Saturday, January 24, 2015

DC Republicans screw up, show their Obamacare "fix" won't work

Yeah, that whole idea of Republicans having a better grip on the economy now that they're in power in D.C.? That doesn’t seem to be going so well. Take a look at this summary of Thursday’s Senate committee meeting that was intended to show support for the GOP’s bill to allow businesses to avoid penalties under Obamacare if they choose not to insure employees that work less than 40 hours a week, instead of the 30-hour limit that exists today.

This committee hearing tried to prop up Hardee’s/Carl’s Junior CEO Andrew Puzder (2012 compensation,just under $4.5 million) as an example of a hard-pressed businessman who would be facing extra costs due to the employer mandate hitting his restaurants that have people working between 30 and 39.5 hours a week. We'll let Slate's Alec MacGillis take it from there.
For starters, there is the basic problem that President Obama has made clear that he’ll veto the 40-hour measure. If he does, Republicans could still seek to use the proposal as a cudgel to attack the law politically, but even here there are problems. The Congressional Budget Office has given the measure a decidedly unfavorable review. It estimates that the bill would result in as many as 1 million workers having their hours cut to put them under the new 40-hour limit and thereby losing their employer coverage; about 500,000 workers being left without any health coverage at all; and the deficit increasing by more than $50 billion as a result of fewer employers paying the $3,000 fine, as well as more people turning to Medicaid and federal subsidies to purchase their own insurance after being denied employer coverage.

Even worse, perhaps, several prominent conservatives have come out against the revision—notably Yuval Levin, one of the right’s most influential policy wonks, who wrote in National Review that changing to 40 hours would inevitably cause more Americans to lose hours than the 30-hour rule does, because there are far more workers just at or above that threshold than at the 30-hour threshold. “By setting the definition lower, Obamacare’s architects were trying to mitigate the damaging effects of the employer mandate some,” Levin wrote in a burst of intellectual honesty, “and by setting it higher Republicans would be worsening those effects.”…

The Democrats on the panel, in the minority for the first time in eight years, relished cross-examining the Republicans’ witnesses. Sen. Patty Murray of Washington, the panel’s top Democrat, noted that Puzder’s claim—that Hardee’s and Carl’s Jr. workers who did not get coverage at work could get Obamacare coverage instead—did not hold up in the many states that have rejected the law’s Medicaid expansion. Sen. Elizabeth Warren of Massachusetts quoted Yuval Levin’s criticism of the 40-hour change and noted the irony that Republicans were pushing a measure that would both raise the deficit and make more people reliant on Obamacare. “This bill is corporate welfare,” she said. “Big corporations would be able to cut their coverage, and taxpayers would get stuck with the tab. I’m against adding $53 billion to the deficit so corporations can push their responsibilities onto the government.”

This provoked Puzder, the CEO, into taking a shot at the CBO’s deficit estimate. “I love the CBO, but have they ever estimated anything that is accurate? I mean, really?” This off-message outburst — delivered with former CBO director Holtz-Eakin sitting right next to him — in turn earned Puzder a rebuke from his putative ally, Alexander, who reminded him that it was the CBO that had done the fast-food industry a big favor with its estimate of high job losses under a minimum-wage increase.
And may I remind you that same CBO report that claimed a minimum wage increase might end up reducing job growth by 500,000 also estimated that poverty would be reduced by more than 900,000 and real incomes would grow by more than $2 billion. That’s a good trade in my opinion, especially in times of rising job growth that would blunt quite a bit of the potential job loss (in 2014, this would have translated to 2.45 million new jobs being added instead of 2.95 million).

Gee, what a surprise that Republicans find it a lot easier to strike poses against Obamacare provisions they don’t like, but the bills they produce would end up working a lot worse than what we have today under the ACA. Sort of like their attempts to still argue that “tax cuts pay for themselves” when we have 35 years of evidence proving that they do not (in fact, the only “dynamic” part of tax cuts on the rich and corporate seems to involve rent-seeking by those people, who run to the tax breaks and reduce job growth and tax revenues).

Not surprisingly this hearing is being underreported in our “liberal” media, because it doesn’t fit the narrative that their corporate buddies and the new GOP-controlled Senate wants, and it's not as sexy as 2016 speculation. But I encourage you to take heed of what was said in there, as the testimony and the CBO figures on this bill that would raise the threshold to avoid ACA penalties has exposed the lie behind the alleged “reform” in the GOP's Obamacare bill. It is nothing but a clear attempt to allow corporations to continue to freeload off of the government by paying low wages and no benefits to just-less-than-full-time employees, forcing us as taxpayers to pay for these businesses’ negligence (aka the Wal-Mart business model).

In addition, the appearance by the fittingly named Andrew Pu(t)zder at yesterday’s hearing certainly is going to keep me from stopping at Hardee’s the next time I want a fast-food fix, joining Papa John’s and Darden Restaurants on the “let’s not eat there” list. So way to go, Andy, you hurt your cause and your company with your lame, whiny performance on Capitol Hill this week.


  1. We could only hope that any Republican "fix" to the ACA would only increase desire for a single payer system.

    I have stopped eating Burger King since they moved to Canada.

  2. That's the dirty little secret- Obamacare is the compromise between the old system and single-payer.

    The GOPs would be wise to let the issue drop and work with it, or even try to make it work better....but I bet they won't. And they'll look worse and worse in the process.