Washington Wednesday: The subsidy showdown

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LINDSAY MAST, HOST: It’s Wednesday, December 10th. Glad to have you along for today’s edition of The World and Everything in It. Good morning, I’m Lindsay Mast.

NICK EICHER, HOST: And I’m Nick Eicher. Time now for Washington Wednesday!

Today we begin with the political fight that drove a 43-day government shutdown this fall—and a deadline that’s still very much in front of Congress.

Obamacare subsidies are scheduled to expire at the end of this year. Democrats had pushed hard to include an extension in a temporary funding bill to keep the government open. Republicans refused. And from October 1st to November 12th, much of the federal government shut down over that standoff.

MAST: The shutdown ended when Democrats dropped their demand… and Republicans agreed to allow a vote on subsidies this month. Democrats now want a three-year extension. Some Republicans prefer a shorter or more limited version. Others oppose an extension altogether. But the clock is ticking: if Congress does nothing before December 31st, millions of Americans will see higher premiums in 2026.

OBAMA: I am not the first president to take up this cause, but I am determined to be the last [applause]

EICHER: President Barack Obama back in 2009, pitching Congress on the Affordable Care Act as a way to bring security—and affordability—to American healthcare.

Not a single Republican in the House or the Senate voted for it. New York Times reporter Peter Baker remembers.

BAKER: It was obviously a big moment of success for President Obama getting it passed, but it sowed the seeds for years of division.

The seeds were the likelihood of exploding costs. Even after the bill passed, President Obama worked to recalibrate expectations.

OBAMA: This legislation will not fix everything that ails our healthcare system but it moves us decisively in the right direction.

MAST: Meaning, the argument is not over whether we’ll have the taxpayer picking up the cost of healthcare, but how much they’ll have to pick up.

REPORTER: The subsidies have grown a lot from about $50 billion a year in 2020 to more than $120 billion now. Just since COVID, American taxpayers have spent around $440 billion on subsidies entirely…

EICHER: Republicans won the shutdown debate, but lost the bigger argument. So now in the Senate, the GOP has put forward several competing ideas for extending the expiring Obamacare subsidies.

MAST: One group in the Senate—led by Republicans Susan Collins and Bernie Moreno—wants a two-year extension with new income limits and a required minimum premium per month.

EICHER: Another plan from Republicans Bill Cassidy and Mike Crapo would route subsidy dollars directly to consumers through Health Savings Accounts, among other things. House Republicans may introduce a separate plan, but no one’s unified around any single approach.

Joining us now is political scientist Hunter Baker. Morning, Hunter.

BAKER: Good morning.

EICHER: So, Hunter, we’re back at not whether we subsidize health insurance, but by how much. What does this tell you about the way Republicans see things now?

BAKER: I think that what they understand is that Americans are about to see a significant increase in the cost of health insurance. And I actually think that this is going to happen not only to people who have been benefiting from Obamacare subsidies, but from people generally in the market. And I think that they're looking at that and they're thinking, we cannot be seen to just have our hands in our pockets doing nothing. And so that's why they're going to be trying to come up with some sort of answer on health care. But I don't think it's going to be enough. I think that we are in a bit of a crisis spiral with regard to the Affordable Care Act and sort of the revolution that it wrought in American health insurance. I don't know if that's sooner or later, but eventually it's going to prove to be kind of an unsustainable system. And we're going to be driven in one of two directions. I think that the first direction would be Republicans trying to push in a more market-oriented system where people basically pay for their ordinary health care the same way they pay for auto maintenance or something like that. I mean, you've got a cold, you go, you buy the service. But if you have something serious, cancer, you know, heart problems, something like that, then maybe there's a bigger sort of catastrophic type of insurance policy that people carry. I think that's the direction the Republicans would like to go. I think the Democrats would like to go to single payer, and I think we're going to go in one of those two directions, ultimately.

MAST: Well, the Trump administration has made it official: the United States plans to revive the Monroe Doctrine–prioritizing American dominance in the Western Hemisphere. It’s laid out as the “Trump Corollary to the Monroe Doctrine” in the President’s National Security Strategy.

Over the weekend, Secretary of Defense Pete Hegseth said the approach would be informed by what he called “hard-nosed realism”... with strategic rationality and cost-benefit assessments guiding the approach.

Here’s what he said that would look like:

HEGSETH: The War Department will not be distracted by democracy building interventionism, undefined wars, regime change, climate change, woke moralizing and feckless nation building. We will instead put our nation's practical, concrete interests first. We will deter war. We will advance our interests. We will defend our people. Peace is our goal. And in service of that objective, we will always be ready to fight and win decisively if called upon.

So Hunter, the plan lays out a few pillars of this strategy. Walk us through how you read the plan. What can we expect?

BAKER: Well, with regard to the Trump corollary, we’re talking about, really, Latin America, and I think Trump is building on the earlier Roosevelt corollary—Teddy Roosevelt—to say that when it comes to Latin America, that the U.S. is saying it will exert a sort of a police power when it thinks it is necessary. So if you want to think about what we've been doing with regard to this sort of Venezuelan drug trade, then you start to understand these words like police power. You know, it's kind of an intervention that is more than criminal in nature, but which could involve military force. And so I think that what Trump is doing is he's building these alliances in Latin America. And so where he intervene militarily. So that's that's sort of in the Latin American side of things.

With regard to Europe, I see him continuing to say what he said earlier, which is, is that Europe is not going to be a free rider on the American military anymore. You know, this continued insistence that the Europeans pay more of their way, but also pointing out, and this is kind of aggressive, and it's going to set off a lot of people pointing out that Europe is in relative decline. I don't know if people paid attention that the state of Mississippi now has a higher standard of living than Germany. You know, the higher GDP per capita than Germany. That is basically unthinkable, and yet it has occurred. So Europe is in economic decline relative to the United States, and he's basically saying, you know, Europe needs to become more like the United States, be a better partner to the United States, stop being with us in NATO and sometimes against us as the EU.

So those are the sorts of things that we're hearing there. And he's also, I think, warning the Chinese not to go too far foreign trying to influence Latin America's path.

MAST: Critics of the plan say it’s dangerous, that there are threats from the other hemisphere that need attention…

Are those criticisms founded?

BAKER: I think that we live in a world of constraints. So if I say we should focus on Latin America, somebody else could say, you're ignoring Asia and that's dangerous. Well, it would always be better for me to be able to police the entire world. It would always be better for me to have a military that could defeat every other military and win a three -nation war and all kinds of things like that. But we don't necessarily have the ability to sustain that. So I can understand pushing the Europeans to do their part and basically saying, we're going to control our hemisphere and kind of giving warnings to the Chinese. I can understand that as sort of a realistic way of dealing with the problem of not being able to do everything.

MAST: You mentioned the drug boats and I’d like to come back to that.

So stay with me here: one thing we’ve not discussed with you is the question of the philosophy around those strikes. Certainly this is not the first time an American president has used the word “war” to describe the battle against drugs. Richard Nixon, more than 50 years ago.

NIXON: America's public enemy number one in the United States is drug abuse. This will be a worldwide offensive, dealing with the problems of sources of supply as well as Americans who may be stationed abroad, wherever they are in the world.

So, are we at war? Are these strikes justified in the first place? And if so, how?

BAKER: So you mentioned Nixon in on drugs, I think, I think that he accurately recognized that a country can be destroyed from within. And I don't want to sound hysterical, but it is disturbing. I mean, when I, when I walk through major American cities and I smell marijuana everywhere, to some extent, that's the scent of American decline that I'm smelling. And obviously, a lot of worse drugs than marijuana out there, and we're worried about those proliferating. We have not been very successful in the war against drugs. It seems to have become much worse. And so we may be asking ourselves, is the criminal response to the problem adequate? Or do we have to do more? So I think that what Trump is doing with these strikes is signaling that we're going to do more. But it is concerning, and it's concerning from a Christian perspective. I mean, we want to try to abide by just war theory, which is kind of Christian in nature, the idea that there's a just cause, there's a legitimate authority to declare that war, that we have a right intention in declaring that war, and that it was our last resort. And so we ask these kind of questions, and are we correctly discriminating between combatants and non-combatants, and are we using proportionate force? As we look at some of these strikes, like on these Venezuelan boats that we're told are narco -terrorists, we have those kinds of concerns.

EICHER: Hunter, the Supreme Court on Monday, heard a case involving presidential power to fire officials in independent agencies.

We’ll cover the legal issues in Legal Docket, but the political issue is interesting, President Trump fired a Federal Trade Commission official. He said she didn’t align with his Administration’s priorities. The official Rebecca Slaughter sued, and pointed to a precedent from 1935 that held that officials like her could be fired only for reasons of “inefficiency, neglect of duty, or malfeasance in office.”

The Trump administration argued that precedent improperly ties the president’s hands.

SAUER: It continues to tempt Congress to erect at the heart of our government a headless fourth branch insulated from political accountability and democratic control.

Hunter, talk about what happens if the president wins this one, because it sure looks like he might.

BAKER: The Constitution says that the executive authority resides in the president's hands. And so I look at these sort of congressional agencies and I see something that is in significant tension with the Constitution. Congress is supposed to say what is supposed to be done, but the executive is supposed to say how it's done and is supposed to do it. And so I think that the idea with these sort of independent, congressionally created agencies was that we had this tremendous faith in the power of neutral bureaucracy that is free from political taint. And I think that what we find is that politics is everywhere, including in these agencies, and that they are run differently depending on who is the president and who is making the appointments. So I would argue that these agencies are sort of usurping the proper sphere of authority of the president, and if the court finds that way, I think that's going to be correct. I think that it will actually make more sense to have these agencies be accountable to the president's executive authority. Now, as I say that, I just want to go back and say what I've said before, which is I think that the president wields too much policy authority of the type that belongs to Congress. We have turned the Constitution into a crazy quilt kind of a thing. But with regard to this particular issue, I think it's clear that this power resides with the president.

EICHER: Well, Hunter, I'm curious, you talk about constitutional structure. Does independent government anything find its authority in the Constitution? I mean, what the Constitution does it really talk about an independent authority in that sense?

BAKER: I mean, you have Congress who makes the law. You have a president who enforces the law. And then you have a president who has sort of this authority to conduct foreign policy. But I don't really see, when the Constitution is written, I don't think that you have this sort of strong idea of an independent or a neutral authority in the same way. Now, it's true. If we were talking to somebody like George Washington, he would say, well, I would rather that we didn't have political parties at all. So maybe in that sense, maybe we had some sort of neutral sort of thing. But no, I don't see the Constitution envisioning neutral agencies.

EICHER: Hunter Baker is provost at North Greenville University. Hunter, thanks so much. We’ll see you next time.

BAKER: Thank you.

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