Well, a “slimmed down” version of Build Back Better may not be a slam dunk after all.
The current deal would involve slapping innovation-killing price controls on the pharmaceutical industry to shovel more money into Obamacare. But new information from the Congressional Budget Office (CBO) and Joint Economic Committee (JCT) could give the key player—West Virginia Sen. Joe Manchin—pause.
Sen. Manchin has said that his top priority is getting inflation under control. In a July 13 statement he said, “No matter what spending aspirations some in Congress may have, it is clear to anyone who visits a grocery store or a gas station that we cannot add any more fuel to this inflation fire.”
He quashed the “climate” spending and other social welfare programs. He can stop the inflationary Obamacare spending as well.
Three Republican committee chairs asked the numbers guys at CBO and JCT for an analysis of the current deal. They know, as all of us do, that a two-year extension of the Obamacare subsidies would become another two years and another and another.
The cost of making these ‘temporary’ subsidies permanent would add $248 billion to the federal deficit over the next decade, their analysis found. Worse for patients, more people would be forced off their current private health plans than would gain new coverage.
“This is a proposal as nonsensical as it is irresponsible,” Chairmen Richard Burr, Mike Crapo, and Lindsey Graham said in response to the findings. “It’s absolutely critical Americans have an accurate accounting of the real harm these proposals would have on our economy.”
Even worse, the spending on boosted Obamacare tax credits would be immediate. Any purported savings from the price controls and confiscatory 95% penalty taxes on drug companies wouldn’t come for several more years. So it’s incontrovertible that the government would soon be pumping more money into the economy—actually the coffers of insurance companies—and fueling inflation.
Doug Holtz-Eakin (president of the American Action Forum and former CBO director) nailed it in his newsletter today: “There is literally no budgetary objective in play at present. All the taxes and spending cuts will be devoted to new spending. This is about punishing drug companies and marching toward a single-payer health system.”
Sen. Manchin, are you listening?
Here are excellent articles by colleagues with many more insights:
- Bob Moffit article in The Daily Signal:Reducing Patient Access to New Medications Is the Left’s Latest Medicare Price-Fixing Scheme addresses the impact of price controls on access and innovation.
- Chris Jacobs article in The Federalist: Democrats Plan To Snatch Medicare Dollars From Seniors To Subsidize Their Rich Friends addresses impact on innovation and the raid on Medicare to pay for ObamaCare subsidies.
- Joel Zinberg op-ed in National Review: Say It Ain’t So, Joe addresses economic effects of price controls, inflation, and impact on innovation
- Bob Moffit article in The Daily Signal: Medicare Savings Should Be Used for Improving Medicare, Not Funding Obamacare addresses the raid on Medicare to pay for Obamacare subsidies
- Doug Holtz-Eakin authored the American Action Forum Weekly Checkup: Putting the Reconciliation Bill in Perspective addresses redirecting funds from Medicare to ObamaCare subsidies, the impact on innovation, and onerous taxes and penalties contained in the package.
- Craig Garthwaite authored an op-ed in STAT: Drug price controls are a dance with the devil: short-term savings will be overwhelmed by loss of innovation addresses the impact that price controls has on innovation and venture investment in startups.
- Doug Badger writing for The Daily Signal: Why Congress Shouldn’t Increase Obamacare Spending explains that taxpayers would save billions of dollars and that the number of people with health insurance would remain the same if the subsidies were allowed to expire in December, as they are on track to do.