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Michael Hiltzik

Did Obamacare destroy the Democratic Party? Another look

Another look at whether Obamacare destroyed Democratic hopes

Was heathcare reform a fatal political blunder by the Democratic Party? That thesis of Sen. Charles Schumer of New York, the third-ranking Democrat in the Senate, received a respectful airing this week from the veteran political journalist and New York Times columnist Thomas B. Edsall. 

Edsall observes that hostility to Obamacare from white voters is a menacing counterweight to the party's demographic advantages in the next presidential election. "Whatever you think of Senator Schumer," he writes, "you begin to understand why he spoke out as forcefully as he did."

Edsall cites my own critical analysis of Schumer's remarks, delivered to an audience of Washington journalists on the Tuesday before Thanksgiving,  as an example of the pushback he's gotten from supporters of the Affordable Care Act. Schumer's position--that the Democrats should have delayed healthcare reform at the start of Obama's first term and focused instead on policies to help the middle class--goes to the heart of what it means to govern. It's proper to give it a closer look.

It's even more important to examine the misconceptions about Obamacare that lie at the heart of Schumer's analysis. The fundamental flaw in that analysis is a misunderstanding of Obamacare, as some of Edsall's own data reveal. The lesson, as I've written before, is that the Democrats' blunder was not in passing the bill, but in running away from it once it became law and abandoning it to be defined--misdefined--by their Republican opponents.

As Edsall observes, "Obamacare" has been broadly unpopular. He cites a November 2013 poll by National Journal in which a large plurality (and a majority of whites) stated that the law would make things worse for themselves. Most thought it would make things worse for the middle class.

But the poll underscored a well-known problem with the law: most people didn't, and still don't, understand what's in it. That's the Democrats' own fault. The National Journal poll was designed to reinforce respondents' negative perceptions of "Obamacare," then asked them what they thought about it; why would anyone be surprised that the results tilted negative? The poll questions mentioned the glitchy launch of healthcare.gov and the brouhaha over cancellations of existing policies. These were big deals at the time; soon afterward, however, the first problem was resolved and the second concern shown to be grossly inflated.

But the poll did nothing to probe whether respondents actually understood what was in Obamacare for them. This is a serious flaw, because other surveys, notably by the Kaiser Family Foundation, have shown repeatedly that voters strongly favor almost all of the actual features of Obamacare, including the end of insurance denials and jacked-up premiums for pre-existing medical conditions, lower drug prices for Medicare enrollees, the right to keep children on employer health plans to age 26, tax credits for small businesses to buy insurance, and the expansion of Medicaid.

Not a single one of these provisions was mentioned by National Journal's polltakers. More to the point, they were almost never cited by Democrats running in the 2010 or 2014 Congressional elections. Nor was the fact that the ACA had brought low-cost health insurance to an estimated 10 million Americans who were previously uncovered.

It's worth repeating that while the ACA is a boon to low-income Americans, especially in states wise enough to take advantage of its federally funded Medicaid expansion, it incorporates a strong middle-class benefit. Premium subsidies in the individual market extend to families earning up to 400% of the federal poverty level. For a couple with two children, that comes to $95,400; doesn't Schumer consider that a middle-class income?

So the Democrats' problem wasn't Obamacare so much as faulty messaging. Think of how things might have been different if every time a Republican or Koch-backed political organ trotted out a purported Obamacare "victim" (most of which cases were bogus), a Democratic organization produced an Obamacare winner from among those 10 million new insurance holders. (They weren't hard to find.)

As the Washington Monthly's Ed Kilgore writes, the Democrats utterly failed to explain Obamacare "as an economic initiative" defending the middle class from a poorly regulated health insurance industry. Kilgore and others have pointed out the other big hole in Schumer's rant about the lack of Democratic ideas to help the middle class: It was light on practical specifics.

Schumer mentioned a few: supporting the prosecution of bankers for their role in the financial crisis, raising taxes on CEOs, "changing labor laws so workers could demand more pay."

These are all sound. On the prosecution of bankers, if Schumer's spoken out on this topic before, it certainly hasn't been with the verve of, say, Sen. Elizabeth Warren, D-Mass. On the CEO pay, he's also correct, but tax hikes on the top 1% were an essential element of President Obama's economic policy, and he probably got about as much from the GOP as possible. And strengthening the hand of labor shoud always be a core issue for Democrats.

Democrats have achieved much during the Obama Administration. There's hardly any disagreement that Democrats were "incompetent in conveying their actual accomplishments in economic policy," as Kilgore writes. (Emphasis his.) Schumer was correct in stating that Democrats should display more conviction about their economic platform. What he didn't say is that what's been missing is the courage of their convictions.

"We must convince the middle class that the only way out of their morass is by a stronger and effective government, not by demeaning or running away from it," Schumer told his audience. But by trampling over the Affordable Care Act, he became part of the problem.

[Addendum: Kevin Drum weighs in with his customarily sage approach.]

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