the national interest

Confused Hedge-Fund Manager Cliff Asness Struggles to Express Continued Rage at Obamacare

Clifford Asness, president and managing principal of AQR Capital Management LLC, speaks during a television interview in New York, U.S., on Thursday, Oct. 7, 2010. Asness, who runs one of the world's biggest hedge funds, says fellow fund managers gouge their clients by charging exorbitant fees for just tracking the markets. Photographer: Jonathan Fickies/Bloomberg via Getty Images *** Local Caption *** Cliff Asness
Clifford Asness, president and managing principal of AQR Capital Management LLC, has strong opinions on Obamacare. Photo: Jonathan Fickies/Bloomberg via Getty Images

As evidence of Obamacare’s success continues to mount, hedge-fund manager and occasional right-wing crank Cliff Asness takes to The Wall Street Journal op-ed page to retrench on behalf of the doomsayers. After noting that the Obama administration has touted “the largest reduction in the uninsured in four decades,” Asness concedes that, yes, insurance coverage has risen. But he declares that this was never in doubt:

That more people would be insured was never in dispute. If you mandate that people buy something, penalize them if they don’t and give it away to some, more people will end up with it. The proper response to this is: Duh.

Asness is absolutely right that it was completely obvious that Obamacare would substantially increase insurance coverage. We know this because the same system — regulated insurance plus subsidies plus mandate — was tried in Massachusetts, and lots of people signed up. But Asness is wrong about whether it was in dispute. Despite the blithering obviousness of the fact that Obamacare would bring about a major decline in people lacking insurance, lots of conservatives denied that it would happen. I rounded up a handful of examples the other day, though plenty more can be found:

The National Center for Policy Analysis, a major conservative health-care think tank, predicted in 2013, “the massive law that was enacted to solve the problem of the uninsured in America is more likely to worsen it.” “At the end of the day, for all of the rhetoric and promises about what Obamacare would achieve, the health law’s most ardent supporters have stuck to their guns because of one thing: coverage expansion,” wrote Avik Roy, a leading Republican health-care adviser, in 2014. “But new data suggests that Obamacare may fail even to achieve this goal.” Obamacare would result in “essentially the same number of uninsured,” insisted Charles Krauthammer in February 2014.

People deny obvious cause-and-effect relationships all the time. People even deny that the massive release of heat-trapping gasses into the atmosphere will trap more heat — people like Cliff Asness.

Indeed, it is not even clear that Asness is conceding Obamacare’s impact on insurance now. In his op-ed, he suggests, “The real question is how many of those covered by ObamaCare were previously uninsured.

Well, that’s why you measure the net number of uninsured people, not just the gross expansion of coverage under Obamacare. Asness seems unclear on this concept, so I’ll unpack it a bit. Here’s a chart showing the decline in the rate of uninsured Americans:

Those numbers at the top of the chart, ranging from 17.4 percent to 18 percent, represent the proportion of Americans lacking insurance before Obamacare went into effect. The number at the right, 11.9 percent, represents the current total. That means that Obamacare has so far resulted in a net 6 percent of the American population that was previously uninsured gaining insurance coverage. If Obamacare was mostly enrolling people who already had insurance, there would not be a large drop in the uninsured rate. That’s what “the largest reduction in the uninsured in four decades” means.

By the way, Asness is managing and founding principal of AQR Capital Management, which is helpful to know in case you’re looking to put your savings in the hands of a man who has strong opinions on topics of which he lacks basic comprehension.

Cliff Asness Struggles to Express Obamacare Rage