July 03, 2017
Dean Baker
HuffPost, July 3, 2017
After the election last fall many people were furious that enough people had voted for Donald Trump to put him in the White House and allow him to place second in the popular vote. In particular, Trump relied on a larger than usual Republican majority among white working class voters, defined as whites without college degrees.
Trump carried white working class women by a margin of 53 to 39. He carried white working class men 71 to 23 percent, an incredible margin of almost 50 percentage points. This has caused much anger to be directed at the white working class (WWC), at least among people who didn’t want to see Donald Trump in the White House.
Remarkably, if we judge actions over words, it would seem that no one is angrier at the white working class than the Republicans in Congress. How else can someone explain the health care bill approved by the House as well as the one now being considered by the Senate?
The centerpiece of both of these bills is a $700 billion tax cut over the next decade, the vast majority of which will go to the top one percent. There is nothing for the white working class in this one.
But the white working class will very much be hit by the cuts in Medicaid that will be the major offset for the tax cut. The plan being considered by the Senate cuts projected spending by more than 10 percent over the period from 2018 to 2026, but the cuts increase in size each year. By 2026, the last year in the Congressional Budget Office’s (CBO) projections, the cuts will be more than 25 percent. They will get even larger in the years beyond the forecasting horizon.
Millions of moderate income people in the WWC now have insurance because of the expansion of Medicaid. This expansion was especially important in extending coverage in Kentucky and West Virginia, both overwhelmingly white states that went for Trump by large margins. Trump defeated Clinton 63 to 33 percent in Kentucky and 69 to 27 percent in West Virginia.
West Virginia’s Medicaid enrollment went from 354,000 in 2013, before the expansion, to 562,000 in the most recent data, almost one third of the state’s population. In Kentucky, enrollment more than doubled from 607,000 in 2013 to 1,248,000 in the most recent data, also almost a third of the state’s population. If a plan like either the House or Senate bills takes effect, many of the Trump voters in these states will again find themselves uninsured.
But Medicaid cuts are only one way in which congressional Republicans are trying to inflict pain on Trump voters. They also are both cutting back the subsidies for insurance purchased in the health care exchanges, and perhaps more importantly for Trump voters, they are hugely changing the rate structure.
The structure put in place by the Obama administration benefited older Pre-Medicare age people at the expense of the young. It limited insurers to a premium ratio of three to one for the 55 to 64 age group relative to the 20 to 40 age group. This implied a subsidy from younger people to this older group since the actual ratio of costs is closer to 4.5.
(The question of who is getting a subsidy is actually more complicated than implied by these ratios. The majority of people in both age groups are relatively healthy. However there is a larger percentage of unhealthy people with high bills in the older grouping. The question is whether we make older healthy people cover the costs of less healthy people or distribute these costs among the population as a whole.)
Anyhow, the Republican bills move away from this rate structure and allow a ratio of five-to-one. According to the projections from the CBO, a 64-year-old with an income of $56,800 in 2017 can expect to see the premium for a sliver plan jump from $6,800 with Obamacare to $20,500 with Trumpcare. CBO projects that $8,500 of this increase is due to the loss of the Obamacare subsidy, while $5,200 is due to the higher plan price with the new five-to-one ratio.
The costs for older insurees should be especially important for Trump voters, because this is the group where he had the biggest vote margin. While Trump lost the under 40 vote by double digit margins, he carried the 50 to 64 age group by a margin of 52 to 44 percent. So it looks like the Republicans are prepared to make these people pay a real price for their votes.
To be clear, there are tens of millions of African Americans and Hispanics who will also be hit by the cuts being proposed by the Republicans. There are also plenty of white people who did not vote for Trump who will be hit by these cuts. But there is at least a small irony in the fact that millions of Trump voters will be frontline losers if Trumpcare gets signed into law.
