Bloomberg News

Republicans Focus Health Law Attack on Taxes After Ruling

June 29, 2012

Republicans in Congress are recasting President Barack Obama’s health-care law as a significant tax increase imperiling a fragile economy as they continue efforts to repeal the law after the Supreme Court upheld its core tenets.

Moments after the court’s 5-4 decision yesterday, Republican lawmakers and allies including the anti-tax Club for Growth shifted from attacking the constitutionality of the law’s requirement that Americans purchase health insurance or pay a penalty to emphasizing its tax implications for millions of Americans.

“It’s not really a health-care law, it’s a tax law,” said Representative Allen West, a Florida Republican and member of the Tea Party Caucus.

Senate Minority Leader Mitch McConnell, a Kentucky Republican, said he would redouble efforts to do away with the law, which he said the court’s ruling showed was “a tax.” The Republican-aligned Americans for Prosperity, a nonprofit group, said it is launching a $9 million advertising campaign characterizing the law as a tax.

Chief Justice John Roberts ruled that the individual mandate was constitutional as an exercise of Congress’s broad power to levy taxes, not to regulate commerce. Roberts picked up on a secondary legal argument the administration had made, which ran counter to its political contention that the penalty wasn’t a tax.

Medicaid Program

The Supreme Court justices, in their ruling, also limited the law’s extension of the Medicaid program for the poor by saying the federal government can’t threaten to withhold existing money from states that don’t fully comply with the expansion.

The court’s decision to uphold the core of the law was a blow to Republican plans to overturn the 2010 Patient Protection and Affordable Care Act through the court system. Now the battle to repel Obama’s signature achievement turns to the legislative front, where Republicans’ best chance of repealing the law hinges on tying it to the economy and trying to pick up enough seats to take control of the U.S. Senate.

The Club for Growth started attacking Indiana Democrat Joe Donnelly, who is running for a U.S. Senate seat, for supporting “a massive tax increase.”

‘Rallying Cry’

“Democrats have their victory but Republicans have their rallying cry,” said Ron Bonjean, a Republican strategist and former aide to former Senate Majority Leader Trent Lott. “During such a bad economy, why did the president just put a health-care tax on the backs of hardworking Americans? That’s the way they’ll thread the needle.”

House Minority Leader Nancy Pelosi of California didn’t deny that the ruling gives Republicans a political opening.

“The politics be damned, this is about what we came here to do,” she said.

Other Democrats said Republicans are overplaying the tax angle.

“This is only a tax burden on free riders and it was a Republican idea in the first place advanced by Newt Gingrich of all people that free riders should pay their own way,” said Jim Moran of Virginia.

According to a statement yesterday from Democrats on the tax-writing House Ways and Means Committee, 98 percent of Americans won’t be fined for not having insurance because most people will have access to health care through an employer or through the law’s exchange system or a public program.

Repeal Vote

House Majority Leader Eric Cantor, a Virginia Republican, announced that the Republican-controlled chamber would vote again July 11 to repeal the law. Whatever repeal efforts House Republicans make almost certainly will die in the Senate, where Democrats have control, and Obama would have the ability to veto such a bill if it passed both chambers.

Congressional Republicans said they’ll use the court ruling to energize their voting base before the November election. “The only way” to “get rid of Obamacare” after yesterday’s decision “is to elect a Republican House, a Republican Senate and a Republican president this fall,” said Representative Steve Chabot, an Ohio Republican.

“Now the Tea Party knows what it needs to do,” said Dean Clancey, vice president for health policy at FreedomWorks, an umbrella group for the Tea Party movement. “We need to win it all in November and our mission is clear,” Clancy said in a telephone interview.

Top Concern

Opinion polls show voters’ top concern is the economy, which means Republicans run a risk of appearing out of touch with the nation’s priorities if they keep up efforts to repeal the health-care law, warned Democrats.

A plurality of Americans, 43 percent, said they wanted to retain the 2010 law with only small modifications, while 15 percent said the measure should be left alone, according to a Bloomberg National Poll conducted June 14-18. One-third said the law should be repealed.

Senator Charles Schumer of New York, the chamber’s third- ranking Democrat, said Republicans’ repeal plans would backfire by damaging their efforts to win the Senate majority in November.

“The more they talk about wanting to come back and repeal health care instead of focusing on jobs and the economy and the middle class, the harder it’s going to be for them to ever get that majority,” Schumer told reporters.

Political Risks

In a floor speech yesterday, Democratic Senator Tom Harkin of Iowa warned Republicans about the political risks of pressing for repeal. “Woe to those who would try to repeal this” because “the American people will judge you” as being “on the wrong side of history.”

Democrats control 53 votes to 47 for Republicans in the Senate. Republicans would need a net gain of four seats to take control of the chamber with 51 votes. A victory by presidential candidate Mitt Romney, the former Massachusetts governor, would reduce that threshold to three seats as his vice president would cast tie-breaking votes.

“This just makes the stakes of the next election all that higher,” House Budget Committee Chairman Paul Ryan, a Wisconsin Republican, told reporters yesterday.

To contact the reporters on this story: Heidi Przybyla in Washington at hprzybyla@bloomberg.net

To contact the editor responsible for this story: Jodi Schneider at jschneider50@bloomberg.net


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