Nixon: Welfare, School Desegregation, Health

Research tips

For next time:

• Nooree Lee, "The Congressional Budget and Impoundment Control  Act of 1974, Reconsidered,"  Harvard Law School Federal Budget Policy Seminar, Briefing paper 34, April 29, 2008.  COPY ALSO AVAILABLE ON CANVAS

Unanticipated consequences 

In 1935, members of Congress designed ADC as a modest, temporary way of keeping mothers -- mostly widows -- at home.  It remained a modest program through the 1950s. In 1962, the program -- now Aid to Families with Dependent Children -- became a way to rehabilitate the poor to join the workforce (Gillon, p. 60)

During the 1960s:

• CAPs and legal services programs helped the poor understand their rights (Gillon 68);
• Welfare rights activism took off;
• Court cases expanded rights for AFDC recipients;
• Anyone receiving cash assistance through AFDC was automatically enrolled in Medicaid, providing free health insurance for low-income parents and their children.

• The Family Assistance Plan
• NIT and Constructive Republican Alternative Programs (Moynihan 65)
• Nixon triangulated (Moynihan 68-69)
• Specifics of the Policy

• Guaranteed minimum income: The plan would have provided a federal minimum income floor for families with children, which was an innovative step toward a negative income tax.
• Expansion to the "working poor": Unlike AFDC, which primarily served unemployed families, the FAP was to provide benefits to the "working poor"—families with low-wage earners.
• Work requirements and incentives: The FAP included a work requirement for able-bodied recipients, but also financial incentives to work. Families could keep the first portion of their earnings without a reduction in benefits, with benefits decreasing gradually as income rose.
• National standardization: The FAP aimed to create a single, national standard for family assistance, addressing the wide variation in benefit levels across states under the AFDC system.

Despite passage in the House, the plan fails because of opposition from both sides. Conservatives see it as too expensive -- Nixon acknowledges that it would "cost more" at first -- while many liberals deem guaranteed income level to be too low. 

But...FAP leads to EITC

Moynihan gets into political hot water:  The 1965 Moynihan Report and  The "benign neglect" memo (1970, p. 7)

Desegregation

On the one hand, Nixon tries to appeal to white Southerners with rhetoric and efforts to appoint Souther justices.  On the other...

"You will be better advised to watch what we do instead of what we say"  -- John N. Mitchell 

Health Insurance

An unanticipated consequence of Medicare is that it fuels medical price inflation. 

Nixon proposes Obamacare 1.0.  Both involve employer-provided insurance -- path dependency.

Ted Kennedy later regrets sinking it.

Gary L. Freed, Anup Das, "Nixon or Obama: Who Is the Real Radical Liberal on Health Care?" Pediatrics 136 (August 2015)

Nixon National Health Strategy 19714	ACA 20103,6
National Health Insurance Partnership	Employer-Shared Responsibility
(1) Require employers to provide basic health insurance coverage for their employees, with the minimum requirement being to pay for hospital services, inpatient and outpatient physician services, full maternity care, well-infant care, immunizations, laboratory services, certain other medical expenses, and minimum of $50 000 in catastrophic coverage	(1) Employers with at least 50 full-time employees must offer health coverage that is affordable and provides a minimum level of benefits to at least 95% of their employees and dependents. None of their employees can receive a premium tax credit to help pay for coverage on a marketplace; if so, the employer must make a shared responsibility payment
(2) The costs for this would be shared by employers and employees, with a 35% ceiling on employee contribution for the first 2.5 years, and 25% after that	(2) Affordable coverage is defined as ≤9.5% of an employee’s annual household income
(3) Keep the range within which benefits can vary narrower than it has been, so competition between insurance companies will be more likely to compete on overall price of contracts	(3) A plan provides the minimum level of coverage if it covers at least 60% of the total allowed cost of benefits
	(4) Small employers are exempt from the coverage requirement and allow them to purchase insurance through the small business health options program
(4) Require the establishment of special insurance pools in each state that would offer insurance at reasonable group rates to people who did not qualify for other programs: the self-employed or poor-risk individuals
	(5) Small employers with up to 25 employees and average annual wages less than $50 000 are eligible to receive a tax credit
Medicaid	Medicaid Expansion
(1) Implement the Family Health Insurance Plan to meet the needs of poor families by eliminating the part of Medicaid that covers most welfare families. In its place, develop a new insurance plan that is fully financed and administered by the federal government. This federal health insurance plan would provide insurance to all poor families with children headed by self-employed or unemployed persons whose income is below a certain level. As family income increases, the cost-sharing would increase through a graduated schedule of premium charges, deductibles, and coinsurance payments	(1) Provide funding to states to expand their Medicaid programs to cover non–Medicare-eligible individuals younger than 65 with incomes up to 133% of the federal poverty line
	(2) Guarantee all newly eligible individuals a benchmark insurance package that includes the minimum benefits for plans in the marketplace
	(3) Finance the coverage for the newly eligible with federal dollars until 2016, and then gradually decrease the federal contribution to 90% by 2020
	(4) Increase Medicaid payments in fee for service and managed care for primary care services to 100% of Medicare payment rates
Nixon Comprehensive Health Insurance Plan 19745
Employee Health Insurance
(1) Require all employers to offer all full-time employees health insurance, with employee contribution at 35% for 3 years, and then 25% subsequently
(2) Use federal subsidies to ease initial burden on employers
(3) Specific deductible, coinsurance, and out-of-pocket limits under this insurance plan
Assisted Health Insurance
(1) Replace state-run Medicaid by implementing a federally administered insurance plan to cover anyone not offered coverage under the Employee Health Insurance or Medicare
(2) Individuals could also get this if they cannot get coverage at reasonable rates from other options