What is increasingly obvious is that President Trump’s motivations and impulses have everything to do with narcissism, personal piques, anger at his predecessor and fear of losing face — and very little to do with creating real policy outcomes. He prefers to be seen doing something rather than to do something for which he would bear the consequences. We’ve seen this on the Deferred Action for Childhood Arrivals (DACA) program, health care and taxes.
At the behest of his anti-immigrant advisers Attorney General Jeff Sessions and Stephen Miller, he rescinds DACA on the grounds that it is unconstitutional, but not so unconstitutional as to end right away. He sets a March deadline, then gets cold feet and promises “Chuck and Nancy” he will agree to a DACA fix for more border security. Miller tries to nix the deal with ridiculous demands. Trump gets nervous once again and on Thursday tells Sen. James Lankford (R-Okla.), a co-sponsor of a GOP bill to legalize “dreamers,” that he’ll extend the March deadline for ending DACA, which was supposed to be unconstitutional. Got it? It’s smoke and mirrors, and puffery for the base, followed by retreats. The lives of hundreds of thousands of young people are irrelevant to him. He wants a “win,” and he wants his base to be happy.
On the Affordable Care Act, he could not piece together a workable replacement that could get through Congress, so by executive order he seeks to sow chaos, wreck the exchanges and carry out what some have described as “synthetic repeal.” He will create loopholes for health-care associations to offer cheaper (i.e. high-deductible, non-compliant insurance) and turn temporary coverage plans (also non-compliant) into substitutes for ACA-approved plans.
Then the kicker: He’ll stop paying the subsidies that insurers were promised to cushion them from losses. The Post reports:
Ending the payments is grounds for any insurer to back out of its federal contract to sell health plans for 2018. Some states’ regulators directed ACA insurers to add a surcharge in case the payments were not made — but insurers elsewhere could be left in a position in which they still must give consumers the discounts but will not be reimbursed. . . .
One person familiar with the president’s decision said that HHS officials and Trump’s domestic policy advisers had urged him to continue the payments at least through the end of the year.
The cost-sharing payments are separate from a different subsidy that provides federal assistance with premiums to more than four-fifths of the 10 million Americans with ACA coverage.
Those subsidies for individuals will rise as premiums soar, shifting more cost to taxpayers and adding to the deficit.
The upshot is that insurers may then flee the exchanges or raise premiums. The Congressional Budget Office estimated that ending the cost-sharing reductions (CSRs) would have dramatic consequences: “Premiums for 2018 would increase by 20% over the CBO’s current baseline and by 25% over the 2020 projection … [and] since premiums would increase with no CSRs, Americans would need more help paying the higher costs through subsidies. The increased cost of subsidies, said the CBO, would be greater than simply funding the CSRs.” In addition, CBO estimated that as insurers fled, about 5 percent of the country would not have access to the exchanges.
After the lawsuits by states (including California and New York) and/or insurers, Congress could fix all this by, for example, the compromise plan Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) were working on. If Trump gets his way, he will have created Trumpcare, a failing system that will disrupt the insurance market, drive up costs and leave many more Americans uninsured. This is the great plan he had in mind? His “solution” to Obamacare is to make it much worse and blame others. He, as with DACA, has no solutions of his own, none that he can comprehend and push through Congress. Republicans in Congress foolishly cheer this mindless destruction, as if they have forgotten (or never thought through) how to improve health care for Americans.
Turning to the tax front, Trump’s giddy language about middle-class tax relief doesn’t match the half-baked tax outline he put out. In fact, some middle-class taxpayers will pay more because, as Josh Barro points out, the plan takes away the personal exemption, but the substitute (an increase in the standard deduction) doesn’t fully compensate some taxpayers: “Abolishing the personal exemption would raise $1.6 trillion over 10 years. The measures designed to offset that change — the larger standard deduction and dependent credits — would only reduce taxes by $1.1 trillion, meaning a net tax hike of $500 billion aimed largely at the middle and upper-middle class.”) The plan, in short, was either never thought through or never intended really to focus on middle-class taxpayers. (“Abolishing personal exemptions is a revenue-raising option that hits middle-income families unusually hard.”) Trump and/or Congress could fix the plan and align it with their rhetoric, but that would entail cutting out items intended solely to benefit the super-rich (e.g. abolishing the estate tax, lowering the top rate to 35 percent and creating a 25 percent pass-through rate). Trump, as he did on DACA and health care, isn’t creating tax policy of tangible value to ordinary Americans; he’s flapping his arms, misrepresenting the plan and getting ready to blame Congress when the whole thing flops.
In sum, on DACA, health care and taxes, Trump never had a clue what he would offer to replace policies that he vilified. Now he’s content to tear away at policies that help at least some people, substituting rhetoric and faux legislation that has not been carefully considered. He is playing a president on TV for his low-information viewers. He’s not governing, however, and he sure isn’t “winning.”