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Politics & Policy

A Bogus Health-Care Number from the Center for American Progress

A new analysis by Avalere Health, funded by the left-wing Center for American Progress, is making headlines for supposedly finding that Graham-Cassidy would cut $4 trillion in health care funding to states through 2036. Outlets like CNBC and Axios have led their stories with the $4 trillion number in the headline. But it’s fundamentally dishonest and anti-democratic.

The study finds a $215 billion-over-seven-years reduction in spending from 2020-2026, but then jumps up to $489 billion when one more year is added, and ends up at $4.15 trillion by 2036. Why? Because Graham-Cassidy provides funding through 2026, then requires an affirmative reauthorization of the block grants after that. Avalere treats that “funding cliff” as if Congress has barred future funding. (“As the bill does not appropriate block grant funding to states after 2026, Avalere does not assume any state block grant funding available from 2027 onwards.”) Even over the full 17-year time horizon, as CAP Health Care analyst Topher Spiro confirmed to me on Twitter, the study assumes $1 trillion in cuts from the changed funding formula, meaning that 75% of the projected “cuts” are attributable entirely to the program requiring further authorization by Congress by 2026.

You could hardly ask for a better illustration of the upside-down perspective of Beltway insiders: the idea that it’s a “cut” in federal spending to ever ask the House of Representatives to vote on it again. Liberal/progressive writers have expressed alarm that a massive category of the federal budget should ever again require the affirmative approval of the people’s Representatives. Yet, that’s precisely how our government was designed to function – indeed, the Framers of the Constitution expressly argued that the need to go back to the House year after year for funding was among the most essential safeguards of democracy and popular liberty in the entire document.

Article I of the Constitution provides that “All Bills for raising Revenue shall originate in the House of Representatives” (Sec. 7), that “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law” (Sec. 9), and specifically provided with regard to the army that Congress would have power “To raise and support Armies, but no Appropriation of Money to that Use shall be for a longer Term than two Years” (Sec. 8). While nothing in Article I expressly prohibited appropriations other than for raising armies from extending more than a year or two, it was broadly assumed and argued at the time that the House’s power over raising revenues, combined with the fact that the entire House stands for re-election every two years, meant that no money would be spent that wasn’t affirmatively appropriated by the current House majority. As Madison argued in Federalist No. 58, this was the centerpiece of the House’s power over the other, indirectly-elected branches:

The House of Representatives cannot only refuse, but they alone can propose, the supplies requisite for the support of government. They, in a word, hold the purse that powerful instrument by which we behold, in the history of the British Constitution, an infant and humble representation of the people gradually enlarging the sphere of its activity and importance, and finally reducing, as far as it seems to have wished, all the overgrown prerogatives of the other branches of the government. This power over the purse may, in fact, be regarded as the most complete and effectual weapon with which any constitution can arm the immediate representatives of the people, for obtaining a redress of every grievance, and for carrying into effect every just and salutary measure.

In Federalist No. 41, Madison argued that allowing two-year appropriations for raising armies was reasonable, given that the House would turn over after that: 

Next to the effectual establishment of the Union, the best possible precaution against danger from standing armies is a limitation of the term for which revenue may be appropriated to their support. This precaution the Constitution has prudently added…take notice of an argument against this part of the Constitution, which has been drawn from the policy and practice of Great Britain. It is said that the continuance of an army in that kingdom requires an annual vote of the legislature; whereas the American Constitution has lengthened this critical period to two years. This is the form in which the comparison is usually stated to the public: but is it a just form? Is it a fair comparison? Does the British Constitution restrain the parliamentary discretion to one year? Does the American impose on the Congress appropriations for two years? On the contrary, it cannot be unknown to the authors of the fallacy themselves, that the British Constitution fixes no limit whatever to the discretion of the legislature, and that the American ties down the legislature to two years, as the longest admissible term.

Had the argument from the British example been truly stated, it would have stood thus: The term for which supplies may be appropriated to the army establishment, though unlimited by the British Constitution, has nevertheless, in practice, been limited by parliamentary discretion to a single year. Now, if in Great Britain, where the House of Commons is elected for seven years; where so great a proportion of the members are elected by so small a proportion of the people; where the electors are so corrupted by the representatives, and the representatives so corrupted by the Crown, the representative body can possess a power to make appropriations to the army for an indefinite term, without desiring, or without daring, to extend the term beyond a single year, ought not suspicion herself to blush, in pretending that the representatives of the United States, elected FREELY by the WHOLE BODY of the people, every SECOND YEAR, cannot be safely intrusted with the discretion over such appropriations, expressly limited to the short period of TWO YEARS? 

The insistence that the spending power should be designed to require affirmative votes by Congress on a continuing basis was one of great practical urgency to the Framers, drawn – as Madison himself suggests – from the British experience. The great structural battle in British government in the 17th century was over whether the Crown could raise and spend money without calling up Parliament to provide it, or without calling for elections to a new Parliament. Efforts by Charles II and his successor, James II, to fund the government without new Parliamentary elections were one of the major triggers for the Glorious Revolution of 1688-89. The British “Bill of Rights” agreed by William III and Mary II as a condition of accepting the Crown after deposing James II required that the Crown would call regular Parliamentary elections to provide fresh popular support for any funds provided to the monarch.

This effectively constrained future British monarchs, and the colonists’ most prominent grievance leading up to the American Revolution was their exclusion from participating in the legitimizing role of new Parliaments in taxing and spending – thus, “no taxation without representation.” By contrast, the French monarchy had operated with financial independence that allowed it to avoid calling the Estates General between 1626 and 1789, and by the time of the drafting of the Constitution, the resulting profligate spending by successive French kings had led the nation into an existential financial crisis that would soon plunge it into Revolution.

Thus, while Article I did not prohibit permanent or multiyear appropriations outside of the area of funding armies, it was designed to keep spending on a short leash to avoid the growth of monarchical powers that could develop when the Executive could simply keep spending money without returning to Congress – in particular, the biennially-elected House – for continuing popular legitimation. This was seen as vital to the public’s sense that they controlled their government – a sense that has been slipping away badly in recent years. 

By 2017, of course, we have wandered far afield from the notion that the House’s permission should be required to spend money on any particular thing; today, at most, the House can either try to repeal spending measures (in which case it is powerless without the cooperation of both the Senate and the President), or to use some other form of leverage to bring them to the table, such as the debt ceiling or a shutdown of the entire government. Using the debt ceiling and continuing-resolution votes, which almost alone in the federal budgetary process require continual affirmative House votes, as the mechanism for exercising the popular control of the House over the budget are backwards and terribly blunt instruments, but they are nearly all that remains to the people’s House (which is why it is so alarming to see President Trump trade the debt ceiling power away in exchange for essentially nothing). The power of the purse is the power to simply refuse to act – and if the House can no longer exercise that power alone, it is not really in charge of its own core reason for existing.

So no, Graham-Cassidy doesn’t cut $4 trillion in spending. It just provides that the American people’s Representatives will need to be asked again, nearly a decade from now, to continue funding. If that’s too much democracy for you to handle, that says more about your view of  whether a popularly elected government, accountable to the people on an ongoing basis, should really be trusted to run the country.

Dan McLaughlin — Dan McLaughlin is an attorney practicing securities and commercial litigation in New York City, and a contributing columnist at National Review Online.

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