Academic supporter of Obama-endorsed conservative Senate health care reform bill paid $400k by Obama admin

Call him the Cadillac Consultant. He’s Jonathan Gruber. One of the most quoted defenders of President Obama’s proposal to tax so-called “cadillac” health care plans, and a big defender of the more-conservative Senate version of health care reform. He also has secretly received nearly $400,000 from the Obama administration to consult on… what? Health care reform.

Yesterday, I did a post on President Obama’s support for the Senate proposal to tax expensive health care plans. I linked to an article in the Washington Post, which had strong critiques of that so-called “cadillac” tax by Robert Reich and Rep. Joseph Courtney (D-CT). Courtney noted this tax violated a campaign pledge made by Obama. The Post article included a defense of the policy by an academic named Jonathan Gruber, who dissed any criticism:

Jonathan Gruber, an MIT economist and a leading proponent of the new tax, dismisses these concerns. Even if the tax hit some high-cost plans that are not particularly lavish, it would still goad employers generally to seek lower-cost plans, he contends. “The argument that because it won’t cause efficiency in every case, we should therefore not do it, is a dumb argument,” he said.

Bringing the plans below the tax threshold would require only slightly higher deductibles, he said, enough to make people more cost-sensitive but not enough to make them skip necessary care. “If you take people at the level where they’re spending $23,000, that’s not skimpy insurance, and . . . if you raise their co-pays or deductibles, that’s not going to adversely affect their health,” he said. “There’s literally no evidence out there that people are going to suffer.”

Funny thing, Jonathan Gruber isn’t just an “MIT economist and a leading proponent of the new tax.” He’s a highly-paid health care reform consultant to the Obama administration.

Marcy Wheeler reported on this development last night (based on a post over at DailyKos):

MIT health economist Jonathan Gruber has been the go-to source that all the health care bill apologists point to to defend otherwise dubious arguments. But he has consistently failed to disclose that he has had a sole-source contract with the Department of Health and Human Services since June 19, 2009 to consult on the “President’s health reform proposal.”

He is one source for the claim that the excise tax will result in raises for workers (though his underlying study is in-apt to the excise tax question). He is the basis for the argument that the Senate bill reduces families’ risk–even if it remains totally unaffordable.

To date, Marcy reports that Gruber has been paid $392,000 by the Obama administration. One of Marcy’s links is to an op-ed Gruber wrote for the Washington Post on December 28, 2009 titled “‘Cadillac’ tax isn’t a tax — it’s a plan to finance real health reform.” The byline reads:

The writer is a professor of economics at the Massachusetts Institute of Technology.

Yes, but he’s also a well-paid health care reform consultant to the Obama administration. What would happen to his nearly $400,000 contract if he came out publicly opposed to what the President is proposing? We don’t know, because he never disclosed it.

Gruber defends himself to Ben Smith at Politico today by making two key points:

1. He says he has always disclosed his conflict of interest to reporters “whenever they asked.” Well, reporters would need to know that you had a conflict in order to ask about it. The only person in the relationship who knew Gruber had a conflict was Gruber himself. And he wasn’t telling.

2. Gruber tells Ben that any public advocacy he did on behalf of Obama’s preferred Senate bill was on his own time and his own dime. That nearly $400,000 that the Obama administration was paying him to help them on that very same topic had nothing to do with his public support of the Obama administration’s proposals.

Washington Post writer Ezra Klein cited Gruber on October 21:

Earlier in the day, I’d been talking to MIT economist Jon Gruber about this issue. “There are a few things economists believe in our souls so strongly that we have a hard time actually explaining them,” he said.

Not just an “MIT economist” you were talking to, Ezra.

The Post and many others have been punk’d by Gruber, including the New York Times, Wall Street Journal, Boston Globe, CNN, NY Daily News, Politico, the Atlantic, the Economist, and the Guardian.

He is probably a very smart guy. But, Gruber is publicly pushing a policy position that he is privately being paid a ton of money to assist, without disclosing that fact. That is just wrong. I expected more from our side.


On October 27, 2010, Joe was one of five bloggers who interviewed President Obama. Joe is a DC-based political consultant with over twenty-five years of experience at both the state and federal level. Joe has managed political operations and legislative efforts for both candidates and issues-based organizations. For seven years, he was the Director of State Legislation at Handgun Control, Inc. He served as that organization's first Political Director during the 2000 cycle. Joe is a graduate of the University of Maine School of Law. In addition, he has a Masters in Public Administration from Lehigh University and received his B.A. from the University of New Hampshire. Joe also has a fun dog, Petey, a worthy successor to Boomer, who got Joe through eight years of Bush and Cheney. Joe likes to think he is a world class athlete having finished the 2005 Chicago Marathon in the time of 4:10. He has completed six other marathons as well -- and is still determined to break the four hour mark.

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