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Apparently, if anyone can make Americans love Obamacare, it’s Ted Cruz.

What?

Just look at the polls. There are brutal numbers for the GOP in a new Fox News poll, confirming numbers from an earlier Quinnipiac poll. Obama’s job approval is up, support for Obamacare is up (opposition running at just 47-45 in the Q poll), approval of Republicans in Congress has fallen yet further, and the generic ballot has tilted sharply in favor of Dems (9-point lead in the Q poll). Meanwhile, Americans blame Republicans more than Democrats for the shutdown (although the median voter opts for “both”).

The shutdown would never have happened without Ted Cruz’s quixotic campaign to defund Obamacare. “He pushed House Republicans into traffic and wandered away,” says Grover Norquist. By wasting time on that doomed quest due to his influence, House Republicans had no backup plan when the continuing budget resolution fell due. At this point, for reasons I discussed in a previous post, it is more likely that the Dems will get concessions from the GOP than the other way around.

How did we get here? Matt Welch accuses the Republican “wacko birds” of bad deadline management, and it’s hard to disagree. But there’s a reason for that bad deadline management, and it’s not actually incompetence so much as ideological intransigence. The new litmus test for conservatism became willingness to defund Obamacare. Tactical disagreements became ideological disagreements. If you didn’t want to waste time trying to defund Obamacare, you were at best a coward and more likely a “RINO,” according to hardline websites like RedState. As Avik Roy has noted,

The common view of Obamacare among conservatives goes something like this. Prior to 2010, America’s free-market health-care system was the envy of the world. Obamacare changed all that; it is a government takeover of our health-care system, of one-sixth of our economy, one that will turn America into a European-style welfare state. That is to say, Obamacare is an existential threat to the American way of life.

If this is your view of Obamacare, then of course it makes sense to shut down the government in order to attempt to defund the law. What’s the point of maintaining a Republican majority in the House in 2014, let alone seeking a majority in the Senate, if the end result is the destruction of the American way of life?

That view of Obamacare is, of course, dead wrong. It’s a mistaken law that moves the country in the wrong direction, but the regulatory framework for health care and health insurance in this country was already badly broken and in need of reform. But damn the facts and fix bayonets!

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As Pileus readers know, the spending cuts Congress and the President agreed to in future budgets are a drop in the bucket of future deficits. Nevertheless, the cacophony of protest among partisan hacks is deafening. Jacob Weisberg has a particularly incoherent piece at Slate today. Two selections:

But for the federal government to spur growth or create jobs, it has to spend additional money. The antediluvian Republicans who control Congress do not think that demand can be expanded in this way. They believe that the 2009 stimulus bill, which has prevented an even worse economy over the past two years, is actually responsible for the current weakness. Their Hooverite approach—embedded in the debt-ceiling compromise—demands that we address the risk of a double-dip recession by cutting public expenditure now rather than later.

The deal that President Obama and House Speaker John Boehner tentatively agreed upon in early July was far from perfect, imbalanced in favor of spending cuts over revenues by a ratio of 4-to-1. But that $4 trillion “grand bargain” would have constituted a serious down payment on the deficit, and sent a strong signal to financial markets that our political establishment took the problem seriously. Instead we got this week’s sad bargain—a much smaller, deferred, and contingent reduction in spending projections. This sends quite a different signal: that our political system cannot, in its current configuration, cope with difference between what comes in and what goes out.

So let’s get this straight: the cuts in spending were both too large and too small for Weisberg. Bigger cuts would have been better, and so would no cuts – in fact, increases! Perhaps he means that there should be increases now, bigger cuts later – a respectable position. But that’s not what he says, nor does that position correspond to any recognizable negotiating position taken by either side in the debt ceiling debate. So why does all the blame accrue to “antediluvian Republicans”? (Never mind the ignorance about Hoover’s massive increases in federal spending.)

But the reliably behind-the-curve New York Times editorial board takes the cake with their proposal to abolish the debt ceiling altogether. So let’s get this straight: Politicians in DC are such irresponsible spenders that the only thing that could force them to get together and make even small cuts in future spending growth was the risk of financial annihilation. And the solution is? Take away the very risk of financial annihilation that finally forced them to exercise a modicum of fiscal responsibility!

Of course, if you abolish the debt limit, then under divided government we’d have the same game of chicken played at budget time, when the hostage would be the operations of the federal government. And I’m sure we can count on the Times editorial board to scream about not holding our economy hostage when the federal government shuts down or comes close to it. Maybe we should abolish annual budgeting too. Just let departments set their own budgets. It’s safer that way.

The right blogosphere is little better. Looking ahead to the super-committee, the only concern on the right seems to be that – horrors of horrors – the committee might try to raise some revenue by eliminating tax expenditures and deductions! So the GOP should have forced default instead! Because if you want long-run spending cuts, the right strategy is to gain control of one house of Congress and then maintain a position of complete and total intransigence on the only thing you can reasonably offer the other branches in exchange for spending cuts! Oh, and frighten as many independents as you can before the next election.

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Noel Johnson, Matt Mitchell, and Steve Yamarik have a new working paper answering that question in the affirmative. They look at state fiscal and regulatory policies and find that Democrats generally like to increase taxes and spending when in control of state houses and Republicans do the reverse. But when states have tough balanced-budget requirements called “no-carry rules,” Democrats and Republicans don’t differ much on fiscal policy. Instead they try to appeal to their constituencies by pursuing regulatory policies – in general, Democrats increasing regulation and Republicans cutting it. As the paper’s still in the working draft stage, they are looking for comments on it.

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Mitch Daniels seems to be the potential Republican presidential candidate getting the most attention from libertarians if one excludes the forthrightly libertarian candidates Gary Johnson and Ron Paul. Our own Grover Cleveland has expressed his man-crush here, while Ilya Somin puts the case for Daniels here.

But I want to take a look at Jon Huntsman, widely viewed as a “moderate” Republican, but whose policy positions appear to stake out a position that may be more libertarian than Daniels’, even though he rejects any label other than pragmatism (see also Sven Wilson on Huntsman):

  • Voucherizing Medicare
  • Ending the Libya intervention
  • Civil unions for gay couples
  • Expanded immigration rights

Support for the stimulus is problematic, but in my view should not be a killer in the way that, say, support for an individual health-insurance mandate would be – or, for me, Daniels’ opposition to any legal status for gay families. Daniels might be more economically libertarian than Huntsman, but from all reports he’s a social conservative. And you’ve got to give a guy points for signing a proclamation declaring “Dream Theater Day” in Utah!

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Wasn’t it just five minutes ago that Democrats and Republicans alike were hailing their budget resolution from last week as “historic” and “unprecedented” in its cuts? Even the usually understated WSJ called it, as I pointed out only moments ago, “The Tea Party’s First Victory.”

I guess that was then. Today the WSJ reports that even that widely reported figure of $38 billion in hotly negotiated cuts was “hokum,” the real figure being closer to $20 billion. The Journal also reports that this revelation might mean that House Speaker Boehner is in danger of losing yet more backbencher support from those yahoos of media lore

Well, I for one am shocked, shocked that instead of cutting the budget by the whole one-and-a-half percent ($61 billion) the Republicans initially demanded, and instead of the one whole percent ($38 billion) they claimed to end up with, they in fact cut the budget by only about one-half of one percent.

Budget crisis? What budget crisis?

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Wall Street Journal editorials are usually very good, the WSJ‘s editorial page being one of the few of major newspapers whose authors are economically literate. The editors recently argued that last Friday’s late-hour budget agreement was “The Tea Party’s First Victory.”

Maybe it was. But consider this passage from the piece:

Republicans also showed they are able to make the compromises required to govern. We realize that “governing” can often be an excuse for incumbent self-interest. But this early show of political maturity will demonstrate to independents that the freshmen and tea party Republicans they elected in November aren’t the yahoos of media lore. A government shutdown over a spending difference of $7 billion and some policy riders would have made the GOP look reckless for little return.

Here the editors are misreading the political tea leaves. There is nothing that “the freshmen and tea party Republicans” can do that will change the opinion of most media outlets that they are “yahoos” bent on “reckless” endangerment of the republic. Indeed, that is one of the more charitable ways to describe what liberal pundits and editorial pages will write, not to mention think, about these Republicans. And when I say they can do nothing to change that, I mean it: Even if the Republicans had capitulated entirely to the Democrats’ opening offer of—what was it, $9 billion in cuts?—it would have been explained not as evidence of the ‘maturity’ and ‘reasonableness’ the WSJ seems to believe but because of something rather less flattering. (My guess: either (a) stupidity, (b) a secret Machiavellian strategem, or (c) some combination of the two.)

If I’m right about that, and the central currents of media and liberal opinion of these Republicans will not change, then why should either they or the WSJ bother worrying about it?

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Avik Roy has an interesting piece in National Review on how conservatives (really, free-marketeers) should approach the policy and politics of health care in the age of PPACA. I largely agree with his policy prescriptions, somewhat vaguely stated as they are:

First, Republicans must foster a truly free market for health insurance by eliminating the differing tax treatment of employer-sponsored and individually purchased insurance. Second, Republicans must make dramatic improvements to Medicaid, using Mitch Daniels’s impressive reforms in Indiana as a template. Third, Republicans must move Medicare onto a sustainable path that puts financial control in the hands of seniors themselves rather than central planners.

I would also argue for repealing state-level health insurance mandates, but that is properly the role of state governments. (As noted in this blog, allowing purchase of health insurance under other states’ laws would achieve more or less the same end.)

Roy’s analysis of the political situation is insightful. Republicans and conservative Democrats are very unlikely to achieve a filibuster-proof majority after the 2012 elections. Therefore, repeal of PPACA will have to be passed through reconciliation. But since the CBO scored PPACA as reducing the deficit, a simple repeal cannot pass through reconciliation.Thus, whether they like it or not, Republicans will have to take on new spending cuts to any repeal.

And this on the presidential race is spot on:

This means that influential Republican activists must — must — coalesce around the most electable Republican presidential candidate who can articulate conservative health-care principles. This is no time for single-issue small-ball or personal score-settling. A GOP nominee who passes all the litmus tests but can’t win in November would only succeed in making Obamacare permanent. One who can win but isn’t capable of pushing for real health-care reform wouldn’t be much better.

The first criterion rules out Palin and Gingrich (and let’s be honest, Paul and Johnson too). The second rules out Huckabee and Romney. Who’s left? Mitch Daniels?

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