By getting eight Senate Democrats to relent, Republicans appear to have cleared the biggest obstacle toward ending the longest government shutdown in American history, though a few more legislative steps and President Trump’s signature still remain.
Under the deal, certain key priorities (military construction, veterans’ affairs, and the Department of Agriculture) would be funded through the full fiscal year ending next September 30, while funding for the rest of the government would extend until January 30. That will be long enough for Congress to make it to the other side of the holidays, but short enough that it will set the stage for another showdown right after they get back in the New Year.
To secure the agreement, Democrats abandoned a demand that was central to the shutdown, which was that Republicans expand Obamacare. Instead, the agreement would do no more than promise a vote on extending the Covid-era subsidies for purchasing insurance on Obamacare’s exchanges that are set to expire at the end of the year.
In the short run, this is a win for Trump, who would not be cowed by Senate Minority Leader Chuck Schumer — the government is poised to reopen without any concessions. At the same time, the deal is incredibly divisive among Democrats, with progressive voices infuriated with Democratic senators for buckling. Though they had absorbed the cutting off of food stamp benefits, ultimately the prospect of holiday travel being roiled by delays and cancellations due to the shortage of air traffic controllers seems to have forced a compromise. We are glad that Republicans did not cave on expanding Obamacare, as we urged them to hold the line back in September. And we also applaud them for not using this as an opportunity to nuke the filibuster as Trump had called for, because such action would undermine America’s founding idea that major changes should be difficult to impose. In the long run, getting rid of the obstacle would prove more beneficial to left-wing radicals who have an expansive view of government.
The flip side of this result is that Democrats will now be able to bring the issue of rising health care premiums into the midterm elections. This was an own goal by Republicans, who over the more than 15 years since the passage of Obamacare have failed to rally around an alternative and have surrendered the issue of affordability to Democrats.
Obamacare is a national insurance scheme that functions by imposing a raft of regulations on insurance policies and then forcing young and healthy enrollees to pay more for coverage to offset the cost of covering older and sicker enrollees. From its implementation in 2014, enrollees were subject to dramatic annual premium increases, and the program struggled to sign up younger Americans, driving costs even higher and forcing many large insurers out of the individual market. Republicans were unsuccessful in replacing the program in Trump’s first term with something better, and so when Democrats retook power, they used the emergency of Covid as an excuse to funnel more subsidies to insurance companies. The temporary measure did not fix any of the underlying problems with Obamacare but instead masked the premium increases.
So, when Democrats and their media allies talk about premiums going up next year, they aren’t actually talking about the underlying costs, which are increasing thanks to Obamacare itself. They just mean that the government won’t be filling in as much of the gap anymore. A system without these subsidies in 2026 would just represent a return to the original version of Obamacare prior to 2021, which Democrats never claimed was scandalously close-fisted.
There is no shortage of policies that Republicans could advocate to advance choice and affordability. They could push for cheaper plans that will save individuals from financial ruin in the event of a catastrophic event without paying for routine care. Republicans could expand health savings accounts by increasing the allowable limits, enabling individuals to use them to pay for premiums tax-free just as those with employer insurance are able to do, and/or allow people to put money in HSAs to pay for unexpected medical expenses no matter what type of health plan they have or even if they have no plan at all. Republicans can consider various proposals to pull individuals with preexisting conditions out of the insurance market and help them directly rather than imposing the costs of treating them on a few million younger and healthier individuals.
Republicans would have been in a much better position to blunt Democratic attacks had they been spending their time in power explaining how Obamacare regulations drive up the cost of insurance and offering alternative ways to make insurance more affordable. They now have a chance to go into next year better prepared politically if they put for consideration in Congress worthy alternative policies, even if they know Democrats will block them.
The United States spends roughly $5 trillion per year on health care at all levels, representing more than one in six dollars of the economy. They may not like to talk about it, but Republicans need to realize that the health care issue isn’t going away and they need to find their voice on it.