How Southern Republicans Aim To Make White Democrats Extinct
State Rep. Stacey Abrams serves as the Georgia House Minority Leader.
Across the state, legislative maps are drawn to split voters along artificial lines to isolate them by race. Legislators see their districts disappear, themselves the target of racial gerrymandering. Citizens rise up in protest and demand the right to elect the candidate of their choice, but the ruling party ignores them. Racial groups are identified and segregated; their leadership eliminated. It is the way of the South. Only this isn’t 1964, the year before the signing of the Voting Rights Act. This is Georgia in 2011.
But this time, the legislators at risk are white men and women who have had the temerity to represent majority African-American districts, and Latino legislators who spoke up for their growing Hispanic population. In crossover districts, where whites and blacks have worked together for decades to build multi-racial voting coalitions, the new district maps devised by the Republican majority have slashed through those ties with speed and precision. If the maps proposed by the GOP in Georgia stand, nearly half of the white Democratic state representatives could be removed from office in one election cycle. Call it the “race card”—in reverse.
Reapportionment is a dangerous business. Once every 10 years, the naked ambition of political parties wars with the dwindling hope of voters that this time their voices will be heard. In the South, the voting lines traditionally aimed for specific targets—racial discrimination that purged minorities, diminishing their numbers and political power. If a legislator had the poor fortune to be of the wrong race, that district would disappear for a decade or more. The voters who relied on you would find themselves isolated and polarized, the victims of racial gerrymandering.
For most of the nation, the battle lines are drawn by partisan leaders who search for the sinuous lines that will connect like-minded voters to one another and disadvantage those who have shown a preference for the other side. That, as they say, is Politics 101.
But for a handful of states, the stakes are higher. Below the Mason-Dixon Line and scattered across the country, a legacy of poll taxes and literacy tests required a special remedy—Section 5 of the Voting Rights Act of 1965. The Voting Rights Act has a simple goal—integrate the voting of minorities into the fabric of our democracy. For any state held to its obligations, no changes can be made to election laws without pre-clearance by the Justice Department. In the last decade, the minority population across the South has increased, and by any measure, the Voting Rights Act has been the engine of racial progress.
In Georgia, the gains made under the Act are undeniable. Districts populated predominately by African-Americans have routinely elected white legislators to speak for them. In enclaves across the state, white voters have punched their ballots to elect African-American and Latino representatives. Crossover districts, where blacks and whites and Latinos co-mingle, have grown in prominence–combining with majority-minority districts to comprise nearly 35 percent of the House of Representatives.
In 2011, Georgia should stand as a model for the South and a beacon for those who believe in the rights of voters. However, based on the maps passed last week by the Republican majority, we are in danger of returning to 1964.
Redistricting is fundamentally about voters, and in Georgia, minority voters comprise fully 42 percent of the population. More importantly, these populations have aligned themselves with majority white constituents to demonstrate political power. Under the proposal, Republicans will pair 20 percent of Democrats and 7 percent of Republicans in the state House and eliminate the sole remaining white Democrat in Congress from the Deep South. The House pairings pit black Democrats against white Democrats in four contests, white against white in another and eliminate multi-racial coalition voting across the state. When the dust settles, between pairings and the creation of GOP-leaning districts, Republicans stand to knock off 10 white Democrats—half the total number. They will pick up seven new seats, for a total of 123 Republican seats, 56 Democratic seats and one Independent. This will give Republicans a constitutional majority in the state of Georgia; in other words, they will be able to pass any piece of legislation without opposition.
Let’s be clear. It is absolutely the prerogative of the majority party to maximize its political gains. No one questions the right of the GOP to draw as many districts as it can legally muster. The issue is not whether the GOP can increase its hold, but how.
The GOP’s newly drawn voting lines in the state of Georgia reveals a pernicious new cynicism in our politics—the use of the Voting Rights Act as a weapon to destroy racial, ethnic, and gender diversity. It is no consolation if individual black legislators benefit in the GOP’s new scheme. The Voting Rights Act was never intended to protect a particular minority. Indeed, the highest goals of the Act, one of modern America’s most progressive pieces of legislation, was to encourage multi-racial cooperation and understanding. Precisely, what we in Georgia have begun to achieve. More alarmingly, this new strategy targeting white legislators is not limited to our state. If effective here, the cradle of the civil rights movement, the strategy is expected to be implemented in mid-term redistricting across the South. Republican lawmakers in Alabama, Louisiana, North and South Carolina, Mississippi, and Virginia are watching closely.
Today, we all decry a national partisanship that seems unhealthy and corrosive. But there is nothing wrong with partisanship, when it is a battle of ideas. The Voting Rights Act is intended to ensure that differing ideas be heard, that no single voice drown out the rest. Sadly, that is not what we see rising in the South. The Voting Rights Act is in danger of not protecting the promise of a new day, but becoming a new tool in the politics of destruction.
By: Stacey Abrams, Georgia House Minority Leader, Published in U. S. News and World Report, September 19, 2011
The White Working Class: The Most Pessimistic Group In America
Almost no one noticed, but around George W. Bush’s reelection in 2004, the nation crossed a demographic milestone.
From Revolutionary days through 2004, a majority of Americans fit two criteria. They were white. And they concluded their education before obtaining a four-year college degree. In the American mosaic, that vast white working class was the largest piece, from the yeoman farmer to the welder on the assembly line. Even as late as the 1990 census, whites without a college degree represented more than three-fifths of adults.
But as the country grew more diverse and better educated, the white working-class share of the adult population slipped to just under 50 percent in the Census Bureau’s 2005 American Community Survey. That number has since fallen below 48 percent.
The demographic eclipse of the white working class is likely an irreversible trend as the United States reconfigures itself yet again as a “world nation” reinvigorated by rising education levels and kaleidoscopic diversity. That emerging America will create opportunities (such as the links that our new immigrants will provide to emerging markets around the globe) and face challenges (including improving high school and college graduation rates for the minority young people who will provide tomorrow’s workforce).
Still, amid all of this change, whites without a four-year college degree remain the largest demographic bloc in the workforce. College-educated whites make up about one-fifth of the adult population, while minorities account for a little under one-third. The picture is changing, but whites who have not completed college remain the backbone of many, if not most, communities and workplaces across the country.
They are also, polls consistently tell us, the most pessimistic and alienated group in American society.
The latest measure of this discontent came in a thoughtful national survey on economic opportunity released last week by the Pew Charitable Trusts’ Economic Mobility Project. If numbers could scream, they would probably sound like the poll’s results among working-class whites.
One question asked respondents whether they expected to be better off economically in 10 years than they are today. Two-thirds of blacks and Hispanics said yes, as did 55 percent of college-educated whites; just 44 percent of noncollege whites agreed. Asked if they were better off than their parents were at the same age, about three-fifths of college-educated whites, African-Americans, and Hispanics said they were. But blue-collar whites divided narrowly, with 52 percent saying yes and a head-turning 43 percent saying no. (The survey, conducted from March 24 through 29, surveyed 2,000 adults and has a margin of error of ±3.4 percent.)
What makes these results especially striking is that minorities were as likely as blue-collar whites to report that they have been hurt by the recession. The actual unemployment rate is considerably higher among blacks and Hispanics than among blue-collar whites, much less college-educated whites.
Yet, minorities were more optimistic about the next generation than either group of whites, the survey found. In the most telling result, 63 percent of African-Americans and 54 percent of Hispanics said they expected their children to exceed their standard of living. Even college-educated whites are less optimistic (only about two-fifths agree). But the noncollege whites are the gloomiest: Just one-third of them think their kids will live better than they do; an equal number think their children won’t even match their living standard. No other group is nearly that negative.
This worry is hardly irrational. As Massachusetts Institute of Technology economists Frank Levy and Tom Kochan report in a new paper, the average high-school-educated, middle-aged man earns almost 10 percent less than his counterpart did in 1980. Minorities haven’t been exempt from that trend: In fact, high-school-educated minority men have experienced even slower wage growth than their white counterparts over the past two decades, calculates Larry Mishel, president of the liberal Economic Policy Institute.
But for minorities, that squeeze has been partially offset by the sense that possibilities closed to their parents are becoming available to them as discrimination wanes. “The distinction is, these blue-collar whites see opportunities for people like them shrinking, whereas the African-Americans [and Hispanics] feel there are a set of long-term opportunities that are opening to them that were previously closed on the basis of race or ethnicity,” said Mark Mellman, a Democratic pollster who helped conduct the Pew survey.
By contrast, although it is difficult to precisely quantify, the sense of being eclipsed demographically is almost certainly compounding the white working class’s fear of losing ground economically. That huge bloc of Americans increasingly feels itself left behind–and lacks faith that either government or business cares much about its plight. Under these pressures, noncollege whites are now experiencing rates of out-of-wedlock birth and single parenthood approaching the levels that triggered worries about the black family a generation ago. Alarm bells should be ringing now about the social and economic trends in the battered white working class and the piercing cry of distress rising from this latest survey.
By: Ronald Brownstein, Political Director, The Atlantic, May 27, 2011
Donald Trump’s Not So Great Relationship With “The Blacks”
In an episode early in Donald Trump’s career, his New York real estate company was sued by the federal government for discriminating against potential black renters. After a lengthy legal battle, it ultimately agreed to wide-ranging steps to offer rentals to nonwhites.
The little-remembered case provides crucial context for the current discussion centering on Trump and race. The celebrity businessman made news last month when he declared, “I have a great relationship with the blacks. I’ve always had a great relationship with the blacks.”
He has recently come under fire for attacks on President Obama that critics have described as racially tinged. CBS anchor Bob Schieffer, for example, said Wednesday there is “an ugly strain of racism” in Trump’s recent (baseless) accusations that President Obama should not have been admitted to Columbia. Also yesterday, Trump told a black reporter, unprompted, “Look I know you are a big Obama fan.”
The discrimination case began in the earliest days of Trump’s career, when he was still in his 20s.
Fred Trump, Donald’s father, was, unlike his son, a self-made man. He made his fortune by building thousands of units of middle-class housing in Brooklyn and Queens. But in the early 1970s, Donald was made president of the family company.
One of Donald’s first challenges came in October 1973, when the Justice Department hit the Trump Organization with a major discrimination suit for violating the Fair Housing Act. The Times reported:
… the Government contended that Trump Management had refused to rent or negotiate rentals “because of race and color.” It also charged that the company had required different rental terms and conditions because of race and that it had misrepresented to blacks that apartments were not available.
The journalist Gwenda Blair reported in her 2005 Trump biography that while Fred Trump had sought to combat previous discrimination allegations through “quiet diplomacy,” Donald decided to go on the offensive. He hired his friend Roy Cohn, the celebrity lawyer and former Joseph McCarthy aide, to countersue the government for making baseless charges against the company. They sought a staggering $100 million in damages.
A few months after the government filed the suit, Trump gave a combative press conference at the New York Hilton in which he went after the Justice Department for being too friendly to welfare recipients. He “accused the Justice Department of singling out his corporation because it was a large one and because the Government was trying to force it to rent to welfare recipients,” the Times reported. Trump added that if welfare recipients were allowed into his apartments in certain middle-class outer-borough neighborhoods, there would be a “massive fleeing from the city of not only our tenants, but communities as a whole.”
A federal judge threw out Trump’s countersuit a month later, calling it a waste of “time and paper.”
Writes Blair in her book:
Donald testified repeatedly that he had nothing to do with renting apartments, although in an application for a broker’s license filed at the same time he said that he was in charge of all rentals.
In 1975, Trump ultimately came to a far-reaching agreement with the DOJ in which he and the company did not admit guilt but agreed not to discriminate and to take steps to open its housing stock to more nonwhites. The company agreed to submit a weekly list of vacancies to the Urban League, which would produce qualified applicants for a portion of all vacancies.
But it didn’t end there. In 1978, the government filed a motion for supplemental relief, charging that the Trump company had not complied with the 1975 agreement. The government alleged that the Trump company “discriminated against blacks in the terms and conditions of rental, made statements indicating discrimination based on race and told blacks that apartments were not available for inspection and rental when, in fact, they are,” the Times reported. Trump again denied the charges.
It’s not clear what happened with the government’s request for further action (and compensation for victims), but in 1983, a fair-housing activist cited statistics that two Trump Village developments had white majorities of at least 95 percent.
At the very least, the case is something for reporters to ask about next time Trump touts his “great relationship with the blacks.”
By: Justin Elliott, Salon War Room, April 28, 2011
Rep Peter King, Flailing After Muslims
It has often been the case in America that specific religions, races and ethnic groups have been singled out for discrimination, demonization, incarceration and worse. But there have always been people willing to stand up boldly and courageously against such injustice. Their efforts are needed again now.
Representative Peter King, a Republican from Long Island, appears to harbor a fierce unhappiness with the Muslim community in the United States. As the chairman of the powerful Homeland Security Committee, Congressman King has all the clout he needs to act on his displeasure. On Thursday, he plans to open the first of a series of committee hearings into the threat of homegrown Islamic terrorism and the bogus allegation that American Muslims have failed to cooperate with law enforcement efforts to foil terrorist plots.
“There is a real threat to the country from the Muslim community,” he said, “and the only way to get to the bottom of it is to investigate what is happening.”
That kind of sweeping statement from a major government official about a religious minority — soon to be backed up by the intimidating aura of Congressional hearings — can only serve to further demonize a group of Americans already being pummeled by bigotry and vicious stereotyping.
Rabbi Marc Schneier, the president of the Foundation for Ethnic Understanding, was among some 500 people at a rally in Times Square on Sunday that was called to protest Mr. King’s hearings. “To single out Muslim-Americans as the source of homegrown terrorism,” he said, “and not examine all forms of violence motivated by extremist belief — that, my friends, is an injustice.”
To focus an investigative spotlight on an entire religious or ethnic community is a violation of everything America is supposed to stand for. But that does not seem to concern Mr. King. “The threat is coming from the Muslim community,” he told The Times. “The radicalization attempts are directed at the Muslim community. Why should I investigate other communities?”
The great danger of these hearings, in addition to undermining fundamental American values, is that for no good reason — nearly a decade after the terrible attacks of Sept. 11, 2001 — they will intensify the already overheated anti-Muslim feeling in the U.S. There is nothing wrong with the relentless investigation of terrorism. That’s essential. But that is not the same as singling out, stereotyping and harassing an entire community.
On Monday, I spoke by phone with Colleen Kelly, a nurse practitioner from the Bronx whose brother, William Kelly Jr., was killed in the attack on the World Trade Center. She belongs to a group called September 11th Families for Peaceful Tomorrows and is opposed to Mr. King’s hearings. “I was trying to figure out why he’s doing this,” she said, “and I haven’t come up with a good answer.”
She recalled how people were stigmatized in the early years of the AIDS epidemic and the way that stigmas become the focus of attention and get in the way of the efforts really needed to avert tragedy.
Mr. King’s contention that Muslims are not cooperating with law enforcement is just wrong. According to the Triangle Center on Terrorism and Homeland Security, an independent research group affiliated with Duke University and the University of North Carolina, 48 of the 120 Muslims suspected of plotting terror attacks in the U.S. since Sept. 11, 2001, were turned in by fellow Muslims. In some cases, they were turned in by parents or other relatives.
What are we doing? Do we want to demonize innocent people and trample on America’s precious freedom of religion? Or do we want to stop terrorism? There is no real rhyme or reason to Congressman King’s incoherent flailing after Muslims. Witch hunts, after all, are about seeing what kind of ugliness might fortuitously turn up.
Mr. King was able to concoct the anti-Muslim ugliness in his 2004 novel, “Vale of Tears,” in which New York is hit yet again by terrorists and, surprise, the hero of the piece is a congressman from Long Island. But this is real life, and the congressman’s fantasies should not apply.
America should be better than this. We’ve had all the requisite lessons: Joe McCarthy, the House Un-American Activities Committee, the demonization of blacks and Jews, the internment of Japanese-Americans, and on and on and on. It’s such a tired and ugly refrain.
When I asked Colleen Kelly why she spoke up, she said it was because of her great love for her country. “I love being an American, and I really try to be thankful for all the gifts that come with that,” she said. But with gifts and privileges come responsibilities. The planned hearings into the Muslim community struck Ms. Kelly as something too far outside “the basic principles that I knew and felt to be important to me as a citizen of this country.”
By: Bob Herbert, Op-Ed Columnist, The New York Time, March 7, 2011
Be Careful What You Wish For: Repeal of the Affordable Care Act Would Be Harmful to Society and Costly for Our Country
The new Republican leadership of the House of Representatives says repeal of the recently enacted Patient Protection and Affordable Care Act is their top priority. The Republicans pushing for repeal, however, conveniently ignore the enormous step backward that repeal would represent for health care in our country, for the income security of our citizens, and for the fiscal health of our government.
The Affordable Care Act is not just a law designed to cover the majority of our nation’s uninsured, moving us into the league of industrialized nations which guarantee universal health coverage for its citizens. The law also takes the crucial first steps toward reining in our runaway health care costs. It ends discriminatory insurance practices that leave many of our citizens one bad gene, or badly timed accident, away from personal bankruptcy. It does so while introducing insurance market competition that will lead to lower health insurance premiums for some, and better coverage for others, in the so-called nongroup insurance market where workers without employer-provided health insurance turn for coverage. The Affordable Care Act does all this while significantly reducing our enormous federal budget deficit over the next 10 years.
Opponents of the new health reform law claim we can have many of the beneficial features documented above while repealing the parts they don’t like. This is a misleading and dangerous assertion. In fact, virtually none of the accomplishments of the new law are possible without the entire law’s infrastructure coming into place. That’s why all of the harms of repeal documented in this issue brief below will take place if the new law were to be scuttled.
To understand the consequences of repealing the Affordable Care Act, we can turn to two sources of objective information. The first is the careful and comprehensive effort put in by the Congressional Budget Office to evaluate the law’s impacts, including their recent report summarizing the effects of repealing the new law. The second is the closest case study we have where major elements of the new federal law are already in place—the state of Massachusetts, which passed a similar reform in early 2006. So let’s now turn to the different harms repeal of the health reform would deliver up to the American people.
Repeal means more uninsured, and worse public health
The first noticeable feature of a world without the new health reform law would be the much higher share of Americans without health insurance coverage. Absent the Affordable Care Act, CBO projects that 54 million people in our country, or almost 20 percent of our nonelderly population, will be uninsured by 2019. The new law will cover 32 million of those uninsured, according to CBO, or about 60 percent, with much of the remainder undocumented immigrants who are ineligible for coverage. This is more than a projection: It is also the same percentage share of the uninsured in Massachusetts who have been covered by that state’s health reform effort.
Clearly, repeal of the new law would have enormous negative consequences for our nation’s public health. Numerous studies document the dire health implications of uninsurance. An earlier study by the Institute of Medicine estimated that, in the year 2000 (when 38 million persons were uninsured), there were 18,000 deaths per year due to uninsurance. This suggests that repealing the Affordable Care Act could lead to 15,000 more deaths per year due to higher lack of insurance.
Repeal means increased financial risk for U.S. households alongside distorted labor markets
The impact of repeal extends well beyond those households who are uninsured. Indeed, repealing the new law would reach any household who faces the risk of losing their employer-sponsored health insurance. This is because the Affordable Care Act will fix the fundamental broken system of nongroup insurance in the United States.
Currently, individuals who do not have access to employer-provided group insurance coverage face a nongroup insurance market that is discriminatory and expensive. In most states individuals can be denied insurance coverage because they are ill or have their pre-existing illnesses excluded from coverage. Individuals who become ill can face personal bankruptcy as a result. Even when nongroup insurance is available, in most states insurance is priced according to individual health, with the oldest and sickest enrollees paying many multiples of younger and healthier enrollees.
There is a fundamental unfairness to a system under which individuals can face financial ruin because they have the wrong genes, or cross the street at the wrong time, but don’t happen to have access to insurance through their employer. Moreover, such a system significantly distorts our labor markets by forcing individuals to stay in jobs that offer health insurance rather than to move to newer and more productive positions where coverage is not available. Millions of U.S. workers are not moving to better jobs for them or starting new businesses because there is nowhere to turn for insurance coverage should they leave their jobs.
The Affordable Care Act would fix this flaw in our system. Insurance companies would no longer be allowed to price discriminate or deny coverage based on health or pre-existing conditions, and price differentials by age would be lowered. Individuals would be free to move to the job of their choice or to become entrepreneurs without fear of facing uninsurance.
Repealing the new health reform law would leave us in a world of broken nongroup insurance markets, with the attendant financial risk for individuals and the continued distortion to our labor markets. Why? Because without the comprehensive framework of the new law, it is incredibly costly to make insurance fairer in nongroup markets.
If insurance companies must charge the same price to people whether they’re sick or healthy, for example, then many healthy people will view this as a “bad deal” and not buy insurance. This results in higher prices because only the sick would buy insurance, chasing even more people out of the market. The result is a “death spiral” that leads only the sick to purchase insurance at very high prices. Several states tried such community rating reforms in their non-group markets over the past two decades, and the results were sharp rises in insurance prices and rapidly shrinking market size. The only way to make insurance market reform feasible is to pair it with large subsidies to purchase insurance and an individual requirement for coverage, as is the case with the Affordable Care Act.
Direct evidence for this point comes from Massachusetts. In the late 1990s the state moved to a nondiscriminatory nongroup market, but without the subsidies and the individual requirement that are central to the Affordable Care Act. The result was a collapse of the state’s nongroup market, so that by 2006 the state had by far the highest nongroup premiums in the nation. In 2006, the state implemented their comprehensive reform, which added to the insurance market reforms extensive low-income subsidies to purchase insurance and an individual requirement for coverage. This resulted in a 40 percent reduction in nongroup premiums in Massachusetts over a period where such premiums were rising by 14 percent nationally. That’s just one reason why the new law is called the Affordable Care Act.
Repeal means a noncompetitive and expensive nongroup insurance market
Another reason the Affordable Care Act works to bring down costs is because without it, a typical health insurance policy is much more expensive in the nongroup market than in the group market, partly because nongroup insurance markets are less competitive than group insurance markets in many states. There is no common marketplace where individuals can compare the prices of all the options that are available to them in the nongroup market. As a result, existing market participants keep prices high and new firms are unable to promote lower costs as a tool of market entry.
The Affordable Care Act addresses this problem in two important ways. The first is by introducing competitive insurance exchanges in every state. Individuals would be able to shop more effectively, comparing their nongroup options in a competitive and transparent environment. This approach has already had a notable success in Massachusetts, where the introduction of the state’s Connector health insurance exchange expanded the use of nongroup insurance and promoted the entry of a major new low-cost insurer into the state’s nongroup insurance market.
Without the Affordable Care Act states are unlikely to be able to establish transformative and competitive exchanges for the purchase of nongroup insurance. Many states have tried over the past 20 years to establish insurance exchanges and they have virtually all either failed or had little impact. This is typically because insurers were afraid that individuals would choose to buy from the exchanges only if they were sick, which meant prices in the exchange were high and demand for exchange products was low. With low demand, exchanges could not establish the economies of scale necessary for success.
The success of exchanges under the new health reform law will be due to the fact that individuals will be both required to purchase insurance and that insurance purchase will be subsidized only through the exchange. This will promote exchanges on a scale necessary to succeed in promoting competition in state insurance markets.
The second way that the Affordable Care Act addresses the high costs of nongroup insurance is through the introduction of new tax credits to make health insurance affordable through the exchange. The typical middle-class family in the United States would now be provided financial support to ensure that they would not have to spend an unfair amount for the insurance they need to protect their family.
The upshot: Repealing the new law would mean returning to an era where individuals can’t effectively compare their insurance options, guaranteeing continued noncompetitive and expensive insurance in this market. And it would mean that individuals would face the full prices in these noncompetitive markets without the necessary tax credits to make insurance affordable. Repeal, in short, would be unfair, ineffective, inefficient, and costly.
Repeal means free riders would continue to exploit the health care system
Another fundamental flaw in our current health care system before passage of the Affordable Care Act was that individuals could “free ride,” remaining uninsured until they need care and then turning to emergency rooms. Emergency rooms are required by law to provide care to all regardless of insurance coverage. The associated uncompensated care costs of treating these individuals amount to a more than $40 billion a year tax on the insured in the United States
The Affordable Care Act ends this free riding by requiring that individuals purchase insurance if it is affordable for them (which it will be for most due to the subsidies described earlier). This personal responsibility requirement, originally the brainchild of Republican experts, would end the unfairness of a system where emergency room health care providers are required to treat everyone but individuals are not in turn required to pay their fair share of the costs of treatment. Repealing the new law would mean returning to a world where individuals can simply wait until they are sick to get treated, passing the costs on to the rest of society that is paying their share.
Repeal means the continued decline of private insurance
There was an enormous erosion of private insurance coverage in the United States over the past decade. Employer-sponsored insurance fell by 15 percent and nongroup insurance has not grown to keep pace. The result today is an increase in both the ranks of the uninsured and the publicly insured.
The Affordable Care Act arrests this decline and promotes private insurance coverage. According to the CBO, the new law will lead to a small erosion in employersponsored insurance coverage, offset by a rise in nongroup insurance coverage that is almost five times as large. Overall, private insurance coverage in the United States will rise by 15 million people due to the Affordable Care Act.
Repeal would provide no cushion for our citizens to offset this rapid decline in employer-sponsored insurance coverage. Fifteen million fewer U.S. residents would have private insurance than without the law. The Affordable Care Act is not a government takeover of the U.S. health system; it is a means of using reformed private nongroup insurance markets to more effectively fight the steady decline in employer-provided group insurance. Repeal means a fundamental retreat from the promise of private health insurance coverage for our citizens.
Repeal means higher and more rapidly growing budget deficits
The Affordable Care Act delivers a unique dose of fiscal responsibility in an era of rapidly growing federal budget deficits. The new law offsets its new spending with even larger reductions in other spending and revenue increases. As a result, CBO estimates that the legislation will reduce the deficit by more than $100 billion by 2019, and by more than $1 trillion in the decade after that.
What is not widely appreciated is that deficit reduction due to the new health law will rise over time. The cuts in excessive spending and increases in revenues are back-loaded, not front-loaded as with so many other recent pieces of legislation. This is illustrated by the fact that the most recent CBO estimate shows that repeal would raise the deficit by $230 billion over the next decade. And, because the net budget savings from the new health law will grow over time, repeal would raise the deficit by much larger and ever growing amounts into the future.
Repeal would therefore mean undoing the enormous fiscal benefits of this legislation. Offsetting a more than $100 billion hole in the budget deficit by 2019 would require significant cuts elsewhere in the budget or other increases in revenues. And it seems highly unlikely that Congress would enact spending or revenue changes that would increase so rapidly over time. That means even fixes that offset the short-term costs of repealing the new law would not address the enormous long-term hole it would leave in our budget.
Repeal means a critical step backward on cost control
Reforming insurance markets and covering the uninsured are actually the relatively easy lifts for the new health reform law when compared to the more daunting and fundamental challenge—reducing the rate of growth in health care costs, which threatens to bankrupt our government and our nation. U.S. spending on health care is very high and a source of great concern but it is the growth rate of medical spending, not its level, that ultimately determines our country’s financial well-being. Absent the Affordable Care Act, if current trends persist we will be spending an unsustainable 38 percent of our GDP on health care by 2075 because the growth of health care costs would continue to outstrip the growth rate of the overall economy.
Addressing the rapidly rising costs of medical care, however, faces two daunting barriers. The first is scientific: There is tremendous uncertainty about how to lower health care costs without sacrificing health care quality. There is a broad consensus that there is significant waste in our health care system. But there is little consensus about the best way to address that waste without risking the enormous gains in population health due to health care improvements in recent decades. The second barrier is political: There are major entrenched interests that are threatened by fundamental health care reform and who will strongly oppose any such efforts.
In the face of these barriers, our political process has found it difficult to make progress on significant cost-control efforts over the past several decades. The Affordable Care Act represents the most important step forward in cost control in at least 30 years. The new law pursues many different approaches toward cost control, studying them to see which ones work best. This is through provisions that:
- Reduce consumer demand for excessive medical care through the “Cadillac tax” on high-cost insurance plans.
- Reduce health care provider payments by appointing a depoliticized board to make up-or-down recommendations to Congress on changes to Medicare’s provider payments.
- Set up dozens of health care pilot programs to test various approaches to revamping provider-payment incentives and organizational structure.
- Invest hundreds of millions of dollars in new comparative-effectiveness research.
- Launch pilot programs to assess the impact of various reorganizations of the medical malpractice process.
None of these approaches is guaranteed to work but together they represent a significant step toward fundamental cost control.
Importantly, they represent steps that are unlikely to happen if the Affordable Care Act is repealed. None of these ideas are new; most have been around for decades. But it was through the overall push for health reform that Congress was able to finally put them in place. Absent such a unifying framework, the barriers which have blocked cost-control efforts in the past will continue to stand in the way of moving forward on cost-control efforts.
Bottom line: Repeal is a dramatic step backward
The debate over repeal of the Affordable Care Act is characterized by enormous misinformation and confusion. Opponents of the legislation exploit this for political gains. A legitimate debate over the Affordable Care Act and the future of health care in America must recognize the fundamental improvements to our health care system put in place by this new law. Repealing would lead to:
- A society with poorer health and ultimately more deaths from lack of medical care
- A continued unfair and expensive nongroup insurance market that leads to economic instability, medical bankruptcy, and a less efficient job market where individuals are afraid to move to more productive job opportunities
- Continued free riding by those who pass billions of dollars in care costs onto the insured
- A massive decline in private insurance coverage
- Huge and unsustainable increases in budget deficits reaching trillions of dollars over coming decades
- A fundamental step backward in our efforts to control the health care costs which threaten to bankrupt our society
The Patient Protection and Affordable Care Act is aptly named. Repeal would mean less health care protection for more and more Americans at higher and higher costs to themselves, their families, and our nation. We simply cannot afford to repeal the new law.
By: Jonathan Gruber, Professor of Health Economics at the Massachusetts Institute of Technology and a member of the Massachusetts Health Connector Authority: January 19, 2011
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