Jonathan Gruber’s testimony before Congress last week was a series of apologies, evasions, denials, and outright lies. The MIT professor widely acknowledged to be the “architect of Obama-care” before it was known that he attributed passage of the law to legislative deception and the “stupidity of the American voter” began his opening remarks by declaring: “I was not the ‘architect’ of President Obama’s health care plan.” He later refused to say how much money he’d made from his consulting and speeches on Obama-care. But the most staggering and consequential falsehood spoken by Gruber came when he tried to explain away his previous claim that states do not qualify for subsidies under Obamacare if they do not set up their own exchanges (the subject of a Supreme Court case, King v. Burwell, that could destroy the law).
Gruber said during his opening prepared remarks:
The point I believe I was making was about the possibility that the federal government, for whatever reason, might not create a federal exchange. If that were to occur, and only in that context, then the only way that states could guarantee that their citizens would receive tax credits would be to set up their own exchanges.
During follow-up questioning, Rep. Justin Amash of Michigan pointed out that Gruber’s explanation doesn’t make sense. “The law requires the federal government to create Obamacare exchanges in states that refuse to create the exchanges for themselves,” Amash said. He was right: The law clearly states the secretary of health and human services “shall” establish an exchange in states that fail to do so. So, Amash continued, “What did you mean when you repeatedly said that the citizens of some states may not qualify for Obamacare tax credits?”
“When I made those comments, I believe what I was saying was reflecting uncertainty about the implementation of the federal exchange,” Gruber insisted. “I don’t recall exactly what the law says.”
Gruber was clearly not telling the truth to Congress. At the very same 2012 speaking engagement in which he said states don’t get subsidies if they don’t set up their own exchanges, he acknowledged that the federal government is directed to set up exchanges in states that decline to do so:
Audience Member: You mentioned the health information exchanges for the states. And it’s my understanding that if states don’t provide them then the federal government will provide them for the states.
Gruber: Yeah. So these health insurance exchanges—you can go on MAHealthConnector and see ours in Massachusetts—will be these new shopping places, and they’ll be the place that people go to get their subsidies for health insurance. In the law it says if the states don’t provide them, the federal backstop will. The federal government has been sort of slow in putting in this backstop, I think, partly because they want to, sort of, squeeze the states to do it. I think what’s important to remember politically about this is that if you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits [emphasis added].
Gruber’s 2012 remarks—and his failure at the December 9 congressional hearing to plausibly walk them back—have dealt a great blow to the government’s defense in King v. Burwell. Before he became a controversial figure, it would have been entirely uncontroversial to state that Gruber knew more about how the law actually works than Nancy Pelosi, Barack Obama, or Max Baucus. “I was involved in writing the legislation,” Gruber said in a 2010 lecture. “I know more about this law than any other economist,” Gruber told the New York Times in 2012.
Gruber’s remarks are consequential not because the Supreme Court will look to them to determine legislative intent, but because they will significantly affect the legal and political debate surrounding King v. Burwell. Democrats and their allies in the media have tried to create a political environment in which the pressure on the Supreme Court would be simply too great for the Court to rule against the government. When cases challenging the legality of Obamacare subsidies began making their way through the courts, liberals roundly mocked and ridiculed the idea that the federal government had broken the law.
In 2013, Gruber himself told Mother Jones that the lawsuits were “screwy . . . nutty . . . stupid”: