A Win-Win Path Out of the Shutdown - Rob Horowitz

A Win-Win Path Out of the Shutdown - Rob Horowitz

As we move into the second week of the federal government shutdown, we are nearing the missed paychecks for federal workers and members of the military — which, among other real-world consequences, usually create the political pressure on our elected officials needed to break an impasse.  

 

At this point, however, President Trump and the Republican congressional leadership appear unwilling to offer any concrete concessions to gain the Democratic votes in the Senate needed to reopen the government.  At the same time, Democratic congressional leaders show no sign of a willingness to supply the votes required without any meaningful Republican commitments on health care and/or an agreement to put an end to the Trump administration’s rescissions of previously approved spending.  

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Before the negative consequences of this continuing stalemate mount, adding more headwinds to an already softening economy, President Trump should avail himself of a clearly marked and obvious win-win path to reopening the government.  Coupling an agreement to extend the otherwise expiring Obamacare enhanced premium tax credits with the Republican continuing resolution to fund the government can get the needed votes in both houses of Congress, help neutralize a Republican political vulnerability for the midterms, and give the Democratic congressional leadership a needed political win.  Any Republican votes that are lost in either the House or the Senate by extending the Obamacare tax credits can be more than made up by additional Democratic ones.

 

The Affordable Care Act’s (ACA) enhanced premium tax credits, which were put in place in 2021,“both increased the amount of financial assistance already eligible ACA Marketplace enrollees received as well as made middle-income enrollees with income above 400% of federal poverty guidelines newly eligible for premium tax credits,” reported Kaiser Family Foundation (KFF).  These expanded credits have made health insurance more affordable to working and middle-class individuals.

 

 
Americans without access to coverage through their employer have fueled a more than doubling of Americans employing the ACA marketplace to purchase health insurance from about 11 million to 24 million.  

 

Allowing these enhanced premium tax credits to sunset at the end of the year, as specified in the “One Big Beautiful Bill Act passed by Congress earlier this year, will result in premiums increasing by 114% in 2026 for those who purchase health care through the ACA marketplace and currently receive the tax credits. The negative political impacts of this increase will fall squarely on the Republicans and will begin to be felt on November 1, when the marketplace for next year opens and people see their premium increases. These

 

Obamacare increases will supercharge an already compelling case that Republicans are taking away health care from Americans, stemming from the significant cuts in Medicaid spending that were also included in the one big beautiful bill.

 

A series of recent polls showing overwhelming public support for continuing the ACA extended premium tax credits put an exclamation point on the political danger for the Republicans unless they take action. More than 3-in-4 (78%) Americans overall and nearly 6-in-10 (57%) MAGA supporters, for instance, “say they want Congress to extend the enhanced tax credits available to people with low and moderate incomes to make the health coverage purchased through the Affordable Care Act’s Marketplace more affordable,” according to a KFF tracking poll.

 

While there are political risks for both Republicans and Democrats as the shutdown continues, even without the looming ACA premium increases there are signals that the usual dynamics in which the side (in this case, the Democrats) that is refusing to fund the government unless their demands are met ends up with most of the blame may turn out not to be the case this time.  Polling so far, for example, shows that more Americans are blaming the Republicans for the shutdown than the Democrats.  Given that the Republicans control the presidency and both houses of Congress and that Mr. Trump is projecting a kind of enjoyment of the shutdown, threatening to use it as an excuse for large-scale layoffs, employing the tested playbook which has been used against Republican Congressional leaders successfully in shutdowns past of simply turning the tables, saying this time it is the Democrats who are holding the government hostage, may not pack the same punch.

 

President Trump has a far preferable alternative: end the shutdown by keeping Obamacare affordable for the millions of Americans that depend on it for health coverage. It’s a win-win solution for all involved politically. Most importantly, it’s a win for the American people. Mr. President, the ball is in your court.