Obamacare Schadenfreude: Hashing Out Halbig

A cloudy, humid morning here, with the threat of storms later, but nothing on the radar yet. At least the clouds are holding the temperature down.

The fallout from Halbig vs. Sebelius Burwell continues. You might remember that yesterdays highlight reel was the video of Jonathon Gruber, a primary architect of Obamacare saying that the point of not awarding subsidies to people on the federal market places was to coerce encourage the states to get with the program, which pretty much invalidates the "it was a drafting error" defense that the 6th Circuit relied on. He's now on record saying that he doesn't remember saying that, that he was speaking extemporaneously, and committed a "speak-o" (yes, he used that word):

I honestly don’t remember why I said that. I was speaking off-the-cuff. It was just a mistake. People make mistakes. Congress made a mistake drafting the law and I made a mistake talking about it.

During this era, at this time, the federal government was trying to encourage as many states as possible to set up their exchanges. …

At this time, there was also substantial uncertainty about whether the federal backstop would be ready on time for 2014. I might have been thinking that if the federal backstop wasn’t ready by 2014, and states hadn’t set up their own exchange, there was a risk that citizens couldn’t get the tax credits right away. …

But there was never any intention to literally withhold money, to withhold tax credits, from the states that didn’t take that step. That’s clear in the intent of the law and if you talk to anybody who worked on the law. My subsequent statement was just a speak-o—you know, like a typo

The only problem with that explanation is that is that reviewing the records turned up additional instances of his saying the same thing, from prepared remarks.

Give credit to Morgen Richmond and John Sexton for digging it up. There’s a key difference between this audio and the audio Ed posted this morning, too. . .

Gruber’s moronic excuse to TNR, that he committed a “speak-o” while rambling through a Q&A, obviously doesn’t work for this one. Which makes me wonder: Did he knowingly lie to TNR or has he somehow convinced himself that he never believed that only state exchanges would be eligible for ObamaCare subsidies? The answer doesn’t matter insofar as the quotes are damaging either way to the left’s bogus “drafting error” theory for what happened in the parts of O-Care at issue in the Halbig case, but I’m amused by how he’s painted himself into a corner now. His choices are ‘fessing up to lying, probably by admitting that yes, okay, he did at one point believe that only state exchanges would be eligible but has since changed his mind, or basically saying, “Oh yeah, I forgot about that.” Mind you, this is the guy whom the media routinely credits as having all but drafted the ObamaCare statute.

And one more in the same vein from C-Span:  Senate Hearing : Tax Credits are available for State Exchanges Only

Senator Baucus explains how The Affordable Care Act sets conditions where Tax Credits are available for State Exchanges Only

At this point is there any serious doubt that the democrats in the senate who wrote the bill intended the language as written, and only subsequent to the failure of the states to be coerced, changed their tune, and directed the IRS to codify their new prefered interperetation into the regulations? And speaking of the IRS role. . .

From Instapundit, because the original WSJ article is behind the paywall:

KIMBERLEY STRASSEL: The ObamaCare/IRS Nexus: The supposedly independent agency harassed the administration’s political opponents and saved its health-care law.

One of the big questions out of the IRS targeting scandal is this: How can an agency that engaged in such political misconduct be trusted to implement ObamaCare? This week’s Halbig v. Burwell ruling reminded us of the answer. It can’t.
The D.C. Circuit Court of Appeals ruled in Halbig that the administration had illegally provided ObamaCare subsidies in 36 insurance exchanges run by the federal government. Yet it wasn’t the “administration” as a whole that issued the lawless subsidy gift. It was the administration acting through its new, favorite enforcer: the IRS.
And it was entirely political. Democrats needed those subsidies. The party had assumed that dangling subsidies before the states would induce them to set up exchanges. When dozens instead refused, the White House was faced with the prospect that citizens in 36 states—two-thirds of the country—would be exposed to the full cost of ObamaCare’s overpriced insurance. The backlash would have been horrific, potentially forcing Democrats to reopen the law, or even costing President Obama re-election.
The White House viewed it as imperative, therefore, that IRS bureaucrats ignore the law’s text and come up with a politically helpful rule. The evidence shows that career officials at the IRS did indeed do as Treasury Department and Health and Human Services Department officials told them. This, despite the fact that the IRS is supposed to be insulated from political meddling.
We know this thanks to a largely overlooked joint investigation and February report by the House Oversight and Ways and Means committees into the history of the IRS subsidy rule. We know that in the late summer of 2010, after ObamaCare was signed into law, the IRS assembled a working group—made up of career IRS and Treasury employees—to develop regulations around ObamaCare subsidies. And we know that this working group initially decided to follow the text of the law. An early draft of its rule about subsidies explained that they were for “Exchanges established by the State.”
Yet in March 2011, Emily McMahon, the acting assistant secretary for tax policy at the Treasury Department (a political hire), saw a news article that noted a growing legal focus on the meaning of that text. She forwarded it to the working group, which in turn decided to elevate the issue—according to Congress’s report—to “senior IRS and Treasury officials.” The office of the IRS chief counsel—one of two positions appointed by the president—drafted a memo telling the group that it should read the text to mean that everyone, in every exchange, got subsidies. At some point between March 10 and March 15, 2011, the reference to “Exchanges established by the State” disappeared from the draft rule.
Emails viewed by congressional investigators nonetheless showed that Treasury and the IRS remained worried they were breaking the law. An email exchange between Treasury employees in the spring of 2011 expressed concern that they had no statutory authority to deem a federally run exchange the equivalent of a state-run exchange.
Yet rather than engage in a basic legal analysis—a core duty of an agency charged with tax laws—the IRS instead set about obtaining cover for its predetermined political goal.

Tyrannizing you with your money.

From Smitty at The Other McCain: Just Relax In Your ‘Fundamentally Transformed’ Country, Americans:

In the pre-transformed America, it was understood that the Commies had infiltrated Hollywood and academia. No one really expected subversion of the IRS:

To summarize: The IRS (famed for nitpicking and prosecuting the tax law), chose to authorize hundreds of billions of illegal subsidies without having performed a smidgen of legal due diligence, and did so at the direction of political taskmasters. The agency’s actions provided aid and comfort to elected Democrats, even as it disenfranchised millions of Americans who voted in their states to reject state-run exchanges. And Treasury knows how ugly this looks, which is why it initially stonewalled Congress in its investigation—at first refusing to give documents to investigators, and redacting large portions of the information.

These dots on the financial rigging side connect just as we hear that, on the drafting side, the shenanigans were just as wretched. . .

The Politics of Halbig

Jamelle Bouie is one of many arguing that the D.C. Circuit decision on Obamacare creates political peril for Republicans:

In Arkansas, where Republican Rep. Tom Cotton is running a tight race against the Democratic incumbent Sen. Mark Pryor, 40,000 people have paid premiums for health insurance on the federal exchange. If Halbig went into effect today, about 34,000 of those Arkansans would face huge increases in their premiums, given a national average increase of 76 percent, according to one study. That’s an unlikely outcome, but it shouldn’t (and likely won’t) stop Pryor from hitting Cotton as hostile to middle-class families and anyone else who needs health insurance.

I wouldn’t be so sure it works out that way. If tax credits suddenly get withdrawn and people have to pay a larger share of their premiums as a result, red-state Democrats probably will blame Republicans for causing the mess. But Tom Cotton neither wrote the flawed legislation, nor recklessly sent out tax credits in violation of it, nor filed the lawsuit against it. Wouldn’t he just parry by saying, “Obamacare has caused mess after mess”? Arkansas voters—who still dislike Obamacare—might well accept that version of events. . .

Just be sure to keep the focus of Obamacare's problems on the Democrats. They wrote it, they lied about what was in it, they passed it with zero assistance from the Republicans. They deserve all the the blame for whatever doesn't work.

Megan McArdle on the fraud issue: Add Fraud to the List of Obamacare Disasters

. . . It sounds like the systems that are supposed to check identity, immigration status and income simply aren’t working at all; the system just assumes that you are who you say you are.

This isn’t the only major part of the system that’s still missing; as the Official Blog Spouse reported last week, the system that pays insurers still seems to be MIA. Presumably, the emergency team called in to fix the exchanges prioritized the bits that the public could see, leaving everything else for later. Compared to what was described by the Barack Obama administration (and the law), the system still seems to be half-built.

How much does this matter? Obviously, all the GAO can say is that this is possible; we don’t know whether, or how often, such fraud has actually occurred. Even if you get an insurance card fraudulently, how easy would it be to use without ever being asked for picture ID? How many people would go to the trouble of faking or altering documents? And might the subsidies be taken away after review? We simply don't know.

Still, it’s obviously troubling that people could so easily fraudulently obtain government subsidies, because the incentive to do so is obvious: free money from the government. It’s also troubling because it makes one wonder what other major parts of the system simply aren’t working.

Room for fraud wasn't a mistake, it was baked in to get as many people as possible getting the cash and becoming reliant on subsidies.

New IRS Form Proves Obama Lied About Individual Mandate Tax

President Obama has repeatedly denied that the surtax is in fact actually a tax. The most prominent example was a heated exchange on ABC’s This Week in Sept. 2009, when George Stephanopoulos confronted Obama with a dictionary:

STEPHANOPOULOS: I -- I don't think I'm making it up. Merriam Webster's Dictionary: Tax -- "a charge, usually of money, imposed by authority on persons or property for public purposes."

OBAMA: George, the fact that you looked up Merriam's Dictionary, the definition of tax increase, indicates to me that you're stretching a little bit right now. Otherwise, you wouldn't have gone to the dictionary to check on the definition. I mean what...
STEPHANOPOULOS: Well, no, but...

OBAMA: ...what you're saying is...

STEPHANOPOULOS: I wanted to check for myself. But your critics say it is a tax increase.

OBAMA: My critics say everything is a tax increase. My critics say that I'm taking over every sector of the economy. You know that.

Look, we can have a legitimate debate about whether or not we're going to have an individual mandate or not, but...

STEPHANOPOULOS: But you reject that it's a tax increase?
OBAMA: I absolutely reject that notion.

On Thursday the IRS released a slew of draft 2014 tax forms. The new draft Form 1040 shows a new surtax line has been created for the payment of the individual mandate surtax – see line 61 of the 1040:

He lied. So sue him.