Health Care Ruling Turns 'Tax' Into A Four-Letter Word (The Note)

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By MICHAEL FALCONE ( @michaelpfalcone ) and AMY WALTER ( @amyewalter )


  • WORD SEARCH: Based on interviews with Obama administration officials and Republican leaders over the weekend, it was evident that the race to define last week's Supreme Court decision - on favorable terms for each side - is on. GOPers want to use the "T" word (that's "tax") but only when it comes to Obamacare, not when it comes to Mitt Romney's Massachusetts health care plan. And while Democrats would like to move away from health care and back to the economy, Republicans seem poised to turn the Supreme Court ruling into an even larger election-year issue.
  • POST-SCOTUS AIR WARS. The well-funded conservative group Americans for Prosperity launched a $9 million ad campaign attacking the health care law almost as soon as the decision was announced last week. "Obama's health care law is actually one of the largest tax increases in history," the ad's narrator says. "Shouldn't President Obama's priorities have been creating jobs and ending reckless spending?" WATCH:

And another group, Crossroads GPS, announced this weekend they would be unveiling specific ads targeting House and Senate candidates on the health care issue. Here's one calling on North Dakota Senate candidate Heidi Heitkamp to support repeal of the law. The ad is titled "Tax," and was updated to reflects the court's ruling. WATCH:

  • NEW ABC/YAHOO! VIDEO: HONORING BLACK MARINES, 70 YEARS LATER. ABC's Jake Tapper reports on some 400 marines awarded the Congressional Gold Medal, decades after they suffered through racial prejudice and hellish boot camps as the first black men to integrate the U.S. Marines.


It's a bird, it's a plane! It's a tax, it's a penalty!

Ever since last Thursday's Supreme Court decision that ruled the Obama administration's signature health care reform law constitutional, both Democrats and Republicans laced up their running shoes for a sprint to the dictionary.

The keyword: tax.

Republicans want to bake the idea that the health care law imposes a tax into the cake. While Democrats, on the other hand, are loathe to refer to it in those terms.

White House Chief of Staff Jack Lew insisted, repeatedly, in interviews this weekend that under the law refusal to buy insurance would amount to a "penalty" and Obama campaign aides echoed the White House line, calling it a "a free loader penalty."

Democrats, however, have also been circulating videos of Romney acknowledging that his own health care plan imposed a tax. At a January 2008 ABC News' debate in New Hampshire, moderator Charlie Gibson asked Romney whether his plan "imposed tax penalties in Massachusetts."

"Yes," Romney replied, "we said, look, if people can afford to buy it, either buy the insurance or pay your own way; don't be free-riders."

But Republicans weren't about to touch Romney's comments with a ten-foot poll. When asked about Romney's own health care plan, Senate Minority Leader Mitch McConnell, R-Ky. told "Fox News Sunday's" Chris Wallace: "I think Gov. Romney will have to speak for himself about what was done in Massachusetts."

But McConnell did not evade when it came to defining "Obamacare."

"The president said it was not a tax," McConnell said. "The Supreme Court, which has the final say, says it is a tax. The tax is going be levied, 77 percent of it, on Americans making less than $120,000 a year. So it is a middle class tax cut - tax increase."

And, in an interview on CBS's "Face the Nation," House Speaker John Boehner, R-Ohio, was similarly definitive.

"The American people do not want to go down this path," Boehner said. "They do not want the government telling them what kind of insurance policy they have to buy and how much they have to pay for it, and if you don't like it, we're going to tax you."

BOTTOM LINE: The ducking, dodging and weaving by leaders on both sides of the aisle - in service of avoiding the "T" word at all costs - made for awkward Sunday show performances all around. Polls show most voters have already made up their mind on the health care issue and both Democrats and Republicans could risk alienating voters by re-litigating this fight.

GEORGE VS. JACK: TAX VS. PENALTY. As we noted above, White House chief of staff Jack Lew refused to call the individual mandate for health care a tax in an interview on "This Week" with ABC's George Stephanopoulos, continually referring to it as a "penalty" or "charge," despite the Supreme Court's ruling that it should be considered a tax. Here's one of the exchanges between Stephanopoulos and Lew:

LEW: For that once percent who have chosen not to buy health insurance, and just to pass the burden on to others, there's this penalty.

STEPHANOPOULOS: But you do concede, you keep wanting to use the word penalty. You do concede that the law survived only because Justice Roberts found this to be a tax?

LEW: I - I think if you look at the decision, which is a very complicated one, there are arguments that support different theories. There were…

STEPHANOPOULOS: But the argument of Chief Justice Roberts is that it's a tax.

LEW: He - He went through the different powers that Congress has and found that there is a power, whatever you call it, to assess a penalty like this.

STEPHANOPOULOS: He called it a tax. So you're conceding that?

LEW: I'm saying that it was set up as a penalty for people who choose not to buy insurance, even though they can afford it, and for that one percent, we call it fair.

STEPHANOPOULOS: And he calls it a tax.

CHRIS VS. MITCH: WHEN IS A TAX, A TAX? From Senate Minority Leader Mitch McConnell's interview with "Fox News Sunday" host Chris Wallace:

WALLACE: Now, since the Supreme Court justice - Chief Justice Roberts came out with his ruling declaring that the mandate is actually a tax, you have been hammering the president for imposing a new tax on the middle class. But Mitt Romney has a mandate in his Massachusetts health care reform plan and the people in Massachusetts paid more than $20 million last year in that mandate penalty, tax, whatever you want to call it, so isn't that a Romney tax on the middle class?

MCCONNELL: Well, I have two thoughts there. Number one, that was a Massachusetts decision, not a national decision. And number two, every single Senate Democratic - every Democratic senator voted for "Obama-care." It passed with not a vote to spare. Every single Democratic incumbent on the ballot this November was the deciding vote to pass this bill. This law is deeply unpopular with the American people. These Senate races across America will, indeed, be a referendum on this job-killing, health care, tax-increasing measure.

WALLACE: But if I may, sir, I mean, you didn't answer my direct question. If the Obama mandate is a tax on the middle class, isn't the Romney mandate a tax on the middle class?

MCCONNELL: Well, I think Governor Romney will have to speak for himself about what was done in Massachusetts. I can tell you that every single Democratic senator voted for this tax increase and these $500 billion cuts in Medicare. And it will be a huge issue in 2012


ABC's RICK KLEIN: For amazingly complicated reasons, President Obama needed a tax to be a mandate, and Chief Justice John Roberts needed a mandate to be a tax. Now it's back in the political realm, where Democrats need this mandate that the Supreme Court has labeled "tax" to be a "penalty," or something else entirely. The argument may be academic, but if Democrats want a fresh start in selling the Obama health care law to the public, getting past the new tax question is an important start.

ABC's AMY WALTER: While the Sunday shows were obsessed with health care, the campaigns and the political parties are eager to get back to the fundamentals of the campaign: the economy. The Obama campaign pushed back last night on Politifact's criticism of their outsourcing attacks. Meanwhile, the RNC is focusing on the "middle class promise gap."

LOOK AHEAD: June unemployment numbers will be released this Friday.

ROMNEY CAMPAIGN READIES PRE-BUTTAL TO OBAMA'S BUS TOUR. The Romney campaign has enlisted Ohio Sen. Rob Portman and Pennsylvania Sen. Pat Toomey to frame President Obama's bus tour later this week on their terms. The memo is meant to remind voters of the promises the president made early in his term to reduce unemployment and improve the economy - promises, they say, he has not kept. Portman and Toomey also preview the campaign's messaging strategy for the week ahead:

"This week Gov. Romney and his campaign will revisit exactly what President Obama promised and showcase precisely how far away he is from meeting his own standards of success. Issue by issue, Republicans will highlight President Obama's astonishing middle class promise gap, contrasting where he said we'd be today with where we actually are. … President Obama's campaign knows he has fallen short. They know he has disappointed the American people. You can see it in their ads and in their stump speeches. They are filled with excuses and distortions. They cast blame everywhere and take zero responsibility for the failing economy, the broken healthcare system, the terrible housing market, our lack of an energy policy, and our skyrocketing debt. Instead of 'the buck stops here,' they seem to be saying, 'the buck stops over there.' To win reelection, they are desperately working to misrepresent Gov. Romney's record and distract from their own disappointing record."

STATE OF THE STATES: President Obama begins his bus tour through Pennsylvania and Ohio on July 5. Recent numbers from Quinnipiac University give Obama the lead in both states (9 percentage points ahead of Romney in Ohio and 6 percentage points ahead in Pennsylvania). Also both states have seen modest reductions in their unemployment rates within the last year.

PROMISES, PROMISES: GOP LAUNCHES: PROMISEGAP.COM. Although this week will most likely be a slow one on the campaign trail the Republican National Committee isn't slowing down a bit, ABC's Shushannah Walshe reports. The RNC, joined by the Romney campaign, say they will be "highlighting the gap between what President Obama promised the middle class and what he delivered." Today the RNC is launching "", a site featuring a list of what they call the president's "top 10 failed promises" from keeping unemployment below 8 percent to cutting the deficit in half by the end of his first term to bringing more bipartisanship to Washington. The RNC is also out with a research piece today called the "Middle-Class Promise Gap: Health Care," which focuses on numbers they say shows a gap between what President Obama promised his health care law would do to premiums for middle class Americans and the higher cost affecting many Americans:

NOTED: But, as we saw last week, with so much data and research different language and numbers can be manipulated to help both sides of the health care argument:


-MY HUSBAND WOULD HAVE BEEN 'PLEASED BUT NOT SURPRISED.' Vicki Kennedy, wife of the late Sen. Edward Kennedy of Massachusetts, said Sunda morning on "This Week" that her late husband would have been "pleased," but "not surprised" that Chief Justice John Roberts joined the Supreme Court's liberal members to rule the individual mandate - the cornerstone of President Obama's health reform law - to be constitutional. "I think he felt very strongly in health care reform. He had studied this issue for more than 40 years. He believed in it," Mrs. Kennedy said. "He believed in its constitutionality. He had looked at it in every way and I think he would have been pleased but not surprised."

-PAUL RYAN: JUSTICE ROBERTS 'HAD TO CONTORT LOGIC.' ABC's George Stephanopoulos also interviewed Rep. Paul Ryan on 'This Week': "I'm very disappointed in the ruling. I think the chief justice had to contort logic and reason to come up with this ruling," the Republican from Wisconsin said. "So one man decided against the dissenting opinion, against what I, you know, thought were his - his principles and judicial jurisprudence, he decided to leave this up to the American people. So now the stakes of this election could not be higher."

-OVERHEARD ON "THIS WEEK": Nicki Minaj's "Starships." (between George's interview with Paul Ryan and the powerhouse roundtable).


With ABC's Chris Good ( @c_good )

NUMBERS GAME: RGA VS. DGA. With Wisconsin's recall race drawing national interest in 2012, the Republican Governors Association outraised its Democratic counterpart in the second quarter of 2012 by $3.7 million, according to announcements by the two organizations today. From a Democratic Governors Association official: "The DGA will announce today that it raised $13 million across all entities in Q2 of 2012, shattering its previous fundraising record and bringing its total for the first 6 months of 2012 to $21 million, more than the $20 million the DGA raised over the entire year in 2011." And from an RGA official: "It's another record-breaking haul. Perhaps the most impressive comparison is that we have raised more in the first half of 2012 than we raised in the first half of 2010, when 37 governors' races were taking place. … The RGA raised $16.7 million in the second quarter of 2012, bringing its total for 2012 to $29M."

BAIN ATTACKS ARE WORKING, BUT DEMS WORRY ABOUT MONEY. Analysis from ABC's Rick Klein: In [battleground] states, President Obama has been pulling ahead. The gaps aren't huge, but taken together, the numbers strongly suggest that Democrats' relentless attacks on Mitt Romney's business record at Bain Capital have been taking a toll. Quinnipiac University polling last week in the three big classic swing states show the president with narrow but identifiable leads. He's up four points in Florida, seven in Ohio, and six in Pennsylvania. Among the things that those states have in common is that voters there have seen an avalanche of early advertising focused on questioning Romney's business record. … When outside groups are factored in, Obama aides say they could be outspent by 25 percent or more this year.

NOTED: Much of the Democrats' Bain-focused TV firepower has come from the pro-Obama super PAC, Priorities USA Action, which is in the midst of a $10 million ad campaign in Colorado, Florida, Ohio, Pennsylvania and Virginia. So far Priorities has released a series of five ads.

OBAMA CAMPAIGN VS. FACTCHECK.ORG . ABC's Devin Dwyer reports: In a six-page letter to, deputy Obama campaign manager Stephanie Cutter disputes the notion that Romney cannot be held accountable for outsourcing by Bain Capital-owned companies after February 1999, when he stepped down as CEO. "The statement that Gov. Romney 'left' Bain in February 1999 - a statement central to your fact-check - is not accurate," Cutter writes. "Romney took an informal leave of absence but remained in full legal control of Bain and continued to be paid by Bain as such. Governor Romney would have the period of Bain service understood differently, for the obvious reason that there is much in this l999-2002 period that he would prefer to avoid accountability for."

HOW ROBERTS SWITCHED SIDES. CBS's Jan Crawford reports: "Chief Justice John Roberts initially sided with the Supreme Court's four conservative justices to strike down the heart of President Obama's health care reform law, the Affordable Care Act, but later changed his position and formed an alliance with liberals to uphold the bulk of the law, according to two sources with specific knowledge of the deliberations. Roberts then withstood a month-long, desperate campaign to bring him back to his original position, the sources said. Ironically, Justice Anthony Kennedy - believed by many conservatives to be the justice most likely to defect and vote for the law - led the effort to try to bring Roberts back to the fold. 'He was relentless,' one source said of Kennedy's efforts. "He was very engaged in this." … The inner-workings of the Supreme Court are almost impossible to penetrate. … But in this closely-watched case, word of Roberts' unusual shift has spread widely within the Court, and is known among law clerks, chambers' aides and secretaries. It also has stirred the ire of the conservative justices, who believed Roberts was standing with them."


-TRYING TO KEEP 'LOW PROFILE.' From The New York Times' Ashley Parker: "And so, as the members of the Romney clan slowly gathered here over the weekend to start their annual vacation - 30 people total, including all 5 sons and 18 grandchildren, happily ensconced at the multimillion-dollar lakefront compound by Saturday night - the town that bills itself as "the oldest summer resort in America" began wondering just what a Romney presidency would mean for their calm and scenic way of life. … That Mr. Romney's presence threatens to upend the very quaintness and tranquility that first led the Romney's to summer here was not lost on his son Josh, who helped open a Wolfeboro campaign office (complete with a dock) on Saturday morning. 'We hope we can stay as low-profile as possible,' Josh Romney said. 'And in reality, we hope America doesn't discover how cool this place is, because we love having it to ourselves.'" N3UKl3

-FAMILY OLYMPICS AND A 'CHORE WHEEL.' The Washington Post's Philip Rucker reports: "The Romney Olympics have long included a mini-triathlon of biking, swimming and running that pits Mitt and his five sons and their wives against one another. But after Mitt once nearly finished last, behind a daughter-in-law who had given birth to her second child a couple of months earlier, the ultra-competitive and self-described unathletic patriarch expanded the games to give himself a better shot. … Each member of the family picks a daily chore from a 'chore wheel,' so as to share cleaning tasks evenly. And before anyone departs, everyone poses on the lawn for a portrait for that year's Romney family Christmas card. The grandchildren coordinate outfits; last summer, the girls wore matching orange and yellow polka-dotted dresses and the boys, blue checkered shirts."

OBAMA'S IN-FLIGHT FUNDRAISING. The Daily Beast's Lloyd Grove reports: "President Obama sounded weary and maybe a tad worried late Friday during a rambling conference call with campaign donors whom he repeatedly begged to send money-and send it now. 'The majority on this call maxed out to my campaign last time. I really need you to do the same this time,' the president said in a highly unusual (and presumably legal) fundraising pitch from Air Force One on his way back to Washington from Colorado Springs, where he'd been assessing the terrible damage caused by uncontained wildfires. A special phone on the government aircraft is dedicated to political calls that are paid for by the campaign. 'I'm asking you to meet or exceed what you did in 2008,' the presidential pitchman continued, speaking to donors who were invited to dial in based on their contributions during the last election. 'Because we're going to have to deal with these super PACs in a serious way. And if we don't, frankly I think the political [scene] is going to be changed permanently. Because the special interests that are financing my opponent's campaign are just going to consolidate themselves. They're gonna run Congress and the White House.'"

IS ROMNEY'S FOREIGN-POLICY TEAM BORED? The Daily Beast's Eli Lake reports: "At the Romney 2012 campaign, there's a well-known mantra that drives much of the candidate's strategy: Every day Romney talks about something besides the economy is a victory for President Obama. That maxim has left many of the foreign-policy wonks participating in the campaign feeling sidelined, and vying-often unsuccessfully-to make particular policy points that the candidate can take on the road, according to several people involved in the campaign. 'They're constantly sending emails and policy ideas around,' says one adviser, 'but they are rarely doing anything more than pushing paper.' On a recent conference call between the chairs of Romney's 10 committees dedicated to foreign policy, one participant urged the campaign to address a June 19 item from the Iranian state news agency, Fars, claiming the Syrian, Russian, Chinese, and Iranian militaries would be staging joint amphibious exercises in the coming weeks. 'It was so lame,' said one person on the call, adding that such conversations often devolve into debates that have no influence on the actual campaign. 'These conference calls are really for people who have an hour in a half of time every week to waste.'"

BOEHNER TO TAKE HOLDER TO COURT? Politico's Alex Isenstadt reports: "In an interview aired Sunday on CBS's 'Face the Nation,' the Ohio congressman said he expected fellow Republicans to file a lawsuit in federal court following the House's vote last week to hold Holder in contempt of Congress. That suit, he said, will likely come over 'the next several weeks.'"

POLL: A POST-SCOTUS BUMP FOR OBAMACARE. Reuters's Patricia Zengerle reports: "Voter support for President Barack Obama's healthcare overhaul has increased following the U.S. Supreme Court's ruling upholding it, although majorities still oppose it, a Reuters/Ipsos poll released on Sunday showed. Among all registered voters, support for the law rose to 48 percent in the online survey conducted after Thursday's ruling, up from 43 percent before the court decision. Opposition slipped to 52 percent from 57 percent. The survey showed increased backing from Republicans and, crucially, the political independents whose support will be essential to winning the November 6 presidential election. Thirty-eight percent of independents supported the healthcare overhaul. That was up from 27 percent from a Reuters/Ipsos poll taken days before the justices' ruling. Opposition among independents was 62 percent, versus 73 percent earlier."

WHITHER THE YOUTH VOTE? The New York Times' Susan Saulny writes: "In the four years since President Obama swept into office in large part with the support of a vast army of young people, a new corps of men and women have come of voting age with views shaped largely by the recession. And unlike their counterparts in the millennial generation who showed high levels of enthusiasm for Mr. Obama at this point in 2008, the nation's first-time voters are less enthusiastic about him, are significantly more likely to identify as conservative and cite a growing lack of faith in government in general, according to interviews, experts and recent polls. Polls show that Americans under 30 are still inclined to support Mr. Obama by a wide margin. But the president may face a particular challenge among voters ages 18 to 24. In that group, his lead over Mitt Romney - 12 points - is about half of what it is among 25- to 29-year-olds, according to an online survey this spring by the Harvard Institute of Politics. And among whites in the younger group, Mr. Obama's lead vanishes altogether. Among all 18- to 29-year-olds, the poll found a high level of undecided voters; 30 percent indicated that they had not yet made up their mind. And turnout among this group is expected to be significantly lower than for older voters."

OBAMA'S SPANISH-LANGUAGE AD BLITZ. Politico's Robin Bravender reports: "Obama's campaign has spent more than $2 million on Spanish-language television and radio ads since mid-April, according to several sources who track media buys. That's on top of the $4 million the pro-Obama super PAC Priorities USA Action and the Service Employees International Union have committed to spending through the summer on Spanish TV and radio ads hitting Romney in Colorado, Nevada and Florida. In contrast, Mitt Romney has spent about $110,000 on Spanish-language ads during the general election, sources say."

WITH 51 VOTES, GOP COULD OVERTURN 'OBAMACARE.' Republicans would also need to win the White House, but The Wall Street Journal's Louise Radnofsky reports: "A quirk of Senate rules lets some tax and spending bills come to a vote under a fast-track procedure called budget reconciliation that prevents filibusters. It allows the bills to pass with a 51-vote majority instead of the 60 needed to break a filibuster. Should the GOP gain a handful of Senate seats in November, the party plans to use the tactic to try to knock down the health law. Republicans currently hold 47 of the Senate's 100 seats. 'Look, reconciliation is available because the Supreme Court has now declared it a tax," Senate Minority Leader Mitch McConnell (R., Ky.) said on 'Fox News Sunday.' 'They have unearthed the massive deception that was practiced by the president and the Democrats, constantly denying it was a tax.'"


- DCCC PLAYS OFFENSE. After last week's Supreme Court ruling, The Democratic Congressional Campaign Committee launched robo-calls in 10 Republican districts. The calls begin: "Hi, this is [name] from the DCCC calling with a warning. Congressman Dan Lungren has gone Washington. After taking more than $120,000 from insurance companies, Congressman [X] wants to put insurance companies back in charge of our health care and let them: deny coverage to people with pre-existing conditions like asthma, heart disease and cancer; cut back your health benefits; throw some kids off their parents' insurance; and roll back prescription coverage for seniors. …" The calls attack Reps. Dan Lungren, Calif.; Mary Bono Mack, Calif.; Robert Dold, Ill.; Judy Biggert, Ill.; Rodney Davis, Ill.; Bobby Schilling, Ill.; Roscoe Bartlett, Md.; Nan Hayworth, N.Y.; Chris Gibson, N.Y.; and Anne Marie Buerkle, N.Y.

-BIDEN TO SPEND THE FOURTH IN SCRANTON: From Obama For America's Pennsylvania press office: "On July 3rd Vice President Biden will travel to his hometown of Scranton, Pennsylvania to meet with campaign supporters, visit with friends and family and attend Scranton's Courthouse Square fireworks celebration. The Vice President will deliver remarks at the fireworks celebration." (h/t Devin Dwyer)

-FROM THE DESK OF HERMAN CAIN: " All in to take down Obamacare ," by Herman Cain, July 2, 2011: "Getting rid of Obamacare through the political process is much more achievable now, but we still need that proverbial army of Davids to rise up and approach the Philistine. The Republicans must take the House, capture the Senate and win the presidential race. Once in office, they must know that the American people demand nothing less than complete repeal of the entire Obamacare law, and that we expect the Senate to use reconciliation just as the Democrats used it to get the thing passed in the first place. The inside-the-Beltway crowd and the lamestream media will howl that this is beyond the pale and horrible. The Republicans need to learn to ignore these people and serve the public."


?@Ginger_Zee : An absolute mess STILL in Virginia among so many other spots still w/o power & will be until after the 4th! @gma

@SusanPage : Ann Romney calls @stephencolbert parody of dressage 'hilarious;' says sport's political downside beyond her control:

@petersgoodman : In case you missed in mag… How Loss of Enthusiasm Among Youth Voters Could Cost Obama the Presidency: via HuffPost

@PoliticoKevin : Jim DeMint is launching a super PAC, @jonallendc reports:

@jimacostacnn : My little one to me on vacation: did Rominny Mitch win?


- President Obama is on vacation at Camp David.

- Mitt Romney is on vacation in Wolfeboro, N.H.

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