Many Republicans are optimistic that, given its manifold problems, Obamacare will be repealed if the GOP wins the presidency in three years. However, as the Heritage Foundation warns, Obamacare is putting down deep roots that will make repeal more difficult than it may now appear.
First, Obamacare is creating a new entitlement — taxpayer-funded healthcare subsidies for millions of Americans. Obamacare created insurance exchanges to sell and subsidize government-approved health care plans. Most of those who receive coverage through the exchanges will have their costs partially subsidized by federal taxpayers. Indeed, the Congressional Budget Office estimates that more than 75 percent of them will receive subsidies. This represents a transfer of an estimated $1.1 trillion to lower income individuals over the next ten years.
Second, Obamacare has vastly expanded an existing entitlement — Medicaid. According to Heritage, if every state expands its program, as many as 25 million additional people could enroll in Medicaid by 2021. Anything remotely approaching this level of expansion would entail a massive transfer of state resources to subsidize lower income individuals.
To see why these developments make repeal of Obamacare so daunting, we need only consider the current legislative front. The centerpieces of the Democrats’ agenda are (1) increasing the minimum wage and (2) extending unemployment benefits again.
Both are, in essence, subsidy programs for lower income individuals. An increased minimum wage subsidizes employees by paying them more than their work is worth. Unemployment benefits subsidize unemployment.
Both agenda items are popular. Jim Geraghty informs us that 66 percent support raising the minimum wage; 55 percent support extending unemployment benefits.
The Obamacare subsidies may well prove popular too. Granted, their cost to the Treasury will vastly exceed that of extending unemployment benefits.
But it’s far from clear to me that, three years from now when the Obamacare dust has settled, the body politic can summon the will to take away health care subsidies from lower income individuals. When Republicans have had substantial control of the government in the past, they have had their hands full holding the line on entitlements, never mind rolling them back.
This, of course, was the argument made by Ted Cruz and others last fall. They insisted that Republicans fight to the death (so to speak) against Obamacare because once it kicks in and the benefits are doled out, it will be impossible to repeal.
This argument has been ridiculed recently because the rollout of Obamacare has only made it more unpopular. But Cruz may have the “last laugh” on this, though I’m sure he won’t be laughing.
Cruz’s argument was not frivolous; indeed, it may well have been correct. His fallacy was believing that a fight to the death last fall had any chance of bringing about the repeal of Obamacare.