Politics

02.05.14

Obamacare Attacks the Middle Class

Obamacare is looking more and more like it was designed to punish the middle class at the expense of the Democratic base—just like the old welfare days.

It’s welfare redux time. Yesterday, the Congressional Budget Office reported that the Obamacare will cost the country the equivalent of 2.5 million full-time jobs by 2024, as people choose not to work or work less in order to keep their Obamacare subsidy. Meanwhile, the Brookings Institution announced yesterday that Obamacare stands to shift wealth from the top 80 percent on America’s income ladder to the lowest fifth—a cash grab from most of the bottom half. President Obama and his congressional allies have sacrificed the work ethic and growth on the altar of the Democrats’ upstairs-downstairs coalition, with the emphasis on “downstairs.”

That Obama would go gunning for affluent America was no secret. As a candidate, sticking it to the relatively rich was a principle from day one. On the stump, Obama intoned, “I can make a firm pledge. Under my plan no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.”

Well, it now looks like Obama has played us again, just as he did when he “promised” that if we liked our healthcare we could keep it. Yes, Obama was sort of, proximately, true to his word when he raised taxes on Americans earning $250,000 and up. But, here’s where Obama as Pinocchio comes in.

The president hit working and lower middle income America hardest. So while the stock market was setting new highs in 2013, working America was socked with a Social Security tax hike, and has now been told that it will shoulder a larger share of Obamacare’s burden than those closest to the apex of the income pyramid—that is, if they are foolish enough to keep working.

As an apparently punch-drunk but honest Senate Majority Leader Harry Reid (D-Nev.) phrased it, “We live in a country where we should be free agents. People can do what they want.”

Regardless, Obamacare is looking a lot less about Obama and his vaunted calls for “justice,” and a lot more like Chicago or New Jersey-style vengeance—with a dollop of “whatever” thrown in for kicks. As it is playing out, Obamacare appears increasingly as if it were designed to punish the Republican rank and file, while haphazardly rewarding the Democrats’ core. And if someone gets hurt that shouldn’t have been, so be it, like those someones who earn between $30,000 and $50,000.

Just look at the 2012 exit polls. Two Novembers ago, Americans earning at least $50,000, and those living in small town, rural or suburban America voted for Mitt Romney, while those below the $50,000 line, or residing in America’s larger cities went for Barack Obama. 2008 told a similar story, with urban America and those under the $50,000 mark full-throatedly backing Obama’s bid for the White House, while the rest of the U.S. was more equivocal and more muted in its enthusiasm.

Against this backdrop, the political calculus for punishing the nearly 60 percent of voters with incomes above $50,000 must have stared Obama’s operatives in the face like a bull seeing red.  But why tag those who make only between $30,000 and $50,000, and why throw a lead weight around the recovery?

But we do know why, and it’s called redistribution and it’s about demographics, much as the administration may half-heartedly deny it. Just ask William Daley, the former Obama White House Chief of Staff who helped make Obamacare the reality that it is. In Daley’s own words: “Redistribution is a loaded word that conjures up all sorts of unfairness in people’s minds. … It’s a word that, in the political world, you just don’t use.” Sometimes the truth can be so inconvenient.

This brings us to demographics and the Democrat’s upstairs-downstairs coalition. It relies heavily on political contributions from the rich on both coasts; prays for the votes of enough upscale suburbanites; and is electorally wedded to Americans in the lower socio-economic tiers who are disproportionately uninsured.  

While non-Asian minorities comprise over 30 percent of the population, they are nearly half of the uninsured, according to the Department of Health and Human Services. Although Americans earning below $25,000 annually are approximately a fifth of the U.S., they too are over 30 percent of the uninsured, and how they vote is no secret.

So the Democrats and President Obama have bet America’s fate and future on an alliance of paupers and princes, with “pity-charity liberalism” as their touchstone. In the words of Michael Lind of the New America Foundation, these “charity liberals” have “preferred means-tested programs focused directly on the poor,” disdained “middle-class social insurance,” and favored “micromanagement of the behavior of the poor by upper-middle-class social workers.” As a political agenda, this translates into welfare and Obamacare for the Democratic base, jobs as social workers for the children, or their college roommates, of the Democratic Donor Class, and Social Security—well, we can talk about that later, but by all means let’s think about means testing it.

From Lyndon Johnson up until Bill Clinton, the Democrats divorced benefits from work, and managed only to elect the hapless Jimmy Carter to a single term. Then Bill Clinton took on Sister Souljah and welfare, and won the popular vote in five of the last six elections.

Right now it looks like back to the future, with Obamacare as the 21st century’s iteration of welfare, and the Democrats in danger of losing control of the Senate. In the words of Chris Cilizza of the Washington Post, “If the 2014 election is a referendum on President Obama, Democrats are in deep trouble.”

Let’s amend that statement. If the 2014 election is a referendum on Obamacare and welfare, can you say Majority Leader Mitch McConnell? Thank you Harry Reid, at least you told the truth.

Correction: A previous version of this article referred to Richard Daley, not William.