This essay by Ezekiel Emanuel Obama, an administration health insider who helped craft the ACA, explains how corrupting politics can be:
Economists—liberal and conservative alike—overwhelmingly denounce the tax exclusion. It drives costs higher while keeping wages down, it is regressive, and it is a major drag on the federal budget—lowering revenue by a whopping $250 billion a year.
During the 2008 presidential campaign, Senator John McCain proposed eliminating the exclusion and replacing it with a $5,000 tax credit to help families buy health insurance. The Obama campaign ran more than $100 million worth of ads pounding McCain, accusing the GOP nominee of “taxing health benefits for the first time ever.”
Once Obama was in office, his advisers split on the issue. The economists wanted to limit the exclusion, but the political team didn’t want to touch it. David Axelrod, the president’s political guru, even showed us a montage of Obama’s campaign commercials to remind the economic team of his stated position.
Emanuel (yes, Rahm’s brother) says that Obama ultimately did the right thing by adding a tax on Cadillac plans that will begin, wait for it, in 2018. Not only is the timing of the reform questionable, but it is delusional to think of this as real reform.
The reality is that Obama was devastating against John McCain using a very insincere, populist attack when it was McCain who was offering up a good policy proposal, a proposal that Emanuel himself calls a good, consensus, bipartisan idea. Politics won. The nation lost. End of story.
UPDATE: I spelled Emanuel’s name incorrectly in the original title. Now corrected. Thanks to a reader for pointing this out.