Monday, March 22, 2010

What a mess of pottage they've sold themselves for

If Congressman Stupak truly believes that President Obama's Executive Order accomplishes the same thing as the Hyde Amendment, he is willingly deluding himself. A congressman who has served as long as he has should understand that an Executive Order cannot override a law passed by Congress. Yet that is the illusion that he sold his vote for.

As Yuval Levin explained yesterday, the Bush administration lawyers had looked into the same issue and found that an Executive Order would not accomplish what the Stupak group is pretending that it will.
Upon first hearing there was talk of an executive order yesterday, I wondered how the administration’s lawyers thought such an order could go beyond the letter of the law in restricting abortion funding. This was a question the Bush administration examined quite extensively on several occasions, and the lawyers involved always agreed that the legal precedents from the time between the Roe decision and passage of the Hyde amendment, as well as some after the Hyde amendment, are extremely clear in stating that federal funds cannot be denied to the provision of abortion except by explicit legislative prohibition. That’s why the Hyde amendment was necessary. But the Hyde amendment wouldn’t apply to this bill, since it applies only to the annual HHS appropriations bill. Hence Stupak’s concern. So what could the White House possibly give Stupak that would not be thrown out by any federal judge in a second?

Looking at the executive order (which you can read here), the answer is clearly nothing. The executive order quite literally does nothing that the Senate bill does not already do, and it is careful to say as much. It offers a kind of narrative of what champions of the bill claim it does with regard to abortion (claims that Rep. Stupak among others has disputed for months), and then says the executive branch will make various people aware of this understanding of what the law says. It orders no action (only the usual promulgation of regulations the law requires anyway) and offers no interpretation beyond that.

If Rep. Stupak and his fellow pro-life Democrats were not satisfied with the protections against taxpayer funding of abortion in the Senate bill (as they rightly were not), there is simply nothing in the text of the order that should change their minds.
Bill Burck & Dana Perino explain further.
it is truly astonishing that Rep. Bart Stupak has been duped into thinking the president's executive order has done, or can do, anything to alter the Senate bill. Executive orders have the force of law only within the executive branch and only to the extent they are consistent with legislation. Stupak believes that the Senate bill does not do enough to prohibit the use of federal funds; what he apparently does not realize is that the executive order can do no more to prohibit use of federal funds for abortion than the Senate bill does. If there is any inconsistency between the executive order and the bill, the order gives way to the bill. Moreover, as is typical of executive orders, this one explicitly says that it creates no right at law to sue the U.S. government if funds in fact are paid for abortions. So, the executive order is a nullity. Stupak has allowed himself to be tricked into supporting a bill that he disagrees with on the basis of an executive order that does precisely nothing to alleviate his concerns.
I think that the Stupak group wanted to vote for this bill any way they could. All they needed was a fig leaf. And the Executive Order gave them that fig leaf. If they truly cared about federal funding for abortion, as they all claimed they did, they sold their vote for an illusion. No wonder the pro-choice House Democrats were willing to go along with the whole Executive Order charade.

For those Democrats who claimed that they wouldn't vote for this bill unless it truly was deficit-neutral, they were truly deceiving themselves or their constituents when they pretended that the CBO scoring was enough to convince them this bill wouldn't blow out deficits. As former CBO Director, Douglas Holtz-Eakin, wrote yesterday, the CBO is limited in how it scores bills by the assumptions that are placed in the bill even if those assumptions are clearly bogus.
In reality, if you strip out all the gimmicks and budgetary games and rework the calculus, a wholly different picture emerges: The health care reform legislation would raise, not lower, federal deficits, by $562 billion.

Gimmick No. 1 is the way the bill front-loads revenues and backloads spending. That is, the taxes and fees it calls for are set to begin immediately, but its new subsidies would be deferred so that the first 10 years of revenue would be used to pay for only 6 years of spending.

Even worse, some costs are left out entirely. To operate the new programs over the first 10 years, future Congresses would need to vote for $114 billion in additional annual spending. But this so-called discretionary spending is excluded from the Congressional Budget Office’s tabulation.

Consider, too, the fate of the $70 billion in premiums expected to be raised in the first 10 years for the legislation’s new long-term health care insurance program. This money is counted as deficit reduction, but the benefits it is intended to finance are assumed not to materialize in the first 10 years, so they appear nowhere in the cost of the legislation.

Another vivid example of how the legislation manipulates revenues is the provision to have corporations deposit $8 billion in higher estimated tax payments in 2014, thereby meeting fiscal targets for the first five years. But since the corporations’ actual taxes would be unchanged, the money would need to be refunded the next year. The net effect is simply to shift dollars from 2015 to 2014.

In addition to this accounting sleight of hand, the legislation would blithely rob Peter to pay Paul. For example, it would use $53 billion in anticipated higher Social Security taxes to offset health care spending. Social Security revenues are expected to rise as employers shift from paying for health insurance to paying higher wages. But if workers have higher wages, they will also qualify for increased Social Security benefits when they retire. So the extra money raised from payroll taxes is already spoken for. (Indeed, it is unlikely to be enough to keep Social Security solvent.) It cannot be used for lowering the deficit.

A government takeover of all federally financed student loans — which obviously has nothing to do with health care — is rolled into the bill because it is expected to generate $19 billion in deficit reduction.

Finally, in perhaps the most amazing bit of unrealistic accounting, the legislation proposes to trim $463 billion from Medicare spending and use it to finance insurance subsidies. But Medicare is already bleeding red ink, and the health care bill has no reforms that would enable the program to operate more cheaply in the future. Instead, Congress is likely to continue to regularly override scheduled cuts in payments to Medicare doctors and other providers.

Removing the unrealistic annual Medicare savings ($463 billion) and the stolen annual revenues from Social Security and long-term care insurance ($123 billion), and adding in the annual spending that so far is not accounted for ($114 billion) quickly generates additional deficits of $562 billion in the first 10 years. And the nation would be on the hook for two more entitlement programs rapidly expanding as far as the eye can see.

The bottom line is that Congress would spend a lot more; steal funds from education, Social Security and long-term care to cover the gap; and promise that future Congresses will make up for it by taxing more and spending less.
The Democrats know all this, but they happily ignored the reality of what their bill will really cost. All they needed was the pretense of a CBO stamp of approval so they could go before cameras and their constituents and pretend that they weren't voting for a huge new spending increase.

The real shame is that Medicare is still going broke. According to the Medicare Trustees Report from 2009, Medicare has unfunded future liabilities of $38 trillion. Even if future Congresses made the cuts in Medicare that the Democrats' bill promises, those savings aren't directed towards addressing those unfunded liabilities. No, they're redirected towards an entirely new, huge entitlement. Even more stringent future cuts will be necessary or the entire federal budget will be taken up by mandatory spending.

So if you hear some of these Democrats go around claiming about their pretty deficit-neutral program, you will know that that is a total farce. Instead of addressing the true problems that Medicare is facing, they've simply exacerbated the problems.