Tuesday, October 1, 2013

The Biggest Bargaining Chip Ever?

Obamacare is not too popular, and the Obama administration (like most administrations) is comprised of politicians who normally pay attention to such things. Obamacare is a logistical nightmare, and even proponents cannot rule out the possibility that it will shrink the economy. For sure, if the law goes ahead, some of the promises from Obama administration will prove to be false and embarrassing.

Yet the convention wisdom is that the Obama administration really wants Obamacare to go ahead. How can that conventional wisdom be reconciled with the facts above? One interpretation -- the conventional interpretation I guess -- is to assume that the Obama administration is simultaneously (a) obsessed with the "legacy" of starting "universal" health care, and (b) sufficiently over-confident or risk loving that they assign little probability to the nightmare scenarios that would make the Obamacare legacy not worth owning.

A second interpretation is that the Obama administration only wants to appear this way, so that it can sell delays or repeals of Obamacare to the Republicans and charge them an exorbitant political price. E.g., agree to delay or repeal Obamacare in exchange for (a) 2-5 percentage point increase in taxes on the "rich" or on big businesses and (b) planning to work on a "bipartisan" health care "solution" that would reduce the number of Americans without health insurance below a threshold (say 30 or 40 million).

Under this scenario, the Obama administration does not have to worry much about Obamacare logistics, or (ignoring those employers who have already changed their way of doing business in expectation of Obamacare -- they can always go back to business as usual) the possibility of significant economic damage, because it does not really plan to carry this thing out.  This scenario has few, if any, broken promises.

This scenario also has a good cop/bad cop version with President Obama sticking to his support for Obamacare but Mrs. Clinton and a few others agreeing, for a price (see above), to talk him out of it.

What do you think? If the second interpretation is correct, what should the Republicans be doing?  Should Democrats "sell" Republicans control of Obamacare (repeal), or just rent it ("delays")?

1 comment:

Patrick Sullivan said...

One thing Republicans could do is to mock Obama's economic illiteracy. Point out to the electorate that Apple Computer doesn't mandate that people buy their products, they have to produce products that consumers will voluntarily purchase because they think they're good value.

If Obamacare was good value, it wouldn't have to be forced down anyone's throat. So, why isn't it Obama who is responsible for HIS REFUSAL to negotiate? The truth might set Republicans free.