HARI SREENIVASAN: Democrats and Republicans turned the heat up today as they battled over
plans for a sweeping tax overhaul.
It comes as Republicans are growing more confident they can push their plan through quickly,
and are making an even bigger bet on what will be part of the new law.
Our Lisa Desjardins has the latest.
LISA DESJARDINS: To the highly complex, overhauling the U.S. tax system, Senate Republicans now
are adding the incredibly complicated, the health care debate.
SEN.
ORRIN HATCH (R), Utah: Keeping the individual mandate tax in place is meaning retaining
the status quo, which isn't working too well.
LISA DESJARDINS: Top Republicans like Finance Chairman Orrin Hatch now have woven a repeal
of the individual mandate, or the requirement to buy insurance, into the Senate tax cut
bill.
Why?
Repeal the mandate, and fewer Americans sign up for subsidized plans and for Medicaid,
saving the government over $300 billion, which GOP senators want to use for more tax cuts.
SEN.
JOHN THUNE (R), South Dakota: What we're doing here is, we are cutting taxes for low-income
earners, who are being hit hardest by the mandate tax, and then providing additional
tax relief through an expanded per-child tax credit and lower rates in the middle of the
income tax structure, so that middle-income families are going to benefit the most.
LISA DESJARDINS: Democrats are erupting with objections.
SEN.
RON WYDEN (D), Oregon: This tax bill is now officially a health care bill, an enormously
important health care bill, with consequences for millions and millions of Americans.
SEN.
DEBBIE STABENOW (D), Michigan: By trying to use a backdoor approach to repealing the Affordable
Care Act, this bill would cause 13 million people to lose their health insurance and
premiums to go up 10 percent a year.
LISA DESJARDINS: Those are Congressional Budget Office figures.
Republicans argue that those without insurance should get the choice to turn it down.
House leaders are considering adding a mandate repeal as well.
REP.
PETE SESSIONS (R), Texas: The rule provides for consideration of H.R.-one, the Tax Cuts
and Jobs Act.
LISA DESJARDINS: Even as Rules Chairman Pete Sessions and others prepare for a full House
vote on their tax cut bill tomorrow, arguing lower taxes for people and corporations will
spark growth.
REP.
PETE SESSIONS: I think what is going to happen is, you are going to see this boom, this big
opportunity that is already well under way, to continue.
But it is up to us to deliver that.
LISA DESJARDINS: But, yesterday, in front of Trump economic adviser Gary Cohn, some
top CEOs were less enthusiastic.
MAN: If the tax bill goes through, do you plan to increase investment of your company's
investment, capital investment?
Just a show of hands, if tax reform goes through?
LISA DESJARDINS: Few hands went up.
GARY COHN, Presidential Economic Adviser: Why aren't the other hands up?
LISA DESJARDINS: Of course, the raised hands that matter next are those in Congress, where
Republicans in both chambers are moving quickly on what could be an unprecedented sweeping
tax and health bill.
HARI SREENIVASAN: Even as the House moves toward passing its bill, there are still major
issues affecting people's pocketbooks that have to be resolved before a tax overhaul
becomes law.
Health care is, of course, very much part of that mix.
Lisa Desjardins is here with us now, along with Sarah Kliff of Vox.
So, Lisa, let's start with what they're trying to do.
LISA DESJARDINS: OK.
So Senate Republicans wanted more money so that they could pass more tax cuts as part
of their plan.
Putting the individual mandate repeal in their bill gives them more money.
But the problem, Hari, is that it always could cause some destabilization in the individual
health care markets.
So, there's actually a part two of this deal.
Senate Republicans are also saying they will have a separate vote on a bill that would
stabilize the market some.
That's the Murray-Alexander bill that we have talked about in the past that would pay for
those cost-sharing subsidies that the president says he wanted to end and Congress had to
deal with.
Republicans have been holding on to that bill.
They say now they will pass it, but it's part of this package where they would also repeal
the individual mandate.
Those are some things that could have cross-effects, but this is what Republicans are doing, essentially,
to try and put more money into their tax cut bill and say they have done something on Obamacare.
HARI SREENIVASAN: Sara, there are already people lined up saying, we have very strong
concerns about repealing the mandate.
SARAH KLIFF, Vox: Yes, there is a lot of worry that it really would destabilize the insurance
markets.
We saw very, very quickly yesterday a joint letter from the hospitals, the insurance companies,
the doctors, saying, we don't want you to do this.
We think this would be bad for people.
And it's about two things, really, first about people losing coverage.
The Congressional Budget Office estimates that 13 million people would lose coverage
if the mandate went away.
And the second is about rising premiums.
If there is not a requirement to buy insurance, the expectation is a lot of young, healthy
people would sit out the market and that would raise premiums for everyone else.
If we go back to the CBO, they estimate about a 20 percent to 25 percent increase in premiums
in the individual market.
HARI SREENIVASAN: There's also people concerned about the estimates themselves and whether
we can believe that, whether it's overly optimistic, or whether, you know, the mandate has the
sort of magical solution to this all.
SARAH KLIFF: Yes, this is something Republicans have raised really since the repeal debate
earlier this year, where they argue that the CBO overestimates the effect of the mandate.
They think that this fine really isn't the reason people buy insurance, that there are
subsidies, that people actually want health care.
And it's an issue the CBO is taking seriously.
They had a meeting about this.
They're considering revising their methodology, but it doesn't look like it will be done quite
in time for the current tax effort.
HARI SREENIVASAN: OK, so putting the mandate aside just for a second, there's still a lot
to be hashed out in the tax plan.
There's mortgage deduction, state and local taxes that still have to be sorted out.
LISA DESJARDINS: That's right.
That's just the beginning of it.
That's one of the biggest issues right now that Republicans need to work out, state and
local tax deductions that many Americans get, not just many Americans.
It's actually the majority of Americans, I think, over -- who make over $50,000, and
even 10 percent who make under, take what they pay in their state and local taxes.
They get a tax break on it on the federal.
The Senate bill would end all of that.
But there are some senators who are worried about how that affects their states.
And, of course, in the House, there are many House Republicans who can't support something
that goes that far.
In the House, they would allow a $10,000 deduction on property tax.
So, we will see if these two versions come together.
But as we talk about the health care issue, that's one issue that concerns a few Republicans,
and then there's the separate one on state and local taxes that is still very much in
the mix.
HARI SREENIVASAN: Given all of these costs, Sarah, regardless of whether the individual
mandate goes forward or not, it seems that there's going to be some triggers, mandatory
cuts that are going to happen if they cross over the amount that they're allowed to spend.
SARAH KLIFF: Yes.
This is another thing that came up this week in kind of this growing pile of obstacles
to tax reform.
The Congressional Budget Office put out a letter saying estimating that this would trigger
mandatory cuts, that the tax cuts are bigger than the spending cuts.
And they estimate that this would amount to a $25 billion cut per year to Medicare.
Now, Republican senators, the people Lisa are talking to, they say that, well, this
isn't the final bill.
We're still working on it.
We're trying to sort this out.
This is why we added individual mandate repeal.
But it certainly is kind of a specter hanging out there, and something -- I don't think
Republicans want to see this bill branded as a big Medicare cut.
HARI SREENIVASAN: One of the -- go ahead.
Sorry.
LISA DESJARDINS: Yes, I think that's right.
And that's where we're seeing kind of some doubts.
And they also say they could just sort of vote to remove that requirement in later years.
We will see.
HARI SREENIVASAN: One of the concerns has been that this is a large wealth transfer
from middle-class Americans to corporations.
I mean, that might be overly simplistic, but you can hear that resonating.
LISA DESJARDINS: It's notable that, in the Senate bill, what they did with this extra
money from the individual mandate is they extended the corporate tax cuts, so that they're
permanent, but not the individual tax cuts.
Those would expire in the Senate bill in 2025.
And that's something that they are getting some criticism for.
HARI SREENIVASAN: OK, let's talk about just the politics of it.
Do they have the votes?
How likely is this?
LISA DESJARDINS: Well, it depends on who you talk to.
They seem to have the votes to include this individual mandate repeal.
That seems to be full steam ahead in the Senate.
But for the entire bill, there was one big rut-roh today for Republicans.
Senator Ron Johnson of Wisconsin said he cannot vote for it, and not for any of the issues
that we have named yet, but instead for how it handles the smaller businesses, basically
owner-operator businesses.
He says they wouldn't get the same tax cut as corporations.
He can't vote for this bill.
That's one vote down.
That means they can't lose but one more, and we have got people with problems with the
deficit, people with other concerns, like the state and local taxes.
It means it's very close in the Senate right now.
HARI SREENIVASAN: So, Sarah, what about all the concerns that people had, that legislators
had when health care came around the first time around?
Are any of those members of Congress going to stick to their guns about the issues that
they saw were faulty about this, or just kind of say, look, the tax is too big for to us
give up and we have got to vote?
SARAH KLIFF: Yes, I think that's something we're waiting to see a bit.
On the one hand, a lot of the concerns were about process.
We saw someone from Senator John McCain from Arizona, he was less concerned about the content
of the bill and more that it was so rushed.
Now, there has been more process, but it's not a lot.
We're talking about a week to consider the bill, instead of a few hours.
I think someone else to watch would be someone like Susan Collins from Maine, who has voiced
a lot of concerns about the loss of insurance coverage.
And I think she is studying the individual mandate situation pretty closely.
I don't know if she's OK with this loss of coverage of 13 million people, the CBO's estimate.
HARI SREENIVASAN: All right, Sarah Kliff of Vox, Lisa Desjardins, thanks so much.