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The Truth About Gruber-Gate

Nov 13, 2014

Republicans think they have found a smoking gun that exposes a nefarious plan by the Obama Administration to lie to the public in order to build support for the Affordable Care Act. This week, several videos from 2012 and 2013 have surfaced that show MIT Professor Jonathan Gruber, a former paid consultant to the Administration on health reform, calling the American people “stupid” and saying “a lack of transparency” was crucial to getting the ACA passed in 2010.

“Stupid” is not a great word to use to describe anyone, and Gruber said Tuesday that he regretted the comment. But rather than a smoking gun, Gruber-gate is actually a flash of candor in a debate that was filled with disingenuous statements from both sides. Supporters of the law did, in fact, do their best to obscure unpopular provisions—like new taxes. But Republican opponents were just as deceptive in their efforts to exaggerate the law’s potential negative effects. Neither is excusable.

The American people did not really understand the intricacies of the ACA before it passed. In April 2010, 55% of Americans said they were “confused” by the law, even after it passed and its provisions had been parsed for months in the media. Some of the confusion was due to Washington rhetoric that obscured the true details of the law and some can be blamed on a media that focused more on the politics of the bill than its policies.

It also seems unrealistic to expect average citizens to sort through a piece of legislation as large and complicated as the ACA to judge fact from fiction. Instead, the public largely relied on the opinions and information disseminated by politicians they agreed with generally.

That's where the party-line deceptions come in. In one video, Gruber says that if the public had really understood that the law would require healthy people to pay for sick people, it wouldn’t have passed. He also says that the penalty for not having insurance is a "tax," even though Democrats didn’t use that word to describe it because it would have made the law politically unfeasible. In another video, Gruber explains that a new ACA tax on high-cost health plans supposedly levied on insurers would actually be passed through to consumers.

None of these facts are exactly revelatory. Healthy people subsidizing sick people is how health insurance works. Whether it's perceived as a "tax" or not, nobody wants to pay a financial penalty for not having insurance. And of course it's true that any company—including an insurer—will try to pass overhead costs on to its customers.

The truth is there was deception on both sides of the debate that preceded passage of health care reform. Two wrongs don't make a right—transparency is always better and more fair—but such context is necessary when judging Gruber and his remarks caught on tape. Republicans propagated talk of “death panels” and the notion that health reform would “ration” care, putting a board in charge of deciding who could live or die. The ACA does neither. The GOP also peddled the false idea that Democratic health reform was a “government takeover,” an argument that conveniently left out the fact that government dollars account for more than half of all health spending, with or without the ACA. And Republicans cast the entire discussion of the "public option," a Medicare-like government insurance plan consumers could buy if they wanted to, as socialized medicine for all.

I’ve talked to Gruber many times over the past six years. He's a good source because he's smart, candid and was privy to the Democratic behind-the-scenes thinking and maneuvering that preceded passage of the Affordable Care Act. Gruber has always spoken so freely that I suspect the Obama Administration never felt completely at ease with the idea that one of its chief consultants was out there explaining everything, untethered. Comments Gruber made in 2012 about the health law's subsidy system, which were also caught on tape and which he later described as "off the cuff," could weaken the government's case when it defends the law before the Supreme Court next year. (I reached Gruber to discuss this latest video controversy and he declined to comment on the record.) Gruber's usually willing to talk and often, it seems, he's not thinking much about the political ramifications of what he says.

In 2013, for instance, I asked Gruber if Democrats understood that the ACA would slowly and methodically erode the system under which millions of Americans get health insurance through their jobs. In pitching the ACA, Democrats had been adamant that the law would support and sustain the employer-based system, not erode it. But Gruber knew better and he told me so, likening workers being kicked off job-based health plans to people “falling off a building,” an outcome that architects of the ACA knew was likely and had planned for.

At least one Republican in Congress has called for hearings over Gruber's newly revealed comments. Buoyed by a midterm election that gave the party a larger majority in the House and a new majority in the Senate, Republicans are hoping that Gruber-Gate might help them dismantle parts of the ACA next year.

What’s significant about Gruber-gate, though, is not that the Obama Administration was less transparent about what the ACA would do than its critics. It’s that Gruber admitted that his side participated in this unseemly dance.

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