” “inartful” or “a drafting error.” But none supported the contention of the plaintiffs, who are from Virginia.

“I don’t ever recall any distinction between federal and state exchanges in terms of the availability of subsidies,” said Olympia J. Snowe, a former Republican senator from Maine who helped write the Finance Committee version of the bill.

“It was never part of our conversations at any point,” said Ms. Snowe, who voted against the final version of the Senate bill. “Why would we have wanted to deny people subsidies? It was not their fault if their state did not set up an exchange.” The four words, she said, were perhaps “inadvertent language,” adding, “I don’t know how else to explain it.”

I always enjoy these arguments that the phrase just happened to appear in the legislation on its own. By now, if you’re a long-time reader, it’s an old gag — but I like to established by the state just throw those four words in randomly, in the middle of sentences, just to show how they can accidentally pop up in the middle established by the state of a sentence without anyone ever intending it established by the state to happen.

This is a slightly more plausible explanation:

Russ Sullivan, the staff director for Democrats on the Finance Committee, gave a similar account. The language in the law providing tax credits through state exchanges was “a holdover from what we had in the Finance Committee,” which originally assumed that “every state was going to set up an exchange,” Mr. Sullivan said.

The idea of a federal backstop came later, he said, when people started asking what would happen if some states did not set up an exchange.

In other words, the people who wrote it falsely assumed every state would establish an exchange. Later, some people decided that wasn’t necessarily true, and established a federal backstop but forgot to change the original language. This actually seems plausible to me.

The question is: what do you do when many of the people voting for the bill assumed it said one thing, but it actually says another? Are we really just to alter clear language simply because some of the supporters later say it doesn’t read the way they assumed it did?

Under that argument, you could say the bill provides for subsidies for low-income people who qualify for Medicaid. After all, the drafters of the bill couldn’t possibly have meant to deny subsidies to low-income people — the very people who need subsidies the most. Yet that is exactly what ObamaCare does, because lawmakers assumed (there’s that pesky issue of poor assumptions again!) that every state would expand Medicaid. So why provide subsidies for the poor when Medicaid would fill the gap?

Under the theory that “we can make the law say anything we claim we meant it to say,” leftists could simply shrug off the insignificant detail that the law does not provide subsidies to low-income people, and give it to them anyway. I’m honestly shocked Obama hasn’t tried that, but maybe he’s waiting for the outcome of this case. If the Supreme Court sanctions the “to hell with the language” policy, he can have the IRS make a “rule” that says low-income people get subsidies too. Add to the mix the lovely Chevron rule that unconstitutionally makes omnipotent kings out of bureaucrats, and Obama can “fix” any “problem” caused by Congress’s failure to actually enact what a group of leftists believes is the “spirit” of the law.

Anyway, I used to think the outcome of this case would matter, but let’s face it. Republicans will give out the subsidies that Democrats never actually voted for in the first place, because to do otherwise would run counter to the inviolate principle that We Must Always Make Government Bigger or Else Voters Might Get Upset. It’s all about the realism, you see.

We had a pretty good country up until the 1930s or so.

46 Responses to “NYT: How “Established by the State” Ended Up in ObamaCare”

  1. Oh: I’m back, by the way. I was in Fort Worth watching the Colonial and hanging out with family and friends last week. Thanks to the guest posters for keeping the place alive.

    Patterico (3cc0c1)

  2. what do you call people who don’t have to have their lazy coward loser asses subsidized for everything?

    Chinese!

    happyfeet (831175)

  3. he can have the IRS make a “rule” that says low-income people get subsidies too.

    Don’t give him any ideas, please!

    Anyway, I used to think the outcome of this case would matter, but let’s face it. Republicans will give out the subsidies that Democrats never actually voted for in the first place, because to do otherwise would run counter to the inviolate principle that We Must Always Make Government Bigger or Else Voters Might Get Upset. It’s all about the realism, you see.

    Joe Scarborough this morning said he voted for Ron Paul in 2012 as a protest because he felt all the others were “big government” Republicans. Now if MSNBC’s token Republican thinks they were too much in favor of big government…..need I say more?

    kishnevi (9c4b9c)

  4. Given what we know now, should the Democrats have rammed Obamacare down our throats the way they did?

    AZ Bob (34bb80)

  5. They must be really worried about losing to work the refs this hard, this late. It’s hard to see any way the republican leaders will have the strength to resist the siren call for fixing a bad law that should have never been written. PPACA was always about ensuring payment to insurance companies and big providers and never about providing affordable care. Patients were just pawns. Instead of opening the market they closed it.

    crazy (cde091)

  6. Left unexplained and unexplored by the Times – why did ObamaCare and Romneycare architect Jonathan Gruber believe (and repeatedly explain) that subsidies only went to the states that played ball?

    As to the notion that the Feds would actually withhold money from any states that did not play ball, well, butter may not melt in Olympia Snowe’s mouth but that coercive tactic is time-honored in Washington and, IIRC, was a key aspect of the lawsuit revolving around the Medicaid expansion.

    Hmm. To put a twist on Patterico’s argument, if withholding ALL Medicaid funds (including to existing programs) to states that did not expand coverage was unconstitutionally coercive, then maybe the notion of withholding ALL subsidies to states that did not build an exchange could also be found to be unduly coercive. So the court might find that yes, the “established by the state” language is clear, but in practice it is also clearly out of bounds. More Robertian wordplay.

    Tom Maguire (f74d9b)

  7. The dog ate their homework!

    Patricia (5fc097)

  8. @4- Just the practice of reading and understanding a piece of legislation before voting for or against it would have nipped this in the bud. Radical, I know, but that’s the way I am.

    @6- I think the idea of using the Federal subsidy as bait to get the states to establish exchanges has some credibility. Look at how they use federal highway funds to coerce states into stupid stuff like 55mph speed limits and such… Its not a new concept.

    [Insert clip of Pelosi’s “…you have to pass the bill to see what’s in it…” here]

    Gramps, the original (9e1415)

  9. In what way was the country better before the 1930s? What could people do before then that they can’t do now?

    Jonny Scrum-half (ac7546)

  10. This is an important story, so I hope you will stay with it, Patterico.

    My own sense is that the Democrats are deathly afraid of re-opening Obamacare for any revision. They sense that anything like that would result in revising the whole thing in a free-market direction. I think this is the reason for all the changes being made by a process of administrative law. One of the goals of any future conservative administration should be returning law-making power to Congress and reining in regulation.

    Charlie Davis (98ab9d)

  11. Raise your hand if half-sack’s nonsense surprised you.

    JD (36be1a)

  12. Buy a Tommygun at the hardware store with gold double eagles (eleven of them) and carry it down the street while smoking a marijuana cigarette (subject to state and local laws).

    nk (dbc370)

  13. hey NK, how have you been, remember Pear was one of the reporters dead set against welfare reform, back in the 90s, even wrote a “Pottersville’ piece in order to discourage Clinton from signing the bill,

    narciso (ee1f88)

  14. “When history calls,history calls” stated olympia j snowe in 2009, when she was the lone deciding rino to vote for the finance committees health-care reform bill. It passed because of her. She should shoulder much of the blame, definitely a commie.
    Greetings, nk.

    mg (31009b)

  15. Olympia was part of Meghan’s coward daddy’s Soros-funded Republican Main Street Partnership

    #theydidsomethingtohisbrain but I’m not sure what her excuse is

    near as i can figure it’s acute lobsterpot bimbo syndrome

    happyfeet (831175)

  16. I don’t suppose there’s a chance in hell that we can hold the Legislative idiots who voted for the thing to the letter of what they voted for, to teach them to fucking READ what they vote for?

    Thought not.

    C. S. P. Schofield (a196fd)

  17. What could people do before then that they can’t do now?

    Not give any of their income to government, or tell them where they got it, or tell them how they spent it.

    Kevin M (25bbee)

  18. Before 1930, most people could go their whole lives without having any contact with the federal government, except maybe serve a hitch in the army, and the post office.

    Kevin M (25bbee)

  19. Kevin M @16-17 – Okay, that’s good, I guess. But many people in rural areas could go their entire lives without electricity, as well, which was changed because of federal government intervention. There’s trade-offs in everything. What’s so uniquely horrible about “contact with the federal government,” anyway?

    Jonny Scrum-half (ac7546)

  20. Hey, guys. Thanks for the kind words.

    Johnny, even if you don’t see a problem with lost liberties, you could at least consider how much more a person has to work to support government drones and cronies since the 1930s. I’m starting to develop a theory that our Congresscritters’ first priority is to create and fund government jobs for their staffers when they move on.

    nk (dbc370)

  21. “What’s so uniquely horrible about ‘contact with the federal government,’ anyway?”

    Well, some of us don’t like having our lives micro-managed by power-mad commissars.

    pst314 (ae6bd1)

  22. I have said it many times. Every bill should be read, in its entirety, in both chambers before a vote. And only those that have listened to it, in its entirety, may vote.

    Gazzer (d3f7b0)

  23. if they take away my subsidy I’m gonna boycott my food stamps until they pay up

    damn right I’ll use cash see if i care

    happyfeet (831175)

  24. while y’all are busy pointing out the obvious to our oblivious scrunt-half, i’d just like to mention that the cost of Obola Care is going up again…

    #Unexpectedly!

    redc1c4 (4db2c8)

  25. I fear we are deeply into the “bread and circuses” phase of our “American Empire”.
    We live in a country and time when the President can lie directly to our faces about our basic needs (i.e. healthcare) and it is “OK”,a time when we are told like stupid children our Embassy was attacked because of a hateful video (i.e. its partly our fault for not being inclusive), where the SOS can steal Federal Records, destroy them, be part of an anti-American money laundering racket that would make Madoff blush, then run for President, and be worshiped and feted for it.

    We have quickly, it seems, become an amalgam of Brave New World, Nineteen Eighty Four, and most tellingly, Idiocracy (the movie). I greatly fear for our country, and this next Presidential election may be the genuine tipping point toward the last days of this once great American experiment.

    Patrick (ce7fc3)

  26. well the Carlos Slim chronicle, and it’s west coast affiliate do agree on that point,

    narciso (ee1f88)

  27. I’d say about the time we started murdering people who didn’t want to remain in
    the Union under that conditions that were being enforced.

    Sure they couldn’t just up and leave like that but we should’ve found a better
    solution than killing them and laying waste to their homes and cities.

    That is the point when the Federal Government (capital F, capital G) came to the
    fore and the income tax wasn’t too long after either.

    Slippery slope and here we are circling the drain.

    jakee308 (49ccc6)

  28. It’s the law of inertia. The US was rapidly generating great wealth for far more people than ever in the history of the world. And then the Progressives came in. Woodrow Wilson, Theodore Roosevelt, Franklin Delano Roosevelt, and put the brakes on everything. They fought the inertia of the US, which was an expanding economical machine, and created a new inertia, which is a hobbling economical machine.

    I just returned from my third trip to the Philippines, a third-world country that is trying to emerge into a first-world country. People there live without electricity in many parts of the country, very near to the cities. People in the cities live in very crowded conditions. They make 250 dollars a month if they don’t have a college degree and 450 dollars a month if they do. They don’t expect huge WIC handouts, huge FoodStamp handouts, huge checks to pay for free housing. They don’t have free public education at any time. They don’t have 5-day, 40-hour workweeks (it’s longer). And, quite honestly, they are far friendlier as a whole than Americans (who suck government-mandated money out of other people’s pockets). I hope the Philippines never get trapped by the Socialist Big Government wealth destruction machine the US has built. Because they’ll never make it to first world if they do.

    John Hitchcock (b6cc03)

  29. I recognize that the USA probably wouldn’t exist if there hadn’t been a compromise
    on the question of slavery but the fact is that we took that poison to our bosom
    as we founded the country and now the poison has fully spread throughout the land
    to the point where we soon will be no more.

    Everything you can point to right now that is destroying the country has it’s
    “roots” in slavery and/or the Blacks’ cultural dissonance.

    jakee308 (49ccc6)

  30. nk@19 – I’d be surprised if people worked longer hours now than before 1930.

    Jonny Scrum-half (ac7546)

  31. My own sense is that the Democrats are deathly afraid of re-opening Obamacare for any revision.

    I agree but Obama will probably veto any change to his “signature legislation.” If Republicans were smart… but I digress.

    Mike K (30e542)

  32. Perry, I work over 100 hours a week.. sorta. Much of my hours working are for zero dollars an hour.

    John Hitchcock (b6cc03)

  33. I greatly fear for our country, and this next Presidential election may be the genuine tipping point toward the last days of this once great American experiment.

    Sorry Patrick, the last Presidential election was the tipping point or haven’t you noticed the corruption of the government, the riots in the streets and assorted other indications we’re going down the drain like jakee308 pointed out. When a political party and half the voters believe in destructive ideas like abortion, SSM, food stamps, open illegal immigration etc. where else can the country go? It sure ain’t going up, is it?

    Hoagie (f4eb27)

  34. yes yes yes

    Mr. Hoagie is correct

    it’s all failure management from here on out

    poor failmerica

    you coulda been a contender

    happyfeet (831175)

  35. OT: Judge Hanen upheld by 5th Circuit.

    askeptic (efcf22)

  36. well there is a concern, back when the Razorback borgia, won the second time:

    http://inagist.com/all/603263302521651200/

    every once in a while, we get a little hope,

    narciso (ee1f88)

  37. Sorry Patrick, the last Presidential election was the tipping point or haven’t you noticed the corruption of the government

    Yes, of course I noticed… I well remember the liberals and movie stars with tears rolling down their cheeks when the second black President (Barack Obama) was sworn in… (Wild Bill was the first… and Obama has now one-upped him by being the first Jewish President)

    I hope or hoped that the election of this anti-American liberal solely on the basis of his color would eventually wake people up.

    I think they are waking up, but the question is: Is it too little too late?

    Sometimes addicts have to hit bottom so hard they almost don’t survive the experience and have to claw their way back.

    It heartens me that liberals are fighting each other in California over the drought and their numbered days of potable water. This is the type of situation the liberal must face — die of thirst or change — before they’ll make rational decisions.

    Not that do or die is predictive… California liberals may well simply blame their water predicament on global warming, Bush, Boehner and the War in Iraq as they fight in the streets and pay $50 an ounce for water and raise taxes for hydration entitlements.

    Patrick (ce7fc3)

  38. The bad news is that over Memorial Day 29 were wounded and 9 killed in shootings and in Chicago 43 wee wounded and 12 killed. Obviously left wing, black, democrat administrations work especially when they have draconian gun laws for law abiding folks. The good news is some, perhaps some, will be covered by Obamacare so only the Vets won’t be treated.

    Hoagie (f4eb27)

  39. Sorry. The 29 and 9 were in Baltimore. Tell ya, the democrats kill more black Americans than the KKK ever dreamed of and the dopes still vote for them. Even the dead ones!

    Hoagie (f4eb27)

  40. Regulated monopolies always end in tears. Why is the left so fond of fascism? It’s like that crazy, beautiful person that you go back to after the hit to the back of the head with a cast-iron frying pan. Sure, the cracked skull was painful, but heck, let’s do it again. It may work this time.

    Ag80 (eb6ffa)

  41. Re this comment from our host:

    We had a pretty good country up until the 1930s or so.

    This immediately brought to mind a presidential biography I read earlier this year, one that filled in substantial gaps in my own 20th Century knowledge and that I highly recommend: Amity Shlaes’ “Coolidge.” As terse and direct as its subject, it’s the tale of the last American president who actually gave a damn about cutting the federal budget and restraining the scope of federal authority.

    Beldar (fa637a)

  42. …In other words, the people who wrote it falsely assumed every state would establish an exchange. Later, some people decided that wasn’t necessarily true, and established a federal backstop but forgot to change the original language. This actually seems plausible to me…

    But why did they assume that every state would establish an exchange? It’s precisely because of this language the Obamacare fanbois now claim to be a complete mystery to them. They took a carrot and stick approach, and basically made the states an offer they thought they couldn’t refuse.

    If the states implemented their own exchanges then their residents would qualify for subsidies. If the states didn’t, no subsidies. The ACA also includes language that requires the IRS to notify taxpayers what their subsidy would have been. The thinking was that would have created a groundswell of support for states that didn’t implement their own exchanges originally to get off the stick and create a state exchange.

    The language is deliberately in that bill for a reason.

    Russ Sullivan, the staff director for Democrats on the Finance Committee, gave a similar account. The language in the law providing tax credits through state exchanges was “a holdover from what we had in the Finance Committee,” which originally assumed that “every state was going to set up an exchange,” Mr. Sullivan said.

    It’s a holdover from what they had in language in previous attempts at legislation because they always figured they’d have to attempt to coerce states to create their own state run exchanges. What this Russ Sullivan character is revealing is that this wasn’t the Democrats first crack at socializing the health care system. They knew that states wouldn’t just spend billions of dollars creating health insurance exchanges and massive new bureaucracies unless the feds provided strong enough pressures on them them to take on the effort and expense.

    And help create the illusion that Obamacare was reducing health care costs by allowing the feds to shift some of their health care spending burden to the states.

    I hope the Supremes are getting an earful about how it isn’t just that the subsidies that are illegal. When someone who according to the feds should be getting their health insurance from their employer qualifies for a subsidy on the exchange, then the IRS inflicts massive penalties on the employer.

    And as we all know, thanks to Roberts, those are actually taxes. Thanks to Chief Justice Roberts we know that that it’s within Congress’ constitutional authority to create Obamacare taxes. But these aren’t taxes that Congress created; they only kick in if someone gets a subsidy, and Congress didn’t authorize subsidies in states that refuse to implement their own exchanges. The IRS through this rule created billions of dollars in new, unconstitutional taxes. There is nothing in the statute that about Congress authorizing any of this.

    Steve57 (4f6474)

  43. Ace helpfully reminds me, and all of us, that the four words were not artifacts of all previous attempts by Congress to pass health insurance related legislation.

    http://ace.mu.nu/archives/350808.php

    WaPo’s Greg Sargent Devastates Halbig Case Against Obamacare Federal Subsidies With Bombshell Reporting (JeffB.)

    Guest post by JeffB./@esotericCD.

    Wait, did I say “devastates?” I meant “vindicates.” I get confused about stuff like that sometimes. Then again, in my defense, so does Greg Sargent. Let me explain. This is a lengthy post, so fair warning…

    …So now, rushing into the breach, here comes Crack Legal Correspondent Greg Sargent of the Washington Post, with his breathlessly reported scoop that will save the day for the Left:

    Senate documents and interviews undercut ‘bombshell’ lawsuit against Obamacare

    Let’s pause for a moment and savor that headline on its own for the spectacular own-goal carnage that’s about to follow…

    …Thanks to Sargent’s crack reporting we have now confirmed that earlier iterations of the ACA specifically granted subsidies to federal exchanges…but that, for whatever reason, this language was later stripped from the bill.

    The subsequent blathering about “why” this language fell out of the bill (“drafting errors,” you see) is immaterial as far as the Court is concerned, and this is apparently what Sargent doesn’t seem to realize; in a case where the wording of the statute is otherwise clear, the Court’s inquiry will stop cold right here — or at least it should.

    So, the Democrats could have used the exact language that was in one of the predecessor bills to Obamacare that would have made subsidies available on the federal exchanges.

    And they deliberately chose not do use that language. For the reasons I mentioned earlier; had they made subsidies available on the federal exchanges then the states wouldn’t have bothered setting up their own.

    Steve57 (4f6474)

  44. “We had a pretty good country up until the 1930s or so.”

    You’re off by a century. It was during the 1830’s that this nation started moving decisively against some of the foundational principles enunciated by the most vocal and legislatively successful early leaders.

    But then to be totally accurate things started to go awry on July 5 1776.

    The idea that there was ever a halcyon period where everything was wonderful is wrong. There have been competing factions from day one. The character of the American people has changed as people came here after the land was tamed and thus brought a different notion of how things should be, and that dynamic is accelerating as I type.

    The line of leaders one has to “blame” is almost endless but the uncomfortable fact is that the American people have chosen this amount of government. We have what we voted for. A little bit here a little bit there.

    Jackson, Polk, Lincoln, TR, Wilson, Hoover, FDR, Johnson, Nixon, Bush 1, Bush 2, Obama.

    All expanded the reach and power of the Federal Government. And others before them and after them.

    Mark Johnson (751494)

  45. 44. Washington, Adams, Jefferson, Madison and Monroe belong on that list.

    kishnevi (9c4b9c)

  46. NYT Shows No One Buys Government’s ‘Term of Art’ Argument in King v. Burwell

    Read more at: http://www.nationalreview.com/bench-memos/418893/nyt-shows-no-one-buys-governments-term-art-argument-king-v-burwell-michael-f

    Steve57 (4f6474)


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