Trump’s Bermuda Triangle: Obamacare, Taxes, and the Debt

I’ve got an oped in the Times today on the GOP meltdown over Obamacare.

While pundits and journalists focus on the problems of personality (Trump’s or the GOP’s as a whole) and policy (the Republican bill was a terrible bill, the assumption being that Republicans somehow never pass terrible bills), of timing (the GOP should have waited to do healthcare until after they dealt with taxes, an analysis that gets things backward) and tactics (Trump negotiated badly, Ryan led badly), the real story, I argue, is deeper and more structural:

Movements long ensconced and habituated to power — such that when their leaders are out of office, their ideas still dominate — get out of that practice. They lose touch with that external reality of their opponents. The impulsion outward disappears; they grow isolated and doctrinaire, more sectarian than evangelical. Arguments their predecessors had to sweat their way through soften into lazy nostrums or harden into rigid dogmas. The free-market ideal, Hayek says, “became stationary when it was most influential.”

Now the movement’s problem is the opposite of when it was in its ascendancy. Its leaders may control all the elected branches of the federal government, as the Republicans do now and as the Democrats did under Jimmy Carter, and many of the state governments, but they no longer control or set the terms of political debate as much as they once did. Their power in government conceals their slipping hold on public legitimacy.

It’s not that the character of the personnel has changed: The Tea Party supporter is no more zealous than Barry Goldwater, and on any given day, Ronald Reagan could be as fuzzy and foggy as Donald Trump. It’s the context that has changed. Yesterday’s conservative wrote and read his Bible in the crucible of defeat; today’s recites his catechism in a cathedral of success.

It’s no surprise, then, that the Republican Party should now find itself uncertain about what to do. After 40 years in Zion, it has lost the will and clarity it acquired while wandering in the desert. The movement has lost the constraint of circumstance.

You can read more here.

Looking forward, there are two issues to consider.

First, taxes.

Now that the Republicans have been defeated on healthcare, or defeated themselves, I’m seeing on social media a fair amount of second-guessing and stealing victory from the jaws of defeat. Some analysts and partisans are now saying that Trump and Ryan and the Republicans didn’t really care about repealing Obamacare, that this was all kabuki theater orchestrated by Trump or Bannon or Ryan himself.

That’s, well,  not true.

If you go back to the best reporting on this issue, it’s clear that repealing Obamacare was never, simply, about an ideological antipathy to government-provided or government-subsidized insurance—though that of course played a role. What really was driving the repeal—and why Ryan insisted it had to be done first (that was no duping of Trump, as some are claiming, nor was it Bannon setting up the Freedom Caucus, as some are even more fantastically claiming)—was the tax cuts: not only the massive tax cuts that the repeal contained within itself, but also, and more important, the permanent tax cuts that repeal would make possible down the road this year (in a way that George W. Bush’s tax cuts were not permanent, much to the chagrin of the right). There was, in other words, a very rational reason to take on healthcare first; in some ways, given the ultimate long-term goals of the GOP (where cutting taxes has always proven to be the most tried and true method for keeping entitlement spending under control), they had no choice but to move on healthcare first.

That was why, ultimately, I thought the repeal might pass: Ryan and Trump could make it clear to the Unfreedom Caucus that without repeal, they couldn’t get permanent tax cuts.

Now, if they want permanent tax cuts, they’re going to have eliminate the Senate filibuster because they’d have to eliminate the Byrd Rule. So there’s no way of slicing yesterday’s defeat as anything other than a massive defeat for Trump, Ryan, and the entire GOP: not only on political grounds (I think people really underestimate how bad it is for a president to lose like this this early on; again, this is partially why Bannon worked so hard to get this bill passed) but also on substantive policy grounds insofar as this messes up their plans on taxes.

Second, the debt.

I’ve been saying for months that the Republicans are facing a Bermuda Triangle around Obamacare, taxes, and the debt. As we get toward the April deadline on the debt ceiling, will the Republicans lift the debt ceiling or enact stopgap measures that will allow the federal government to spend in the coming months?

You’ll recall that this issue dogged Obama like the plague: whether you think it was the GOP that controlled him on this issue or he who allowed himself to be controlled by the GOP, it was a real constraint on his presidency from 2010 onward. So as soon as Trump was elected I began to wonder to myself whether this same GOP, and particularly these meshuga Tea Partiers, would allow Trump simply to increase the debt ceiling without exacting some sort of price from him, the way they did with Obama.

Under Obama, liberal journalists and partisan defenders of Obama had treated the GOP grandstanding on the debt as it if were all about race: these members of Congress simply refused to accept Obama’s legitimacy as a black president, so refused to increase the debt as a way of thumbing their nose at them. I always thought that explanation was wrong because it ignored how hardcore these people were on the tax/spending issue, and how their stance totally fit with Grover Norquist’s long-term strategy of divesting the government of tax money in order to force cuts in social spending (Norquist always being the best guide, when it comes to taxes and spending, to the reactionary mind).

Now we come to the Trump administration. Leftists alarmed by Trump tend to think the GOP will naturally fall in line with him and with Bannon’s vision of a different kind of GOP. So the debt ceiling from this perspective won’t even be an issue. I myself really didn’t know what would happen: would these Tea Party types really have the gumption to oppose Trump on the debt, to force him to come around to their priorities? I was dubious.

After what happened this past week, I’m no longer dubious. I still have no idea what the GOP will do, but I think it not impossible that the Unfreedom Caucus and their allies (a much wider group in the GOP) will replay with Trump what they did with Obama: demand concessions from Trump on taxes and spending in order to justify their voting to raise the debt ceiling. The difference this time around is that unlike Obama, Trump has far less room to maneuver: Obama had the entire Democratic Party vote and only needed a certain number of GOP votes; Trump has an uncertain number of GOP votes and will almost definitely have to reach out to the Democratic Party.

If the Democrats are smart and ready to play hardball, they could extract some concessions of their own—not necessarily on penny ante spending crap, which will never be enough to deal with the rot and which they can probably win anyway given GOP division on the budget, but maybe on some of the nastier parts of the Trump program.


  1. Romaine March 26, 2017 at 8:51 am | #

    Good analysis. I also think the debt ceiling tail risk increased after the ACHA loss. Even more so since Trump has revealed himself to be a “paper tiger.’ Think of the One China episode as a case example.

  2. Chris Morlock March 26, 2017 at 9:14 am | #

    Great political analysis, the left is giddy with watching the train wreck. Was it worth the spectacle? The ACA is doomed under a Republican government anyway, part of the reason it never worked to begin with is the endless sandbagging of the right (especially the Governors). The system will continue to fail at it’s core intent: keeling prices down. Now the Republicans have an easy excuse to continue to sabotage a poorly constructed healthcare system. This is nothing more than Washington gridlock, and no one is going to “win”.

    There was some hope that at some point the national competition system could have been put in place, and Democrats could have seized on that part of legislation (and attempted to twist the arm of the Freedom Caucas) but they chose to ignore the issue. The tea parities insistence that protections for pre-existing conditions be removed also painted them as completely tone-deaf.

    There was a logic to balancing the failure of the individual marketplace and the co-ops with cuts to the medicaid part of the ACA, and there certainly was logic to national competition. People will no doubt suffer in any condition, and being happy about the “loss” shows that you are in fact not on Obamacare nor understand how it functions for working people or the poor.

    • Robin Stelly March 26, 2017 at 9:49 am | #

      I don’t know about every group opposed to the ACHA but my group was fighting to save Medicaid and Medicaid Expansion. So yes, it was worth the spectacle. We aren’t giddy. The mood is definitely that we (and the people we advocate for) live to fight another day. My guess is that Medicaid still has the target on its back for the tax reform and budget fights. And protecting it through those fights will be much harder to do for obvious reasons.

      • Chris Morlock March 27, 2017 at 1:36 am | #

        The ACA had so many parts to it, each one dependent on the other. The failure of the individual marketplace and the co-ops meant the revenue stream supposed to be generated from taxes on the burgeoning new “market” cannot provide the funds to pay for the Medicaid additions. Again the working class is mysteriously not in the equation of left wing politics. If you fought for Obamacare now, you were fighting for poor people who largely do not pay taxes.

        The working class or middle class solution was the individual marketplace, which was doomed to failure because of the Right’s sabotage and the fact that no national competition exists. Those factors alone account for the vast majority of reasons the system will ultimately fail, and is failing now.

        The left’s insistence that Obamacare works is just as bad as the Right’s wanted to completely dismantle it. The ACA is turning out to be a medical welfare program, providing poor people with awful insurance. This was not my dream, and seems hopelessly flawed.

        At least Trumpcare would have been obviously very unpopular and ineffectual and proven to people that Republicans couldn’t fix healthcare in a million years. Now we are facing having to defend an awful system and own that outcome.

  3. mark March 26, 2017 at 9:49 am | #

    ‘About That Coin’ Paul Krugman blog JANUARY 31, 2014.

    ‘Some comments I’ve seen indicate that people still think the trillion-dollar platinum coin idea was self-evidently ridiculous. Guys, you missed the memo — literally. From last month:

    The Obama administration was serious enough about manufacturing a high-value platinum coin to avert a congressional fight over the debt ceiling that it had its top lawyers draw up a memo laying out the legal case for such a move, The Huffington Post learned last week.

    The Justice Department’s Office of Legal Counsel, which functions as a sort of law firm for the president and provides him and executive branch agencies with authoritative legal advice, formally weighed in on the platinum coin option sometime since Obama took office, according to OLC’s recent response to HuffPost’s Freedom of Information Act (FOIA) request. While the letter acknowledged the existence of memos on the platinum coin option, OLC officials determined they were “not appropriate for discretionary release.”

    A bad idea? Maybe — Obama and company seem to have successfully played chicken on this issue. But ridiculous, no — it was seriously considered as an option.’

  4. msobel March 26, 2017 at 11:08 am | #

    I’m interested in what you think the Democratic should require in exchange for their votes.

  5. Lichanos March 26, 2017 at 5:34 pm | #

    I liked your piece, and I agree with it, as far as it goes, but is that what is really going on with the Republican’s? Seems to me that a “lack of practice” wouldn’t do them any good, and that The Movement of the Unfreedom Caucus has become it’s own party wthin a party, And the reasons for that are many, but not the one’s you cite in your article.

    On the other hand, Ted Cruz predicted and deplored the phenomenon I hear being noted more and more these days, BY CONSERVATIVES, that people have somehow gotten it into their heads that they have a RIGHT to healthcare. I hear conservatives predicting a single payer option within five or ten years – what’s up with that!!

    So it’s the 21st century, and a chunk of the Republicans are racing back to the 1880s, while the bulk of the country is drifting at last into the 20th???

  6. tankermottind March 27, 2017 at 10:25 am | #

    “If the Democrats are smart and ready to play hardball” is like saying “if the Democrats were a totally different political party that weren’t a bunch of gormless cowards”. There is no opportunity too great for them to squander, no crisis too urgent for them to stick their heads in the sand. They’re going to job for the Republicans…again.

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