Grubergate Part II: The Truth

MIT economist Jonathan Gruber, who advised policymakers on the economics of healthcare during the debate over the Patient Protection and Affordable Care Act (Obamacare), landed himself in hot water for the second time (demonstrating, again, why academics and politicians have fundamentally different goals and skill sets). Critics of the law discovered video of a Penn conference in which Gruber said the following

This bill was written in a tortured way to make sure the CBO [Congressional Budget Office] did not score the mandate as taxes. If CBO scored the mandate as taxes, the bill dies. So it's written to do that.

In terms of risk-rated subsidies, in a law that said health people are gonna pay in - if it made explicit that healthy people are gonna pay in, sick people get money, it would not have passed. Okay - just like the ... people - transperen- lack of transparency is a huge political advantage. And basically, call it the stupidity of the American voter or whatever, but basically that was really, really critical to get anything to pass.

Republicans gleefully pounced on the remarks to further their case against the law, while Democrats angrily denounced Gruber. David Axelrod, a former chief strategist for President Obama, tweeted that you'd find Gruber's picture under a definition of stupid in the dictionary. The House Oversight Committee even called Gruber to testify at a hearing next month. 

Overstating this outrage and its importance would be quite easy. After all, I have real doubts that the vast majority of the public even knows who Gruber is. Indeed, when people started referring to his remarks on Twitter last week, I wondered how Hans Gruber resurrected himself and what he did (If you don't know who Hans Gruber is, go watch Die Hard. NOW). 

Nonetheless, the outrage among the political class raises two important questions: did Gruber violate a taboo, but speak honestly, or did he speak out of bitterness, frustration or a failure to properly understand the legislative process? Additionally, did Gruber's comments reveal something untoward or nefarious about the legislative process?

Gruber basically spoke the politically inconvenient truth. Undoubtedly, calling the voting public stupid represented a poor choice of words and a foolish blunder for someone who should know better. Gruber would have been far better served using a phrase like uneducated about the political process and public policy, or under informed about policy matters.

Both would have been far more accurate and less inflammatory. Yet, speaking at an academic conference, Gruber displayed a political tin ear and employed shorthand that guaranteed that he'd make news and look foolish (Of course, as an academic, at an academic conference, he freely spoke in a way that no one in the political world would have done). He likely assumed that his audience would understand that stupid meant ill-informed about policy and the activities of Congress. 

This poor choice of words aside, as Ezra Klein wrote, Gruber otherwise spoke the truth. As anyone who has ever read R. Douglas Arnold's seminal Logic of Congressional Action knows, members of Congress always try to obscure the chain of responsibility for the costs (i.e. unpleasant aspects of legislation), while loudly claiming credit for the benefits. 

It's why Congress has created mechanisms to vote for congressional pay raises without actually voting on raises. The sad truth is that politicians who choose honesty over such maneuvering tend to find themselves in trouble politically (as Walter Mondale famously learned). Rather than being rewarded for their honestly, they are punished for whatever ill effect they've admitted to causing. 

Almost all legislation has costs and benefits. Even when those costs are diffused among the population, they still exist. Gruber was also undoubtedly correct that the attempt to hide these costs led to more complex legislation, which made it even harder for the public to be well informed. 

In fact, as the work of Suzanne Mettler, Brian Balogh, and Jacob Hacker has shown, Congress often produces needlessly complex legislation that obscures even its benefits in order to avoid stirring anxieties about government power and the welfare state. While members of Congress certainly try to make sure that constituents who benefit from legislation know that they deserve credit, they still steer clear of the sorts of ideological debates required by more simple, straightforward legislation. 

In fact, the paradox at work is that legislators feel compelled to create overly complex legislation to hide costs and benefits because it is difficult to explain the reasoning behind legislation in a culture of thirty second soundbites.

Congress understood that the claim that the Affordable Care Act raised taxes could be potentially fatal both to the legislation and to their careers. Congressmen did not believe that they could win the messaging debate, and explain the need for these provisions in a way that could counter the potency of simple accusations of burdening the taxpayer. The two or three minute explanation (I'm being generous here—it might be 15-20 minutes) of these provisions complete with citations to studies would never reach the public. 

But because of this belief, Congress made the legislation even harder for Americans to understand, and may have contributed to its unpopularity and to the suspicion that many people have towards the legislation and the legislative process behind it. 

The only way to undo this process of obscured costs and benefits and overly complex legislation would be for the public to engage with the legislative process to a sufficient degree that they understood minute policy details and ramifications. The public would also need to develop a newfound willingness to pay the costs for popular things (in the case of the Affordable Care Act, a ban on insurers disqualifying people because of preconditions). 

Gruber's comments certainly won't help in this regard. Nonetheless, we should understand that his careless word choice aside, Gruber spoke the truth, and identified a major problem with our political and governing processes. The practice he identified was not limited to or unique to the Affordable Care Act. Nor was Congress trying to fool the public about the Affordable Care Act. Rather, Congress was doing what it always does to protect itself against demagogues and talking points, and to ensure passage of legislation in a soundbite culture. 

This practice does a real disservice to the public's understanding of legislation, but it's more reflective of a systemic process flaw than a problem with the Affordable Care Act. The process itself also does not signal that legislation is bad. Merely that it is overly complex and might be better.