Ocasio-Cortez Wants Congress to Stop Pretending to Pay for Its Spending

Get used to reading more storylines like this over the next two years: The left hand doesn’t know what the far-left hand is doing.

On Wednesday, incoming House Speaker Nancy Pelosi (D-CA) faced a potential revolt from within her own party. Rep.-elect Alexandria Ocasio-Cortez (D-NY) and several progressive allies threatened to vote against the rules package governing congressional procedures on the first day of the new Congress Thursday, because of proposed changes they believe would threaten their ability to pass single-payer health care.

What’s Going On?

Ocasio-Cortez and her allies object to Pelosi’s attempt to reinstate Pay-as-You-Go (PAYGO) rules for the new 116th Congress. Put simply, those rules would require that any legislation the House considers not increase the deficit over five- and ten-year periods. In short, this policy would mean that any bill proposing new mandatory spending or revenue reductions must pay for those changes via offsetting tax increases and/or spending cuts—hence the name.

Under Republican control, the House had a policy requiring spending increases—but not tax cuts—to be paid for. Pelosi would overturn that policy and apply PAYGO to both the spending and the revenue side of the ledger.

Progressives object to Pelosi’s attempt to constrain government spending, whether in the form of additional fiscal “stimulus” or a single-payer health system.

However, Pelosi’s spokesman countered with a statement indicating that the progressives’ move “is a vote to let Mick Mulvaney make across-the-board cuts.” Mulvaney heads the Office of Management and Budget, which would implement any sequester under statutory PAYGO.

Regardless of what the new House decides regarding its own procedures for considering bills, Pay-as-You-Go remains on the federal statute books. Democrats re-enacted it in 2010, just prior to Obamacare’s passage. If legislation Congress passed  violates those statutory PAYGO requirements (as opposed to any internal House rules), it will trigger mandatory spending reductions via the sequester—the “across-the-board cuts” to which Pelosi’s spokesman referred.

To Pay for Spending—Or Not?

Progressives think reinstituting PAYGO would impose fiscal constraints hindering their ability to pass massive new spending legislation. However, the reality does not match the rhetoric from Ocasio-Cortez and others. Consider, for instance, just some of the ways a Democratic Congress “paid for” the more than $1.8 trillion in new spending on Obamacare:

  • A CLASS Act that even some Democrats called “a Ponzi scheme of the first order, the kind of thing Bernie Madoff would have been proud of,” and which never went into effect because the Obama administration could not implement it in a fiscally sustainable manner;
  • Double counting the Medicare savings in the legislation as “both” improving the solvency of Medicare and paying for the new spending in Obamacare;
  • Payment reductions that the non-partisan Medicare actuary considers extremely unlikely to be sustainable, and which could cause more than half of hospitals and nursing homes to become unprofitable within a generation;
  • Tax increases that Congress has repeatedly delayed, and which could end up never going into effect.

A Bipartisan Spending Addiction

An external observer weighing the Part D and Obamacare examples would find it difficult to determine the less dishonest approach to fiscal policy. It reinforces that America’s representatives have a bipartisan addiction to more government spending, and a virtually complete unwillingness to make tough choices now, instead bequeathing massive (and growing) amounts of debt to the next generation.

In that sense, Ocasio-Cortez and her fellow progressives should feel right at home in the new Congress. Republicans may criticize her for proposing new spending, but the difference between her and most GOP members represents one of degree rather than of kind. Therein lies the problem: In continuing to spend with reckless abandon, Congress is merely debating how quickly to sink our country’s fiscal ship.

This post was originally published at The Federalist.

What Mitch McConnell and Congressional Democrats Get Wrong about Entitlements

Sometimes, as parents often remind children in their youth, two wrongs don’t make a right. This held true on Tuesday, when Democrats erupted over comments by Senate Majority Leader Mitch McConnell (R-KY) on entitlement reform.

In returning to “Mediscare” tactics, Democrats made several false claims about entitlements. But so did McConnell, who blithely omitted what a Republican majority did earlier this year to worsen the country’s entitlement shortfall.

What McConnell Got Wrong

McConnell spoke accurately when he said in an interview that Medicare, Social Security, and Medicaid serve as the primary drivers of our long-term debt. He stood on less firm ground when he told Bloomberg that “the single biggest disappointment of my time in Congress has been our failure to address the entitlement issue.” Contra McConnell’s claim, Congress—a Republican Congress—actually did address the entitlement issue this year: they made the problem worse.

This Republican Congress repealed a cap on Medicare spending—the first such cap in that program’s history. It did so as part of a budget-busting fiscal agreement that increased the debt by hundreds of billions of dollars. It did so even though Republicans could have retained the cap on Medicare spending while repealing the unelected, unaccountable board that Democrats included in Obamacare to enforce that spending cap.

By and large, both parties have tried for years to avoid taking on entitlement reform. But Democrats included an actual cap on Medicare spending as part of Obamacare, and Republicans turned around and repealed it at their first possible opportunity. That makes entitlements not just a bipartisan problem—it makes them a Republican problem too.

What Democrats Got Wrong

But McConnell’s comments suggested just the opposite. He noted that, while entitlements serve as the prime driver of the nation’s long-term debt, any changes to those programs “may well be difficult if not impossible to achieve when you have unified government.” McConnell said the same thing in a separate interview with Reuters on Wednesday: “We all know that there will be no solution to that, short of some kind of bipartisan grand bargain that makes the very, very popular entitlement programs in a position to be sustained. That hasn’t happened since the ’80s.”

Even though Congress needs to start reforming entitlements sooner rather than later—even if that means one political party must take the lead—McConnell indicated he would do nothing of the sort. In fact, his comments implied that Congress would not do so unless and until Democrats agreed to entitlement reform, giving the party an effective veto over any changes. Yet Democrats, who never fail to demagogue an issue, attacked him for those comments anyway.

Actually, they haven’t “earned” those benefits. Seniors may have “paid into” the system during their working lives, but the average senior citizen receives far more in benefits than he or she paid in taxes, and the gap continues to grow.

Making a Tough Job Worse

In this case, two wrongs not only did not make a right, they made our country worse off. Like outgoing Speaker of the House Paul Ryan (R-WI), McConnell wishes to absolve himself of blame for the entitlement crisis, when he made the situation worse.

On the other side, Pelosi and her fellow Democrats continue the partisan demagoguery, perpetuating the myth that seniors have “earned” their benefits because they see political advantage in defending nearly infinite amounts of government subsidies to nearly infinite numbers of people. For all their love of attacking “science deniers,” much of the left’s politics requires denying math—that unsustainable trends can continue in perpetuity.

At some point, this absurd game will have to end. When it finally does, our country might not have any money left.

This post was originally published at The Federalist.

Mixed Messages on Paul Ryan’s Entitlement Record

Upon news of House Speaker Paul Ryan’s retirement Wednesday, liberals knew to attack him, but didn’t know exactly why. Liberal Politico columnist Michael Grunwald skewered Ryan’s hypocrisy on fiscal discipline:

Ryan’s support for higher spending has not been limited to defense and homeland security. He supported Bush’s expansion of prescription drug benefits, as well as the auto bailout and Wall Street bailout during the financial crisis…Ryan does talk a lot about reining in Medicaid, Medicare, and Social Security, for which he’s routinely praised as a courageous truth-teller. But he’s never actually made entitlement reform happen. Congress did pass one law during his tenure that reduced Medicare spending by more than $700 billion, but that law was Obamacare, and Ryan bitterly opposed it.

For the record, Ryan opposed Obamacare because, as he repeatedly noted during the 2012 campaign, the law “raided” Medicare to pay for Obamacare. (Kathleen Sebelius, a member of President Obama’s cabinet, admitted the law used Medicare spending reductions to both “save Medicare” and “fund health care reform.”)

Compare that with a Vox article, titled “Paul Ryan’s Most Important Legacy is Trump’s War on Medicaid”: “[Paul] Ryan’s dreams are alive and well. Through work requirements and other restrictions, President Donald Trump could eventually oversee the most significant rollback of Medicaid benefits in the program’s 50-year history.” It goes on to talk about how the administration “is carrying on Ryan’s Medicaid-gutting agenda.”

Which is it? On fiscal discipline, is Ryan an incompetent hypocrite, or a slash-and-burn maniac throwing poor people out on the streets? As in most cases, reality contains nuance. Several caveats are in order.

First, Ryan’s budgets always contained “magic asterisks.” As the Los Angeles Times noted in 2012, “the budget resolutions he wrote would have left that Medicare ‘raid’ in place”—because Republicans could only achieve the political goal of a balanced budget within ten years by retaining Obamacare’s tax increases and Medicare reductions.” The budgets generally repealed the Obamacare entitlements, thus allowing the Medicare reductions to bolster that program rather than financing Obamacare. The budgets served as messaging documents, but generally lacked many of the critical details to transform them from visions into actual policy.

Second, to the best of my recollections, Ryan never took on the leadership of his party on a major policy issue. Former GOP House Speaker John Boehner famously never requested an earmark during a quarter-century in Congress. Sen. John McCain’s “Maverick” image came from his fight against fellow Republicans on campaign finance reform.

But whether as a backbencher or a committee chair, Ryan rarely bucked the party line. That meant voting for the Bush administration’s big-spending bills like the Medicare Modernization Act and TARP—both of which the current vice president, Mike Pence, voted against while a backbench member of Congress.

Third, particularly under this president, Republicans do not want to reform entitlements. As I noted during the 2016 election, neither presidential candidate made an issue of entitlement reform, or Medicare’s impending insolvency. In fact, both went out of their way to avoid the issue. Any House speaker would have difficulty convincing this president to embrace substantive entitlement reforms.

In general, one can argue that, contrary to his image as a leader on fiscal issues, Ryan too readily followed. Other Republicans would support his austere budgets, which never had the force of law, but he would support their big-spending bills, many of which made it to the statute books.

On one issue, however, Ryan did lead—and in the worst possible way. As I wrote last fall, Ryan brought to the House floor legislation repealing Obamacare’s cap on Medicare spending. This past February, that repeal became law.

Ryan could have sought to retain that cap while discarding the unelected, unaccountable board Obamacare created to enforce it. As a result, Ryan’s “legacy” on entitlement reform will consist of his role as the first speaker to repeal a cap on entitlement spending.

Primum non nocere—first, do no harm. Ryan may not have had the power to compel Republicans to reform entitlements, but he did have the power—if he had had the courage—to prevent his own party from making the problem any worse. He did not.

This post was originally published at The Federalist.

Is the CBO Director Breaking the Law to Help Paul Ryan Bail Out Obamacare?

Why would an ostensibly nonpartisan Congressional Budget Office (CBO) director violate the law and the word he gave to Congress only a few short weeks ago? Maybe because Paul Ryan asked him to.

In late January, I wrote about how the House speaker wanted CBO to violate budget rules to make it easier for Congress to pass an Obamacare bailout. At the time, House leadership aides dismissed my theories as unfounded and inaccurate speculation. Yet buried on page 103 of Monday’s report on the budget and economic outlook, CBO did exactly what I reported on earlier this year—it changed the rules, and violated the law, to make it easier for Congress to pass an Obamacare bailout.

The Making of a Budget Gimmick

Because of the interactions between the (higher) premiums and federal premium subsidies (which went up in turn), the federal government will likely spend more on subsidies this year without making CSR payments than with them.

Therein lay the basis of the budgetary gimmick Ryan and congressional leaders wanted CBO to help them accomplish. House staffers wanted CBO to adjust its baseline and assume the higher levels of spending under the “no-CSR” scenario. By turning around and appropriating funds for CSRs, thereby lowering this higher baseline, Congress could generate budgetary “savings”—which Republicans could spend on more corporate welfare for insurers, in the form of reinsurance payments.

The Problem? It’s Illegal

As I previously noted, the House’s scheme, and CBO’s actions on Monday to perpetrate that scheme, violate the law. Section 257(b)(1) of the Gramm-Rudman-Hollings Act (available here) requires budget scorekeeping agencies to assume that “funding for entitlement authority is…adequate to make all payments required by those laws.”

Following my January post, Rep. Dave Brat (R-VA) asked CBO Director Keith Hall about this issue at a House Budget Committee hearing. Hall noted that CBO had been treating the cost-sharing reductions “as an entitlement, so it’s”—that is, the full funding of CSRs in the baseline—“remained there, unless we get direction to do something different. We’re assuming essentially that the money will be found somewhere, because it’s an entitlement.”

In a separate exchange with Rep. Jan Schakowsky (D-IL) at the same hearing, Hall went even further: He said, “We’ve treated the cost-sharing reductions actually as an entitlement, at least so far until we get other direction from the Budget Committee.”

Then Comes the Flip-Flop

Yet Monday’s document on the budget outlook did exactly what Hall said mere weeks ago that CBO would not. A paragraph deep in the section on “Technical Changes in Outlays” included this nugget:

Technical revisions caused estimates of spending for subsidies for coverage purchased through the marketplaces established under the ACA and related spending to be $44 billion higher, on net, over the 2018–2027 period than in CBO’s June baseline. A significant factor contributing to the increase is that the current baseline projections reflect that the entitlement for subsidies for cost-sharing reductions (CSRs) is being funded through higher premiums and larger premium tax credit subsidies rather than through a direct appropriation.

In the span of a few weeks, then, Hall and CBO went from “We’re assuming essentially that the money [i.e., the CSR appropriation] will be found somewhere” to the exact opposite assumption. Yet the report mentions no directive from the budget committees asking CBO to change its scorekeeping methodology, likely because the committees did not give such a directive.

In analyzing the status of the Medicare trust fund, which CBO projects will become exhausted in fiscal year 2026, Footnote A of Table C-1 notes how the baseline “shows a zero [balance] rather than a cumulative negative balance in the trust fund after the exhaustion date”—because that’s what Gramm-Rudman-Hollings requires:

CBO may try to make the semantic argument, implied in the passage quoted above, that it continues to assume full funding of CSRs, albeit through indirect means (i.e., higher spending on premium subsidies) rather than “a direct appropriation.” But that violates what Hall himself said back in late January, when he laid out CBO’s position, and said it would not change absent an explicit directive—even though the budget report nowhere indicates that CBO received such direction.

It also violates sheer common sense that the budget office should assume “funding for entitlement authority is…adequate to make all payments” by assuming that the administration does not make all payments, namely the direct CSR payments to insurers.

Coming Up: An Embarrassing Spectacle

During his testimony before the House and Senate Budget Committees this week, Hall may make a spectacle of himself—and not in a good way. He will have to explain why he unilaterally changed the budgetary baseline in a way that explicitly violated his January testimony. He will also have to justify why CBO believes Gramm-Rudman-Hollings’ direction to assume full funding for “all payments” allows CBO to assume that Congress will not make direct CSR payments to insurers.

Conservatives should fight to expose this absurd and costly budget gimmick, and demand answers from Hall as to what—or, more specifically, whom—prompted his U-turn. If Hall wants to transform himself into the puppet of House leadership, and break his word to Congress in the process, he should at least be transparent about it.

This post was originally published at The Federalist.

Conservatives Have Themselves to Blame for Ominous Omnibus

Several years ago, I kvetched to a friend about various ways I found myself unhappy with my life. My friend listened attentively, and when I had finished, responded calmly and succinctly: “Well, what are you going to do about it?”

Conservative members of Congress face a similar dilemma this week, as they return to Washington for the first time since Congress passed a massive omnibus spending bill just before Easter. Politico last week highlighted senators’ concerns about a closed process in the Senate. Sen. John Kennedy (R-LA) went so far as to say the floor process, and the lack of amendment votes, “sucks.”

Consider the floor process in the House. The morning after Congress passed the omnibus, a staffer bragged to me about how his boss voted against the sprawling spending legislation. But my follow-up query spoke volumes: “Did your boss vote against the rule allowing for consideration of the bill?” The staffer hung his head and said that he hadn’t.

Therein lies the problem. Fully 210 Republican members of Congress voted to approve a rule that allows the House of Representatives to vote on a 2,232-page bill a mere 16 hours after its public release. In so doing, they blessed House leadership’s tactics of negotiating a budget-busting bill in secret, springing it on members without time to read it, and ramming it through Congress in a take-it-or-leave it fashion.

Or, to put it another way, those 210 Republican members of Congress signed their judgment over to the Republican leadership, which made all the decisions that mattered regarding the bill. Conservatives complained that, for the rule governing debate on the omnibus, House Republican leaders gaveled the vote to a close too quickly. Fully 25 Republicans did vote against the rule bringing the omnibus to the House floor, and if a few more that wanted to vote no had been given time to do so, the rule might have failed.

The conservatives who would not vote against the rule governing the omnibus also bear responsibility for the next omnibus. Had conservatives voted down the rule governing the omnibus, they could have demanded concessions to prevent future instances of congressional leaders ramming massive spending bills down Congress’ throat.

For instance, they could have demanded that Senate Majority Leader Mitch McConnell (R-KY) commit the upper chamber to passing a budget, and considering spending bills individually on the Senate floor this summer. But because not enough conservatives voted against the rule, they received exactly no procedural concessions, ensuring Congress will resort to another massive, catch-all omnibus spending bill late this year or early next.

A very similar dynamic exists in the Senate. Despite their complaints, Kennedy and his Senate colleagues have failed to use their considerable powers to demand changes to that process. In the Senate, a single member can make long speeches, object to passing legislation by unanimous consent, and object to routine procedural requests. One senator or a handful of senators using such tactics for any period of time would quickly attract the attention of Senate leaders—and could prompt a broader discussion about how to open up Senate floor debate.

In democracies, people generally get the type of government they deserve. That axiom applies as much to the internal functioning of Congress as it does to Congress’ role in the country as a whole. If members of Congress don’t like the process their leaders have developed for debating (or not debating) legislation, they need only look in the mirror.

This post was originally published at The Federalist.

The Rising Costs of Medicaid Expansion in Louisiana

A recent Associated Press story claimed that Louisiana’s Medicaid program is spending less than expected. Don’t you believe it. By multiple measures, Medicaid expansion has proved a budget buster — with worse outcomes ahead.
Take the claim that “more than $535 million of the less-than-projected spending is in the Medicaid expansion program.” But Medicaid expansion’s enrollment, or costs, have not dipped below projections. Far from it, in fact.

In 2015, the state’s Legislative Fiscal Office estimated that expanding Medicaid eligibility would raise spending on benefits by $5.8 billion over five years under moderate enrollment, or $7.1 billion over five years in a high enrollment scenario — roughly $1.2 to $1.4 billion annually.

Compare those numbers to the Louisiana Department of Health and Hospitals’ January estimate. Instead of costing $3.45 billion this fiscal year, Medicaid expansion will “only” cost taxpayers $2.91 billion. In other words, rather than nearly tripling the 2015 cost estimates, expansion will instead exceed the original high-end projections by a mere 108 percent.

First, the Department of Health’s analysis touting purported “savings” to the state ignores the “woodwork effect” — individuals already eligible for Medicaid who only sign up because of the “hoopla” surrounding expansion. The analysis trumpets the individuals previously enrolled in Medicaid for whom the state can receive a higher federal match, saving the state money. However, it does not examine the opposite phenomenon — whether the publicity surrounding expansion has increased enrollment in populations for which the state must pay a larger share of costs.

In 2015, the Legislative Fiscal Office assumed no “woodwork” effect when analyzing the effects of expansion. But since then, enrollment in Medicaid expansion has skyrocketed. While the Edwards administration first claimed only 300,000 would sign up for expansion, enrollment now exceeds 460,000. A serious fiscal analysis would use the exploding enrollment numbers to study the “woodwork” issue afresh; the Department’s did not.

Second, the analysis also ignores the issue of “crowd-out” — individuals dropping private coverage to enroll in government programs. In 2015, the Legislative Fiscal Office assumed that between 67,000 and 89,000 individuals would drop their private coverage to enroll in “free” Medicaid; that coverage would cost $1.3 billion over five years, $99 million of that coming from the state general fund.

Particularly given the higher than projected enrollment since the 2015 estimate, the department should analyze the costs to taxpayers associated with individuals who dropped private coverage to join a government program. It has not.

Third, the proposed savings rest on a budget gimmick: Providers and insurers agreeing to pay higher taxes — because those “taxes” generate themselves money. The doctors, hospitals and insurers agree to give more funds to the state, the state collects federal Medicaid matching dollars on that money, and then gives both the state and federal funds right back to hospitals and insurers.

If this fiscal maneuvering — providers raising taxes on themselves to obtain more government funding — sounds like a scam to you, you’re not alone. None other than Joe Biden called it as much back in 2011. Other liberal researchers have called the gimmick “egregious” and a “national disgrace.”

President Trump’s budget endorsed legislation that would crack down on this “Medicaid tax gimmick,” and in 2010 the bipartisan Simpson-Bowles commission endorsed eliminating it entirely. With our nation facing trillion-dollar deficits, Washington will soon have to return to fiscal discipline, putting both parts of the Medicaid expansion in Louisiana — Obamacare’s enhanced federal match for able-bodied adults, and the tax gimmick used to pay Louisiana’s portion of expansion costs — under threat.

Far from small or stable, Medicaid expansion in Louisiana has become a sprawling monstrosity built on a fiscal house of cards. Policy-makers should examine ways to unwind the expansion sooner rather than later, before it starts falling down of its own weight.

This post was originally published in the Shreveport Times.

Who Really Proposed the Obamacare Bailout in the Trump Budget?

Maybe it was Colonel Mustard in the conservatory with the revolver. Or Professor Plum in the library with the candlestick.

The story behind the Obamacare bailout proposed in last week’s budget has taken on a mysterious tone, akin to a game of Clue. My Thursday story focusing on the role played by White House Domestic Policy Council Chair Andrew Bremberg prompted pushback from some quarters about the actual perpetrator of the proposal. As a result, I spent a good chunk of Friday afternoon trying to gather more facts—and found definitive ones hard to come by.

As to the accuracy of my initial theory, people I trust and respect arrived at strikingly different views. However, I found surprising unanimity on one count: No one—but no one—wants to take credit for inserting the proposal to pay $11.5 billion in risk corridor claims. As someone told me: “You raise a valid question. If Andrew Bremberg didn’t insert the proposal into the budget”—and this person didn’t think he did—“then how did it get in there?”

Therein lies a huge problem. To call the inclusion of a $11.5 billion proposal in the president’s budget that no one in the administration seemed to know about, or wants to take credit for, a prime example of managerial incompetence would put it mildly. Either career staff inserted it in the budget, and the political staff did not have the antennae or bandwidth to understand its consequences and take it out, or a few political appointees and career staff hijacked the budget process, with most other individuals unaware of the situation until the budget’s public release.

To borrow a politically loaded phrase, someone—or a group of someones—colluded to get this language included in the budget. Its inclusion could cost federal taxpayers literally billions of dollars.

Why It Matters

By submitting a budget proposal to “request mandatory appropriations for the risk corridors program,” the White House completely undermined and undercut the arguments its own Justice Department had made in court a few short weeks ago, that the federal government owes insurers nothing.

In other words, whomever inserted this policy U-turn into the budget, just as the judges ponder a ruling in the insurer lawsuits, may have effectively “tanked” the government’s case. Either by leading to an adverse ruling, or by prompting the Justice Department to settle the case at a much higher cost, this move could cost taxpayers billions.

A Pro-Life Administration, Or Not?

Unfortunately, it gets worse. While the budget did include new funds for insurers, including the controversial risk corridors bailout described above, it did not include a single word proposing that such funds prevent taxpayer dollars from going to plans that cover abortion.

There’s a reason for the deafening silence: Republicans know that any legislation that funds insurers and provides robust pro-life protections will not pass. Democrats will object to its inclusion. Given the choice between passing up on an Obamacare bailout or abandoning their pro-life principles, Republicans have given every expectation that they will choose the latter course. (They shouldn’t bail out Obamacare regardless, but that’s a separate story.)

Regardless of who proposed these, it doesn’t take a detective to understand how a policy reversal that could cost taxpayers billions and a pending U-turn by Republicans to fund abortion coverage represent a major one-two punch against conservatives. But the mysterious origins and mangled management of the risk corridor proposal adds a further layer of insult to injury, a triple whammy of a tough week for the administration.

This post was originally published at The Federalist.

Politico’s Dumbest Headline Ever Trivializes Rand Paul’s Budget Protest

So much for the romance surrounding the famous scene in “Mr. Smith Goes to Washington” where the title character successfully filibusters a bill, rousing the public to his side. Politico claimed that similar tactics surrounding a budget agreement last week led to the “dumbest shutdown ever.” In reality, however, the brief lapse in appropriations had serious underlying causes, and the flip way its correspondents covered the incident led to arguably the dumbest headline in Politico’s history.

To explain the shutdown in brief: Congressional leaders arrived at a budget agreement last week, just before the existing spending bill expired on Thursday at midnight. Having only introduced the bill hours previously, Senate leaders pushed to pass it Thursday afternoon, before the prior spending bill expired.

Paul’s actions protested two important issues: Skyrocketing spending and deficits, and Congress passing massive spending bills without reading them or allowing anyone to offer amendments. But the Politico report by Rachael Bade and Seung Min Kim trivialized the incident, calling it a “spectacle,” “extraneous drama,” and a “sideshow” full of “absurdity.” Their own phraseology amplified quotes such as those from an unnamed Republican aide, who called the floor drama “even more stupid than the name of the new Kardashian baby.”

So Paying for Stuff Congress Buys Is ‘Stupid’?

Why would reporters take such a cavalier attitude toward otherwise weighty matters? Four possible reasons come to mind.

First, the natural inclination to blame the individual or individuals perceived as responsible for causing havoc with the schedule. Few politicians or reporters on Capitol Hill expected to spend Thursday evening and much of Friday morning covering all-night drama surrounding the appropriations bill. The missed flights, cancelled dinner plans, and other last-minute chaos largely redounded on Paul’s head, even though Senate leaders could, and should, have avoided that drama by planning more than a few hours ahead.

If, instead of the headline at issue, Politico had led its story by pointing out that tactical stupidity by Senate Majority Leader Mitch McConnell (R-Kentucky) led to the shutdown—belying his November 2014 and December 2017 statements that “We will not be shutting down the government”—how quickly do you think the majority leader’s press staff would have responded to Politico reporters’ questions this week?

Always Selective ‘Concern’ for Process

Third, reporters’ natural bias towards bipartisan agreements, underpinned by an implicit assumption that bipartisan agreements are inherently good. Whereas last year’s partisan attempts to “repeal-and-replace” Obamacare led to myriad stories about Republicans violating their pledges for transparency (an exception to rule two above), the bipartisan budget deal aroused much less indignation from the press about the secretive process used to craft it.

A contrarian might ask the obvious question: If the bill is so good, why not give lawmakers time to read and understand its contents, rather than ramming through a 652-page bill spending hundreds of billions of dollars in a 24-hour period?

Of course not. But when officials at the Centers for Medicare and Medicaid Services (CMS) earlier this month tried to shut out a reporter for what CMS officials viewed as an inaccurate article—or, to coin a phrase, “bad behavior” by a journalist—the Association of Health Care Journalists filed protests with CMS, and published multiple stories on the kerfuffle (which Politico dutifully covered).

If they care about democracy as much as they claim, the reporters who consistently hyperventilate every time President Trump makes (idle) threats towards the press might spend more time promoting sunshine and accountability throughout government. But instead of highlighting Paul’s efforts to enhance transparency in government—is a single amendment vote on a 652-page bill really too much to ask?—the “dumbest shutdown ever” story ridiculed these efforts. It’s why the story represents Politico’s dumbest headline ever.

This post was originally published at The Federalist.

The White House’s Plan to Bail Out Obamacare AND Fund Abortion Coverage

The White House released its budget proposal this morning. Apart from the fact that the budget abandons any attempt to get to balance within ten years (or ever), a footnote buried deep in the document hides key proposals: Bailing out Obamacare health insurers to the tune of tens of billions of dollars, and taxpayer funding of abortion coverage.

On page 141, footnote 6 of Table S-6, showing the president’s policy proposals, includes the following admission: “The Budget requests mandatory appropriations for the risk corridors program and for cost-sharing reduction payments.”

There you have it: At least $11.5 billion in corporate welfare payments to insurers for risk corridors, and more for cost-sharing reductions.

About Risk Corridors

While risk corridors have faded in the public debate over the past two years, they remain a potent issue for health insurers. See a full explanation of the issue, but here’s a summary.

To prevent the Obama administration from using funds from elsewhere to subsidize corporate welfare to insurers, Congress enacted restrictions prohibiting the use of taxpayer funds to bail out risk corridors. Under these restrictions, insurers with losses could only receive as much money from the risk corridor program as insurers with gains paid into the program.

In Obamacare’s first few years, most insurers suffered massive losses, so the money coming in to the risk corridor program by no means equaled the requests for funds from the program. As a result, several insurers sued in the Court of Federal Claims, requesting payment from the Judgment Fund of the Treasury for their unpaid risk corridor obligations. Many of those cases remain on appeal.

While both the White House and HHS budgets include few details about this proposal, it appears that they would pre-emptively surrender the pending legal cases by paying insurers more than $11.5 billion in risk corridor obligations that insurers claim they are owed. The budget further proposes making these payments exempt from the budget sequester.

About Cost-Sharing Reductions

The White House’s proposal on CSRs looks downright conservative, however, compared to the budget gimmick being contemplated by Speaker of the House Paul Ryan (R-WI). The White House budget indicates that spending on CSRs would have no deficit effect, because the Gramm-Rudman-Hollings statute requires budgetary agencies to assume full funding of entitlements (including CSR payments) when developing their fiscal baselines.

Ryan, however, finds this legal requirement an inconvenient truth. He wants to direct the budget agencies to raise the spending baseline artificially, so Congress can then “lower” the spending baseline right back to where it is now—and spend the phony “savings” from this gimmick on more corporate welfare to insurers.

Forcing Taxpayers to Fund Abortion Coverage

Another point of note: Passing either one of these proposals would by definition result in taxpayer funding of plans that cover abortion. The administration did not include any language prohibiting the use of CSR or risk corridor funds for plans that cover abortion. Therefore the White House presumably endorses federal taxpayer funding of abortion coverage.

The budget proposal means Trump administration is now actively working to codify not one but two Obamacare bailouts that a Republican Congress denied to the Obama administration—doing liberals’ bidding for them. Moreover, the failure to include any pro-life protections on these bailouts represents at best a massive managerial oversight, and at worst an insult to the pro-life community. For those who thought that last week’s budget deal represented the nadir for conservative principles among this administration, think again.

This post was originally published at The Federalist.

Who Really Caved on the “Shutdown Showdown?”

While conventional wisdom over the past 18 or so hours, both at The Federalist and elsewhere, holds that Democrats “lost” the shutdown showdown, this contrarian takes the position of noted college football analyst Lee Corso: “Not so fast, my friend!”

While not conceding on the substance of immigration legislation, Senate Majority Leader Mitch McConnell (R-KY) made an important concession on process—one he has not made to conservatives. According to press reports, McConnell pledged that, if lawmakers cannot agree on an immigration package addressing the Deferred Action for Childhood Arrivals (DACA) program by February 8, the expiration date of the continuing resolution that passed Monday, he would begin a freewheeling and open debate on a stand-alone immigration measure—provided the federal government remains open.

No Budget—No Problem!

Compare McConnell’s comments on an immigration bill with this Politico report not two weeks ago: “Republican leaders are considering skipping passage of a GOP budget this year—a blow to the party’s weakened fiscal hawks that would squash all 2018 efforts to revamp entitlements or repeal Obamacare….McConnell has argued that he cannot pass deficit-reduction legislation using powerful budget procedures with his new 51-vote majority—and wasn’t even sure he could find the votes for a fiscal blueprint in the first place.”

While liberals’ priority—immigration policy—will get prime floor time thanks to the commitment McConnell made in exchange for Democrats’ votes to reopen the government, conservative priorities like reforming entitlements and repealing Obamacare won’t see the light of day, because McConnell doesn’t even want to try to pass a budget.

All of this gives conservatives an obvious lesson: For the next appropriations bill, they should withhold their votes unless and until McConnell publicly commits to passing a budget through the Senate, with reconciliation instructions allowing for entitlement reform and Obamacare repeal efforts.

Could Have Been (and Might Get) Worse

Contrast that response to this article from just last month, about bailing out Obamacare through a “stabilization” bill:

U.S. Sen. Susan Collins said she is confident President Donald Trump and Senate Majority Leader Mitch McConnell will ensure passage of two bills aimed at shoring up the insurance markets.…

Collins remains confident that Trump and McConnell, fellow Republicans, will keep their word and make sure the health care bills get approved, said Annie Clark, a spokeswoman for the senator.…McConnell committed in writing to support passage of the bills either before adoption of a final tax bill or before the end of the year, Clark said.

If McConnell didn’t want to bind the House to an Obamacare bailout measure, he sure did a much less convincing job making that clear to Collins than he did to Democrats regarding immigration in the past week. Granted, the Obamacare bailout hasn’t happened—yet. But rest assured that McConnell and Collins, among others, are already looking to the next appropriations bill as a vehicle to pass the “stabilization” measure.

The disparate treatment between immigration and an Obamacare bailout gives conservatives the “consolation” that McConnell could have made far worse concessions to Democrats. But conversely, if McConnell wants to respect the House’s prerogatives, why does Collins believe he made a commitment to her to do the exact opposite?

Given that daunting landscape ahead, conservatives shouldn’t focus their energies celebrating how they “won” this weekend’s battle, as doing so would guarantee they end up losing the larger war.

This post was originally published at The Federalist.