Bench Memos

Obamacare Architect Embraced Anti-Subsidy Reading

If this doesn’t quiet down the crazies on the Left, nothing will.

It turns out that leading Obamacare architect (and MIT economist) Jonathan Gruber embraced the exact reading of the exchange-subsidy provisions that the plaintiffs challenging the Obama administration’s application of those provisions have advanced. Specifically, in a January 2012 presentation, Gruber explained:

[S]o these health-insurance Exchanges … will be these new shopping places and they’ll be the place that people go to get their subsidies for health insurance. In the law, it says if the states don’t provide them, the federal backstop will. The federal government has been sort of slow in putting out its backstop, I think partly because they want to sort of squeeze the states to do it. I think what’s important to remember politically about this, is if you’re a state and you don’t set up an Exchange, that means your citizens don’t get their tax credits. But your citizens still pay the taxes that support this bill. So you’re essentially saying to your citizens, you’re going to pay all the taxes to help all the other states in the country. I hope that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these Exchanges, and that they’ll do it

Cato’s Michael Cannon, who (with Jonathan Adler) has spearheaded the challenges, has much more here (including a video of Gruber’s remarks).

Update: As Gruber tries to run away from his comments, John Sexton and Peter Suderman highlight similar comments by Gruber on another occasion.

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