Donald Trump’s health-care strategy has been in mortal peril since before his inauguration. (Once Republican Senators indicated in early January they wouldn’t support repeal-and-delay, forcing the party to draw up its own plan, the best chance to repeal the law was already gone.) If there was a moment when the final demise became assured, it was in Trump’s interview last night with Tucker Carlson, when the president declined to mount even a perfunctory defense of the existing bill:
Whether or not he realized it at the time, Trump was essentially filming an attack ad that could be used against any member of Congress who votes for the bill. The plan cuts taxes for the rich and lays waste to health-care access for the poor and middle class. Trump’s response is, “I know.” He replies that the bill is “very preliminary,” and when told it’s not consistent with the message of his election, says, “a lot of things aren’t consistent.” Why would any Republican vote for a bill knowing they can be hit with an ad showing Trump admitting the plan harms their voters?
Health care has risen to the top of Trump’s vulnerabilities. A new Fox News poll shows that the public disapproves of his handling of health care by a 22-point margin. His allies have mounted an aggressive effort to shift the blame for this debacle from Trump to Paul Ryan. Hilariously, the pro-Trump spin depicts the president as a dupe for the wily House Speaker, and Trump’s aides are trashing the bill in private. Of course, the lack of presidential support drives the chance that the bill can pass the House even lower. The Obamacare repeal debacle is already moving out of the how-a-bill-becomes-a-law stage and into the blame-shifting stage.
The truth is that Ryan and Trump are both at fault. At one level, blaming Ryan for the legislation’s demise is absurd. Trump agreed to the process Ryan carried out, as well as to its substance. His administration collaborated on the design of the House bill and the legislative strategy. To be sure, Trump almost certainly lacks even the faintest grasp of the workings of the law he agreed to, but it’s hardly Paul Ryan’s fault that the president is a television junkie who can’t read anything longer than a single large-type font page with a handful of bullet points. Ryan would not have produced a bill in the first place if Trump didn’t authorize him to do it.
It also isn’t Ryan’s fault that the Republican Party has spent eight years making impossible promises on health care. Obamacare is unpopular with the public — or at least it was before it became threatened; now people like it — because most want generous care and insurance with transparent costs. It’s unpopular with conservative ideologues for the exact opposite reason. Conservatives don’t want the government to subsidize health care for people who can’t afford it on their own. Republicans have attacked the law from the left (the premiums and deductibles are too high) while avoiding being pinned down on a specific plan that would reveal that their alternatives create higher premiums and higher deductibles.
Liberals have been warning for years that the “alternative” Republican plan that could actually pass Congress was a mirage. There was no plan that could be both acceptable to conservative anti-government ideology and to the broader public. The dilemma Republicans find themselves in now — a plan that subsidizes too little coverage to be acceptable to vulnerable members, and too much coverage for the party’s right wing — has always been unavoidable. Whoever had to write the first version of the Republican health-care bill that would have to be scored by the Congressional Budget Office and pass both chambers was given a task with impossible parameters. Ryan is being turned into the fall guy for eight years of lies that the entire Republican party, himself included, told the country and itself.
However, Ryan does appear to be the mastermind behind the legislative sequence Trump has agreed to. The plan is rooted in Ryan’s obsessive quest to pass a huge tax cut for the rich that will be permanent. That strategy requires a series of difficult steps, which — if carried out correctly at every turn — will ultimately culminate in a massive tax cut that can be scored by the Congressional Budget Office as revenue-neutral after ten years, and thus avoid the arcane budgetary requirement that caused the Bush tax cuts to expire automatically after a decade. This intricate calculation, based on complying with the Senate’s budget rules, is the linchpin of the entire Republican legislative strategy.
I explained Ryan’s plan a few weeks ago. The conclusion I drew is that it’s impossibly ambitious. Ryan’s plan has already gone horribly awry. His original scheme was to rush through a repeal of Obamacare with the replacement to come later, so that Congress could move on to tax cuts. When that couldn’t pass the Senate, Congress was forced to pass a replacement for Obamacare on the fast-track schedule that was originally conceived for a simple repeal bill. Now they are bogged down in the impossibly complex work of reordering one-fifth of the economy on a schedule that was never designed to accommodate such a task. Ryan’s assumption that he could rush a simple repeal and delay plan through Congress turns out to be like the Wehrmacht invading Russia without bothering to pack winter clothing.
What’s more, even if Obamacare repeal somehow survives and can pass Congress on something remotely like the original time frame, Ryan’s tax-reform plan is probably doomed anyway. It relies upon, among other things, finding a trillion dollars in revenue from a border-adjustment tax that divides his party and the business lobby against itself and raises taxes on the working class.
If Republicans don’t try to pass a “revenue neutral” tax cut, and just cut taxes like Bush did and accept that they’ll expire after a decade, their task would grow immeasurably easier. They wouldn’t need to repeal Obamacare first, because they wouldn’t need to lower the tax-revenue baseline by eliminating Obamacare’s taxes. And they wouldn’t need to pass a complicated and unpopular border adjustment tax. They would only need to hand out big tax cuts to rich people, which is something Republicans can all agree on. Yes, the tax cuts would only have a shelf life of ten years, but ten years of low taxes for rich people would still be a pretty big win for them.
Trump has alluded to Ryan’s strategy multiple times. He always explains it by repeating the word “statutorily,” and consistently gives the impression that the strategy has been explained to him, and he has agreed to it without quite understanding why. For instance, he told Carlson last night:
“One of the reasons I want to get the health care taken care of — and it has to come statutorily and for other reasons, various complex reasons, having to do with politics, and also Congress — it has to come first. It really has to come first. One of the reasons I want to get it finished, ideally soon, is because I want to start on the taxes.”
Trump has been persuaded that he has to repeal Obamacare first in order to have a gigantic tax cut. But that, again, relies on Ryan’s wildly complex and probably impossible plan to write a huge tax cut for the rich that won’t expire. When Trump talks about the tax-cut plan, he describes it in a very different way than Ryan does. Ryan calls his idea “tax reform,” a nod to his notion that the revenue losses will be offset by higher revenue from other sources, at least on paper. Trump doesn’t say that. He just calls it tax cutting.
“I want to get to taxes, I want to cut the hell out of taxes,” Trump told his audience last night, “But before I can do that — I would have loved to have put it first, I’ll be honest — there is one more very important thing that we have to do: We are going to repeal and replace the horrible, disastrous Obamacare.”
Does Trump understand that he doesn’t actually have to repeal Obamacare first? That he could just cut the hell out of the taxes for the next decade?