The idiot's guide to de-funding Obamacare

De-funding Obamacare is simple. But by making it seem complex, politicians hope voters will forgive them for a lack of effort. Photo: AP

WASHINGTON, September 18, 2013  De-funding Obamacare is tough politically. It is not complicated, though, even though some want you to think that.

De-funding is a simple idea surrounded by political jargon and double-speak. If voters are convinced that the task is too complex, they might forgive politicians for not going all-out to de-fund it. De-funding in turn is still second-best to outright repeal.


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So here is an “Idiot’s Guide to De-Funding Obamacare.”

The title isn’t intended to call anyone a dummy, but to stress that this is not rocket science. Anyone who understands how a checking account works can understand how to stop Obamacare by taking away its funding.

Basics of a checking account:

A checking account requires that you:

  1. Set up the account at the bank (Get an account number; have checks printed; etc.)
  2. Deposit money in the account upfront and add more as needed
  3. Write checks not to exceed your available balance

Automatic deposits are common, such as for paychecks or Social Security benefits. Automatic debits are common to pay mortgages, rent, utility bills and so on.

It is less common to write post-dated checks. They cannot be deposited right away, but when the due date arrives, recipients don’t have to watch the mail for their checks.

But unless the money is in the bank, a post-dated check will bounce just like any other check.


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If you follow this overview of checking accounts then, congratulations. You can understand how to de-fund Obamacare.

Basics of de-funding Obamacare:

Every federal program gets the equivalent of a banking account within the U.S. Treasury. When each year’s spending bills are passed ― called appropriations ― then automatic monthly deposits are set in motion, coming from the Treasury. The program spends those funds and the process repeats the following year.

Normally, a program runs out of money at the end of the fiscal year, September 30. Without a new series of deposits, the program then halts. Sometimes there is money left over, but that’s a different story.

The rest of government “shuts down” without new funding, except for essential services like the military, Social Security benefits, and air traffic control. But Obamacare has its own unique exemption from a shutdown.

In essence, Obamacare already was given ten years of post-dated checks from the U.S. Treasury. The original legislation in 2010 guaranteed a decade’s worth of money to cover its overhead and administrative costs ― $105-billion through 2019. Without this administrative processing, the Treasury has no way to handle the other money that would pay actual health care costs and insurance subsidies.

These “post-dated checks” were intended to make it impossible for any future Congress to curtail the program, just in case the Democrats didn’t keep full control of Congress after 2010, which they didn’t.

It takes new legislation, passed by both houses of Congress and approved by the President, to stop payment on those ten years of post-dated checks. Normally, if the House and Senate disagree, then there is a stalemate and no money is provided. But because Obamacare has automatic funding, any stalemate has the opposite outcome: The funding goes on as scheduled.

Unless, of course, the checks bounce.

If the Treasury doesn’t have enough money to cover all other spending plus Obamacare’s costs, then Obamacare grinds to a stop. The only alternative would be a presidential decision to halt instead services that he consistently claims are essential and highest priority. Imagine President Obama choosing to fund Obamacare instead of Social Security, withholding Social Security checks and blaming others for his misplaced priorities. Without extra borrowing ― raising the debt ceiling ― to cover all the massive checks, Obamacare is de-funded unless Obama publicly chooses to let other programs rot.

Obama says no and refuses even to negotiate about borrowing

The President labels this a failure to pay our bills, but that isn’t true. We can pay all our existing bills out of tax receipts. It’s the new expenses that require borrowing.

This year’s tax revenue is an all-time high, about $2.7-trillion. So we can pay $2.7-trillion without borrowing a penny, covering existing bills plus some new expenses. We have no need to borrow unless we spend more. Unfortunately, current plans call for spending $800-billion more than tax receipts. That would requiring revisiting the law that limits our credit line.

We’ve already blown past the legal debt limit that Obama and Congress set two years ago, namely $16.7-trillion. The Treasury Department is hiding this fact. They use gimmicks like raiding federal retirement trust funds while claiming the raid doesn’t count as borrowing.

We’re told that we must borrow because the budget isn’t balanced. But turn that around: If we stop borrowing, the budget balances. We just have to decide where to cut. A good start would be Obamacare; we don’t need this extra expense that is already costing jobs and lowering take-home pay.

Obama refuses even to negotiate over the debt ceiling. He wants unlimited borrowing. He claims we already spent the money so now we have to pay the bills. That simply isn’t true; most spending is for future bills that we could avoid by reducing the size of government.

Obama makes people dizzy. First, he approved the spending he’s now criticizing. Next, he blames Congress for the level of spending. Then he says we can’t cut spending because it would hurt essential programs.

The way to de-fund Obamacare is not to write it any more checks and to stop payment on the post-dated checks.

Obamacare’s tricky post-dated checks were written when Nancy Pelosi was still Speaker of the House. She is one of the richest members of Congress. She should cover her own checks.


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More from Ernest Istook: Knowing the Inside
 
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Ernest Istook

Ernest Istook spent 25 years in public office, including 14 years in Congress. He was rated one of the top 25 conservatives in the U.S. House of Representatives. Then was a Heritage Foundation fellow and a fellow at Harvard's Insitute of Politics, where he led a study group on Propaganda in American Politics Today. 

Now as a radio host and a commentator, Ernest aims to expose Washington's gimmicks--to help you avoid the pitfalls. He brings clarity out of the confusion. 

Native to Texas, Ernest transplanted to Oklahoma after graduating from Baylor University.

Contact Ernest Istook

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