Furman: Obamacare Uproar Won’t Undercut Budget Talks
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The Fiscal Times
November 4, 2013

As the political crisis over the administration’s disastrous rollout of Obamacare mounts, President Obama’s chief economic adviser insisted the controversy would not undercut the president’s efforts to negotiate a critical budget and tax deal with Republicans.

Jason Furman, the new chairman of the White House Council of Economic Advisers, repeatedly described the technical glitches and repeated breakdowns of HealthCare.gov as a “debacle” and a source of alarm during a Monday breakfast meeting with reporters and budget experts. “No one is remotely happy with the way the website has gone, and people are working very hard to fix it,” Furman said.

But he insisted the crisis would not impede negotiating a new budget deal with the GOP to replace the sequester with a package of alternative spending cuts, economic initiatives, entitlement reform and tax measures by mid-January.

Last week, a House and Senate budget conference committee began negotiations on a compromise that would avert another government shutdown and debt ceiling crisis early next year. But opening statements by Democratic and Republican negotiators signaled broad partisan differences, especially over taxes. And many Republicans argue Congress can make little headway in improving the economy and increasing employment unless the implementation of Obamacare is postponed and the law is revised.

RELATED: HOW POLITICS DOOMED OBAMACARE’S ROLLOUT

Moreover, many congressional Democrats are voicing concern that the uproar surrounding the launch of Obamacare may hurt their chances for reelection next year.

“We’ve been dealing with multiple issues at the same time for the last nearly five years,” said Furman during a breakfast sponsored by The Wall Street Journal. “People are working 24-7 on the website. The debacle is incredibly serious on this. So they’re focusing on it. But people want to hear about jobs, they want to hear about growth.”

Asked by former Clinton White House budget expert Joe Minarik whether the administration was “starting to tread on dangerous territory” because of the outrage over the faulty website and reports that millions of Americans will lose their current health insurance policies under the new law, Furman replied that critics must take the “longer view” of a law that was passed three years ago and already has provided important new benefits to consumers.

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Before passage of the Affordable Care Act, “every year tons of people didn’t have their policies renewed because they got sick and were too much of a risk” to insurers, Furman said. “It was a little bit like the Wild, Wild West,” he said of the individual health insurance market. “So it’s not like there was some perfect, stable, wonderful system and then along came Obamacare, and every problem in the country is now a result of that.” A veteran of the Obama administration, Furman replaced Alan Krueger as chairman of the Cabinet-level White House council post. Furman was a central player in drafting the $825 billion stimulus package in the depths of the recession and advised the president on drafting the Obamacare health reform legislation.

Among other highlights of the breakfast on Monday, Furman:

  • Agreed in part with former Treasury Secretary Larry Summers and others who argue there is little need to focus on additional short-term deficit reduction when the deficit plummeted by 38 percent in fiscal 2013 to $680 billion – a startling turnabout after four consecutive years of trillion-dollar deficits and the worst economic conditions since the Great Depression. “We certainly don’t need faster deficit reduction in the near term,” he said. “It’s in fact quite the opposite. We need more support for job creation in the near term.” He said doing more in the short-term to spark job creation “is related to doing more in the medium and long-term for deficit reduction” because of the effects it would have on economic expansion and increased revenues.
  • Stressed that the administration would hold firm in seeking to replace thesequester with a mix of spending cuts, stimulus spending on infrastructure, entitlement reforms and tax reform that would increase overall revenue. The administration would also continue to press for a higher minimum wage.
  • Signaled that the administration continues to favor business tax reform, including rate cuts over individual tax reform. “We see the biggest economic gains from tax reform on the business side,” Furman said.
Washington Editor and D.C. Bureau Chief Eric Pianin is a veteran journalist who has covered the federal government, congressional budget and tax issues, and national politics. He spent over 25 years at The Washington Post.