The Uncomfortable Truth About the Republican Defeat

Republicans Will Continue to Target Obamacare

A couple of months ago, in “Is Obamacare Working? Or Is It a ‘Train Wreck?”, we wrote that the Affordable Care Act had enough potential problems that it might implode of its own accord. And that was before the disastrous roll-out of the government’s attempt at building a health insurance exchange.

Republicans watching the public’s exasperation with the balky system from the sidelines are chortling over Obama’s fiasco. “#TrainWreck: Skyrocketing Prices, Blank Screens, & Error Messages”, was the tweety headline on a press release Friday from House Speaker John Boehner of Ohio. “To our Democratic friends: You own ‘Obamacare’ and it’s going to be the political gift that keeps on giving”,
said South Carolina Senator Lindsey Graham. “Obamacare will now be the issue for the next few years”, wrote the Heritage Foundation’s Jim DeMint in The Wall Street Journal. “I will do anything to stop train wreck of Obamacare”, says Texas Senator Ted Cruz.

obsession

Newly emboldened by seeing the “train wreck” come true, Republicans plan to continue a relentless assault on the beleaguered health care law. “It’s going to be fight every hedgerow, fight every ditch. It’s just like trench warfare in World War I”, was the prediction in Bloomberg/Business Week of Tim Jost, a health law professor at Washington and Lee School of Law.

Only 29% in a Gallup poll favor full repeal of the health care law, but that does not give pause to Conservatives and Libertarians who despise it as government overreach for forcing people to buy what they might prefer not to, and for helping them buy it with a massive program of subsidies that the Wall Street Journal estimated will run to $1.762 trillion over 10 years. The Journal editorial page said, “This is Mr. Obama’s dream of expanding government to create a permanent entitlement state”.

But that manic pronouncement falls apart when one stops to realize that 80% of Americans are already covered either by their companies, Medicare or Medicaid. For them nothing changes.

Republicans in and out of the government are deploying every weapon in their arsenal to defeat the Affordable Care Act (ACA), with tactics that go well beyond their symbolic but futile 40-plus attempts to repeal the Act in the House.

Republicans see an opportunity to gain control of the Senate when four Democratic senators who voted for Obamacare face re-election in 2014. A planned campaign against them will ask them why they voted for the problem plagued law.

Democrats across the states will be similarly targeted. But it doesn’t stop there. The conservative faction that led the fight against Obamacare have those Republicans who voted to re-open government and raise the debt in their cross hairs with the intention of replacing them with allies of their cause.

exploiting weakness

The requirement that companies with over 50 employees must provide their health insurance was put off for a year by the White House, but Obamacare foes can already point to people losing income from widespread cutbacks in hours — 313 businesses and 30,377 workers so far, says National Review — to below the 30 hours a week threshold above which they must pay for their personnel.

Republicans asked why business should have a reprieve and not individuals? Why shouldn’t the mandate that we all buy insurance be delayed for a year in parallel?

In Obama’s waiver to business Republicans saw an opening to crush the economics of Obamacare. Key to its success is bringing everyone into the insurance pool, with premiums paid by the young and healthier counterbalancing the costs of the older with medical problems. The White House estimates that 2.7 million healthy 18 to 34 year olds are needed to provide that offset. An online system that makes it difficult to sign up for insurance will likely cause the younger and healthier will turn away, whereas the older and sicker will press on to get insurance. Without premium payments from the young, insurers’ costs for accepting all with pre-existing medical problems — as mandated by the law — will cause costs to skyrocket.

But the mandate is weakened by penalties for not buying insurance well below the cost of insurance, and nothing in the rules prevents them from waiting to opt in only when and if they become ill at some future date. The Tea Party group FreedomWorks is encouraging Millennials to do just that — don’t buy in until they acquire that pre-existing condition that insurers cannot turn away. Failure is assured for a law that “depends on people acting against their self-interest” is Ramesh Ponnuru’s view at Bloomberg.com. “Since when was free-loading a conservative value?”, asks Andrew Sullivan at The Dish.

The House also tried to prohibit the Internal Revenue Service from involvement in the law. Its role is crucial. Subsidies take the form of tax credits, which the IRS would administer. And it is to act as the enforcer, imposing penalties on individuals and companies who fail to meet the law’s requirements. House Majority Leader Eric Cantor (R-Va) says “The IRS” — in his view all of it, apparently, not just the Cincinnati unit discovered targeting right-leaning non-profits applying for tax-free status — “has been abusing its power” and “the last thing we should do is to allow the IRS to play such a central role in our health care”. The IRS “will have access to the American people’s protected health care information”, said Cantor. That happens to be an absolute falsehood.

These efforts at sabotage, like the votes to repeal, could not hope to survive the President’s veto, but such negativism serves to set the public against the law. Those whose companies pay for their health insurance are happy with that tax-free handout and don’t want anything to change. But as a hypothetical, assume repeal. Some in that group will inevitably will lose their jobs and then discover what an individual’s insurance policy costs absent the new exchanges or that even a minor pre-existing condition gives insurers an excuse to deny them insurance altogether. Out in the cold, these same people would likely realize that their former negative opinion of the health care act was ill-considered.

Beyond the Beltway

The group co-founded by Karl Rove, Crossroads GPS, is running an over the top video clumsily called ObamaCareNado that has a tornado causing “a rising tide [sic] of health care costs” with “nobody safe from its wrath”.

Dick Armey’s creation, FreedomWorks, advises everyone to burn their Obamacare cards as an act of protest. But there are no Obamacare cards. FreedomWorks intends to design one that you can print from the Internet, and then burn. (We’re not kidding).

More serious are the scores of law suits around the country that take aim at Obamacare’s particulars. Catholic run organizations want the requirement that insurers must pay for contraceptives struck down. The Goldwater Institute has sued to eliminate the Independent Payment Advisory Board — the “death Panel” that would “ration” care if costs exceed targets. One suit even wants to invalidate the law altogether because spending bills should originate in the House, says the Constitution, but the Affordable Care Act was first passed by the Senate. Another suit says that there is no provision in the Act for subsidies to be issued by the federal exchange — a calamitous defect thanks to faulty wording in the law.

“Almost no law as sprawling and consequential as the Affordable Care Act has passed without changes … known as ‘technical corrections’ …in subsequent months and years”, The New York Times and others have pointed out, listing a number of examples. But there’s the rub. It is Congress’s job to make such repairs, but Republicans intend to block any fixes whatsoever as their way to bring Obamacare crashing down.

Obama, in an early-August press conference, clearly thinks it is lunacy:

“I think a really interesting question is why it is that my friends in the other party have made the idea of preventing these people from getting health care their holy grail, their #1 priority. The one unifying principle in the Republican Party at the moment is making sure that 30 million people don’t have health care. At least they used to say, well, we’re going to replace it with something better. There’s not even a pretense now that they’re going to replace it with something better. It’s become an ideological fixation”.

Obama’s “Signature” Achievement May Have Signed Its Death Warrant

Republicans have for weeks been calling the Affordable Care Act a “train wreck” well before it had even left the station but the sputtering October 1 debut made it clear that Obama doesn’t know how to run the railroad.

You’ve got to wonder, how could the President have paid so little attention to the status of what is endlessly called his “signature” achievement that he would say on the same day the government’s Internet insurance exchange crashed that people will be able to shop “the same way you’d order a plane ticket on Kayak or a TV on Amazon”.

Instead, the insurance “marketplace” was let loose for the entire country to beta test, but Obama has “brought in some of the best IT experts from across the country” to deal with the emergency, says a White House e-mail, experts who should have been involved from the beginning. Almost three weeks after launch, Obama said in a Rose Garden appearance, “Nobody’s madder than me about the fact that the website isn’t working as well as it should, which means, it’s gonna get fixed”, as if the commander in chief can simply order millions of lines of code to rearrange themselves. Most predictions expect that repairs will take weeks. Our forecast is months, and that could bring Obamacare down.

famously aloof

Did Obama simply take the word of equally non-technical Health & Human Services (HHS) chief Kathleen Sebelius (a former governor) that “we’re on target”, as she said in a July interview after months of “projecting optimism and confidence”?

Sebelius would soon exhibit cluelessness of her own. A week after the government’s exchange opened, when asked by Jon Stewart on the Daily Show, “How many have signed up thus far?”, she answered, “Fully enrolled, I can’t tell you. I don’t know”. We are now told that in the months before the system would debut, she reportedly misallocated her time traveling the country to promote it, instead of constantly monitoring the progress of the hugely complex system, which could have headed off the disastrous launch. There are calls for madam secretary to resign, as the one ultimately responsible for the botched system, but Obama cannot allow that. Republicans in the Senate would block any nominee he put forward, leaving the department headless.

overflow

Fourteen states either couldn’t be bothered to roll their own system or preferred to undermine Obamacare by not cooperating, leaving the federal government to handle the exchanges for the rest of the states. Visions of deluge should have panicked the Obama administration. Ms Sebelius said that the website’s inability to handle the load would not have occurred “unless millions of people flooded the marketplace”. Surprise! There are millions in the 36 states. So there were 9.5 million visitors in the first week and 4.1 million in the second.

States were better prepared. New York dealt with about 2 million visits in its first 90 minutes; California recorded 5 million on opening day. The HHS secretary belatedly concluded, “We didn’t have enough testing, specifically for high volumes, for a very complicated project.” Ya think?

Months before, they could have found a hacker to launch a distributed denial-of-service attack to bombard the prototype exchange website with increasing loads of millions of logon to reveal at what point the system breaks. They would have discovered well in advance that another warehouse of servers was needed.

Actually, Secretary Sebelius did say that the system had been stress tested. They had set the bar at five times the highest volume that the Medicare.gov website had ever experienced. But Medicare’s universe is only a slice of the population, and when would millions of seniors have had cause to rush that mature system to make for a comparable peak day?

Capacity was only the first problem to surface. USA Today quoted several experts who found evidence of what they said looked like 10-year old web technology, although some of their expertise seems a bit ancient itself, as with one expert’s suggestion that, “If I was them [sic], and I’m just conjecturing, I would probably come up with some manual way of saying, ‘Only people with the last name starting with ‘A’ can sign up today”.

remember ‘user friendly’?

Once inside the system, applicants were forced to set up an account before they even decided whether or not they were customers. There was no ability to browse the offerings. That says there was no move to draw on the wealth of technical and marketing savvy of online sellers like Amazon, or to learn from Massachusetts’ “Romneycare”, which could have told the system architects that people in that state went online 18 times before they bought insurance. People shop before they buy. At least that design flaw was quickly fixed.

coding confusion

Further in, applicants found a loosely coded site that lacked error checking. One could enter multiple spouses, could list spouses as children, could sign up for more than one plan, could even change someone else’s data, could enroll more than once — which happened often when users repeatedly hit the “Submit” button in the unresponsive system.

Much of this is attributable to reports that government officials made constant changes requiring re-writing of code which foreshortened the time remaining for testing in the months leading to the October 1 deadline.

One consequence is flawed data being handed to the insurance companies that are “straining their ability to handle even the trickle of enrollees who have gotten through so far”. Insurers are finding they have to correct a high percentage of submissions manually and even hire temporary workers to phone applicants. They fear an inability to handle the load once the current trickle turns into a flood.

Their bigger worry is that if system problems cannot be rapidly corrected, only the sickest will persevere to buy insurance, whereas the young and healthy — whose participation is key to offsetting the cost of those with illnesses — will give it a try but not come back.

original sin

HHS let the principal contract to the U.S. arm of a Canadian company to create the system. The original bid was $55.7 million, with a cap of $94 million. But those numbers expanded grotesquely, evidencing how badly both the agency and the company underestimated the task before them. Ultimately, $394 million was spent, according to the Associated Press.

The government unaccountably failed to tap the best developers of Internet technology, instead contracting with a company that calls itself an “information technology and business process services firm”, which sounds more like a back office mainframe shop. The hundreds of millions spent on a flawed system bring to mind the decade-long $450 million FBI attempt to modernize its system. Was the HHS the victim of lowest bidder rules and made to chose the wrong supplier?

tangled web

When Congress creates laws, its members seem utterly unmindful and unconcerned for how those laws will be implemented. That is certainly the case with the Affordable Care Act, routinely spoken of as 2,200 pages that no one in Congress ever read (actually, that would be the double-spaced original; the law, as passed, runs to 906 pages and can be found here). Like tax law, it is larded with requirements, many of which are inconsequential, simply adding to complexity. Government departments and agencies are then left to deal with the mess.

Example enough was in a Wall Street Journal column that said, “The Government Accountability Office last year calculated that for the IRS alone, implementing ObamaCare would be a ‘massive undertaking that involves 47 different statutory provisions and extensive coordination’”. There is exaggeration in saying that though, because as soon as a few facts are obtained from an applicant’s entries — income above a certain amount, for example — none of the more extensive checks concerning eligibility for subsidies need be made. Only a percentage of applicants need the full bore analysis.

What undoubtedly makes the system frighteningly complex is not the logic paths that the code must follow to gather its information, but the connections it must make. When the code knows at a certain point to reach out to a particular federal database, it may find that its target runs on a different and incompatible platform — a stumbling block that the industry calls “interoperability”. As the clock ticked, system designers had to coordinate with that agency or department to find a way into that database, and if lacking, wait for it to be developed. That external data fiefdom will have its own validating ID, password protocols and data format to work through. Worst of all, the target system may itself not have been engineered to handle heavy loads; there may be bottlenecks all over the network and, if so, they will take a long time to rework.

The need for such coordination, multiplied times the number of external contact points that could be needed for the universe of applicants, makes for a very tangled web. It is our guess that here lies the deeper problems that could take a very long time to straighten out, which is why we said months, not weeks. Our diagnosis
was hinted at by one repair technician quoted in The New York Times who said, “the account creation and registration problems are masking the problems that will happen later”.

Knowing which side their bread is buttered on

Here’s a short and spot-on clip from www.represent.us that illustrates how our
Congress earns its 5% approval rating.

So, Why Not the 14th Amendment?

The media often cites the phrase from the Constitution that “The validity of the public debt of the United States…shall not be questioned” as the basis for why the nation should not be allowed to default on its debt obligations. That event is expected to occur in a few days, when the Treasury Department says it will have exhausted all accounting maneuvers and will finally run short of money. And if not then, the only compromise on the table would simply push the next debt ceiling imbroglio to Thanksgiving, which will be upon us in an eye-blink.

Those words are found in the 14th Amendment, which was ratified in 1868 a few years after the Civil War. It’s a busy amendment, containing three other sections about citizenship, the apportionment of House representatives, and prohibitions of holding office for those who fought for or aided the Confederacy. Only then do we get to the pledge to honor debts, and even that 4th section has extra language about not paying debts incurred “in aid of insurrection or rebellion”.

That declaration about honoring the public debt may have been prompted by the events of the time but a Constitutional amendment prevails beyond its immediate purpose. It lives on as a requirement of the present government.

Yet to put an end to the rebellion of the moment, President Obama demurs from invoking the 14th amendment as grounds for borrowing the additional money needed to pay the bills that Congress’s spending appropriations have run up. “We do not believe that the 14th Amendment provides that authority to the President”, said Press Secretary Jay Carney. Obama is uncertain that his office can act without the concurrence of the legislative branch.

Sean Wilentz, a professor of history at Princeton, in this recent op-ed in The New York Times recounts how the 14th Amendment came about, then makes the case that the legislature’s participation is not needed. The president should act under his emergency powers, he concludes. And certainly it is an emergency if the United States is poised to bring on the global crisis that officials meeting now in Washington at the annual sessions of the International Monetary Fund and World Bank have said they fear will happen.

But the Constitution grants no emergency powers to the president. These “powers” have simply been assumed to be implicit — by Lincoln, in suspending habeas corpus (struck down by the Maryland district court in Ex Parte Merryman), by Roosevelt with an executive order to confine West Coast Japanese in internment camps after Pearl Harbor, and by Truman to break a steel worker strike during the Korean War (also struck down — by the Supreme Court in Youngstown Sheet & Tube v. Sawyer).

But Congress will be violating the 14th Amendment by preventing the borrowing needed for the U.S. to pay its debts. Only that body has the power of the purse, says the Constitution. The President has sworn to protect and defend the Constitution. For him to do nothing will make him complicit. He should conclude that the 14th Amendment requires him to act. It is odd that this former Constitutional professor does not make this equation.

It is not suggested that the President ignore the debt ceiling law and spend at will. That would run afoul of congressional authority. But he could use the 14th at least to the extent that the U.S. doesn’t default on its prior obligations, obligations resulting from Congress’s own appropriation bills.

We can then probably expect that this House of Representatives will initiate impeachment proceedings. But it is the Senate that tries an impeachment indictment and its Democratic majority would bar the door. That would leave it to history to decide who did the right thing.

How One Senator Would Avoid Default

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The nation would not default were Congress to refuse to raise the debt ceiling according to Richard Burr, the Republican senator from North Carolina. There’s the steady stream of payroll taxes flowing into Washington, he says, and besides:

“We always have enough money to pay our debt service. You’ve had the federal government out of work for close to two weeks; that’s about $24 billion a month. Every month, you have enough saved in salaries alone that you’re covering three-fifths, four-fifths of the total debt service, about $35 billion a month. That’s manageable for some time.”

So let’s take away the paychecks of the 800,000 furloughed government workers and have them pay the interest on government borrowings. Thanks to the senator for helping to explain why we have already called his state the “nastiest” in the union.

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