The current crop of GOP lawmakers in Washington are risking conservative voter revolt in coming elections as it becomes increasingly clear that the Republican establishment is poised to give in to Democrat demands on the Obamacare overhaul.
Senate Majority Leader Mitch McConnell (R-Ky.) on Thursday left little doubt about the establishment’s lack of conviction when it comes to producing the Obamacare repeal and replacement the GOP promised voters for the past eight years. If the Senate can’t muster the 50 votes required to pass the current Obamacare re-write, McConnell told a Rotary Club group in Glasgow, Ky., Republican leaders will be forced to work across the aisle with Democrats on an alternative plan.
“If my side is unable to agree on an adequate replacement, then some kind of action with regard to the private health insurance market must occur,” McConnell said. “No action is not an alternative. We’ve got the insurance markets imploding all over the country, including in this state.”
This is the second time McConnell has hinted that Republican belligerents pushing for a full repeal and replacement– which the party promised voters– are going to be responsible for forcing the leadership to give in to Democrat demands that Congress  prop up, rather than do away with, Obamacare.
And already, GOP leaders are floating ideas that would further distance the current legislation from anything resembling the promised repeal in an effort to woo Democrats they may be working alongside on the legislation later.
For instance, the GOP leadership is now discussing leaving intact a 3.8 percent net investment income tax imposed by the Obama administration to help pay for Obamacare subsidies. Earlier iterations of the GOP’s rewrite left out the tax, bringing many Democrat lawmakers to the floor to carry on about how Republicans only care about wealthy Americans.
The investment tax applies to to earnings from capital gains, dividends and interest for single Americans earning more than $200,000 a year and couples earning more than $250,000.
Conservative opponents of the tax argue that it hampers the economy by increasing the tax burden on job creators.
“This tax, just like any tax increase, is an anathema to conservatives as it suppresses economic growth and opportunity throughout our nation,” Club for Growth President David McIntosh said recently. “Under no circumstances should the NIIT be included in any forthcoming Republican ‘repeal’ bill.”
Club for Growth is just one of about 47 conservative organizations throughout the country urging the GOP to resist Democrat pressure to keep the tax.
Americans for Tax Reform pointed out this week that the revenues raised by the tax is often insignificant, even negative, especially compared to the damage the net investment income provision does to the free market.
“This tax is a known job-killer. It would be a bad idea to leave this tax in the code for a second longer than necessary,” the organization said. “The faster we get the capital gains tax down, the faster we’ll get further growth and investment.”
Unfortunately, the tax is very likely to remain.
And, as The Wall Street Journal’s editorial board pointed out this week, it’ll be just the first of many concessions the GOP leadership makes to Democrats as the healthcare debate drags on: “Democrats will pocket the concession and continue demagoguing tax cuts for the wealthy as the tax debate begins — only more emboldened for having tasted blood.”
No doubt. But it shouldn’t come as a surprise. We’re witnessing the same duality within the GOP that we’ve been seeing for years: The Republican Party and its Washington establishment leaders understand that the average GOP voter is very fiscally conservative and becoming more so every day. But the Republican Party and its Washington establishment leaders are not actually fiscal conservatives.
So they create messaging for the voters. Simple, chant-able messaging that plays well during speeches and rallies. Conservative American voters dislike the freedom-robbing provisions included in the healthcare law bearing the previous president’s name? Well, we’ll REPEAL IT! Repeal it! Repeal it!
And then they make symbolic gestures– more than 50, when it came to voting on Obamacare repeal bills that were sure to die by the pen.
If Obama had wanted to destroy the GOP while still in office, he should have taken it on the chin and allowed a repeal to occur. Why? Two reasons. For most of the time GOP leaders raised money and wooed voters with repeal talk, they lacked any actual plan to pick up the pieces. And from the White House, Obama would have then been able to blame Obamacare’s failure on the GOP, while leveraging the bully pulpit to re-establish government-controlled healthcare. Look at this turmoil they created, he could have said. He must’ve known Obamacare wasn’t going to hold up, everyone else with a solar powered calculator did. So why not let a vote the GOP leadership didn’t expect to go anywhere reach its conclusion and revel in the ensuing chaos. It’d be better than the slow death march the president’s healthcare law has endured without intervention.
Of course, Obama couldn’t do that. Giving in to the GOP would’ve damaged Hillary Clinton’s “inevitable” presidential bid. Plus, acquiescing to the other party’s demands is the GOP’s job.
But if you think Obama didn’t know that the GOP would never achieve its repeal in any substantive way, even with a Republican president in the White House? Think again.
House Majority Leader Paul Ryan finally did come up with a plan last year. And, sure, it called for the dissolution of individual mandates. But it mostly kept Obamacare intact, taxes and all. It came after the election, before the inauguration. An effort to temper expectations, one might say.
Congressional Republican leaders in Washington have been doing everything but taking out full page advertisements in major newspapers to let American conservatives know, to borrow from former House Speaker John Boehner, that “outside groups” calling for real conservatism have no sway over the GOP establishment. No matter how much they advocate for GOP candidates they believe will cut taxes, restore freedom and get the government out of healthcare, the leadership will always spend any time that’s not election time acting as though conservative Washington outsiders have “lost all credibility.”
But why is the GOP establishment so against allowing for a full repeal like the one Sen. Rand Paul (R-Ky.) and other conservatives have been advocating in the first place?
Because a repeal will be painful for many Americans. Many will lose coverage, there will be a great deal of uncertainty and confusion. Establishment politicians hate uncertainty– it makes it too hard to control the narrative. And when your stack of lies is as high as it needs to be to stay in Washington for more than a few years, controlling the narrative is important. Also, of course, the insurance companies Obamacare was written for have a lot of money sitting around.
If Americans want real conservative reforms out of Washington, it’ll take a level of comfort with the initial tough consequences. But first, it’ll take a national commitment to removing government lifers from Washington and checking the Republican Party establishment’s power all the way down to local council elections. If the Obamacare non-repeal accomplishes nothing else, it ought to at least serve as a reminder that often the biggest enemies of conservative reform are in plain sight within the GOP.