by Jon Sanders
Director of the Center for Food, Power, and Life, Research Editor | John Locke Foundation
Last year, Jonathan Gruber was "one of the most respected economists in the world," in the words of U.S. Senate majority leader Harry Reid on the Senate floor. He was cited favorably by then-U.S. House Speaker Nancy Pelosi. He was praised by NPR and others for producing a comic book featuring himself as "superhero" to help simple Americans understand the complex Affordable Care Act of which he was an "architect." He was paid handsomely by the Obama administration to help the legislation game the scoring system used by the Congressional Budget Office.
Things have changed in a year. A new round of Obamacare lawsuits filtered through the federal appeals courts over the issue of the Internal Revenue Service’s rule that subsidies for health insurance shall be available to low- and middle-income consumers regardless of whether they bought coverage on a state or a federally run exchange.
Long story short: the IRS rule runs counter to the clear statutory language of the law, under which subsidies are available only to consumers who bought coverage on a state-run exchange. The IRS is an executive agency, not a legislative body — it cannot make or rewrite law; it can only implement it.
Defenders of the ACA want to argue that this clear language is somehow "essentially a typo," just "a drafting error." As Katherine Restrepo has shown, however, the plain language of the text was necessarily Congressional intent all along.
Hope rests on the convenient fiction of the "typo." And here is the beginning of Gruber’s fall.
Video surfaced of Gruber explaining in 2012 this:
Yeah, so these health-insurance Exchanges, you can go on ma.healthconnector.org and see ours in Massachusetts, will be these new shopping places and they’ll be the place that people go to get their subsidies for health insurance. In the law, it says if the states don’t provide them, the federal backstop will. The federal government has been sort of slow in putting out its backstop, I think partly because they want to sort of squeeze the states to do it.
I think what’s important to remember politically about this, is if you’re a state and you don’t set up an Exchange, that means your citizens don’t get their tax credits. But your citizens still pay the taxes that support this bill. So you’re essentially saying to your citizens, you’re going to pay all the taxes to help all the other states in the country. I hope that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these Exchanges, and that they’ll do it. But you know, once again, the politics can get ugly around this.
In other words, the law was written as it was written deliberately to force states to set up the exchanges. It never occurred to Gruber et al. that the states wouldn’t go along with the scheme. In the words of Michael Cannon, "They thought that once Obamacare reached the states, they’d be greeted as liberators."
Gruber’s admission therefore harms the administration’s case, so he immediately tried to take it back. Specifically, he called it a "speak-o," a verbal typo.
This neologism lasted all of a few minutes before being obliterated by a second recording of Gruber making the same justification for the law as written:
And that is really the ultimate threat, is: Will people understand that, gee, if your governor doesn’t set up an Exchange, you’re losing hundreds of millions of dollars of tax credits to be delivered to your citizens?
This month the Supreme Court surprisingly chose to hear the issue. Not only will Gruber’s comments continue to shine light on Congressional intent, but new videos have surfaced exposing a brazen mendacity and arrogance in seeing to it that Obamacare became law of the land despite the presumed will of the people.
The first was of Gruber in a panel discussion October 17, 2013, at the University of Pennsylvania’s Leonard Davis Institute of Health Economic, in which he said:
This bill was written in a tortured way to make sure CBO did not score the mandate as taxes. If CBO scored the mandate as taxes, the bill dies. Okay, so it’s written to do that. In terms of risk rated subsidies, if you had a law which said that healthy people are going to pay in — you made explicit healthy people pay in and sick people get money, it would not have passed. … Lack of transparency is a huge political advantage. And basically, call it the stupidity of the American voter or whatever, but basically that was really really critical for the thing to pass. … Look, I wish Mark was right that we could make it all transparent, but I’d rather have this law than not.
Gruber’s attempts to downplay his admissions of gaming the CBO, obfuscating the process, and thereby taking advantage of "the stupidity of the American voter" as a one-time slip, an off-the-cuff comment, lasted almost as long as his previous attempt at backtracking. Video upon video upon video (five as of this writing) have surfaced just this week of Gruber making these claims, laughing about hoodwinking his "too stupid" fellow Americans.
So of course Gruber has now become a pariah. Obamacare advocates have suddenly discovered he couldn’t have had much to do with the ACA (as a Politico article begins, "Nobody much cared how much credit Jonathan Gruber took for Obamacare — until now"). No, see, he’s just a guy with an opinion, "like 300 million other Americans." Pelosi even claims now she doesn’t know who he is.
At this point, it wouldn’t be surprising if Gruber’s pet parrots had heard it so much they were squawking throughout the house RAAWWK Gruber’s a nobody! Gruber’s a nobody!
It’s easy to call it schadenfreude, but enjoying this long overdue comeuppance doesn’t seem shameful at all. This man spent years congratulating himself among other self-impressed elitists, boasting and laughing about taking advantage of "stupid" Americans to get Obamacare passed through lies and subterfuge.
If his admissions somehow help hamstring the harmful law he helped construct and whose terrible costs he helped hide, great. If by some miracle they also cause the president, Congress, and the media to cherish truth in dealing with the American people, whom they should respect as the chief authority in the land, even better.
Click here for the Rights & Regulation Update archive.
You can unsubscribe to this and all future e-mails from the John Locke Foundation by clicking the "Manage Subscriptions" button at the top of this newsletter.