ROBERT COSTA: Disruption at home and abroad. President Trump undermines the Obama agenda on health care and the Iran nuclear deal. I’m Robert Costa. We’ll discuss the politics and consequences of unraveling commitments, tonight on Washington Week.
PRESIDENT DONALD TRUMP: (From video.) I just keep hearing repeal, replace, repeal, replace. Should have been done a long time ago.
MR. COSTA: After failed attempts in Congress, President Trump dismantles Obamacare on his own. His administration will stop paying monthly subsidies that cover low-income Americans. Democrats sound the alarm.
HOUSE MINORITY LEADER NANCY PELOSI (D-CA): (From video.) This is sabotage of the Affordable Care Act and, quite frankly, a real disservice to the American people, many of whom voted for him.
MR. COSTA: What do the new rules mean for Americans and the future of the law? Plus, the president says the Iran nuclear agreement is a bad deal and requests Congress to act.
PRESIDENT TRUMP: (From video.) The Iranian regime continues to fuel conflict, terror, and turmoil throughout the Middle East and beyond.
MR. COSTA: But some of his own advisors and leading Republicans are wary of walking away.
REPRESENTATIVE ED ROYCE (R-CA): (From video.) As flawed as the deal is, I believe we must now enforce the hell out of it.
MR. COSTA: Where does America stand on the world stage? And what is driving President Trump?
We’ll explore his go-it-alone strategy with Shawna Thomas of VICE News, Julie Hirschfeld Davis of The New York Times, Nancy Cordes of CBS News, and Michael Crowley of POLITICO.
ANNOUNCER: Celebrating 50 years, this is Washington Week. Once again, live from Washington, moderator Robert Costa.
MR. COSTA: Good evening. This was the week a frustrated President Trump took a hammer to some of the biggest pieces of his predecessor’s agenda. In back-to-back decisions, he made significant changes to the Affordable Care Act and the Iran nuclear agreement. We’ll explain the effect of both moves, but let’s begin with health care.
After several failed attempts by Republicans in Congress to repeal and replace Obamacare, the president has decided to stop making federal monthly payments to insurance companies. The cost-sharing reduction subsidies totaled about 7 billion (dollars) this year, and they helped lower the out-of-pocket cost for about 7 million low-income Americans who bought insurance on the health care exchanges. The decision has rattled the health care marketplace, and it’s just with open enrollment set to begin in about two weeks. Nancy, when you look at the president’s decision, the first question, everyone’s big question, is: How does this affect people, low-income Americans?
NANCY CORDES: It doesn’t affect them in the short term because rates have already been set for 2018. And if rates do go up in 2019 as predicted, their tax credits will go up as well. The big problem comes in if these insurers say, hey, we were promised these subsides; if you’re not going to give them to us, we’re leaving the marketplace, then that means everybody – not just low-income Americans, but everyone on the exchanges, 20 million people – end up with fewer choices, and in some cases no choices. If Republicans thought things were moving in the wrong direction before, that people didn’t have enough choice, you’re going to be stuck with people who have even fewer choices.
MR. COSTA: Shawna, are we looking at higher premiums?
SHAWNA THOMAS: What you have to understand is that some of the insurers, depending on what state they are – they are in, have already baked in the idea that they weren’t going to get these specific subsidies, and so they raised some of their rates already for 2018 based on that. There are other insurers in some states who also have an option to go to a higher rate if they don’t get this. But it’s all – a lot of people have already been given their letter saying this is what your rate will be for next year, go into the marketplace if you want to make a change. So some of this is baked in, but it’s partly why we’ve seen such higher rates in some states. And there are some states, as she said, who only have one insurer, some counties, like about 1,500 counties have one insurer. And there is a possibility that health insurance companies will say in states like Nevada and Arizona, where there are a lot of those counties, you know, we’re not going to do this.
MR. COSTA: Inside the white House, Julie, they’re making the case that the current law, the way these subsidies were paid out to insurance companies, was unconstitutional, and because there was a federal court ruling that said so. But is there a political risk here for the White House?
JULIE HIRSCHFELD DAVIS: Well, there’s a huge political risk because I think, and what both Nancy and Shawna are pointing out, is that there are already problems where already – people are already experiencing some problems in the current system, the way the Affordable Care Act is. The marketplace is not perfect, and in the years to come there were already going to be possibilities of insurance companies dropping out, premiums going up. But instead of addressing that problem, what the president announced was that he’s actually going to be exacerbating that. And this is all predicated on a strategy of if he does this, somehow he believes that Democrats will have to come to the table and cut a deal with him to replace the Affordable Care Act. But it’s – it is the president who is taking this action. It is he who has decided not to pay these payments. And so if nothing does happen – if Congress continues to be able unable to cut a deal on this – I do think that he and Republicans, congressional Republicans, are going to bear a lot of that blame. And Republican leaders know that, and I think that’s the only possible path toward a solution here.
MR. COSTA: Nancy, is that true? Are Democrats actually going to maybe think about playing ball on health care to try to get these payments back?
MS. CORDES: Well, they’re already negotiating with Republicans. You’ve got these high-level negotiations that have been going on between Patty Murray and Lamar Alexander in the Senate on a package of fixes that would potentially include Congress paying out these subsidies for the next two years, and Democrats will admit that’s how the law should have been written in the first place so they didn’t get into this situation. It was not a huge problem when you had President Obama in the White House, very willing to make these payments. President Trump in the White House, not quite as willing. But these negotiations are really, you know, anybody’s guess how they’re going to end up. When you’re trying to talk about not replacing Obamacare but fixing it, that’s a very fraught discussion between Democrats and Republicans, with a lot of possibilities that this will end in a stalemate.
MR. COSTA: Michael, what’s the big picture here? The president’s trying to act unilaterally. It’s, in part, because the Republicans in Congress couldn’t get the job done.
MICHAEL CROWLEY: It’s unbelievable. If you had said before Trump came in the picture, rewind two years ago and say Republicans are going to win the Congress and the White House but they’re not going to be able to repeal Obamacare, they’re not going to be able to come up with a substitute plan, you would find it hard to believe. And it kind of took Donald Trump to get us to this point.
Two quick things I would add. One is on the question of what Democrats are going to do. I think part of it is – there could be kind of an intermediate fix, but if Trump thinks the Democrats are going to embrace one of these Republican plans, Democrats have to believe that plan is going to less hurtful to most Americans than the status quo, even after he’s made these changes. And I think at this point, a lot of Democrats still think that the Republican alternative plans are even worse than what Trump is doing.
And one other thing, if we look at polling there has been polling specifically on the question of whether voters want to Trump to maintain the exchanges, maintain the current system, and whether they would hold him responsible for it falling apart or getting worse. Those numbers are not in Trump’s favor. So politically this is very dangerous. And if he’s counting on Democrats to come and bail him out, I don’t see that happening anytime soon.
MR. COSTA: And, Shawna, there’s an important point to remember. President Trump has already made these CSR payments, cost-sharing reduction payments, throughout his presidency. Now, in October, he’s deciding not to.
MS. THOMAS: Well, I think some of this is because he has told his base that I am going to get rid of Obamacare, right? And this is one of many ways that you can kind of destroy Obamacare from the inside. You have this. You have the decision to not totally fund the advertising of Obamacare when open enrollment starts on November 1st. And you have a couple of other others that they’ve done that he’s hoping, I think, that it brings Democrats to the table because they are under so much pressure.
But one of the things that I find interesting about this is if you are a fiscal conservative what the CBO has said about this specific thing that the president has decided to do is that it will actually increase the deficit, because the government will have to make up more money because of the way Obamacare is written.
MR. COSTA: Nancy, I was talking to Charlie Dent, a congressman from Pennsylvania. He’s retiring, so he’s a little more candid. He said the Republicans are trying to pass tax reform. They have a budget coming up in December. They have to extend the debt limit. Now the president’s thrown health care into the mix. How are they going to get it all done?
MS. CORDES: This is yet another hot potato that they did not want to be juggling right now. It’s just like the DREAMers, which the president also put in their lap. They want to focus on tax reform. And now they have this very unpalatable decision. Do we fix the exchanges and get shellacked by our base for essentially propping up Obamacare, or do we potentially take the fall if premiums jack up and people lose coverage and we’re left holding the bag? So it’s yet another iron in the fire for Republicans.
And it’s an iron in the fire they didn’t want to put there. For months they had been telling the president as he was threatening to do this: Don’t do it. It’s going to destabilize the markets. Give us some time. We’re trying to work on our own plan. But once it became clear last month that their plan is not going to see the light of day, they can’t get the votes, that’s when the president said, well, you know, looks like I’m going to have to take matters into my own hands.
MR. COSTA: What’s the White House’s response to the idea that the markets could collapse or they could really struggle because of this decision?
MS. DAVIS: Well, I mean, I think that they would say in the short term that that’s not going to happen, that it’s going to take a while for the effects of this to be felt. And before that, we’re going to get a deal. I mean, I do think that they’re putting a lot of eggs in this basket of this is ratcheting up the pressure on Democrats and Republicans, frankly, to actually get something done that we’ve been asking them to get done.
The problem for them is that, you know, there are deadlines and there are – there’s open enrollment. There are things that are going to start to happen that people who have now seen this decision are going to attribute to the fact that the president clearly wants to take actions that make the Affordable Care Act less effective. And Democrats are going to be very loath to step forward and make any kind of a deal that could result in them owning any of the responsibility for that.
MR. COSTA: What does that deal look like, though, Julie, quickly? I mean, does it mean that the president’s going to push for border wall funding or border security money in exchange for these new health care subsidies to be reinstated?
MS. DAVIS: I haven’t actually heard the idea of any sort of other subject rider coming onto this floated. I do think that, you know, restrictions and potential waivers for states to be able to do what they want with regard to the insurance markets and insurance plans is something that they would really like to do. And I mean, that’s what a lot of the repeal and replace efforts were about before. I think it wouldn’t be surprising if they tried to pair that with the CSR payments. I just don’t know if that’s going to fly.
MS. CORDES: And part of the problem is that nobody really knows exactly what kind of plan the president wants. He seems to change his mind all the time – repeal it alone, repeal and replace it, just let it fail. And so Democrats would be very reluctant to get into a conversation with him without having any real understanding of where he wants to get to at the end of the day, other than better, cheaper, covers everybody.
MR. COSTA: And we saw, Shawna, today, there are going to be legal challenges as well as political challenges.
MS. THOMAS: Yeah. There already are legal challenges.
MR. COSTA: There already are. The attorney generals of California, Connecticut, Kentucky, Massachusetts. They all said Friday: We’re going to sue to make sure these payments keep up.
MS. THOMAS: Yes, but the thing is, there are no appropriations for these payments. And so you also might see insurance companies sue just basically to say there’s a law that says we have to make your ability to go to the doctor at a certain group of people cheaper. But you have to pay us. So this is going to go to court immediately, and whether there will be a stay put on it or not. But it is unclear – the president has the power to pay on this. And it is unclear if they can force him to or not.
MR. COSTA: Nancy, when you look at the Affordable Care Act, this is pulling out one piece of thread with the subsidies. But the expansion of Medicaid remains. Other aspects remain. So this doesn’t take a hammer to the whole law.
MS. CORDES: Right, but the president is pulling at several different threads at the same time. You know, he issued executive orders this week saying that he wants to make it easier for small businesses to band together to get cheaper coverage, which sounds great, but which Democrats warn will mean that, you know, people will be getting coverage that might not necessarily offer everything that is required under Obamacare. It bifurcates the system. You’ve got some people getting one level of care, other people getting another level of care. He’s also working on allowing people to purchase insurance across state lines.
And there is this fear, which is, you know, valid, among Democrats that, you know, yes, he can’t just eliminate the law, but he can do a lot to destabilize it. And at a certain point, you know, these markets are not invincible. They’re already in – you know, on shaky ground. Democrats and Republicans acknowledge that.
MR. COSTA: It’s a fascinating debate about executive authority. And President Obama, who Julie covered so closely, and Nancy too, and Shawna and Michael, he used executive authority. Now President Trump’s using executive authority to counter that exact agenda.
Let’s continue with this theme of the week, which is the president trying to undo what President Obama put in place. When President Trump entered the White House, remember, he promised to renegotiate what he called bad deals. And on Friday, he set his sights on what he says is the worst deal ever, the Iran nuclear agreement. The 2015 pact provides Iran relief from economic sanctions in exchange for limits on their nuclear weapons program. President Trump has recertified the deal twice before, albeit reluctantly. But not anymore.
PRESIDENT TRUMP: (From video.) We cannot and will not make this certification. We will not continue down a path whose predictable conclusion is more violence, more terror, and the very real threat of Iran’s nuclear breakout.
MR. COSTA: The Trump administration says Iran is technically complying with the agreement, but is violating the spirit of the deal. Michael, when they talk about the spirit of the deal they’re saying Iran’s complying, but if Iran’s complying then why make these kind of moves? Why disavow it today?
MR. CROWLEY: Well, partly because Trump has reached his breaking point. And part of the problem here for Trump is that under a law passed by Congress in 2015 – July of 2015 was when this deal was sealed by the Obama administration and, remember, several other countries – I think five other countries and then also Iran. The law required the president every 90 days to issue a declaration: Iran is complying with this deal. And Trump doesn’t want to have to keep doing that. Every time the 90-day mark comes around there are these stories saying Trump is going back on his campaign pledge to tear up the nuclear deal. And I think Trump feels like this is driving him crazy. He’s getting these bad headlines.
So they’re trying to find a way to break out of this. And what the compromise solution here is, is for him to say – and let me add, international inspectors are saying that Iran is complying with the deal. So are senior administration officials, including the chairman of the Joint Chiefs of Staff. There have been a couple of little things along the margins you could really nitpick. Basically, they’re complying. So Trump actually on the kind of pure technical facts can’t say that Iran is violating the deal. So he broadens the lens and says it’s the spirit of the deal.
Now, the spirit of the deal can mean a lot of things. And there is language in the law that says essentially if the president says it’s not in our national security interests he can say, OK, I’m going to – what people are saying is decertify the deal. That’s basically what he’s done here, on broad grounds saying that Iran’s bad behavior around the region and in general – he doesn’t like Iran – is his basis for doing this.
MR. COSTA: On that behavior point, is there anything Iran has done since the pact was signed that would give the president some argument to make against it?
MR. CROWLEY: So, again, it’s a question of sort of how you – how wide the lens is going to be. OK, so Obama administration officials would say this was a deal about Iran’s nuclear program. And remember, it’s not a perfect deal. But Iran might have been 18 months away from building a bomb. Israel was talking about airstrikes. We were looking at a possible war in Iran – another war in the Middle East. And we did the best we could. And we didn’t have the luxury of pulling in everything Iran was doing around the region that we didn’t like, even though there was a whole bunch of that stuff.
Trump’s approach is I’m not just going to focus on the nuclear deal. I think Iran is a big problem for what they’re doing everywhere in the Middle East, from Iraq, Syria, Yemen, supporting Hezbollah the menaces Israel. And that’s the conversation we need to be having. And so it’s almost just different categories that people are looking at. And the argument from Obama people is that Trump is just not – it’s just an apple and an orange. And Trump is just not dealing with the deal – with the nuclear deal on its own terms. But we are where we are. And so now it’s going to go to Congress.
People have to understand. What Trump did today was not tear up the deal. But refusing to certify, it opens a window for Congress, which has 60 days to potentially impose sanctions that would constitute a unilateral American withdrawal. And at this point, it doesn’t look like it’s going to happen. Indeed, Trump is not even really asking Congress to do that. So he got the rhetoric that he wanted, he got the politics he wanted, but on the policy we will probably have something like a shaky status quo.
MR. COSTA: Julie, when you look at the president’s decision to criticize the deal, but not totally walk away, was that because of the influence of the generals around him – General Mattis at the Pentagon, General Kelly in the White House?
MS. DAVIS: Well, I do think that, you know, when – he clearly knew what he wanted to do, which is rip up the deal. We heard him say it on the campaign trail. We’ve heard him say it since he’s taken office. But the fact is, as with so many other issues, what he’s found is that when it gets down to actually executing on that, even his own administration does not like that that’s a good course to take. Allies don’t think it’s a good course to take. They worry about the implications in the region. They worry about the implications in other regions, our ability to potentially negotiate a resolution to the dispute with North Korea and their nuclear program. I mean, there are a lot of concerns here.
And so he – when he’s – to the degree that there’s been a process around this, and I think more than most issues that this administration has dealt with they have tried to really deal with this in a painstaking way and really review it. All of the information that he’s getting back from his own national security and foreign policy apparatus is telling him: You can’t just turn your back on this and unilaterally withdraw. So what he’s left with instead is kind of this half measure. And he’s actually taken a smaller fraction of a measure even than a half, because what he’s done is just kick it to Congress and said: You all figure out what you want to do here.
And it’s kind of ironic because the Obama administration bent over backwards to kind of cut Congress out of this. They purposefully didn’t make it a treaty, so it wouldn’t have to go through the Senate. You know, it was really a deal that was done by – with a lot of executive power and prerogative. And in the end, Congress did have a say. But this president is really punting it back to Congress.
MR. COSTA: So if it’s going to Congress, Nancy, it’s going to Capitol Hill we already see Senator Bob Corker of Tennessee, he’s been a critic of the president. Senator Tom Cotton of Arkansas, a Trump ally. They’re working on some kind of agreement to adjust the Iran nuclear deal.
MS. CORDES: Right. They’ve got some legislation that would do things like snap back sanctions if Iran is found not to be in compliance with the nuclear deal. Things like that, that they say don’t trash the deal, that actually strengthen the deal. The challenge is going to be that they need to get 60 votes in the Senate. So they’re going to need to pick up Democratic support. That means Democrats who supported the president cutting this deal in the first place would then have to, you know, be in favor of a deal that essentially says that what President Obama cut wasn’t good enough.
So the devil’s really going to be in the details there. And I think also Republican leaders are going to be watching the president for clues about whether he’ll accept sort of a fig leaf, something that he could tout and say: See, I made the deal stronger. Is that going to be good enough for him, or is he going to want, you know, a really specific serious set of deliverables? That is going to be a much heavier lift.
MS. THOMAS: Well, and isn’t this already in some ways kind of a fig leaf? Like, we keep seeing the president do this. He wants to do something that he said on the campaign trail he wanted to do – rip up the Iran deal, get rid of the Affordable Care Act – can’t do that, so he does something that basically makes it Congress’ problem. He keeps punting things to Congress. He’ll get to go out on the campaign trail now and say, look, I am hard on Iran, I want to get rid of this deal, now Congress has to do their job. One, Congress doesn’t even have to be involved. If he wanted to put the sanctions back on himself, the way it’s written he could. He could just waive what Obama did like magic. And, two, it’s – it puts in some ways Republicans in Congress in the worst possible situation, once again adding to all the things that you talked about that they have to deal with. Now you want us to deal with the enormity of a deal that was done by the executive branch that involves many other countries, a nuclear Iran. It puts them in a terrible box right now.
MS. DAVIS: Well, and he’s also boxed himself in because he set up this predicate whereby, in a certain amount of time, he said if you don’t take these actions, Congress, I am going to walk away from the deal. So we’re going to be all asking and writing stories and wondering 90 days from now, well, what’s he going to do? Is he going to do what Shawna said and unilaterally say this is over, or is he going to take what Congress gives him if they are able to even produce anything?
MR. CROWLEY: And it’s important to understand – it’s hard for members of Congress to explain this – but even people who really opposed sealing the – it wasn’t formally signed, it’s not a treaty, so I hesitate to use the word “signed.”
MR. COSTA: Sure.
MR. CROWLEY: Sealing the deal in July 2015, even people who said don’t do it, this is a bad deal, it stinks, keep negotiating, they say now the horse is out of the barn, it’s too late for a bunch of reasons, including the fact that as soon as the deal was consummated we unfroze tens of billions of dollars of assets that Iran was able to access which we cannot claw back – it’s too late, and the consequences of undoing it now are not worth the trouble. And you can believe that even if you thought it was a terrible deal and you opposed it being signed in July 2015. But try to explain that as a member of Congress to your local TV station or a town hall.
MR. COSTA: And Iran said today in their response, are you prepared to return us our enriched uranium, all of the cash, all of the parts of the deal?
MR. CROWLEY: Exactly. So Iran is essentially calling our bluff. And one thing you hear from a lot of Iran hawks is we can negotiate a better deal, and that to some degree Trump is using Congress as leverage for more negotiating power with the Iranians. Maybe, but really you don’t get something for nothing. And if – you know, the Obama administration tried really hard to get a good deal. I just don’t see how they go back and say to Iran give us more without something in return.
MR. COSTA: We’re going to have to leave it there. Thank you, everybody. We could go on all night. (Laughter.)
Our conversation will continue online on the Washington Week Extra, where we’ll take a closer look at three people behind the headlines this week. You can find that Friday night after 10 p.m. at PBS.org/WashingtonWeek.
I’m Robert Costa. Thanks for watching, and have a wonderful weekend.