Special interest groups line up to oppose GOP tax reform

The law of unintended consequences applies to crafting legislation as well as life, and the Republican Congress with its tax proposal reforms is now facing a backlash, even protests, as what it sees as a signature piece for their power trifecta with Donald Trump as president.

First up last week was when the National Federation of Independent Businesses, a huge GOP supporter, became angered at a sleight-of-hand trick that would have only some of its members get a tax break with the proposed pass through. Upset at the backlash, Chair of the House Ways and Means Committee Kevin Brady Brady's turnaround “proposed amendment would provide a lower tax rate for smaller firms that otherwise wouldn't have qualified for the 25% rate on pass-through businesses,” reported Business Insider, on their website.

"We are very grateful to Chairman Brady for listening to our concerns and working with NFIB to ensure that tax reform benefits the greatest possible number of American small business owners," Juanita Duggan, president and CEO of NFIB, said in a statement.

"This amendment would create substantial tax relief for millions of small business owners who were left out of the original bill. We urge Republican and Democratic members of the House to support this amendment going forward," she added.

That bullet dodged, next up were the objections of the National Home Builders Association who felt that doubling the standard deduction would be harmful to the new housing deduction, for those filers that itemize on their federal returns, would not have an incentive to build new homes, and perhaps prepare to stay put, or rent.

Current rates reflect 21 percent of filers take this deduction, but NHBA predicts that this could drop to 4 percent if the proposal passes.

If a man’s house is his castle, then a new one, forgetting about the moat, under the GOP plan is going to take more gold than Fort Knox, says the housing industry, and depress the value.

“Specifically, the legislation calls for capping the mortgage interest deduction at $500,000 instead of $1 million [in value]. It would also limit the deduction for state and local property taxes at $10,000. The fear, at least in the housing industry, is that these tax breaks could sap demand for pricey homes, especially in expensive markets. Many of those markets, such as San Francisco and Manhattan, are in high-tax states. That's a problem because the GOP tax plan would eliminate state income tax deductions altogether,’ says CNN Money, and as we have previously noted before.

The National Association of Home Builders warned the GOP tax plan "slams the middle class" by hurting home values. The group complained that Republicans didn't include its proposal to replace the mortgage deductions with a tax credit. "This tax reform plan will put millions of homeowners at risk," said Granger MacDonald, chairman of the NAHB.

Not to be outdone, “The California Association of Realtors is fighting back against GOP tax reform plans, taking out full-page ads in seven California newspapers calling on state Republicans to oppose provisions curtailing tax benefits of homeownership.

Measures seeking to curb mortgage interest deductions, property tax deductions and capital gains exemptions will dampen homebuying while “punishing” millions of other California homeowners, the ads say,” says the Orange County Register on their website.

Things got dicey and somewhat personal when the ads noted, “Tax reform shouldn’t hurt Californians, but the House of Representatives proposal does, in a big way,” the ad says. “How could any member of the California congressional delegation think this plan is good for the Golden State?”

Desperate for a win and sticking to party lines, “U.S. House Majority Leader Kevin McCarthy, a Republican from Bakersfield, [Ca.] issued a statement this week defending the tax plan, saying it amounts to a tax cut when all provisions are taken into account,” they reported.

Or does it? Most that have read the proposal have remarked like, Fortune Magazine, that, “Even though mortgage interest deduction remains, it will no longer have value for current itemizers who would take the standard deduction under the Trump plan. Only the few taxpayers who would still itemize will receive any income tax savings from mortgage interest, however, those tax savings will likely be substantially smaller than under existing tax rules.”

In a nutshell, “The elimination of mortgage-related tax savings for most homeowners, and reduction for others, compounded with the loss of tax savings from deducting property taxes means the after-tax cost of home ownership will increase.”

As early as August, when the details of the proposed tax reform came to light, charitable organizations were worried, and the first on the list was the Lilly Family School of Philanthropy at Indiana University. And, again the culprit was doubling the standard deduction to 35 percent from 39.6 percent, and which has the potential to reduce charitable giving, from between $5 billion and $13 billion, or up to 4.6 percent.

As CNN Money then reported, “Few people donate simply because of the tax breaks and are unlikely to stop giving altogether if they don't get any. But analyses from the Congressional Budget Office and others have found that tax incentives typically increase how much you choose to donate -- whether in life or at death.”

“The double whammy of doubling the standard deduction while lowering the top rate to 35% from 39.6% could reduce giving by between $5 billion and $13 billion a year, or up to 4.6%, according to a recent study by the Lilly Family School of Philanthropy at Indiana University.”

“Of those two changes, increasing the standard deduction has the greatest negative effect because it would reduce those who itemize to just 5% of filers, down from 30% today. That's because the only reason to itemize is if your deductions combined exceed the value of the standard deduction,”

“The 25% who used to itemize will probably give some but not as much," said David Thompson, vice president of policy at the National Council of Nonprofits.

While we may not want to ignore the opportunity for tax reform, since the last try in 1986, it seems that unintended consequences are making the whole deal reek like limburger cheese. Yet, there seems to be hope for some reconciliation at least according to Speaker of the House Paul Ryan who says that it will go to yet another House committee rather than an up or down floor vote.

Many on Capitol Hill are concerned about the deficit, another detail that perhaps GOP lawmakers have not carefully considered.

Last month we reported the following concern: “Rep. David Schweikert, of Arizona, the soon to be retired Sen. Bob Corker of Tennessee, and Rep. Mark Sanford of South Carolina; all of whom seem to see less light, than darkness, on the horizon with what has been proposed. “The numbers are really uglier than almost anybody around this place seems to have digested,” said Schweikert . . . a member of the tax-writing Ways and Means Committee.

The Hill, the ultimate inside the beltway publication, said that “The tax plan could cost the government $1.5 trillion in revenue over the next decade, but advocates argue that would be made up for through economic growth unleashed by the corporate and individual tax cuts included in the plan.”

At that time Treasury Secretary Steven Mnuchin said that the tax plan would bring in $2 trillion because of economic growth, which would be enough to actually lower the deficit. Some were not so sure, even then, and even more so now.

“The running joke in our office is we work in a math-free zone,” said Schweikert, in opposition to that statement.

House delivers its version of tax reform

It’s long been a core belief that politics held the art of compromise as the means to an end, but House Democrats faced a unwillingness by their Republican counterparts on Thursday as they dominated their bill to rewrite the U.S. Tax Code, an ambitious, and long sought desire by many, but also a strong push to score a legislative victory for the Trump administration, who has not had one in the nearly 10 months that they have been in office, despite the benefit of dominating both Congressional chambers.

The bill after it exited committee, still faces a floor debate, but it has several prominent features that the GOP says will give almost everybody a tax bracket, and will help Main Street, as well as Wall Street.

Its main, and most controversial, feature is the removal of the state and local tax deductions, that after four days of debate, stuck fast, despite efforts by some to pry it loose from the gums of debate.

The bill also slashes the corporate tax rate from 35 to 20 percent, and claims to offer tax benefits to small business, and offer punitive measures to those companies that make money overseas, once it is repatriated to America.

“Americans deserve a new tax code for a new era of prosperity, and today we deliver,”  said chair, Kevin Brady (R-Texas.)

In total disagreement are the House Democrats, who say, the “Joint Committee on Taxation estimates that showed some middle-class taxpayers would still see their taxes go up, particularly in later years,” and there are also claims that “This bill will raise taxes on the middle class. It will raise taxes on the middle class. It will raise taxes on the middle class,” said Rep. Joseph Crowley (D-N.Y.), reported The Hill, on its website.

“You don’t have very many tools available to you as the minority members of the House, not like the Senate,” said Ways and Means Committee ranking member Richard Neal (D-Mass.). “And so you use messaging to make your argument and hope that the other side might, on a couple at least, acquiesce.”

The proof of that pudding was in the eating, and the Dems had to swallow a lot as each of their objections were shot down as “political theater,” sniped Sen.T om Reed (R-N.Y.)

As has been noted before the removal of the state and local tax deductions will hit many people hardest, especially those with Democratic majorities, a fact that did not go unnoticed by Republican lawmakers.

The removal of the state and local income tax deductions seems punitive because it only hits those who itemize on their returns, plus those cities that voted in the majority for Hillary Clinton in the 2016 election. According to the Tax Foundation only 28 percent of taxpayers take advantage of this specific deduction, most Americans don’t, but the opposition remains.

New York City, as well as New York State, is a perfect example of how to raise the ire of those long used to something, to only have it taken away. The benefit allows the average New Yorker to deduct roughly $20,500 annually from his or her federal taxable income, according to the nonpartisan Tax Policy Center.”

“The Independent Budget Office has estimated that doing away with the deduction would increase New York City residents' taxable income by $28 billion, causing their collective federal tax bill to rise by $8 billion a year. The state and local deduction especially benefits people with incomes of $100,000 or more who live in places like New York, New Jersey and California, where state, local and property-tax bills are high,” says Crain's New York.”

Tax Policy Center senior fellow Frank Sammartino estimates the state and local deduction costs the government about $100 billion in annual revenue, so repealing it could help pay for the tax cuts Trump is proposing for businesses.

"There has been a big campaign by municipalities to save the deduction because they don't want folks to realize how large their tax burdens really are," said Nicole Kaeding, an economist at the Tax Foundation.

Taking it a step further, the bill also caps the property tax deduction at $10,000, but in an odd twist, the GOP seems to feel that this will be a benefit, after the loss of the state and local tax deduction.

As predicted the House bill did cut the corporate tax rate from 35 to 20 percent, which has been on the hit list of tax reformers as a way to increase, retain and attract business development, and especially to avoid those that create foreign headquarters to avoid paying U.S. corporate tax, currently the highest in the world.

The House bill also gives a sleight of hand trick with the pass through rate for small business. Robert Robb noted in his piece for azcentral.com noted: “Thirty percent of the total income a working owner receives is designed a return on capital and subject to the lower 25 percent rate. Or the business can come up with an alternative based upon somehow calculating actual capital invested and multiplying that by a rate of return dictated by the government. But, if an alternative is chosen, the business has to stick with it for five years. And some professional service firms – such as lawyers and accountants – aren’t eligible for the lower pass-through profit tax at all.”

In another critical assessment Forbes Magazine noted that, “The provision also discourages professional services and other business from taking advantage of the lower business income rate altogether. But perhaps most important, it would only help a tiny fraction of business owners, individuals with taxable income above $200,000, or $260,000 for couples,” often hedge fund owners.

The most vocal have been groups that have usually been squarely in the corner of the GOP, namely the National Federation of Independent Business, who in their protest, said, “"We believe that tax reform should provide substantial relief to all small businesses, so they can reinvest their money, grow, and create jobs.”

In contrast, and what will eventually be a center stage fight, is to reconcile the bill passed by the House, versus the Senate version, who differs on key points, and which has powerful backers, all who want to be the first to get a final product on the president’s desk by Christmas, and this is next.

Yellen's successor as Fed chair is a Washington insider

With the beginning of the new month comes the end of an era, when President Trump announced on Thursday in the Rose Garden of the White House his nomination for the new Federal Reserve Chair, lawyer and investment banker, Jerome Powell, to replace Janet Yellen, whose term ends in February.

Trump says that, with Powell, holding the reins, he would be able to provide the “strong leadership” that is needed, or as some critics would say, which Trump wants.

What the president also wants, among other things, is an easy confirmation, after 10 months of an administration that has seen its shares of mostly downs, and very few ups, whether it be in legislative success, or critical approbation, as his ratings continue to tank.

While Powell’s nomination, was expected, there was also a shortlist that included acclaimed Stanford economist John Taylor, but it was the sense in Washington, that Trump needed to have an easy win with this job, and a hassle-free confirmation.

Yellen, who Trump had pilloried on the 2016 campaign trail, even saying that she should be “ashamed” of the way that she ran the Fed, came out with words of praise for her, even using her first name, and that she was “a wonderful woman who has done a terrific job,” and going further that “she is also a spectacular person.” In another remarkable departure he said, “Janet, thank you very much. We appreciate it.”

In yet another departure from tradition he did not, like his predecessors, reappoint a Fed chair, that was also a member of the opposition party.

Many have said that this is the ideal man for the job, because he will continue the cautious, dovish, and date driven position that was characteristic of Yellen, as she easily navigated an often rocky landscape with ease,  and one that he easily knew having served with her these last four years, and also has the experience of being on the board of governors, since 2012

Some of her notable achievements consisted of leading what was a bullish stock market, low interest rates, adjusted for, and only by the data, and the maintenance of a $4.5 trillion balance sheet, mostly bonds, to help stimulate the market during the Great Recession.

Those super low interest rates have been raised four times, and a fifth is expected in December.

But, she had her detractors, most notably, Jeb Hensarling, House Financial Services Chairman Jeb Hensarling (R-Tex.) told Yellen.when as required, she appeared before the House, this year, “After eight years, there is zero evidence that zero interest rates and a bloated Fed balance sheet lead to a healthy economy."

She responded that Fed officials do not feel the bond holdings should be reduced until they have raised its benchmark rate, currently at a range of 0.5 percent to 0.75 percent, to a more normal level of 1.24% to 1.5 %, which would give the Fed room to lower the rate if the economy was given an unexpected jolt. Yellen also noted that she was averse to creating formulas to set interest rates, and that “no single formula offers the flexibility the Fed needs in making decisions,” and that using them “would result in poor economic performance."

Hensarling who recently announced his retirement from Congress was disappointed that a hardliner was not nominated, but also gave his support to Powell, but still maintained his need for deregulation, that has become the watchword in the Administration since January.

Other critics want to see a regulatory environment that favors smaller banks over larger ones, and that they felt was a byproduct of Yellen’s era.

Still others are concerned, even upset, that Powell, who uses the nickname, Jay, does not have the requisite PhD in economics that his predecessors have had. In a town, where you can’t swing the proverbial cat without hitting a lawyer; this may be the ultimate insult.

Paul Ashworth, chief U.S. economist at forecasting firm Capital Economics, in particular, made some pointed, and critical remarks, when he said, "Powell's resume is not up to the standards we would expect of a nominee for Fed Chair,” reported CNBC, and that, "The risk of a serious policy mistake — in either direction — will arguably be higher under Powell's leadership than under Yellen's."

Yet Gary Cohn, the director of the National Economic Council, and another investment banker, (holding only a bachelor’s degree) called him a “spectacular choice.”

A Washington native, with an undergraduate from Princeton, he took his law degree from Georgetown, a training ground, of sorts, for the federal government; that should be helpful, in that he knows, as the old adage says, “where the bodies are buried.”

Despite absence of the doctorate, and the experience of Yellen in labor market relations, and her predecessor Ben Bernanke in financial crisis management, Powell is a very rich man with an estimated worth of $55 million, no small change for someone who also worked for the prestigious equity firm, the Carlyle Group.

Money, as the old song says, may not buy you love, but he may not need it, despite the sniping of some of his critics in a town where holding a doctorate has become nearly ubiquitous with federal fame.

Powell has said that he will perform “with objectivity, based on the best available evidence,” sounding very much like his soon-to-be predecessor.

Donald Trump's race problem

The recent hurricanes and tornadoes in Texas, Florida and Puerto Rico have resulted in great personal and economic damage to the United States, but they have also added to the perception that President Donald Trump is a racist. While Texas and Florida faced equally damaging loss of life and property as did Puerto Rico, it was only Puerto Ricans that were told that they were expecting too much from the federal government and that they needed to do more on their own, an oft repeated phrase from whites towards blacks in their struggle for civil rights during the 1960s.

Unwittingly, or not, the president’s remarks tend to underscore not simply that his sentiments, were not just symptomatic of a white man in his 70’s,  but that he seemed to dismiss the validity of their concerns and anxiety, and, in which, no shape or form, could they do by themselves.

It also gave the president the unenviable position that he was painting himself into a corner. This also had some critics wondering if he even knew that Puerto Rico is a U.S. Possession, and not a foreign country; notwithstanding that they are people of color.

Not helping were the optics that reflected badly on Trump as he threw paper towels to Puerto Ricans in a relief center, as if the master of the plantation had come to throw out - the emphasis on throwing out -- supplies. Even in the minds of the less literally minded American, it seemed that the mythic Southern plantation master would have at least handed out provisions to the slaves.

Lending further damage was his defense: “They had these beautiful, soft towels. Very good towels,” Trump told Mike Huckabee during an interview Saturday with Christian network Trinity Broadcasting.

“And I came in and there was a crowd of a lot of people. And they were screaming and they were loving everything. I was having fun, they were having fun,” he added. “They said, 'Throw 'em to me! Throw 'em to me Mr. President!”

If this were not bad enough, or as the old adage advised, “leave well enough alone,” he further said, “And so, I'm doing some of this,” Trump added, making a throwing motion, “So, the next day they said, 'Oh, it was so disrespectful to the people.' It was just a made-up thing. And also when I walked in the cheering was incredible.”

The only thing that he did not say, or do, was to use the phrase, “You people,” which raises both the ire, and anger, of people of color.

The race optics became even worse with his condemnation of the NFL players protesting the ill-treatment of black men, by some of the nation’s police and by mostly black players, joined with his verbal recommendation to “get that son of a bitch off the field,” if he did not stand for the national anthem.

Circling back to Charlottesville, we get the lion’s share of remarks when he said that there was blame on both sides, as hundreds of white supremacists marched towards a group or bedraggled, mostly University of Virginia undergraduates, protesters, angry about the invasion of their town to support an untenable position.

As National Public Radio reported, “When he was chastised, by member of his staff, and fellow Republicans he backtracked, only later when scheduled to discuss infrastructure, to reverse direction, and return to his original remarks . . . "I think especially in light of the advent of antifa, if you look at what's going on there, you know, you have some pretty bad dudes on the other side also. And essentially that's what I said."

"Now because of what's happened since then, with antifa, [anti-fascist groups] you look at, you know, really what's happened since Charlottesville — a lot of people are saying — in fact, a lot of people have actually written, 'Gee, Trump might have a point,' " the president said. "I said, 'You got some very bad people on the other side also,' which is true."

In response to Trump's new remarks, Sen. Tim Scott (R-S.C) office put out a statement that said in part: "Rome wasn't built in a day and to expect the President's rhetoric to change based on one 30 minute conversation is unrealistic. Antifa is bad and should be condemned, yes, but white supremacists have been killing and tormenting black Americans for centuries. There is no realistic comparison. Period."

The support, near hero worshipping, that he has gained from white supremacists adds further to the racist label. Even more disturbing were the damaging pictures of the Charlottesville marchers wearing his trademark informal uniform of khaki pants, white golf shirts and red caps emblazoned with the tagline, of his own campaign, “Make America Great Again.”

Matters came to a head when the president fumbled this past week to remember the name of Sgt. La David Johnson, who was killed in a mission in Niger, in a condolence call with his widow, Myeshia Johnson, where he amazingly said, “he knew what he was getting into,” and to make it worse, referred to Johnson, not as her husband, but “your guy,” implying that black couples don’t marry, but simply cohabitate.

Mrs. Johnson

As if this was not enough, when Mrs. Johnson’s Congresswoman, Frederica Wilson, called him out, on these remarks, he sent retired Marine General, and now Chief of Staff, John Kelly, out to shield him from the media attacks. Kelly not only called her liar, but said that Wilson got $20 million dollars for a new FBI building in South Florida; but that event happened when she was not in Congress.

Then he uttered the, by now, infamous “empty barrel” remark about the congresswoman, that demeaned her as a black woman, in power.

There seems to be a long list of those that Trump seems to have a problem with, such as journalist April Ryan, Rep. Maxine Waters, former Ambassador Susan Rice, and television anchor Jemele Harris.

While some like Washington Post reporter Ashley Parker, skirt the issue of race,and focuses on the importance of getting names right, the damage is done, with black and brown people of the United States.

As Salon.com noted, this is not merely one of his more brutish swipes, but an assault, on black women, aided and abetted by Kelly, that coupled with his earlier statements, adds to Trump being labelled a racist.

The only way that the president can go from here, is up, and that seems unlikely as he has not listened to the advice of many, on a variety of subjects; including Senate Majority Leader Mitch McConnell, Speaker of the House Paul Ryan, his own team of advisers, or even ranking members of his own party.

Can Alexander-Murray proposal survive Trump ?

In the none too distant past, it was assumed that the Affordable Care Act was doomed, then it seemed to get a life support, of sorts, from the defeat of the Graham-Cassidy bill, and then with the near certain defeat of the proposal by Sens. Lamar Alexander and Patty Murray that wanted to provide continued subsidies for insurers with low-income beneficiaries, it was anyone’s guess to what the future held. Then lo and behold, out of the ashes, on Tuesday, appeared a victory for an agreement to do just that, and then nearly a day later news reports from Washington, said that the latter had the support of 24 senators, 12 Democrats and 12 Republicans.

That took some surprise from political pundits, on both sides, quickly followed by condemnation from President Trump who exclaimed loudly that the deal was done, and over with - finito, dead. But, in a blink of an eye, after encouraging the pair he denounced it again, as did other who called it a bailout for the insurance industry -- a full loaded term across the nation, used to condemn school systems in the urban midwest, and in recession America, for car companies, gasping for air.

“President Trump's mixed messaging is increasingly throwing a curveball into negotiations on Capitol Hill, leaving lawmakers struggling to keep up with his changing opinions,” reported The Hill.

They also noted, that “It was just the latest example in what’s become a familiar cycle on Capitol Hill: Senators believe they and Trump are on the same page, only to find out — sometimes hours later and frequently through tweets — that the president has changed his mind.”

Defeating President Obama’s signature legislation became an almost mythic mating call for the GOP and the repeated failures have left Congress and the Trump base in a headlock, of sorts, as no one can see which direction the wind may blow, and how often the president tweets in the wee hours, to add spice, some say madness, to the whole affair of governing.

The Alexander-Murray proposal is to give two years worth of subsidies to insurance companies for their low income beneficiaries to help pay for deductibles, co-pays and other out of pocket costs, and to defray the cost of insuring them.

Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.), respectively the chairman and the top ranking Democrat of the Senate Health, Education, Labor and Pensions Committee, also against hard opposition, feel that, as the pressure mounts they can pass it by the end of the year, while others are not so optimistic.

Critics note that the proposal, even it becomes law may not undo the damage already done to the the ACA, colloquially known as Obamacare, especially in the light of reduction in advertising by 90 percent, and neighborhood navigators, by nearly one-half; these are trained personnel to help signup new enrollees in public access venues, such as libraries.

“From what I’m hearing on the Alexander-Murray deal, it is good news for insurers and consumers and could mitigate some of the damage done by the Trump administration,” said Emily Gee, a health economist at the Center for American Progress, a left-leaning think tank in D.C.

“However, this open enrollment still remains an uphill battle. Recent polling reveals there’s a great deal of confusion about the marketplace among current enrollees and potential consumers, much of which has been stirred up by the administration’s campaign against the ACA, and any deal can’t change that overnight,” she said.

That is a huge problem for those responsible for educating the public and for consumers, both new, and former, enrollees to know that they can get health coverage.

In a media briefing on Wednesday, the Kaiser Family Foundation gave the not-so- encouraging results of a poll that showed only 33 percent of potential enrollees in individual market know that open enrollment begins Nov.1, and perhaps the most shocking result, that 30 percent of those polled thought that the individual mandate was not in effect, or did not know that it was.

Of utmost importance for consumers is that insurers are still required to provide

reduced deductibles, and copays for low-income marketplace enrollees; and secondly that while insurers are increasing premiums to offset the loss of payments from the federal government, consumers will mostly be held harmless.

Cost sharing reductions (CSR) - subsidies - are available to eligible individuals in the marketplace with income 100 percent to 250 percent of the federal poverty level: $12,060-$30,150 for individuals in 2018, and  $24,600 to $61,500 for a family of four in 2018.

Nationwide, 57 percent of marketplace enrollees were eligible for CSR in 2017 and in states that did not expand Medicaid, on average two-thirds of marketplace enrollees had CSR in 2017.

Adding to another public misunderstanding is that open enrollment for 2018 will be shorter in most states from November 1 through December 15, 2017 in the Healthcare.gov states; and that it will be 6 weeks, compared to 12 weeks in prior years.

Equally important for consumers is to be aware that state run marketplaces have an option to extend dates, and many have.

Of course, the White House has used this lack of knowledge by the public to their advantage, and perhaps the biggest myth, or misinformation, they have promulgated is that insurers are getting rich on these subsidies, when in fact they are getting reimbursed for monies that they have already paid. Trump, in fact, inflated insurance company stock prices from 2010, and not when the provisions took place, in 2014.

“I am very concerned that the president’s actions have confused people, along with all of the conversation around the attempts to pass the two versions of Trump Care we saw earlier this year,” said Sen. Maggie Hassan (D-N.H.).

Piggybacking onto that are further myths surrounding the exodus from the ACA on the exchanges, in shock and awe to show that the ACA was an abject failure, when in fact, it actually happened because many insurers set premiums too low in anticipation that there would be a much higher level of younger enrollees; subsequently it was mostly sick, or older enrollees that signed up.

The path for the Alexander-Murray bill to become law is paved with good intentions, but faces a perilous path of opposition from people such as Speaker of the House Paul Ryan who wants to obliterate Obamacare, to support from old time GOP leaders such as Susan Collins of Maine and John McCain of Arizona, to Lisa Murkowski of Alaska who gave the thumbs down to the Graham-Cassidy bill. Of note is that they are now also on the list of co-sponsors .

Getting the bill to the floor is the last battle, and there are some that think that the best chance of success is to attach the proposal to a spending bill  But, for the 18 million Americans who get their health care on the individual market, time is of the essence.

Trump begins savage attack on Obamacare

In a move to shore up his sagging support from a shrinking base, not to mention his own party, President Donald Trump’s latest executive orders to cut subsidies and change the scope of Obamacare, comes as no real surprise to most observers.

Yet this move might just be the one to lend credence to popular wisdom’s most durable saying: the law of unintended consequences. By removing the subsidies for low-income insurees, he is bound to send insurance premiums sky high, and practically upend the market just when it needs stability.

During the early days of this administration, preceded by all of the various efforts to remove health coverage from more than 21 million Americans, it became clear that no matter what was said, or done, the GOP does not care about them, and Thursday’s announcement is no exception.

In a move that Senate Minority Leader Chuck Schumer called “sabotage” the order will end key payments for low-income to help pay for such things as co-pays and deductibles, among other out of pocket costs, to implode the Affordable Care Act, popularly known as Obamacare.

The effect of skyrocketing premium costs would increase in more areas than previously seen, and while the average increase was 9 percent, at  the top and the bottom ends was Rhode Island with a 1.3 percent increase and a 71 percent for Oklahoma.

Thursdays move will almost certainly, unless there is a Congressional intervention, send these markets tumbling with many companies departing the exchange, as a result.

In 2014 the GOP sued to remove the subsidies, saying that Obama had no constitutional grounds to do so, but with no explicit action from Congress, the judge ruled in favor of the opposition, but the ruling was put on hold.

"Based on guidance from the Department of Justice, the Department of Health and Human Services has concluded that there is no appropriation for cost-sharing reduction payments to insurance companies under Obamacare. In light of this analysis, the Government cannot lawfully make the cost-sharing reduction payments," the White House said in a statement late Thursday night.

Warming to the victory, staffers, most notably was press secretary Sarah Huckabee Sanders, who said, "The bailout of insurance companies through these unlawful payments is yet another example of how the previous administration abused taxpayer dollars and skirted the law to prop up a broken system. Congress needs to repeal and replace the disastrous Obamacare law and provide real relief to the American people,"

Partisanship rules the day in Washington, and nowhere is this seem more than in healthcare, especially as Trump erases anything, and everything, that President Obama did, no matter how beneficial. And, what could be of more benefit than healthcare?

With over six years of opportunity the GOP could have worked in a nonpartisanship manner to fix the resulting issues with the ACA, but they refused; now with a president who wants to be more of a bystander, he fashions a base for support that has the potential to jeopardize the health of millions of Americans.

For nearly two years Sens. Lamar Alexander and Patty Murray attempted to fund these cost reducing measures with their bipartisan committee, but this effort was put on hold with the recent last ditch effort by Sens. Lindsey Graham and Bill Cassidy to kill Obamacare, ended in defeat last month.

Most in Washington are predicting that Trump’s move could presage lawsuits, and in an era of suit, and countersuit, this is not entirely unexpected with this attempt to destabilize the law.

The Congressional Budget Office said in August that “about 1 million additional people would be uninsured in 2018 and insurance companies would raise premium prices by about 20 percent for ObamaCare plans if the payments were cut off,” reported The Hill.

They also noted that “halting the payments would increase the federal deficit by $194 billion through 2026, largely because federal assistance to buy ObamaCare plans rises when premiums do.”

In a related move, Trump also signed an order directing the federal government to move people towards health care pools that he says will help small business compete with large corporations in ensuring that their employees have adequate health care.

Advocating for lower cost, in his eyes, also means for most, the opportunity to have skimpier plans that offer less, such as maternal and mental health care. And, “Because both of these types of plans do not have to follow the same ObamaCare rules, such as minimum benefits standards, experts warn that healthier people could join these cheaper plans and leave only sicker people in ObamaCare plans. That could lead to a spike in premiums for ObamaCare plans or insurers simply dropping out of the market.”

Curiously, the order does not say whether people can join these plans, but it does note that it “will also allow people to use tax-advantaged accounts known as health reimbursement accounts to pay for their premiums.”

“New York's top insurance regulator, Maria Vullo, said Thursday that President Donald Trump's executive order unwinding certain Obamacare regulations would destabilize New York's insurance marketplace,” according to Crain’s New York Business.

“Trump's order, signed Thursday morning, directs federal agencies to consider options to make cheaper, less comprehensive health plans available to more Americans. It offers association health plans as one way to accomplish that goal. The agencies have 60 days to consider proposing regulations, followed by a public comment period, so any changes are not expected to take effect until next year,” they also noted.

Notably, these “plans also are not required to pay for a certain percentage of the total cost of coverage, unlike the products sold to individuals on the marketplaces. These employers are regulated by the federal Employee Retirement Income Security Act, and are not subject to many Department of Financial Services’ rules.”

Karen Ignagni, chief executive of EmblemHealth, said while the order could lower prices for younger, healthier consumers, the overall impact on the state’s individual insurance market could be “devastating,” adding that, “If you create an incentive to remove low-risk individuals from pools, it will make costs soar for those who remain.”

There is definitely a tsunami, of sorts, brewing and this effort by Trump to win partisan points will prove to be one more item in what has been, so far, a disastrous presidency.