Tom Goldstein thinks the latest Obamacare wrangling over subsidies and federally-run exchanges won't sink the ship. I agree. From his summary:
The argument against the administration’s rule is straightforward: if a state refuses to set up an exchange, forcing the federal government to operate it instead, then the subsidies aren’t available. That legal reading of the statute makes some sense, because Congress may have wanted to encourage states to create exchanges with the carrot of promising subsidies for the states’ residents.
The obvious problem - if the potential loss of subsidies was meant to motivate the states, how did it remain a secret, and where was the motivation? Let's cut to AllahPundit, who remarks on the possible political impoact of the latest decisions:
But what about at the state level? There’s a not-so-easy fix for consumers in states that just had their subsidies voided: Their governor and state legislature could get together and create a true state exchange, which would of course be eligible for subsidies. That’s going to put a lot of pressure on Republican governors who opposed creating a state exchange in the first place, especially ones facing reelection this year. Right, Scott Walker?
If that is true in 2014 it should have been true in 2012. Yet I am unaware of any Democratic gubernatorial candidates or Congressional candidates making this argument. By way of contrast, the Medicaid expansion was not fully funded by the Feds, and I recall it was a political football; this, for example, is from Texas.
As much as I like the logic and simplicitiy of following the law as written, a secret incentive that no one knew about and which was discovered after the fact is probably hard to characterize as an incentive.
FROM THE OTHER SIDE: A long discussion of the legal issues at Balkinization for lawyers and those who want to be supports the Administration position.