“A Big Split In The Republican Party”: Here Comes The Big Intra-GOP Fight Over Obamacare Subsidies
It’s been obvious for a while that congressional Republicans will be placed in a difficult position if SCOTUS strikes down subsidies for health insurance purchases under the Affordable Care Act in states that did not create their own exchanges. On the one hand, they’ll be blamed for failure to do something about the consequent loss of insurance and/or increases in premiums (at least in states that do nothing about it, either), when a one-sentence law confirming the original understanding virtually everyone had about the universal availability of subsidies would suffice. On the other hand, any reaction to such a SCOTUS decision that does not at least begin with an all-night kegger-and-prayer-vigil in celebration of this blow against tyranny will rile up The Base into a hate frenzy. Theoretically, GOPers could be ready with a full-fledged Obamacare Replacement bill that could be presented to the president on a take-it-or-leave-it basis, but despite having five years to come up with such a creature, that ain’t happening.
So as TPM’s Sahil Kapur explains today, Sen. Ron Johnson has introduced a bill, which the Senate GOP leadership has quietly gotten behind, that would extend the Obamacare subsidies until the end of 2017, in exchange for some key concessions to conservatives that fall vastly short of an alternative structure for health care reform.
The Senate’s top five Republican leaders have cosponsored legislation to extend until 2017 the Obamacare insurance subsidies that may be struck down by the Supreme Court this summer
The legislation, offered by Sen. Ron Johnson (R-WI), one of the most politically vulnerable Senate incumbents in 2016, would maintain the federal HealthCare.gov tax credits at stake in King v. Burwell through the end of August 2017.
The bill was unveiled this week with 29 other cosponsors, including Senate Majority Leader Mitch McConnell (R-KY) and his four top deputies, Sen. John Cornyn (R-TX), John Thune (R-SD), John Barrasso (R-WY) and Roy Blunt (R-MO). Another cosponsor is Sen. Roger Wicker (R-MS), the chairman of the conference’s electoral arm.
Such a move would seek to protect the GOP from political peril in the 2016 elections when Democrats would try to blame the party for stripping subsidies — and maybe insurance coverage — from millions of Americans in three dozen states. A defeat for the Obama administration in a King ruling would likely create havoc across insurance markets and pose a huge problem for Republicans, many of whom have been pushing the Supreme Court to nix the subsidies.
Given the certainty that this proposal will split Republicans, what are the odds Democrats would go along with this semi-“fix.”?
Democrats would probably demand a fix to make the subsidies permanently available if they go down. But they would be hard-pressed to vote down a bill to temporarily extend them if Republicans were to bring it up.
That may depend, however, on what happens to provisions Kapur calls “sweeteners” for conservatives, including elimination of Obamacare’s individual and employer mandates, and perhaps even more crucially, of the ACA’s minimum benefit requirements. Kapur seems to anticipate, and some conservative critics agree, that Republicans would cave on most of these “sweeterners” in exchange for Democrats agreeing to a temporary instead of a permanent extension of subsidies.
But you will note that the cosponsors of Johnson’s bill do not include Ted Cruz, Rand Paul or Marco Rubio, who will likely be focused on the Iowa Straw Poll at the time the decision comes down. There’s also a competing Senate bill from Ben Sasse that would instead of extending the subsidies replace them with simple tax credits for insurance purchasing that would fade away over time. And there are, according to The Hill‘s Sullivan and Ferris, several plans percolating in the House that would replace the subsidies with our without some “bridge” offering temporary relief. You can judge how much consensus there is from this remark by Republican Study Committee co-chair Bill Flores of Texas, who is one of the people working on one of the many plans:
“I’m not saying there should absolutely not be a bridge, I’m not saying there should absolutely be a bridge,” Flores said. “If we start building toward a shore, but we don’t know what that shore is, then the bridge might not work very well.”
I think we can all agree on that. And that is why despite everything you will hear from them before and after SCOTUS rules, there’s probably no group of people more avidly if silently cheering for Obama to win this case than are congressional Republicans.
By: Ed Kilgore, Contributing Writer, Political Animal Blog, The Washington Monthly, April 24, 2015
“They Should Stop And Take A Second Look”: Ending Forced Arbitration Is A No-Brainer For Conservatives
The Obama administration is preparing to issue consumer protection regulations that will force Republicans to choose between their Wall Street allies and the Seventh Amendment right to a jury trial in civil cases. Republicans will be tempted to denounce the new rules as yet another example of this president’s customary imperial overreach, but on this issue, they should stop and take a second look.
The problem is called forced arbitration, and if you’ve ever taken the time to read a consumer service contract or end-user license agreement before signing it (which makes you an admirable human being, and very rare), you’ll almost certainly have seen a clause that revokes your right to go to court in case of a breach of the agreement by the corporation.
Such clauses are found everywhere, from credit cards and checking accounts to cable TV and car rentals. When you sign, you agree to accept the decision of a private, for-hire arbitrator. Unfortunately, the arbitrator is usually hired by the same company that breached the agreement and is not legally required to follow statutory or common law precedents. Its decisions are almost impossible to appeal. Most consumers have no idea that’s what they’re agreeing to.
Enter the Consumer Financial Protection Bureau, which has been authorized by Congress to step in to study this problem and, based on its findings, restore Americans’ ability to hold financial institutions accountable. Under the Dodd-Frank Act of 2010, the bureau is authorized to issue regulations that limit or ban the use of forced arbitration in consumer financial services and products. Regulations to do just that are expected to be promulgated sometime this year.
The regulations may turn out to be poorly framed or excessive – we’re talking about the same administration that gave us Lois Lerner and executive amnesty, after all – but the problem Congress wanted the agency to address is real.
Recently, while traveling to Topeka on business, I needed to rent a car. I stopped at the Thrifty counter at the Kansas City airport. While filling out the usual paperwork, I asked the gentleman behind the counter, “What happens if I don’t check this box that says I waive my right to sue?” He blinked at me uncomprehendingly for a moment and then replied, “Um, it means you don’t get the car.” I checked the box, disgusted. My destination was 80 miles away, I was in a hurry, and I didn’t have time to haggle or shop around with Thrifty’s competitors, all of whom undoubtedly have the same policy.
Today, a big company like Thrifty can effectively insist that we waive our Seventh Amendment rights on a “take it or leave it” basis; and market forces are not sufficient to police the problem. We’re stuck. And it isn’t just car rentals. When you buy a hair dryer or click “I agree” to a software download, you’re probably forfeiting your right to go to court.
Statistics show that, more often than not, the arbitrator hired by the company you’re disputing with will rule in the company’s favor, likely because he’s eager to be hired again by that company in the future.
Even consumers who think they understand what they’re signing usually have no clear idea of how arbitration really works. They mistakenly equate it with mediation or some other court-like procedure. In reality, forced arbitration is conducted in secret and lacks the procedural safeguards that allow consumers to prove their case. Arbitrators typically keep their reasoning private, making it hard for the losing party to know why he lost, and results are rarely published, making it difficult for similarly situated parties to know they’re entitled to relief.
To be sure, arbitration can be a great option when it’s voluntarily agreed to by both parties after a dispute has arisen, but to be truly voluntary, all parties need to be free to say no. In the case of consumer financial services and products (the kinds of agreements the Consumer Financial Protection Bureau is authorized to regulate), most individual consumers have no bargaining power, as anyone who’s tried to negotiate with his credit card company can attest.
Voluntary arbitration agreements have always been lawful, but up until the 1920s pre-dispute arbitration clauses like the one I had to sign at Thrifty were rarely enforced by American courts. Americans have long cherished the common-law right to a jury trial in civil cases. Indeed, preserving that right was one of the top demands of the Antifederalist skeptics of the proposed Constitution, and the Seventh Amendment was ratified precisely to preserve that ancient right in the courts of the newly constituted federal government.
In 1925, Congress enacted the Federal Arbitration Act to make arbitration a viable alternative for resolving contractual disputes between corporations. That strikes me as constitutionally tolerable, so long as agreements are voluntary and the parties are of roughly equal bargaining power, and if recourse to the courts is still possible if the arbitration process itself is disputed. But recent interpretations of that act by the U.S. Supreme Court have expanded its reach to cover all kinds of contracts, including consumer and employment contracts, and have even overridden state-level laws permitting class actions. (One of the reasons most corporations favor arbitration is that it forces each claimant to pursue his claim individually.)
So in disputes between individual Americans and big companies, the Seventh Amendment has become Swiss cheese, and with more holes than cheese. Many genuinely aggrieved consumers are being denied access to the civil justice system.
How can we fix this? The Supreme Court should reverse its errors, and Congress should amend the Federal Arbitration Act to ensure agreements are truly voluntary. (A bill to do that, dubbed the Arbitration Fairness Act, has been introduced in recent Congresses, but has gone nowhere, thanks to fierce opposition by the U.S. Chamber of Commerce.) Realistically, in the near term, the Consumer Financial Protection Bureau’s forthcoming Dodd-Frank regulations are the best hope consumers have for relief. But that only applies to consumer financial services and products. So there’s no avoiding a legislative remedy.
This issue should be a no-brainer for conservatives. Ending the un-American practice of forced arbitration should be on the agenda, not just of traditional consumer advocates, but of everyone who loves liberty and the Bill of Rights. As a freedom issue, it’s right up there with things like repealing health care mandates, allowing cell-phone unlocking, ending corporate subsidies and eliminating cronyist tax breaks.
By: Dean Clancy, Thomas Jefferson Street Blog, U. S. News and World Report, April 17, 2015
“The Framers Distrusted The Corporate Form”: Toxic Law; How Corporate Power And ‘Religious Freedom’ Threaten Democracy
Corporations from Apple and Angie’s List to Walmart and Wells Fargo exercised their power last week against laws that give aid and comfort to bigots. But don’t be too quick to praise their actions.
Commendable as these corporate gestures were, they also illustrate how America is morphing from a democratic republic into a state where corporations set the political agenda, thanks to a major mistake by Democrats in Congress. What they did has resulted in Supreme Court decisions that would infuriate the framers of our Constitution.
The framers distrusted the corporate form. And they made plain their concerns about concentrations of economic power and resulting inequality, worrying that this would doom our experiment with self-governance. Surely they would be appalled at the exercise of corporate influence last week. For the companies opposing “religious freedom” laws in Arkansas and Indiana were concerned with human rights only in the context of profit maximization, which is what economic theory says corporations are about.
Where are the corporate actions against police violence? Or unequal enforcement of the tax laws, under which workers get fully taxed and corporations literally profit off the tax laws? Or gender pay discrimination? And when have you heard of corporations objecting to secret settlements in cases adjudicated in the taxpayer-financed courts, especially when those settlements unknowingly put others at risk?
The so-called religious freedom restoration statutes in Arkansas, Indiana and 18 other states reflect a growing misunderstanding of the reasons that American law allows corporations to exist, a misunderstanding that infects a majority on our Supreme Court.
Corporations, which have ancient roots, serve valuable purposes that tend to make all of us better off. We benefit from corporations, but they must be servants, not masters.
Confining corporations to the purposes of limiting liability and creating wealth is central to protecting our liberties, as none other than Adam Smith warned 239 years ago in The Wealth of Nations, the first book to explain market economics and capitalism.
There is no fundamental right to create, own or operate any business entity that is a separate person from its owners and managers. Corporations exist only at the grace of legislators.
But in 21st-century America, corporations are increasingly acquiring the rights of people, which is the product of an unfortunate 1993 law championed by Democrats that now helps bigots assert a Constitutional right to discriminate in the public square.
Concern about corporations and concentrated power that diminishes individual liberties has become increasingly relevant since 2005, when John Glover Roberts Jr. was sworn in as chief justice of the United States.
Roberts and other justices who assert a strong philosophical allegiance to the framers’ views have been expanding corporate power in ways that would shock the consciences of the founders — especially James Madison, the primary author of our Constitution, Thomas Jefferson and John Adams.
In 2010, the Supreme Court ruled that corporations could spend unlimited sums influencing elections in the Citizens United decision. Now, as a practical matter, no one can become a Democratic or Republican nominee for president without the support of corporate America.
And, central to the Arkansas and Indiana legislation, the Supreme Court last year imbued privately held corporations with religious rights in the Hobby Lobby case.
The Roberts court invented all of these rights. Principled conservatives should denounce such decisions as “judicial activism,” yet nary a word of such criticism appears in right-wing columns and opinion magazines.
Today’s corporations have their roots in ancient trusts created to protect widows and orphans who inherited property. Hammurabi’s Code provided for an early version of trusts. Later the Romans created proto-corporations to manage public property and the assets of those appointed to oversee the far realms of the empire.
Managers of these early corporations had very limited authority, what the law calls agency, over the assets entrusted to them. Today, corporate managers have vast powers to buy, sell and deploy the assets they manage. They can do anything that is legal and demonstrates reasonable judgment.
Spending money to elect politicians (or pass anti-consumer laws) is perfectly fine under current law if it advances the profit-making interests of the company. Last week, we saw companies denounce bigotry against LGBTQ people, but of course they did so in terms of protecting their profits.
Walmart, the nation’s largest employer, opposed signing the Arkansas bill into law: “Every day in our stores, we see firsthand the benefits diversity and inclusion have on our associates, customers and communities we serve.” Apple CEO Tim Cook said, “America’s business community recognized a long time ago that discrimination, in all its forms, is bad for business.”
But creating efficient vehicles to create wealth by engaging in business does not require political powers, as none other than Supreme Court Justice William Rehnquist noted in a dissent.
Where we have gone furthest astray under the Roberts court is in last year’s Hobby Lobby decision. It imbued privately held corporations with rights under the First Amendment, which says, in part, “Congress shall create no law respecting the establishment of religion or prohibiting the free exercise thereof.” Based on Hobby Lobby, both the Arkansas and Indiana laws were crafted to provide a defense for bigoted actions by businesses.
Yet laws requiring businesses to serve everyone, without regard to their identity, do not inhibit the free exercise of religion. A law that requires a florist or bakery to serve people in same-sex weddings as well as different-sex weddings may trouble the merchant, but it does not inhibit religious activity.
The corporate power on display in the so-called religious freedom restoration cases stems from a Supreme Court case that upheld the doctrine of laws of general applicability.
In 1990, the Supreme Court held that Oregon jobless benefits were properly denied to two Native Americans who worked at a drug rehab facility and who also, as part of their well-established religious practice, ingested peyote, a controlled substance.
Justice Antonin Scalia, who claims to follow the original intent of the Constitution’s drafters, wrote the opinion. He held that “the right of free exercise does not relieve an individual of the obligation to comply with a ‘valid and neutral law of general applicability’” such as denying jobless benefits to drug users.
Scalia cited an 1879 Supreme Court ruling in a test case known as Reynolds in which a Brigham Young associate asserted that federal laws against polygamy interfered with the “free exercise” of the Mormon brand of Christianity.
In that case, as Scalia noted, the high court had rejected the claim that criminal laws against polygamy could not be constitutionally applied to those whose religion commanded the practice. “To permit this would be to make the professed doctrines of religious belief superior to the law of the land, and in effect to permit every citizen to become a law unto himself,” the conservative justice wrote.
Two years later, Congress undid that sound decision with passage of the Religious Freedom Restoration Act, a sloppily crafted bill introduced by then-Rep. Chuck Schumer (D- NY), and championed in the Senate by another Democrat, the late Ted Kennedy (D-MA).
It was this law, undoing Scalia’s sound Supreme Court decision, which enabled corporations to exercise their power for a particular cause that is in their interest, namely ending bigotry. Such actions may be laudable, yet still dangerous.
Corporations are valuable and useful vehicles for creating wealth. But they are not and never should be political and religious actors. As artificial “persons,” they should not be imbued with political or religious rights.
We need to keep corporations in their place. Otherwise, next time, their profit maximization may work against your liberties.
By: David Cay Johnston, The National Memo, April 4, 2015
“The Supreme Court’s Extreme Faith”: The Menendez Case Proves The Supreme Court Was Naive About Campaign Finance Laws
No cameras are allowed inside the main Supreme Court chamber, but on Wednesday, a group of activists—for the second time this year—evaded tight security controls and snuck one in to record themselves causing disorder in the court. Their goal: Decry two of the court’s most controversial rulings on campaign finance, Citizens United v. FEC and McCutcheon v. FEC, which have paved the way for powerful donors and corporations to influence elections.
“Justices, is it not your duty to protect our right to self-government?” a protester is heard yelling in a video posted on YouTube. “Reverse McCutcheon. Overturn Citizens United. One person, one vote.” Court police escorted her out, followed by other protesters, including a man chanting, “We who believe in freedom shall not rest.”
Chief Justice John Roberts was not impressed. SCOTUSblog’s Lyle Denniston, one of the few reporters at the scene, noted he grew impatient and later said, “Oh please,” on top of threatening contempt sanctions against the protesters.
Say what you will of the activists’ stunt or the chief’s reaction—because really, no protest in the world will ever overturn a Supreme Court precedent. But consider what Roberts himself proclaimed in McCutcheon, which turned one year old today: “Spending large sums of money in connection with elections, but not in connection with an effort to control the exercise of an officeholder’s duties, does not give rise to quid pro quo corruption. Nor does the possibility that an individual who spends large sums may garner influence over or access to elected officials.”
McCutcheon invalidated something very specific—the limit on the total amount a person can give to all federal candidates during a two-year election cycle—but Roberts didn’t stop there. Time and again he kept singling out blatant quid pro quo arrangements as the only thing Congress could regulate. Not so with meager attempts to “prevent corruption” or curbing “the appearance of mere influence and access.” Those things aren’t as big a deal under the Constitution. Only tit-for-tat corruption is.
Compare that to the other case the protesters targeted, 2010’s Citizens United, a ruling as grand as it was shocking for the dearth of evidence on which it rested: “We now conclude that independent expenditures, including those made by corporations, do not give rise to corruption or the appearance of corruption.” The court went on: “The appearance of influence or access … will not cause the electorate to lose faith in our democratic order.”
But it turns out corruption, appearances, and influence-peddling are all at the crux of federal charges against New Jersey Senator Bob Menendez. He was indicted Wednesday on several counts of bribery and other offenses, stemming from an allegedly cozy relationship with Salomon Melgen, a Florida ophthalmologist and longtime friend who is accused of giving lavish gifts to the senator. These included a trip to a luxury hotel in Paris, a stay at an upscale villa in the Dominican Republic, contributions to a legal-defense fund, and more than $1 million in donations to various political action groups supporting Democratic candidates—all in exchange for political favors for Melgen, his business interests, and his numerous girlfriends.
Whether these salacious allegations stick or lead to some kind of plea deal will soon be decided; Menendez pled “not guilty” on all charges Thursday. But a sizeable contribution listed in the indictment calls into question the Supreme Court’s extreme faith that large sums of money not directly given to a candidate fail to amount to corruption.
According to prosecutors, Melgen, through his own company, contributed $600,000 to a political action committee aimed at helping Democrats retain control of the Senate. That’s all well and good under Citizens United,except Melgen allegedly earmarked the money so it went directly to the Menendez re-election campaign. That’s also kosher under campaign regulations, except the indictment alleges Menendez “sought and received” the donation—comprised of two checks for $300,000 each, sent to the super PAC in exchange for Menendez’s assistance in resolving a Medicare-related dispute. Interestingly, the indictment notes that Melgen cut one of the checks on the same day he attended an annual fundraiser Menendez hosted.
The legal process will determine the extent to which the alleged favors and contributions are related. But even if they weren’t and the case went away, the Menendez indictment undermines the Supreme Court’s facile conclusion that merely spending large sums of money—absent a clear showing of quid pro quo—isn’t enough to prove that corruption has taken hold. Or the notion that the mere appearance of influence and access to elected leaders fails to be an interest compelling enough to require strong campaign-finance laws—the kind that governs how big donors and big money behave each election cycle.
Chief Justice Roberts may not be too pleased with the recent protests and security breaches at the Supreme Court, but the Menendez case opens the door for some introspection on how recent campaign-finance rulings are reshaping who calls the shots in our democratic order.
By: Cristian Farias, The New Republic, April 2, 2015
“We Don’t Want You”: Indiana ‘Religious Freedom’ Bill Lets Businesses, Individuals Decide Who Gets Equal Treatment
Indiana’s state motto is “The Crossroads of America.” This week, two important roads in American politics and jurisprudence are crossing in Indiana.
One of those roads is the ongoing quest to give real protection to the rights and liberties of racial and religious minorities, women and gay people.
The other path, a reactionary one, wants to vastly expand one particular American right, the free expression of religion, to allow businesses and individuals to pick and choose who they think deserves equal treatment.
Indiana’s House and Senate have passed an Orwellian-named “religious freedom” law that Republican Governor Mike Pence said he would sign [Ed. note: Pence signed the bill into law on Thursday morning]. The bill protects businesses and individuals from having to do things — and to obey laws — that would be a “substantial burden” on their religious freedom.
Gay marriage is the most visible and politicized arena where this rights conflict is being fought. Some businesses and individuals say it would violate their religious freedom if they had to, say, provide flowers, pastries or appetizers to a gay wedding. Indiana’s new law agrees and would protect them.
This is a radical new understanding of the right of religious expression that would trump the civil rights of others.
The Indiana law is the wholly predictable and unfortunate consequence of the Supreme Court’s decision in Hobby Lobby v. Burwell last summer. In that famous case, the Supreme Court said that by forcing Hobby Lobby to provide its employees with health insurance that covered some forms of contraception, the Affordable Care Act violated the company’s religious rights.
One odd facet of the decision is that for-profit companies have the same religious rights as individuals, something common sense has a very hard time with.
More importantly, the court majority in Hobby Lobby said religious freedom no longer only meant protecting how one worships in private and in church, but also means protection from any compromise of beliefs that may come up in the public world of business and everyday life. “In a decision of startling breadth, the Court holds that commercial enterprises, including corporations, along with partnerships and sole proprietorships, can opt out of any law (saving only tax laws) they judge incompatible with their sincerely held religious beliefs,” Justice Ruth Bader Ginsburg said in her dissent.
Dissenters correctly predicted that the decision would set the table for a continuing course of new litigation, new laws and new ways to justify old discrimination. That is exactly what is happening.
If it is legal for a company to refuse to cover contraception in its insurance plan, couldn’t a Christian Scientist company refuse to provide health insurance at all? If it’s okay to refuse catering services at a gay wedding, what about at an interracial marriage? They violate some religious beliefs, too. What if a corner store owned by Muslims didn’t want to serve Jews, or vice versa?
It isn’t hard to make this a long list. Indiana is on the verge of sanctioning and empowering this very un-American mutation of a fundamental American principle.
Earlier this week, Senator Ted Cruz launched his presidential campaign at a convocation service at a Christian fundamentalist university. What a powerful message that sends to Americans who aren’t Christian — Jews, Buddhists, Muslims, atheists and, the biggest category of all, “none of the above.” The message is simply: We don’t want you.
Indiana is at a crossroads and is about to send that very same message, enshrined in a law.
By: Dick Meyer, Chief Washington Correspondent for the Scripps Washington Bureau and DecodeDC; The National Memo, March 27, 2015
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