White House Secretly Squashed IRS Resistance to ObamaCare’s Illegal Subsidies


The New York Times reports on a secret meeting from 2014, exposed thanks to sworn testimony before the House Ways and Means Committee, at which a vanload of IRS officials were told to stifle their complaints about billions of dollars in flagrantly illegal ObamaCare funding.

Upon arrival, the I.R.S. officials, some of whom had expressed doubts that the Obama administration had the proper authority to spend billions of dollars on a crucial element of its [Obamacare] health care law, were ushered into a conference room.

There, they were presented with an Office of Management and Budget memo laying out the administration’s justification for spending $3.9 billion on consumer health insurance subsidies. They were told they could read it but could not take notes or make copies.

The O.M.B. officials left the room to allow their visitors a moment to absorb the document, and then returned to answer a few questions and note that Attorney General Eric H. Holder Jr. had been briefed and signed off on the legal rationale.

“It was not a common practice in my 10 years in government at the three agencies where I worked,” said David Fisher, a former I.R.S. financial risk officer, recounting the odd meeting during a deposition on May 11 conducted by investigators for the House Ways and Means Committee.

The Times makes a fitful attempt to spin this as a “Republicans pounce” story, stressing that we’re only learning about Fisher’s testimony because Ways and Means Democrats “feared Republicans would release selected excerpts” as part of a “witch hunt,” which would in turn be part of a “crusade to dismantle the Affordable Care Act, which has been twice upheld by the Supreme Court.”

Witch hunters and Crusaders in the same sentence? That’s got to be worth double points in Liberal Spin Scrabble.

And yet, the Times article is actually quite blunt about what happened here. A properly-educated grade-school student should be able to understand that using twisted legalese to bypass the separation of powers and appropriate Congress’ power of the purse is illegal:

After failing to win congressional approval for the funds, the Obama administration spent the money anyway and has now distributed about $7 billion to insurance companies to offset out-of-pocket costs for eligible consumers. The administration asserts that the health care legislation provided permanent, continuing authority to do so, and that no further appropriation was necessary.

Mr. Fisher, for one, did not agree, and his testimony is the first to reveal that some within the administration challenged the spending. Beginning in late 2013, he and his supervisor began having qualms about how the White House was planning to proceed. In combing through documents to make sure his agency could defend the spending in future audits, Mr. Fisher said he came up empty.

Cost-sharing reduction payments are not linked to the Internal Revenue Code, as far as I could tell, directly anywhere,” Mr. Fisher, now in the private sector, said in his deposition, made public last week by House Democrats who feared Republicans would release selected excerpts.

“There is no linkage to the permanent appropriation, nor is there any link to any other appropriation that was indicating what account these funds should be paid from.”

Committee Democrats tried to obfuscate the issue by invoking the authority of IRS Commissioner John Koskinen, who maybe isn’t the best choice of legal-and-ethical North Star these days. Go figure that a key player in weaponizing the Internal Revenue Service against Barack Obama’s political opponents thinks ObamaCare’s dubious funding is just peachy, no matter how much of the law was written in crayon.

It won’t be worth much to partisan Democrats, but Fisher stressed that he’s not opposed to ObamaCare itself — he’s concerned with appropriations law. “For those of us who work in financial management, when it comes to the Antideficiency Act, which has criminal penalties associated with it, we take it very seriously,” he testified.

The Antideficiency Act is an important element of Congress’ “power of the purse,” forbidding federal employees from “making or authorizing an expenditure from, or creating or authorizing an obligation under, any appropriation or fund in excess of the amount available in the appropriation or fund unless authorized by law.”

The only time liberals care about the Act is when they’re whining about “Republican government shutdowns” — which are actually triggered by Democrats, but it’s a sacred law of the mainstream media temple that only the GOP devils can be guilty of the shutdown sin, because Democrats would never dream of doing anything to hurt the Leviathan State they raised from a pup.

When there’s a whiff of shutdown in the air, or when Democrats want to compare those who call for tax relief to deadbeat diners trying to skip out on their bills, the Antideficiency Act suddenly becomes a pillar of democracy.

But ObamaCare is a more perfect example of what this legal code is supposed to prevent: federal employees nullifying congressional appropriations authority, by weaving obligations out of whole cloth and obliging Congress to pay for them.

It’s obvious that the Administration knew these subsidies would be legally problematic, especially since they put so much effort into tricking the American people into thinking ObamaCare was “revenue neutral.” Messy legislative fights over multi-billion-dollar subsidies could make voters ornery.

In this, as in so many other ways, Democrats viewed the Affordable Care Act as something akin to an enabling act, a writ of unlimited executive power to do whatever was necessary to keep the government-managed health insurance scheme afloat. They viewed passage of the ACA as a permanent surrender of congressional authority, creating a weird new kind of non-law that could be rewritten by the Executive Branch as needed, in perpetuity.

Keeping ObamaCare alive ultimately required the Supreme Court to rewrite it on the fly, twice. Chief Justice John Roberts might need to break out his erasers and White-Out again.


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