Summarizing the Best Arguments Against PPACA

You could argue that the past week has been somewhat discouraging for opponents of PPACA. The president has mocked opponents of the law for going through "stages of grief." Vox.com recently published a piece critical of opponents of the Patient Protection and Affordable Care Act (hereafter PPACA), saying that they were afflicted with Obamacare Derangement Syndrome. None of the events, though, have weakened the core reasons for opposing PPACA. Instead of doing a point-by-point rebuttal of Ezra Klein's argument, I thought it might be more useful to put together a foundational list of "good reasons to oppose PPACA."

We'll start, though, with the opposite: what are good reasons to support PPACA?

1. A belief that health insurance is a moral imperative.
2. Faith in the ability of a non-single payer centralized program to control costs.
3. A desire to protect President Obama and the remainder of his agenda from a crushing defeat and embarrassment.

Most support for PPACA comes straight from point 1: that health insurance is a moral imperative. My contention would be that if you believe in point 1, there are many better solutions to the problem of the uninsured than PPACA. But that's a separate argument. Why oppose PPACA at all?

There has been so much sound, fury, and writing about PPACA over the last few years that it is often hard to keep track of all of the arguments. Some of the arguments against PPACA were not particularly persuasive, but others really were, and may have gotten lost in the heat. That is my starting point for writing here: there are lots of good reasons to oppose PPACA vociferously, and it would be nice to have those available in one place. So here are eight reasons:

1. The centralized, top-down nature of PPACA will squelch disruptive innovation.
2. The pre-PPACA environment was incredibly flawed. PPACA exacerbates those flaws.
3. The law has created some undeserving winners.
4. The law has created some undeserving losers.
5. The employment effects on both the demand side and the supply side are troubling.
6. The story of the law's passage does not reflect well on the law itself.
7. The Obama administration has shown utter disdain for the rule of law in implementing this legislation.
8. Even the "conservative" ideas in PPACA--like its use of High Deductible Health Plans (HDHPs)--are distorted and perverse.

What follows are a bunch of links from the last half decade of debate and argumentation, and lots of blockquoting. I intend to return to this post somewhat regularly.

1. The centralized, top-down nature of PPACA will squelch disruptive innovation.

I have read hundreds of articles on health care policy, health insurance, and PPACA over the last half decade. Of all of those, French writer Pascal-Emmanuel Gobry wrote the most compelling critique of PPACA and the progressive approach to government and reform more generally. Gobry proposes an interesting thought experiment, imagining if the Internet had emerged as those "in the know" in the early 1990s had expected: as some sort of "connected/interactive TV device." His thought experiment went on:

What would be the state of internet innovation under such a global network? It’s very easy to see that it would be much lower. Because the network would be controlled by gatekeepers, it would be much harder to start things. It would be a walled garden. 

Is this something you agree with? That if the “internet” had been a walled garden there would have been much less innovation on it? 

There would be no Google (the thing would have its own search interface). There would probably be no Amazon (instead the Barnes & Noble of the world would have their own storefronts to which they would dedicate almost no resources and would suck). There certainly would be no Wikipedia, or Twitter, or Business Insider. There would be services! People could certainly “communicate” and “shop” but with nowhere near the kind of efficiency and ease of use and innovation that we have today.

The internet has emerged as a wonderful source of value for humanity because of the very decentralized way in which it emerged. He continues:

Now, imagine, still, that we’re in 2013 in this walled garden internet alternate universe. Everyone’s on the network and it “works” well enough. Now imagine that someone writes that the global network is actually horrendous and that we would have so much more innovation if there were no gatekeepers. That person would be universally seen as crazy. First of all, they would say, why are you saying that we need a global network, since we already have one? Second of all, they would say, why are you saying there’s no innovation, since there is already plenty? I mean, we can shop and communicate and leave each other messages. 

If you described the internet as it exists on this universe to someone from that parallel universe, they would never believe you. Imagine describing Twitter to such a person. Imagine saying, well, we should have an open internet because then people could communicate in 140-character bursts. Or Wikipedia. An open internet is a good idea because people could work on a collaborative encyclopedia that anyone could edit. Yeah, like that’ll work! Oh, and the most profitable thing on the internet would be “search” and the search company would be so profitable that it would come out with self-driving cars. People would think you were just a complete lunatic.

I find this to be an incredibly powerful thought experiment, because it is one way to visualize the difference between the seen and the unseen. Gobry proposes that there is a similar world available to us in health care and health care delivery, discussing the "hints" of such a system--like "health care advocates" and dramatic cost reductions in heart surgery in India. Gobry's suggestions here are all about disruptive innovation, but it is near-impossible to get disruptive innovation in a centralized system where the stakeholders are all heavily vested in the status quo. Disruptive innovation is what could lead to new life-saving medical procedures. It's what could increase the available supply of medical practitioners. It's what could slash the costs of expensive tests and treatments. We can't do those things from the top down; they just don't happen, because the stakeholders are too powerful, and innovation is too hard to control and direct. PPACA essentially makes that future less likely. And those of us who are complaining about it in twenty years while we suffer through long waits, rationing, and astronomical prices will probably be described as "complete lunatics." It's disheartening, but that's the future.

2. The pre-PPACA environment was incredibly flawed. PPACA exacerbates those flaws.

One of the reasons that I thought that Mitt Romney would never win the Republican nomination back in 2011 was because of the obvious Romneycare/PPACA link. PPACA was a major potential source of votes for Republicans, if the right messenger could hit the right message. (I expected Tim Pawlenty to emerge as the guy. Oops.) But Ramesh Ponnuru and Yuval Levin of National Review crafted a compelling message for Romney that really hits at the core issue of PPACA: it entrenches the bad parts of the previous status quo. As a state governor, Romney could not sweep away the pathological problems of the American system of health insurance; considering the flaws of the system, Romneycare was a valiant attempt to solve the problem of the uninsured. But the federal government must address those flaws in any solution, not further entrench them. An example: a man named John was in a precarious situation; he was hanging off of a cliff. If he were alone, his best solution would be to jump to a landing nearby to save himself from a much worse fall. But if his friend Lauren were standing at the top of the cliff, Lauren shouldn't help John jump to the landing; Lauren should help pull John up! That is, in short, what the Romneycare/PPACA message should have been.

Unsurprisingly, the milquetoast Romney campaign never went there. But this critique of PPACA from Ponnuru and Levin is spot on:

The perversity of Obamacare is that instead of addressing the ways in which federal policies make an efficient and competitive health-care system impossible, it doubles down on those policies and adds a highly convoluted system of further public subsidies and oppressive rules on top of them. In short, Obamacare takes a bad health-care system and makes it much worse, in ways that are likely to exacerbate the grave problems with American health-care financing and to be very difficult to reverse once fully implemented. 

Thus Obamacare takes a Medicare system that stifles innovation and prevents competition, and maintains its irrational structure while subjecting it to a rationing board that will undermine access and quality. ... Obamacare vastly expands Medicaid without reforming its structure — intensifying the incentive for overspending and drawing more middle-class Americans into a segregated, subpar health system. ... Obamacare adds to the economic distortions created by today’s system by leaving the tax treatment almost entirely unchanged but placing a new entitlement program alongside it and subjecting both to an additional onerous layer of regulations. ...

Obamacare, in other words, takes each of the three parts of our deeply troubled health-care-financing system and makes every one of them worse, by making them less market-oriented, less efficient, and less innovative. 

Any conservative who doesn't acknowledge that American health care had serious problems prior to the passage of PPACA is a disappointment. (John Hudak notes that this might be because Republicans' "key voters" tend to already have health insurance. There may be some truth to this.) But PPACA didn't really address the central problems of American health insurance. In many cases, it exacerbates them.

3. The law has created some undeserving winners.

Tim Carney of the Washington Examiner is the blogosphere's foremost expert on crony capitalism and handouts to big business. A century ago, Carney would have been a plains Democrat and probably a supporter of William Jennings Bryan. But that is no longer the Democratic Party. Carney has been all over the crony capitalist, corporatist overtones of the law:

Yes, they opposed provisions regarding Medical Loss Ratios (basically capping the legally allowable profit and overhead that health insurers can make), but the heart of the bill – an individual mandate paired with rules requiring insurers to accept all comers and controlling the pricing tiers they have – was a package the insurers proposed even before Obama was sworn in. 

Throw in the subsidies for insurers and the laws requiring employers to cover employees, and you’ve got a bill full of insurer-friendly provisions. It’s noteworthy that on the ObamaCare case before the Supreme Court, the top health insurance lobby is not arguing to overturn the law, but is simply arguing that if the court kills the individual mandate, it must also kill the must-issue and “community rating” regulations. 

And just as a reminder, the biggest single-industry lobby in the country, the Pharmaceutical Research and Manufacturers of America, supported the bill and dedicated millions of dollars to supporting Democratic incumbents who might face electoral trouble for their “Aye” votes. 

The other biggest health-sector lobbies – the American Medical Association and the American Hospital Association – also supported the bill.

Carney also identified some of the direct benefits to pharmaceutical companies from some e-mails that were released back in 2012:

Obamacare emails made public last week show that Obama is skilled at publicly pretending to fight a supposed bad guy -- the drug lobby, in this case -- while ensuring neither side actually gets hurt, both sides get paid, and everyone can be chums afterward. 

Throughout his campaign and while pushing his health care law, Obama regularly spoke as if he were sticking it to the drug industry. But these were phantom punches. Sometimes, the emails show, the drug lobbyists didn't even blink an eye. 

[snip] 

Over the following weeks, the emails show, drug lobbyists, White House officials and aides to Sen. Max Baucus hammered out a deal that formed the backbone of Obamacare. 

The final bill would subsidize prescription drugs, force states to include drug coverage in Medicaid, and expand private insurance coverage of drugs. Also, the White House pledged to oppose policies that Obama had promised on the campaign trail: allowing reimportation of prescription drugs and empowering Medicare to negotiate for lower prices on the drugs Medicare is paying for. In return, drug companies would offer a discount to some senior citizens, and would spend millions of dollars on ads supporting the bill and the lawmakers who backed it. 

But after the deal was complete, in late July, Obama publicly delivered a play-fight piledriver to the drug lobby. "I understand that some will try to delay action until the special interests can kill it," Obama said in the Rose Garden on July 21. The president warned that his opponents "would maintain a system that works for the insurance and the drug companies, while becoming increasingly unaffordable for families and for businesses." 

After that speech, Republican Pfizer lobbyist Anthony Principi, a former Bush Cabinet member, wrote in annoyance to PhRMA lobbyists and other top drug lobbyists. "We're trying to kill it?" he asked sarcastically. "I guess we didn't give enough in contributions and media ads supporting hcr [health care reform]. Perhaps no amount would suffice." (The pharmaceutical industry gave $1.2 million to Obama in the 2008 election, according to the Center for Responsive Politics, the most it had ever given to a candidate, and more than triple its contribution to John McCain.) 

Hall wrote back: "Billy [Tauzin, president of PhRMA] and I were at the WH today. We raised this issue with Jim Messina." Messina was deputy chief of staff and one of the drug industry's main points of contact. "Jim said that he went into the Oval [Office] and talked to the President." Messina reportedly asked Obama, "Why was this in the sppech?" [sic.] Hall writes that "Obama said, 'I was wondering the same.' Attributed to young speechwriter."

The law was a complete giveaway to entrenched interests. The Obama Administration called them stakeholders.

4. The law has created some undeserving losers.

One of my favorite PPACA-related anecdotes pertained to NPR's talented health care correspondent, Julie Rovner. Anyone who listens to NPR regularly (as I do) knows that Rovner is sharp on health care: she reports well and adds clarity to often-complicated situations. But even Rovner was swept up in the fervor of the heady days of 2012. Jonah Goldberg has the story:

In the wake of the Supreme Court ruling upholding the Affordable Care Act (a.k.a. "Obamacare"), NPR's "Talk of the Nation" held a seminar of sorts at the Aspen Institute's legendarily pretentious Ideas Festival. Someone in the audience asked NPR health policy correspondent Julie Rovner this question: "Today's decision is a positive decision for the estimated 50 million uninsured Americans. Who are the losers today?" 

Rovner seemed to struggle to find losers. She came up with insurance companies that want the so-called individual mandate — now a punitive tax according to the Supreme Court — to be much more punitive. After thinking through her answer, she later added that another group of losers might be the citizens of states whose governors opt to not participate in the law's expansion of Medicaid.

Rovner is a public policy reporter, and most public policy decisions have to do with identifying winners and losers. Good public policy minimizes the pain that losers feel so that they are less likely to object to new policies vociferously. But in her enthusiasm for the law, Rovner could not see past the surface of this legislation: there are many losers hidden just underneath the shiny exterior. Jay Cost of The Weekly Standard has been beating this drum the most vociferously.

Losers in the schema include people whose new insurance is more expensive or otherwise less satisfactory because of the new regulations, seniors whose Medicare Advantage program will be peeled back (or whose local hospital stops taking them because of cuts to Part A), businesses who cannot afford the mandates, people who lose their employer insurance as a consequence of the new business mandates, young and health people who [sic], and others. Importantly, the administration's delays speak to the potential coalition of the losers, as almost all of them have been designed to keep these groups from realizing the harm they are due to suffer before the 2014 midterm election.

I suspect Cost would have added "young and healthy people who would prefer not to pay for comprehensive health insurance" if he were to edit it. (Per reason 1, I would also add the millions of Americans who will suffer in a future of less innovation.)

The people who are losers in this schema have long been protected by both sides in an unwritten political agreement, which vouches that the only people the government "takes" from are those with plenty to spare. The rule was: you do not redistribute money and security away from the middle class to accomplish some policy objective. The Democrats broke this rule, largely out of cowardice. They wanted to hide the trust [sic] costs of the legislation. Rather than put together a straightforward tax that hit everybody equally (like the Social Security tax), they created a convoluted system to fund the program, such that people whose premiums have gone up are paying an implicit tax, one that happens not to be collected by the government.

I heartily agree with this. The law's losers have been hidden for political reasons.

5. The employment effects on both the demand side and the supply side are troubling.

In general, I am skeptical of most economic study estimates, particular from government studies; there are too many variables, too many ways to massage the data, and too many assumptions to make to model anything confidently. But I think that theory and logic are useful in conjunction with data, and based on that, the broad outlines of the policy lead to two problematic effects on employment:

- Demand side: By increasing the cost of hiring and maintaining workers, employers will hire some number fewer workers.

- Supply side: Approximately two million workers will drop out of the workforce because they no longer need to work to get health insurance or security.

Conservatives believe that work is useful for social cohesion, harmony, and individual thriving, and that dispensing with work, even if we can "afford it," is socially dangerous. But PPACA challenges "work" from both blades of the supply/demand scissors.

Casey Mulligan has done some excellent writing on the problems of the demand side, noting that the act was chock full of "taxes on employers" and "implicit taxes on employees," which together "amount to a five or six percentage point addition to the average marginal tax rate on labor income."

On the supply side, Ross Douthat wrote persuasively for several days on the problems of the labor impact of PPACA. In one post, he wrote:

... there also lots of people who emphatically do not benefit from being given an incentive to either detach from the workforce or (if they’re already unemployed or underemployed) remain detached rather than taking a lower-paying job. And given the current economic landscape, especially — in which persistently high unemployment coexists with a growing population of workers too discouraged to even look for work — the size and scope of a work-discouraging effect matters a great deal: The bigger the effect, the more likely that the people dropping out aren’t just, say, parents cutting hours to spend more time at home while the other spouse works full time, but people we should want to be attached to the workforce [emphasis added], for their own long-term good and the good of the economy as well.

His Sunday column is also worth quoting:

... in the Obamacare debate and elsewhere, it’s not always clear whether this larger welfare state is supposed to promote a link between work, security and mobility, or to substitute for work’s gradual decline. On the left, there’s a growing tendency toward both pessimism and utopianism — with doubts about the compatibility of capitalism and democracy, and skepticism about the possibility for true equality of opportunity, feeding a renewed interest in 1970s-era ideas like a universal basic income. 

On the conservative side, things are somewhat clearer. There are libertarians who like the basic income idea, but only as a substitute for the existing welfare state, not as a new expansion. Both “rugged individualist” right-wingers and more communitarian conservatives tend to see work as essential to dignity, mobility and social equality, and see its decline as something to be fiercely resisted.

Douthat has been the most consistently interesting critic of PPACA, and he absolutely nailed the supply side employment effects.

6. The story of the law's passage does not reflect well on the law itself.

It may be hard to remember, but PPACA was passed using a variation on the "ping-pong" method of passing laws. The How a Bill Becomes a Law process almost invariably requires a "conference committee." The conference committee takes people from both the House and the Senate, who hammer out differences in the specific legislation and correct drafting errors and inconsistencies. Under normal circumstances, a version of a bill must pass both the House and the Senate, and then must pass again after conference. But in the case of PPACA, there was a problem: a special election in Massachusetts replaced Ted Kennedy with Scott Brown, who vigorously campaigned as the "41st vote" against PPACA. So the House and Senate has passed versions of the bill, but Brown's election ensured that no conference bill would ever get through the Senate.

The Democrats had two options:

- Scale back their ambitions and look for something that moderate-leaning Republicans, like Olympia Snowe, Susan Collins, and Scott Brown, could support.
- Pass the Senate bill without any changes.

Crying, "Damn the torpedoes," the Democrats opted for the latter. The issues in the Senate bill are myriad and are the types of things that should have been cleared up in conference. One is the apparent drafting error that technically prevents purchasers of insurance on the federal exchange from receiving subsidies. Regardless of intent, the plain language of the statute dictates that a court must strike down those subsidies. Judges may disagree with my interpretation. But a major piece of the law is dependent on judges cutting careless drafters some slack. This is not how you pass wise public policy, and it is the type of error that would invariably be corrected in a good conference committee. Massive reform laws should not be plagued with obvious drafting errors. The conference never happened.

7. The Obama administration has shown utter disdain for the rule of law in implementing this legislation.

As bad as the process was in passing the law, the Obama administration's relentless array of waivers, extensions, and outright changes to the law as it exists are downright terrifying if you have . The precedents that Obama has set in terms of selective enforcement are incredibly dangerous. Worse, I expect a Republican president to take a similar tack when one is next in office. This is a terrible norm to set.

The rule of law is one of those elements of the constitution (small-c) that helps ensure a functional political and legal culture. There is a longstanding norm in American governance for sticking to the rule of law, which protects Americans from arbitrary executive action and from unequal treatment by the government. (Let's accept that many non-whites in American history have not always benefited from a fair implementation of the rule of law. This is not a reason to dispense with the concept.) From the perspective of "rule of law," PPACA has been farcical. The Galen Institute identifies 22 separate unilateral executive modifications to the law. These range from a delay of the employer mandate to an expansion of a provision of the law that allowed for "grandfathering" of older plans to an exemption to unions from required reinsurance fees. The logic appears to be "if it is convenient, change the bill." Even outlets friendlier to the president's agenda, like Politico and the New York Times, have seized on the "modifications" story.

At the same time, however, Obama has made it clear that he would veto legislation from the Congress that accomplished the exact same objectives. He has not had to because Harry Reid has prevented all of the House's "fixes" from ever seeing the light of a floor vote in the Senate. But he is essentially flouting standard process and taking an incredibly broad view of his administration's rights to implement legislation as he sees fit. Essentially, Obama has acted as a one-man conference committee.

Perhaps the most galling change, though, was the perfectly-timed Census change of its formula for computing the number of uninsured. Megan McArdle nailed this on Friday:

For several months now, whenever the topic of enrollment in the Affordable Care Act came up, I’ve been saying that it was too soon to tell its ultimate effects. We don’t know how many people have paid for their new insurance policies, or how many of those who bought policies were previously uninsured. For that, I said, we will have to wait for Census Bureau data, which offer the best assessment of the insurance status of the whole population. Other surveys are available, but the samples are smaller, so they’re not as good; the census is the gold standard. Unfortunately, as I invariably noted, these data won’t be available until 2015. 

I stand corrected: These data won’t be available at all. Ever. 

No, I’m not kidding. I wish I was. The New York Times reports that the Barack Obama administration has changed the survey so that we cannot directly compare the numbers on the uninsured over time. 

[snip] 

Sarah Kliff of Vox says we shouldn’t freak out, because these are the numbers that the census collects for 2013, so the change is actually giving us a good baseline. But I’m afraid I’m not so sanguine. As Aaron Carroll says: “It’s actually helpful to have a trend to measure, not a pre-post 2013/2014. This still sucks.”

Of course the formula change will result in a smaller number of uninsured than in the formula's older iteration (which was the source of the numbers that were "shoved down our throats" in the passage of PPACA in the first place). The Obama Administration will disavow any connection to this change, but considering the history of near-total rejection of the rule of law when it is convenient, I just don't believe them.

Ramesh Ponnuru notes that the rule of law "tends not to have a built-in constituency for it" and believes that a "healthy political culture" would take the rule of law more seriously. Indeed. Like many elements of political and social culture, the rule of law will only be missed when it is largely gone. The PPACA implementation has certainly pushed us more in that direction.

8. Even the "conservative" ideas in PPACA--like its use of High Deductible Health Plans (HDHPs)--are distorted and perverse.

I said I'd rather not engage with Ezra Klein's Vox.com piece on Obamacare Derangement Syndrome, but I can't help myself on one point: Klein writes, "High-deductible health plans are a longtime conservative solution for health costs — and Obamacare is spreading them far and wide."

It is true that PPACA has resulted in something like HDHPs gaining some traction on the exchanges (in the form of the lower-tiered "bronze" plans.) But in reality, PPACA has dramatically increased the number of things that an HDHP is required to cover (defeating the purpose). In conservative circles, HDHPs are good in conjuction with robust, tax-exempt Health Savings Accounts (HSAs). These HSAs would offer people money to shop, and would serve to create something closer to a thriving market for health care services, with the advantage of price discovery as the major benefit to everyone else. But if anything, PPACA weakens HSAs by limiting the amount of non-prescription drugs that people can buy with them. It certainly has no place for a growing HSA market.

True conservative health care reform with HDHPs would actually resemble insurance, or protection from unexpected, catastrophic expenses, rather than prepayment for expected expenses. Seeing the appearance of something resembling HDHPs in PPACA and saying that it's a conservative success is like calling my beloved blueberry Eggo Waffles a fruit dish.

You can argue that my eight reasons are not enough to override the moral imperative for health care. But I am convinced that a better law that solved most of the problem that PPACA attempts to solve would have had far less downside. Instead, we got the disaster that is PPACA. I expect stories of the winners to dominate a fair bit of the mainstream narrative, and certainly the Obama campaign narrative. But these drawbacks remain and are important, and we should have had better policy in the end.

Making it Harder to Hire

I've made no secret of my distaste for the current administration. I have many reasons for this, ranging from the president's incredible, relentless use of strawmen to his insistence on making everything political to his Machiavellian approach to pushing the health care bill to that deeply frustrating style of rhetoric where he is always the synthesis to a traditional thesis-antithesis argument.

These are mere pet peeves. More broadly, I find the president's faith in the efficacy and wisdom of top down, government solutions to be misplaced, and I think that this core misjudgment colors much of his policy agenda.

But in terms of policy, if I had to point to one particular issue that irritates me most, my largest qualm with the current administration would be its consistent focus on policies that actually serve to make it more difficult (or less desirable) for private businesses to hire people.

For the most part, I buy into Tyler Cowen's arguments about how structural problems are the main source of our continued unemployment woes. But the president's policies and policy preferences have consistently made the issue worse. You can argue that some of these laws were genuinely good ideas in isolation. Indeed, some may have made perfect sense in a time of economic strength. But that is not where we stood in 2009, and it's not really where we stand in 2014. Here's my list of things that serve to cool the climate for hiring and employment expansion. These are just off the top of my head; we could add to this list going forward. (Note: I will not be engaging with the wisdom of the policy other than its potential employment effects.)

- Lilly Ledbetter Fair Pay Act: This law essentially increased the statute of limitations on pay discrimination suits from 180 days from the "discriminatory decision" to 180 days from any paycheck associated with the discrimination. Businesses may decide that they would rather not hire additional employees if they may becomes sources of litigation, and this law made litigation immensely easier.

- Paycheck Fairness Act: This is essentially the next step after the Lilly Ledbetter law, and takes that logic much, much further, dramatically increasing the difficulty for companies in pay inequity lawsuits. With the risks of wage discrimination suits increasing (higher thresholds mean more likelihood of success for prospective plaintiffs, who will file more suits), it may make more sense simply to avoid expansion and hiring entirely.

- Push for a minimum wage hike: This one is straightforward, in that it directly increases the cost of hiring a new worker and the costs of employing people at the minimum wage at all. Employers can easily respond by making one-time capital investments to automate their processes or simply by hiring fewer workers.

- Appliance efficiency standards: I use this one as representative of most of Obama's minor environmental regulations, but they add up. These efficiency standards cut into company margins because companies are forced to spend more on development, which cut into potential hiring or expansion. (They also may drive up prices, but that is a different issue.)

- Keystone XL Pipeline: The Keystone XL Pipeline has become symbolically important and remains so for many on the environmental Left. Its approval would create 20,000 jobs. It remains in legal limbo.

And, of course, the big kahuna:

- Patient Protection and Affordable Care Act (PPACA): The employer mandate dramatically drives up the cost of hiring new workers. The "full time hours requirement" incentivizes employers to reduce employee hours and avoid bringing on new full-time workers. The increased mandatory benefits--like birth control--drive up the price of insurance, which further increases the cost of employment.

I love the metaphor of regulations as "pebbles in a stream", in that no one regulation is going to negatively affect a business, but a whole slew of them serves to depress economic activity. I don't think the Obama Administration sees it this way; I think they see their regulations as smoothing out the rough edges of capitalism and making it work better. The regulations, on their own, might be a good idea. Indeed, I make no argument (here) about the relative overall merits of any of these policies; all policy decisions are tradeoffs between multiple priorities. But in a time of great pressure on the job market, they do not make sense if our goal is to keep people working and prevent the suffering that is long-term unemployment and the tragedy that is human capital depletion. And I remain unconvinced that President Obama, for all of his rhetoric about getting people back to work, really gets that.

A Defense of Federalism

A friend of mine offered an interesting observation the other day: if federalism in the United States was merely a vestigial byproduct of Britain's "haphazard" colonial policy in the early modern period, then it really cannot be defended by an appeal to its historical wisdom.

This critique is largely correct, as far as I can tell, and is in keeping with the spirit of the Fallacy of Chesterton's Fence.

In the matter of reforming things, as distinct from deforming them, there is one plain and simple principle; a principle which will probably be called a paradox. There exists in such a case a certain institution or law; let us say, for the sake of simplicity, a fence or gate erected across a road. The more modern type of reformer goes gaily up to it and says, "I don't see the use of this; let us clear it away." To which the more intelligent type of reformer will do well to answer: "If you don't see the use of it, I certainly won't let you clear it away. Go away and think. Then, when you can come back and tell me that you do see the use of it, I may allow you to destroy it."

This paradox rests on the most elementary common sense. The gate or fence did not grow there. It was not set up by somnambulists who built it in their sleep. It is highly improbable that it was put there by escaped lunatics who were for some reason loose in the street. Some person had some reason for thinking it would be a good thing for somebody. And until we know what the reason was, we really cannot judge whether the reason was reasonable. It is extremely probable that we have overlooked some whole aspect of the question, if something set up by human beings like ourselves seems to be entirely meaningless and mysterious. There are reformers who get over this difficulty by assuming that all their fathers were fools; but if that be so, we can only say that folly appears to be a hereditary disease. But the truth is that nobody has any business to destroy a social institution until he has really seen it as an historical institution. If he knows how it arose, and what purposes it was supposed to serve, he may really be able to say that they were bad purposes, that they have since become bad purposes, or that they are purposes which are no longer served. But if he simply stares at the thing as a senseless monstrosity that has somehow sprung up in his path, it is he and not the traditionalist who is suffering from an illusion.

British settlement of the colonies was haphazard. Colonies were granted to proto-corporations (the Virginia Company) and religious dissidents who had well-connected parents (William Penn), among others. Each colony established its own means of governance, and these established power-holders jealously guarded their prerogatives throughout the Revolutionary Era. The resulting compromises created the United States and its constitution. So my friend is on solid ground, as far as I can tell from the history: historical defenses of federalism are not enough, considering federalism's accidental origins. To be persuasive, we must dispense with the constitutional, historical argument--as much as I like them in general--and look for more modern sources of legitimacy.

So, with this discussion in mind, I have devised a list of seven reasons to support federalism whenever we can. None of these rely on the history of federalism or a tradition: they are positive arguments in favor of federalism on the merits. (All of these concepts could be expanded out into longer, more researched pieces. But for a blog post, I think this is a reasonable starting point.)

1. The states produce the Electoral College, which forces our presidential candidates to appeal more broadly.

People often criticize the Electoral College because it limits our elections to ten or twelve competitive states, rather than allowing everyone's votes to "count." After all, if you're not in Ohio, or Florida, or Virginia, or Pennsylvania, your vote is meaningless, because your state is uncompetitive.

I believe that this perspective is a case of being overwhelmed by the foreground and then losing the key background. The "unseen" element of the Electoral College is how it forces a presidential candidate to be more inclusive than she would be otherwise. Imagine a world where a candidate could spend their entire campaign simply focused on major cities. She could offer lavish housing subsidies, transit subsidies and other policies, funded on the backs of rural voters. (One could argue that we have this now, with the Democrats' focus on urban voters and the Republican focus on rural voters. But this would overstate the case substantially; Democrats still win in less urban places like Vermont and Wisconsin, and Republicans still win majorities in places like Phoenix and Fort Worth.)

The reason why is because there would be little risk in "going for broke" after any constituency; so long as you could get your 50%+1, you would win elections. But the Electoral College forces a more subtle approach. States have broader interests than narrower geographic constituencies, and thus serve as a safeguard from this sort of single-interest pandering. A full-on rural strategy for the GOP would risk current GOP strongholds like Arizona and Texas. Likewise, a full-on urban strategy for the Democrats would risk places like Vermont and Iowa. This forces the parties to create broader platforms.

Thus, campaigning in swing states rather than in target areas forces a candidate to have a broader appeal. Your vote matters as a threat if you live in one of those other states; it is the Electoral College that prevents candidates from going extremely hard for one group at the expense of all others. This is not direct representation, but for the greater good, it is probably a more useful impact than having one meaningful vote out of 130 million cast.

(Generally, I would throw this argument into one of many that I would make about the dangers of pure democracy and the importance of small-r republicanism. Democracy without safeguards is dangerous.)

2. Independent, strong states can serve as "laboratories of democracy" that offer us the chance to experiment with different methods to solve complex problems.

Louis Brandeis' famous dissent in New State Ice Co. v. Liebmann (1932), I think, covers this argument better than I ever could (for liberal ends, even!). So I'll excerpt it at length:

There are many men now living who were in the habit of using the age-old expression: "It is as impossible as flying." The discoveries in physical science, the triumphs in invention, attest the value of the process of trial and error. In large measure, these advances have been due to experimentation. In those fields experimentation has, for two centuries, been not only free but encouraged. Some people assert that our present plight is due, in part, to the limitations set by courts upon experimentation in the fields of social and economic science; and to the discouragement to which proposals for betterment there have been subjected otherwise. There must be power in the States and the Nation to remould, through experimentation, our economic practices and institutions to meet changing social and economic needs. I cannot believe that the framers of the Fourteenth Amendment, or the States which ratified it, intended to deprive us of the power to correct the evils of technological unemployment and excess productive capacity which have attended progress in the useful arts. 

To stay experimentation in things social and economic is a grave responsibility. Denial of the right to experiment may be fraught with serious consequences to the Nation. It is one of the happy incidents of the federal system that a single courageous State may, if its citizens choose, serve as a laboratory; and try novel social and economic experiments without risk to the rest of the country [emphasis added].

Brandeis was writing about experimentation as a way out of the Great Depression, in a year before most people thought of using the federal government aggressively to combat it. But we can extend his overall logic to other issues. It is good that individual states could have the power to try new things. We don't necessarily have the answer to every problem we face, and having 50 "laboratories" to test things out will give us much more information than minimizing the potential of the states and moving closer towards one-size-fits-all centralization and standardization. If something fails, it has only affected one state rather than all of them. (This is one of many reasons why conservatives found PPACA to be so much more dangerous than Romneycare: the level of change threatened to destroy what was good in American health care, while Romneycare was quarantined to one state.)

3. As smaller entities, states have a better chance to grasp the peculiarities of their particular circumstances than a distant federal government.

This one is sort of a truism, but I'll propose it anyway: different states are different. The needs of Minnesota differ dramatically from the needs of New Mexico, which differ from the needs of New Hampshire, which differ from the needs of Florida. If we accept this proposition, then there are two ways to address these differences: either have federal employees and the Congress determine what is fair and appropriate for each state, or have the states decide themselves. Broadly speaking, I think we are more likely to serve the needs of those states by delegating the control of those issues and the setting of priorities to the individual states.

This comes up for me all the time living out in Oregon: it really is different out here, and I find it staggering that someone in Washington, DC, living 2,800 miles from here, can possibly be qualified to make many decisions about the daily lives of Oregonians. Even representatives from the state, if they serve for any length of time, will lose touch with a state like Oregon. It is just too difficult to fly out here on weekends. (Perhaps it is different if you live in Delaware, or Virginia, or somewhere near the Beltway. But Oregon is just SO far away.)

4. Increasing the scope of the central government means that it is more likely to struggle to do key functions well.

Every time we expand the role of the federal government, another piece of paper hits the president's desk. His day, however, does not get longer. It remains the same length. There are only three ways a president can address this problem:

- Sleep less.
- Spend less time on every problem.
- Delegate less important tasks to staffers/Cabinet.

All of these things can result in governance problems. If President Obama's only job in 2013 was to deal with the Syria crisis, is it likely that he would have mucked it up as badly as he did? Impossible! If Obama could have managed the development of the PPACA website full-time, could it have failed so spectacularly? Doubtful.

In my judgment, a big reason for executive failures over the last couple of decades has been because presidents have been expected to do and manage so many different things. The more we increase their responsibilities, the more potential failure points exist: the day remains 24 hours long, and we really need more than 6 hours of sleep to function effectively. Limiting the role of the federal government to the things that we think are truly important will decrease the time problem. Delegating more duties and responsibilities to the states is one such way to do this.

5. People prefer to help a friend than a stranger.

I recently saw something very horrible happen to an animal while I was driving in town. It was incredibly sad, and the image stuck with me for several weeks. And yet I eat meat six days per week and think little of the treatment of the animals that I eat. (That treatment is inhumane, almost invariably and inexorably. In theory, I could purchase meat from humane farmers, but even that treatment--and the harvesting of living beings for food--is a fraught, difficult idea.)

I liken this to our public posture in dealing with the disadvantaged. Most of us would help out close family members with money if we knew that it was the difference between their life and death, or their being homeless or in a warm bed. We might even help our neighbors or friends out. But we are unlikely to help people out in other parts of the country, and almost never will help out people living in other countries. (If we are all rationally concerned about welfare maximization, we would give almost all of our money to people in the world's poorest countries, where it would go a lot further. We don't.)

This seems to be a fact of human nature: we support those who are closest to us, and provide less support to those who are furthest away, even if their circumstances are substantially more horrifying. So we should work with that reality: if we aim to be humane and decent to those around us who struggle, we are more likely to have broad support if we localize our charity. The more local our donations are, the more that the donors can see the suffering and the impact of their donations. Bringing things to the local level would convince more people to support programs to assist those in great need. We should appeal to people's instincts to help those who are near, rather than appealing to their intellects to help people who are far away. This is more likely to be successful at the state level than at the federal level, where programs make the victims seem distant by definition. Federalism gives us more opportunities for this sort of local program and community engagement.

6. In a true federal system, states that struggle at governance will see a depletion of their revenues as people and businesses relocate.

Although much discussion of federalism hinges on the "laboratories of democracy" argument, the real strength of federalism is much like the real strength of capitalism: competition allowing for failure. States don't compete for profits, though; they compete for tax dollars. Michael Greve has more on what he calls competitive federalism:

This federalism relies on exit and mobility—of capital, and of labor—as a means of disciplining government. Very roughly, competitive federalism is the federalism we had from the Founding to the pre-New Deal period. Its general theory and contours are straightforward. Matters that are genuinely national should be committed entirely to the federal government. National defense, the regulation of network industries (such as airlines or the internet), and perhaps large-scale redistribution (such as Social Security) are the classic examples. The assignment should be exclusive, so as to avoid the regulatory duplication, gamesmanship, and intergovernmental collusion that characterize our federalism. On the other side, lots of things should be left exclusively to the states—exclusive of any federal regulation, and exclusive of any federal funds. This principle limits the federal government and, more importantly, forces state competition. Each state’s citizens will have to tax themselves for whatever level of public services and redistribution they want. When a state offers a lousy mix of taxes and services, productive citizens and businesses move to a more hospitable jurisdiction. Over time, one hopes, states that don’t give citizens their money’s worth will learn their lesson. 

Greve's broader argument is that we have moved away from competitive federalism towards something called cartel federalism, which could also be Potemkin federalism. In cartel federalism, the federal government actually suppresses the type of competition that federalism should actively promote with its policies of conditional grants and mandates. But that does not mean we should discard federalism entirely; it means we should get back towards a competitive environment.

If a state's policy environment is bad, people and businesses can move out, depriving those state governments of potential revenues. Thus, those state governments are incentivized to establish better environments. (Even a place like California, which has a pretty miserable public policy regime, survives, in my estimation, because the conditions are so great in terms of weather and lifestyle that the costs of bad governance are accepted by residents. North Dakota, for example, could not survive under similar governance.) The power of exit is essential in terms of human freedom and flourishing. America allows for free travel between states, with no papers, as Captain Ramius informs us in The Hunt for Red October. But if the states are all uniform, such freedom is less tangible and meaningful. True "exit" from the policy regime then requires things like visas, passports, and learning a new language. Thus the federal government has no comparable competition as do state governments; we can say that we're "moving to Canada" when the election doesn't go our way, but in reality, that's difficult. It is much easier to move from New Jersey to Pennsylvania.

Moreover, again, much like in the case of the Electoral College, the benefits of this particular feature are somewhat unseen. Even poorer people who cannot afford to relocate would benefit from the effects of the competition between governments, if government becomes more efficient. (And the federal government could, in theory, assist this process with relocation assistance for the long-term unemployed.)

7. The major weakness of federalism has been (appropriately) addressed by the federal government.

I think now that we have addressed the most grievous legal racial inequities in this country, we should support federalism on other issues even more strongly, in that its key weakness was its inability to address longstanding racial prejudice, with a particular emphasis on states with a long history of slavery. The federal government has established that it has an important role to play in the enforcement of legal equality in the realm of race relations. This was a good, necessary change to our federal structure. And while structural and social racial inequities probably still exist, these are less likely to be responsive to government intervention than was a direct change in the legal regime.

Paul Ryan and the Liar Leitmotif

Since the 2012 campaign, I have noticed that many on the Left portray Rep. Paul Ryan (R-WI) as "dishonest" or a "liar." I jokingly have noted that the critique comes from a central, all-controlling hand on the Left, who demands that all criticisms match up. This person offers short, staple critiques of figures on the Right--almost like Wagnerian leitmotifs, if you will--and then all criticisms of that figure need to work off of that leitmotif. Here are a few:

• George W. Bush - stupid
• Dick Cheney - evil
• Paul Ryan - liar
• Michelle Bachmann - crazy
• Sarah Palin - all of the above

I was thinking about this in conjunction with an article that emerged in The Fiscal Times, with the inflammatory headline of "Economics Say Paul Ryan Misrepresented Their Research." The author, Rob Garver, originally wrote that one economist whose research Ryan cited, Jeffrey Brown, noted that "while the [Ryan] paper cites the study accurately in a literal sense, it ignores the caveat that ‘there may also be other factors that would continue to limit the size of the private market even if Medicaid was reformed.'” Jeffrey Brown refuted this:

Speaking of “misrepresentation,” I take issue with your portrayal of my email communication to you as suggesting that Congressman Ryan incorrectly cited my work with Amy Finkelstein of MIT. You provided me the quote from his report and asked me if it was accurate, noting that another academic suggested it may not be. My exact response to you was: “That quote is an accurate representation of our work. My only caveat would be that although Medicaid has this effect, there may also be other factors that would continue to limit the size of the private market even if Medicaid was reformed.” The caveat was provided to help you – as the reporter – to understand the context for the citation in case you wanted to explore the policy implications of our work further and to help you understand why another academic might have felt the quote was inaccurate. But I did not suggest nor do I hold the view that Congressman Ryan “ignored” the caveat, as implied by your writing. Nor, as implied by the title of your piece, do I believe Congressman Ryan “misrepresented” my research. His citation was appropriate. Obviously, the interactions of Medicaid and long-term care are complex, and a full discussion would go far beyond the small summary they provided. But that is true of any summary - indeed, even our own abstract of the paper does not provide that caveat due to word count constraints. In short, I do NOT believe that my work was misrepresented in the Ryan document. Rather, I believe my email was misrepresented in your article.

That is somewhat devastating. When I read that, my thoughts drifted to Megan McArdle's new book about failure, The Up Side of Down. McArdle writes:

While it's undoubtedly true that some reporters consciously repress facts that threaten their prior ideological beliefs, I don't think that's really the issue in most cases. What bias does--in science, in media, in any situation where information is gathered--is affect what questions you ask. (pg. 151)

I love McArdle's framing here, and it allows us to accept that bias is pervasive and real without becoming conspiratorial. It seems very difficult to dispute that Garver was asking questions and looking for information to prove the leitmotif--that Ryan is dishonest. Garver was trying to add to "the pattern," thought he had found something, and went to press. (To his great credit--or to his editor's credit--Garver corrected it rather quickly. But that correction does not refute my point about leitmotifs as anchors or prisms for evaluation.)

I eagerly went to present this example of my leitmotifs theory being validated (confirmation bias is a danger here as well!) to my wife. While I was rambling about this on March 5, I saw this tweet from a liberal on Twitter named Mike Cohen:

@baseballcrank maybe he can break his own record for shameless lying set in 2012!
— Mike Cohen (@mcohen2) March 6, 2014

Note that he immediately goes to the "liar" meme. So I think there is something to this. Somewhere, somehow, "Paul Ryan is a liar" became the chosen line of attack from the Left. Thoughtful liberal commentator Jonathan Chait, I think, got part of the way to the reality when evaluating the emergence of the "Paul Ryan liar" leitmotif. He wrote,

A week ago, Paul Ryan’s political assets included — alongside his chiseled torso, plainspoken Midwestern demeanor, and the unshakable loyalty of the entire Republican Party — a firm reputation for honesty among the mainstream media. That reputation has suffered a massive, swift erosion. News stories about his speech at the Republican National Convention focused on its many rhetorical sleights of hand. Over the weekend, the revelation that he dramatically misstated a marathon time added a crucial, accessible piece of evidence to the indictment. Now liberals are calling him “Lyin’ Ryan” — a nickname that, a few weeks ago, would have seemed silly, like “Wimpy Palin.” Now mainstream pundits are defending Ryan with versions of the “well, all politicians fib” defense. Given that this constituency was once portraying Ryan as unusually honest, this represents a huge retreat for his political brand. 

[snip]

The thing about Ryan is that he has always resided in a counter-factual universe. He is a product of the hermetically sealed right-wing subculture. Many of the facts taken for granted by mainstream economists have never penetrated his brain. Ryan burst onto the national scene with a dense, fact-laden attack on the financing of Obama’s health-care bill that was essentially a series of hallucinations, pseudo-facts cooked up and recirculated by conservative apparatchiks who didn’t know what they were talking about or didn’t care. His big-think speeches reflect the influence of fact-free conservatives and collapse under scrutiny.

One of my tenets of this blog is that I am trying to be like Arnold Kling, and to take the most charitable view of people with whom I disagree. I reject most of Chait's contentions here, but buried beneath the criticisms is a good point, in my judgment.

Prior to the 2012 campaign, Ryan's political brand--his "homestyle," if you will--was "serious" and "thoughtful." The media latched onto this, because Ryan presents himself a certain way, and also, because President Obama offered the same appraisal. Way back a million years ago, in early 2010, Obama noted, "You don't get a lot of credit if I say, "'You know, I think Paul Ryan is a pretty sincere guy and has a beautiful family.' Nobody is going to run that in the newspapers." (One could argue that Obama's comments established something of a "permission structure" on the Left and in the media for acknowledging Ryan as "sincere" or "well-intentioned." Such a concession could easily be construed as an argument against interest.)

In the heat of a tough campaign, however, that sort of thing goes away. The minute Ryan was chosen as the GOP nominee for vice president, "sincere" was not going to hold up. Paul Ryan is not John McCain: a war hero with an incredibly strong, well-established national brand as a "maverick" that wasn't going to be impeached by political attacks. Ryan was well-known among the politically engaged, but was relatively obscure otherwise. (Note: McCain lost in 2008 because no Republican was ever going to win as the incumbent party in the middle of a financial crisis brought about by banks. Jay Cost's appraisal from October 2008 still strikes me as the best read of how that played out.)

Ryan, then, enters the arena with a style of sincerity and thoughtfulness... but premises that are almost universally disputed by the Left. Liberals like Jonathan Chait call them "hallucinations" and "pseudo-facts," but if we strip that down to its core, it is essentially that the Right and the Left argue from very different core principles and premises.

As befitting his style, Ryan's speeches are somewhat policy-heavy. He presents math and "facts" in a way that is difficult to ridicule as "stupid," because he is articulate. Here's a classic example from his 2012 convention speech (more on the criticisms of the convention speech and fact-checkers in a later post):

You see, even with all the hidden taxes to pay for the health care takeover, even with new taxes on nearly a million small businesses, the planners in Washington still didn't have enough money. They needed more. They needed hundreds of billions more. So, they just took it all away from Medicare. Seven hundred and sixteen billion dollars, funneled out of Medicare by President Obama. An obligation we have to our parents and grandparents is being sacrificed, all to pay for a new entitlement we didn't even ask for. The greatest threat to Medicare is Obamacare, and we're going to stop it.

This was an argument that was floating around on the Right for a while, but the mainstream media did not really pick it up. So hearing it from Ryan--thundering from the stage in Tampa--as fact, was galling. The reaction to this claim was uniform on the Left: Ryan is just making this up! Let's work through some specific responses, just to this particular claim. Here's Talking Points Memo:

Obama did use those Medicare savings -- in the form of targeted cuts in payments to providers, not in benefits to seniors -- to pay for the health care law. Ryan's budget calls for using them to finance tax cuts for wealthy Americans, and deficit reduction. But by now calling to restore that spending commitment to Medicare, Ryan and Romney are pledging to hasten Medicare's insolvency by many years.

CBS offers a similar take:

The Romney campaign points to a CBO report showing that if the health care law was repealed, spending for Medicare would increase by an estimated $716 billion from 2013-2022. The president's health care reform law is indeed paid for in part by reducing Medicare's expected rate of growth between now and 2022. According to data from the Kaiser Foundation, however, the reductions come primarily from cuts to Medicare Advantage plans, as well as in hospital reimbursements and in payments to other providers. The Obama administration casts them as savings that would streamline the system, reduce waste and fraud, reinforce the Medicare trust fund and extend its lifeline. It does not limit access to benefits for Medicare recipients, and actually offers new preventative care benefits, as well as increased prescription drug coverage. Republicans, however, argue it creates disincentives for hospitals and doctors to accept new Medicare patients.

Here's the NY Times:

The $716 billion cut to Medicare that President Obama made would reduce payments to health maintenance organizations, hospitals and many other health care providers.

And the Washington Post:

Under the health-care law, spending does not decrease in Medicare year after year; the reduction is from anticipated levels of spending in future years. Moreover, the “cuts” did not come at the expense of seniors. The savings mostly are wrung from health-care providers, not Medicare beneficiaries — who, as a result of the health-care law, ended up with new benefits for preventive care and prescription drugs.

Almost an echo chamber effect, no? To these fact checkers, the facts are not that PPACA reduced spending to Medicare Advantage. The facts are that those were "targeted cuts" to health care providers. There were several similar claims in Ryan's speech, which was a laundry list of arguments that had floated around on the Right. The Left rejects those arguments as invalid, and cannot see why any intelligent person would believe them. But Ryan is seen as intelligent. There are, then, two conclusions you can draw from those facts:

• Public policy is complicated, and there are many ways to look at the same sets of facts. Politicians will attempt to present those facts in a way that is most favorable to their own positions.
• Ryan is a liar.

As a pejorative, "liar" fits him well. Ryan certainly presented the facts in a way that was most favorable to his side. Thus the easiest rebuttal is to claim that Ryan is willfully misrepresenting the truth, not that he is a politician trying to make a political argument.

Whether you agree with the policy or not, the Affordable Care Act reduced funding to Medicare Advantage. That's a (narrow) fact. One can dispute whether this was a good idea, whether this constitutes "raiding Medicare," whether reducing payments to providers results in reduced benefits to customers, and a whole bevy of other issues. But it cannot be a "lie" to say, as Ryan did, that Obama cut Medicare to finance a new entitlement. Ryan is failing to paint both sides, but he is not lying. Here's another example of a politician speaking like a politician:

Today, women make up about half our workforce. But they still make 77 cents for every dollar a man earns. That is wrong, and in 2014, it’s an embarrassment. A woman deserves equal pay for equal work. She deserves to have a baby without sacrificing her job. A mother deserves a day off to care for a sick child or sick parent without running into hardship – and you know what, a father does, too.

President Obama is not at all lying here. He is not presenting the opposing case, which would complicate his number greatly, but he is not lying: it is perfectly reasonable to believe that there is a persistent wage gap brought about by overt and structural discrimination, and there is social science research pointing to the 77 cent figure. You could also reject much of his conclusion, as Reihan Salam does. Note Salam's takeaway, though:

In discussing the gender gap, the president has (a) oversimplified and misdiagnosed the underlying problem, (b) obscured the gains that have been made by women in the marketplace, and (c) made claims regarding what public policy can achieve that are unrealistic and potentially counterproductive.

Salam's opinion of the president's argument is that it is unpersuasive. But he doesn't call it a lie; to Salam, it's just a bad argument.

There is no difference between the veracity of those two arguments. Yes, according to a study, on average, women make 77 cents for every dollar men make. Yes, the ACA moved money away from Medicare Advantage. On their own, those facts are meaningless. What you draw from those facts depends on your premises, context, and worldview. (For its part, Politifact rated the President's claim as "mostly true" and Ryan's as "mostly false." Unsurprising.)

Politicians should be given a great deal of latitude to make their arguments, and people should be willing to accept that politicians will slant the truth. But once a narrative is established, the media will anchor to it and work tirelessly to confirm it. Paul Ryan is no different than anyone else, but the narrative must go on.