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BREAKING! Spain Still Not Invaded By The Moops


As I recently noted, Brian Beutler has an excellent piece pointing out that Republican members of Congress universally rejected the contention soon to be considered by the Supreme Court that Congress did not make subsidies available on the federally established exchanges: they assumed that the subsidies would be uniformly available even after it was abundantly clear that multiple states would not establish exchanges. Greg Sargent has followed up with state officials, and YOU’LL NEVER GUESS WHAT HE FOUND:

I can now add more: Several state officials who were directly involved at the highest levels in early deliberations over setting up state exchanges — all of them Republicans or appointees of GOP governors — have told me that at no point in the decision-making process during the key time-frame was the possible loss of subsidies even considered as a factor. None of these officials — who were deeply involved in figuring out what the law meant for their states — read the statute as the challengers do.

Cindi Jones was appointed in August of 2010, after passage of the ACA, by Republican governor Bob McDonnell to head his Virginia Health Reform Initiative panel. A key question it faced was whether the state should set up an exchange or default to the federal one. The question of whether the failure to set up an exchange would sacrifice subsidies was not a consideration throughout the discussions, she says.

“There was no discussion at any meeting that one of the reasons we would want to do a state based exchange was that it would be the only way we would get subsidies,” says Jones, who was held over from a previous Democratic administration and now works for Governor Terry McAuliffe. Referring to 2010 and the spring of 2011, Jones said: “The discussion of whether or not to set up a state-based exchange versus a federal exchange would have been different if one of the issues we had to consider was whether or not our citizens would get subsidies.”

Sargent gets the response of Jonathan Adler, who says it doesn’t matter that nobody read the statute as he now reads it. Michael Cannon has made similar arguments on Twitter, sometimes willfully distorting Nancy Pelosi because he’s a complete hack and doesn’t care who knows it. But it does matter, for two obvious reasons:

  • Climbing Mount Chevron.  For the troofers to win, it is insufficient for them to demonstrate that their nonsensical reading of the statute is plausible.  They have to show that it is unambiguously correct.  The fact that all the relevant parties at the time believed that the subsidies would be available on the federally established state exchanges makes it enormously difficult to show that Congress clearly established otherwise.
  • The Dr. Strangelove Problem.  Remember, Adler and Cannon aren’t “the card says Moops!” troofers, they’re “the Moops invaded Spain” troofers.  Their contention is that Congress established a federal backstop that was designed to fail because it wanted to coerce the states into establishing their own exchanges.  Leaving aside that this makes no sense on its face — if you wanted to do this you wouldn’t set up a federal backstop at all, rather than set up a Potemkin one nobody was even eligible to purchase insurance on — if you’re trying to coerce the states you obviously don’t keep the consequences of states failing to establishing an exchange a secret. The consequences of states not taking the Medicaid expansion before it was re-written by John Roberts were made clear and widely understood.  The fact that nobody thought that a state’s citizens would be ineligible for subsidies if the federal government established their state exchange makes it clear that the Adler/Cannon theory is transparently wrong.

Not that any of this will necessarily matter to a majority of the current Supreme Court, but in a rational universe the King cert petition would have been returned with “why are you wasting our time with this crap?” written over the top of it.

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