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30 March 2012

Supreme Speculation

So, what's going to happen with SCotUS and healthcare? From what I understand, there are three likely outcomes. 1) The Justices will uphold Obamacare, a win for PotUS and Democrats (and the nation). 2) The Justices will strike down the so-called individual mandate and also take an axe to the related items, like requiring coverage of preexisting conditions, a win for Tea Party Republicans but only a comparatively mild defeat for PotUS and the Dems (although a major loss for the nation.) 3) The Justices will strike down the individual mandate but allow the related items to stand, a major defeat for PotUS and the Dems (and the nation).

Why, exactly, would the third option be so horrible? The Affordable Care Act does indeed increase government spending over the medium term; however, it increases spending at a much slower rate than the status quo, in effect lowering the nation debt. It does this by giving the government more bargaining power and cost control and by spreading out the costs among the ill and the healthy. Without the individual mandate and as has been the case in states with this situation, the cost of insurance will skyrocket. This turns a major political/moral victory into a liability. Why a liability? A system that must accept all comers but that cannot compel participation puts Congress in a dilemma. They can either A) allow the provisions to stand, knowing that it will cause insurance rates to balloon, or B) gut the Act, returning those with preexisting conditions to the draconian realities of the status quo.

That decision will be bad enough, but throw the politics of Republicans vs. Democrats into the mix, and my fear is that it gets even uglier. One or both parties could decide to make this decision a weapon. The Republican controlled House could either gut the law as they have always desired or refuse to gut it as to be able to (for the first time accurately) claim that the Affordable Care Act increases the national debt. The Democratic controlled Senate could allow the remaining provisions to stand and blame the added debt on the most conservative SCotUS in modern history or gut the law and use the legal and political fallout as campaign fodder. All of these options are deplorable on several levels.

If I were a betting man, I'm not exactly sure where I'd put my money. Immediately after hearing and reading about the three-day marathon arguments, it seemed to me and many others like option 2 was most likely. After hearing more analysis from lawyers and scholars, I'm cautiously optimistic that option 1 is plausible. In part, I feel this way because of what it is to argue in front of the Supreme Court. It is theater. It is posturing. Justice Thomas doesn't really play along, but everyone else asks questions and challenges the attorneys who make their arguments. It could be that Kennedy, and possibly others, were grilling the Solicitor General to signal a seriousness and a thoroughness and to avoid any claims of impropriety after a decision is rendered. Perhaps I delude myself.

I am terrified that option 3 is equally likely, though.

Here are a few other pieces that you should read:
  • Reinhardt at Economix on the "logic" of the potential SCotUS decisions and the irrationality of the anti-mandate argument
  • Krugman's NYTimes column on the widespread misunderstanding of the mandate narrowly and Obamacare broadly
  • Reich's blog post on a political alternative available to congressional Democrats

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