THERE IS NOTHING MORE PERMANENT THAN A TEMPORARY ARRANGEMENT.

That's an aphorism that might go back to the Scottish Enlightenment, and Reason's Christian Britschgi invokes Milton Friedman's use of it to open his discussion of the latest Washington shutdown drama.

Milton Friedman liked to quip that there's nothing more permanent than a temporary government program.

We're seeing more evidence for this adage as the government shut downs following Democrats' refusal to vote for a spending bill that did not include an extension of "temporary" Affordable Care Act (ACA), aka Obamacare, subsidies passed during the pandemic.

Those enhanced subsidies were passed as a temporary measure as part of the $1.9 trillion American Rescue Plan Act in March 2021, and then extended through the end of 2025 by the so-called Inflation Reduction Act (IRA).

Obamacare always provided subsidies for individuals to purchase insurance plans on ACA marketplaces set up by the law. The 2021 Act passed enhanced subsidies eliminated the income eligibility caps for those subsidies and also made them more generous for current recipients.

Making these subsidies permanent would not be cheap. The Congressional Budget Office estimates that it would cost $340 billion a year.

On the flip side, letting the tax credits expire would result in about 1.6 million higher-income earners losing subsidies completely. Millions more would continue receiving a smaller subsidy and see their premiums rise as a result.

We've long understood that the Patient Protection and Affordable Care Act was two lies for the price of one, while the Inflation "Reduction" Act did only in the sense that the second derivative was negative.

At Cold Spring Shops, we've also understood that the shutdown-continuing resolution "crises" are Business As Usual.

Ronald Reagan once had his staff pile up the binders containing an early continuing resolution on a table in the well of the House, in order to warn Congress that he would veto any subsequent bills.  I don't know whether he made good on his threat; I know that such bills, cobbled together with insufficient time to read them, are regular features these days; and that attempts to give Members of Congress time to read them, or to limit the injection of crap sandwiches or sprinkles, depending on your perspective, through House rules, have been honored more in the breach than in the observance ever since.

So it is as playoff baseball gets under way.

Democrats attempted to use what leverage they had to pass a more permanent extension of the "temporary" subsidies.

Republicans were not inherently opposed to extending four-year-old "temporary" subsidies, with some GOP lawmakers proposing to extend them by at least one year. But Republican leadership in the Senate insisted on funding the government first and then negotiating on health care subsidies.

With the federal government partially shuttered for the time being, both parties are now rolling out their well-worn attack lines. Democrats complain Republicans are trying to take away people's health care. Republicans say Democrats are trying to give health care to illegal immigrations.

That the expiration of "temporary" ACA tax credits resulted in a government shutdown shouldn't surprise anyone, says Michael Cannon, director of health policy studies at the Cato Institute.

"The fact that [the temporary subsidies] create a phony crisis every couple of years when they expire, from a political perspective, is a feature, not a bug. This is how spending grows," he says.

Democrats are particularly insistent on preserving subsidies that were pitched as a temporary COVID measure because they help hide the costs of Obamacare, he says.

The 2010 law required health insurance companies to cover certain "essential health benefits." It also forbade them from refusing to cover, or charging higher premiums to, people with more expensive medical conditions.

The twin effect of these mandates has been to raise premiums generally, particularly for healthier people.

And that, dear reader, is why the Patient Protection and Affordable Care Act is two lies for the price of one, all the caterwauling about adverse selection notwithstanding.  No price discovery, no affordability.  But plenty of opportunities for the hotheads to spout off.

What House Republicans wanted was a short-term, clean continuing resolution to buy more time so that both parties can hash out the final details of some 12 appropriations bills that are on the docket.

Instead, Democrats shut down everything so that illegals can get health care, NPR refunded, and the rural healthcare funds extinguished.

Republicans have working, if not governing, majorities in both houses of Congress, and they've had all summer to get those regular order appropriations together by now.  "Last Christmas, the outgoing Congress was able to avoid a government shutdown by passing yet another continuing resolution, one that in the way of such things was almost as well stuffed as the Christmas goose."

What is more likely by Christmas 2025, the twelve or fourteen regular order appropriations or the Chicago Bears clinching a playoff spot?  Stephen "Vodka Pundit" Green thinks the Democrats erred in forcing this shutdown.  He has not yet, however, twigged to the reality that the showdowns are Business as Usual.  "For one thing, just like the House, the Senate has largely abandoned traditional lawmaking and budgeting. The result is one showdown after another over yet another continuing resolution to kinda-sorta keep the listing Titanic afloat for a few more weeks or months."

It might still be the case, as Reason's J.D. Tuccille notes, that when the presidency and the legislative majorities are notionally on the side of reducing the scope of the federal government, and the party that favors expanding government hopes to somehow continue the expansion by shutting it down, perhaps some reduction will take place.  "Following the relative disappointment of the Department of Government Efficiency, we should seize any opportunity to shrink the government that we can. If that opportunity comes in the form of one of the rare government shutdowns that's actually meaningful, so be it."

I'm pessimistic.  "Democrats like to print money and buy off preferred constituencies, and yet, the track record in this century suggests Official Washington prefer these shutdown dramas to regular order."

It is a fraud.

The immediate increase in policyholders' premiums helps explain why Democrats felt this was an issue they could get political mileage out of during a shutdown fight. It also explains why plenty of Republicans are willing to negotiate on yet another extension of "temporary" enhanced subsidies to prop up a law the party uniformly opposed when it was passed.

Cannon, in contrast, says the subsidies should be allowed to lapse. That would force policymakers to actually deal with the regulations driving up the cost of health insurance premiums, as opposed to just hiding the cost in the federal budget.

"Everything in U.S. health care is a fiscal illusion. They want to keep hiding the cost of Obamacare's health insurance regulations," says Cannon.

Brace yourselves.  "The good news: something that cannot go on forever, won't. The bad news: when bond traders cease to buy Treasuries, none of the oratory of Barack Obama or the bluster of Donald Trump or the caffeinated shouting of Joe Biden will have any effect."

How close is that real debt ceiling?  "It does not reassure the rating services that Congresses, repeatedly, Democrats, Republicans, divided, have not passed a regular order appropriation since 1996 or so, nor have we seen anyone doing something serious about those Social Security and Medicare "trust funds" being depleted."