--:-- Ezra Klein: Hello, we are here for the show. So we are officially in a government shutdown. Democrats and Republicans have not been able to come to an agreement, or nowhere near, as I say this, coming to an agreement, about how to fund the government. The nature of this shutdown — people had lots of ideas over what, if it happened, it should be about. Should Democrats demand concessions on tariffs? Should it be about authoritarianism? What it is about, in the reality we're living in, is health care.
--:-- Ezra Klein: The Affordable Care Act for the last few years has been supported by tax credits that have made the premiums much lower and have expanded coverage under it enormously. Those credits expire at the end of this year. If nothing is done to keep them from expiring, there will be a huge — what's called — premium shock, and millions of people will lose health insurance. So I wanted to have an episode diving into the actual policy debates and stakes of this shutdown, the spending fights that led to it, the unusual ways in which Republicans have been breaking Democratic trust that helps set the stage for it, the Affordable Care Act and Medicaid debates that are now at the center of it, and then the way the Trump administration is trying to bring very particular forms of pressure to bear on the Democrats, trying to break them, make them capitulate. But they're doing so in ways that might actually be uniting them.
--:-- Ezra Klein: The person I want to talk about all this with is Neera Tanden. Tanden is the president of the Center for American Progress, one of the largest progressive think tanks. She worked in the Clinton, Obama, and Biden administrations. Under Obama, she was central in helping to craft and pass the Affordable Care Act. Under Joe Biden, she was a director of the Domestic Policy Council. So she knows all the policy here, inside and out. As always, my email is
[email protected]. Neera Tanden, welcome to the show.
--:-- Neera Tanden: Thank you so much for having me.
--:-- Ezra Klein: So if you're out there following coverage of the shutdown, you're hearing a lot about something called a CR. What is a CR?
--:-- Neera Tanden: CR stands for a continuing resolution. And it basically is legislation that says that the funding levels of the government will just continue as they are for a specified period of time. Now, what's different about this CR is that the president has used unilateral powers to kind of end-run whatever the agreements are in Congress. But generally speaking, a continuing resolution is an agreement to fund the government.
--:-- Ezra Klein: Let's go into that little disclaimer you mentioned there, the end runs around it. This is a debate about another term people might be hearing called rescissions. What are rescissions?
--:-- Neera Tanden: Rescissions are legislation that pulls back funding that has been agreed to. It's interesting about the rescissions packages — they are not subject to filibusters. So it just takes a simple majority. So if it takes 60 votes to come to an agreement and then it takes a simple majority to claw back funding, that means that whatever you agree to in a bipartisan manner can be undone in a partisan vote.
--:-- Ezra Klein: So there are often in congressional fights, the things that people following in the news know everybody's fighting about, and then sometimes some more internal procedural things that have completely pissed everybody off. And this rescissions bit is actually, from my talking to people in Congress, pretty significant. Because what's happening is that you have Democrats and Republicans coming together, making these funding deals. They need 60 votes or more because of the filibuster. And then in what's fairly unusual, Republicans then clawing back money for things like PBS and public media and USAID through rescissions. And so it has created this collapse in — I would not say Democrats trusted Republicans a lot before this — but the sense that they will now go around the deal you just made has created this harder-to-answer question of, well, how do you make a deal at all under those conditions?
--:-- Neera Tanden: Absolutely. And I think it's a combination of things. It's rescissions and then another really self-explanatory term: impoundments. So rescissions are subject to a vote. Impoundments are where the president just refuses to spend — the executive branch refuses to spend money allocated by Congress. So the president has just not been spending funds allocated to the National Institutes of Health, to the National Science Foundation, to other elements of the government. And honestly, I don't think we even have a full picture of what the executive branch has really not implemented of these congressional deals.
--:-- Neera Tanden: So I think it's really both of these issues, but it's also the fact that essentially Russ Vought can decide to just not listen to Congress at all. And I think that is really the fundamental threat to Article I. They are both threats to Article I, but it's this combination where essentially the executive branch is usurping Article I spending powers. I know this is totally in the weeds here, but Congress is designated to decide how the government allocates funding. And that's really being watered down.
--:-- Neera Tanden: And what's interesting about this debate is I do think probably secretly a number of Republicans, particularly in the Senate, and some in the House who are on these appropriations committees, would secretly like the president's powers to be limited because it really is undermining their authority. But I think you're absolutely right. At the end of the day, we have this Washington talk about a clean CR, but fundamentally this is very different from any other period of time that I've been in Washington where essentially it's not a clean CR because you can undo it. I mean, essentially, you could have an agreement between Republicans and Democrats on what is called a clean CR, and then a month or two later, Russ Vought could just decide not to spend multiple billions of dollars for an agency. And then what has anyone even agreed to? So I think that is a fundamental part of this debate as well.
--:-- Ezra Klein: There's also the reality that if rescissions become common practice or impoundment becomes common practice, there will be Democratic presidents, and you can imagine them using that authority, right? There is a big spending deal. It funds ICE to a certain level. Actually, we're unfunding ICE to that level. We're not spending a bunch of the money on certain kinds of border enforcement. It seems very — as you said — it seems in the weeds, but the question of how you do normal congressional procedure when the deals stop holding is a pretty big one here.
--:-- Ezra Klein: But I think it would be both selling the Democrats a little bit short and selling the Republicans here and their argument a little bit short to say this is just about rescissions. Democrats have increasingly come to the view that they can't let Trump run the government this way. There's been a lot of debate over what they should try to draw the line on. Should it be on neo-fascism? Should it be on authoritarianism? Should it be on mass men in the streets? Where they decided to draw the line was health care. And so they're not just asking for a clean extension of the funding in the government. They are trying to change what is about to happen in the health care markets. What is about to happen in the health care markets?
--:-- Neera Tanden: So under the Affordable Care Act, there's the exchange markets. This is a way in which basically middle-class people can get health insurance through the Affordable Care Act. And these marketplaces exist in every state. And in 2020, there were 12 million people in these marketplaces. And now there's 24 million people in these marketplaces, in part because during the Biden administration, the Congress took two votes to make the marketplaces more affordable. Essentially, they expanded the value of tax credits people receive in order to purchase health care in these marketplaces. And essentially, that funding is going to run out at the end of this year.
--:-- Neera Tanden: So what is imminently happening is that insurers are sending out notices now to people. It's just beginning. It'll increase over the next several weeks because open enrollment — the time where people choose what health insurance they're going to have — starts November 1st. So people are going to start getting notices about what their premiums will be in the marketplaces in the coming year. And they will be subject to premium shock. The expanded tax credits were really substantial investments. And so people are going to see, according to Kaiser Family Foundation, on average, their premiums double. A family of four making $55,000 a year are going to see their prices quadruple. So that is a huge price spike. And essentially, Democrats are saying that we should come together and avoid that price spike. And I will note the Democrats at the end of last Congress, in the waning days of the Biden administration, they tried to come to a negotiation with Republicans around the Supreme Court. Everyone knew this was coming. People talked about it. Republicans didn't want to deal with it then.
--:-- Ezra Klein: So I don't know if people realize how big the increase in coverage was under the changes made in the Inflation Reduction Act. So 2020, 11.4 million people were enrolled in the Affordable Care marketplaces, right? So that's Obamacare as we understood it when Joe Biden becomes president. By 2024, four years later, the enrollment nearly doubles, depending on how you look at it. In some cases, it does double depending on your years. So who are these people? Who is this massive increase of people flooding into the Affordable Care Act marketplaces between 2021 and 2024?
--:-- Neera Tanden: There are people who found the marketplace pretty expensive before and then found it affordable. And I think it's really interesting because a sustained Republican criticism of the Affordable Care Act after it was passed is that it wasn't really affordable. I mean, they didn't want to make it more affordable, but they just said it was too expensive. And I know that you covered the passage of the Affordable Care Act. I worked on the passage of the Affordable Care Act in the Obama administration. And the truth is the marketplaces are really two forms of coverage in the Affordable Care Act. One is Medicaid expansion, which is people who are pretty poor. And then people who are above the Medicaid threshold.
--:-- Neera Tanden: So these are really like 99% of these people are working Americans. They are disproportionately in small businesses. They work for small businesses or own small businesses. They make anywhere from $15,000, $16,000, $17,000 a year, but really go all the way up the income. People are making $35,000, $40,000, $55,000 individually or as a family. So people are choosing to buy health care in the marketplaces, and it's subsidized health care. The government does help pay, offset a lot of the cost. But as you said, we got over 11 million people roughly in the first 10 years of Obamacare, the ACA, to get health care. But I do think it was really not affordable enough to a lot of people.
--:-- Neera Tanden: And President Biden, at first in the American Rescue Plan with Congress, expanded the tax credits. And then Democrats, through the Inflation Reduction Act, extended those tax credits until this year. And fundamentally, we learned that actually people really wanted health care if you made it more affordable. Now, again, everyone has skin in the game. People spend, they have to invest their own dollars. People who at higher incomes have to spend more money. But what we really learned is that people desperately want to have health care that is affordable. And when we made it more affordable, as you noted, it basically doubled the number of people who are getting health care. And I actually think in this country at this point, the fact that we have the lowest rates of uninsurance in our history is a profoundly good thing for the country.
--:-- Ezra Klein: So you mentioned that a lot of people we're talking about here — they make a little bit too much money for Medicaid. There's another group, though, which are people who live in red states that did not expand Medicaid.
--:-- Ezra Klein: And one of the ironies of this fight is that Democrats are shutting the government down to protect and extend tax credits that heavily disproportionately benefit red states because in a bunch of these red states, they didn't expand Medicaid and it means more people get the tax credits. So you have more than 10% of the population now in Florida, in Texas, in Georgia, in South Carolina, in Utah, using the Affordable Care Act's subsidies. Talk to me a bit about the policy and the politics of that.
--:-- Neera Tanden: I mean, the politics of health care has been really odd over these last decade or so, because while we have gotten 40 states to do Medicaid expansions, there are 10 states that have not passed Medicaid expansion. In those states, you do see a much higher percentage of people on the exchange markets just because they're so clearly desperate to have health care and they can't really get it. And of course I think it is kind of insane we live in a country with states where if you have a slightly higher income you get into the exchange markets, but really low-income people don't have it. I do think that is very perverted. And I'm glad that over a decade so many more states have come on. But that does end up being a situation where, as Kaiser Family Foundation has noted, we're talking about 75% of people in these exchange markets being in places that Trump won.
--:-- Neera Tanden: So it's just a long way of saying that Republicans are choosing essentially to make people in their states who already are struggling — I mean, these are not wealthy people — face, again, not just a slight premium increase, but a real premium shock.
--:-- Ezra Klein: This gets to the politics of this in an interesting way. The Kaiser Family Foundation did a poll on whether or not people thought these credits should be extended, whether or not the tax credits should be extended. They did this at the sort of roughly at the end of September. 78% of Americans were in support of extending the tax credits. You don't get that high of a number for many things anymore. But that included majorities of not just self-described Republicans, but self-identified MAGA supporters. It had nearly 60% support from people who said they were MAGA.
--:-- Ezra Klein: There's a Wall Street Journal story the other day where Trump administration officials were starting to say anonymously that they're actually worried about this — that they feel that this is actually a tough thing for them to own. It's not going to be great for them if health care premiums skyrocket for millions of people on their watch. The shutdown fight is a partisan fight. The politics of this, the polling of this, who it helps, who it hurts — are not a partisan issue. It does not break along partisan lines.
--:-- Neera Tanden: Absolutely. And what's interesting about this is this reminds me of where we were in the ACA repeal debate, which is that was another debate — now eight years ago — where we were talking about President Trump's effort to repeal the ACA. And in the heat of that debate, we were in a very similar place. 50% of Republicans did not want to repeal the ACA. A majority of MAGA supporters did not want to repeal the ACA. Now, why is that? It's because this program is actually helping people that need health care coverage. And it's helping people in red states. It is a project of government to actually help people particularly.
--:-- Neera Tanden: And I also think we're in a moment which is a little bit different from past moments where people feel that the cost of living is very high across the board. Now, it's also really important to remember that when — if these premiums double — then a lot of people will choose not to get coverage. People choose not to get coverage over time. We will see other people being impacted by that. Essentially, emergency coverage goes up, hospitals shift prices to others. So we also know that when people lose coverage — and the Medicaid from the One Big Beautiful Bill Act, which I just struggle to say so often — from that, we know that when people lose Medicaid coverage, it actually drives up prices for other people in the market. That takes longer time. But I think people totally understand that in this moment, it seems like the opposite of common sense to allow this price spike to happen to people when it's completely avoidable.
--:-- Neera Tanden: And the truth is, and just to touch on the last point you made, Republicans know this is a problem. I do not think it is an accident that last week the Trump White House had a leak into the Wall Street Journal that they do feel like they have to negotiate this. From what I've heard of the meeting with Senator Schumer, Congressman Jeffries, Speaker Johnson and Leader Thune with President Trump, the president really does seem to get that he has to deal with this problem and that he might need to make a deal with Democrats. And then I'd say the last crazy point about this is people seem to acknowledge they have to deal with it. They just don't want to deal with it now, which I think just sounds nonsensical to most people.
--:-- Ezra Klein: Well, let me take that argument. So what you hear if you listen to interviews right now with Senator Thune, with Speaker Johnson, is that Republicans are happy to discuss this. They would love to negotiate over this. They understand it's a problem, but only after the government is reopened. They're not going to allow the government to be held hostage on this issue. They will not talk about this issue while the government is closed. What's your take on that?
--:-- Neera Tanden: I just think it just sounds ridiculous to people, right? I mean, people are going to get their premium shock — like their notices in the next few weeks. So I think the position of Republicans at this point — and look, I think it's important that they're acknowledging that this is a big problem, at least maybe more Senator Thune than Speaker Johnson — but they're acknowledging that this is a problem. But then that's sort of an intellectual trap, right? Because I'm saying, if you think you're a person who's worried about your health care costs going up, how does this sound to you? "We know it's a problem, but we'd like you to get your premium notice. And then at the end of the year, after you have to make a decision — you're supposed to start making decisions on whether you're going to purchase health care in November — at the end of the year, we'll deal with that." I mean, who thinks that that's what you should do to your constituents?
--:-- Neera Tanden: I think once you've sort of conceded this is a problem, then I don't really understand why the argument is we need to deal with it later and not now. And obviously, I feel like every Democrat in America feels like they can trust what the congressional Republican leadership says and Donald Trump as far as they could throw them. I mean, it's just like — I do think it sounds kind of cuckoo when you think about what the arguments people are making right now. "Give up your leverage and then we promise you the deal you'll get is great."
--:-- Ezra Klein: There was actually a funny moment, I thought, on the Sunday shows this weekend. I was watching Speaker Johnson be interviewed and he's being pressed. "OK, you say this is a real problem. You say you need to deal with it. Are you saying that you support the extension of the subsidies? Do I hear you correctly that you, as Speaker of the House, want to see the tax credit extended at a future date? Is that what you are saying?" "No, I haven't staked out any position on it yet because that's not how this process works. We're in a deliberative body." "Right, I'm asking your position because you said you would be willing to talk about it." "I'm telling you my position. I'm the Speaker of the House. What I have to do is draw consensus among 435 members of my body. I don't get out and project what the final conclusion is going to be." He very, very clearly did not say yes.
--:-- Ezra Klein: The other Republican argument is that what Democrats are really trying to do here is give healthcare subsidies to, as they put it, illegal aliens. What is that argument they are making?
--:-- Neera Tanden: Okay. I just need to say this is like the most deeply cynical, ridiculous thing, but I will — [laughs] I watched your shoulders actually fall. Like, "I can't believe I have to deal with this bullshit." I mean, it is really funny to me. It's like — I mean, I worked in the White House, and I could just imagine them sort of dialing up a legal immigration argument as they have to deal with a confrontation on health care, which, of course, they know that they have to deal with anyway. So it's just totally odd.
--:-- Neera Tanden: But OK, the best case of their argument is that during the One Big Beautiful Bill Act, the Republicans limited Medicaid coverage to legal immigrants in the United States. They made it more difficult for legal immigrants. No illegal aliens, no undocumented people, nobody crossing the border. We're talking about people like Afghani refugees, Ukrainian refugees, people subject to domestic violence who get protected status. So these are all people who have legal status in the United States. Now, they are doing a card trick to call them illegal aliens. They have legal status in the United States. They are not illegally here. They've shown themselves to the government. We know who they are. And Democrats put forward — and basically they said, "We'd like to undo everything you did in the Medicaid, on your attacks on Medicaid." And this was one part of it. But really, the substance of their argument was undo the massive cuts to the Medicaid program. So that is just false that it is covering illegal aliens. They are not illegal aliens.
--:-- Ezra Klein: It is currently illegal under federal law for federal dollars to go to health care subsidies for people here illegally. Yes. That is like the number one point to just say about this, which is the truth is that for those of us who are old enough to remember, and I have some battle scars over this issue, having worked on the legislation, there's a big, robust debate about whether people who are illegally here — illegal aliens, undocumented people — could get access to the ACA. And there is literally a provision that says by statute, you cannot receive health care. The premium tax credit cannot go to any illegal aliens, undocumented people, whatever you want to call them. That is illegal. And that is why they've had to do this mental gymnastics to basically transform people who are legally here into illegal aliens. This is like two different words. They have two different meanings and they're just conglomerating them in order to have some shred of making a lie true. But it is still a lie.
--:-- Ezra Klein: So we've been talking primarily about the Affordable Care Act private health insurance marketplaces. But when we started talking about the questions of immigrants of different forms, that gets you into Medicaid. And as you mentioned, a lot was changed in Medicaid. The expiring tax credits come actually from Democratic bills, right? These were tax credits set to expire and as you mentioned, the Inflation Reduction Act. The Medicaid changes were in the OBBBA. Talk me through the Medicaid changes.
--:-- Neera Tanden: Yeah, I mean, this is the biggest seismic shift in health care in my 25 years of working on it, and in a negative way. I mean, this is the Republicans essentially put forward a transformation of the Medicaid program. They adopted a series of regulations that will mean that millions of people will lose health care. They instituted work requirements, but those work requirements are honestly just about so much paperwork that it just really becomes hard for people to keep their health insurance. You use the complexity of the paperwork to kick people off the programs.
--:-- Neera Tanden: My wife, Annie Lowrey, is literally writing a book on this. It's called "The Time Tax." I know. I know. I mean, I'm a great student of her work. We did a lot of work in the federal government to go the other way and make benefits easier. But essentially, that is kind of the hack. The hack is that they make it so complicated to access your benefits that people will lose their benefits. And this is a highly contested debate during the consideration of the bill. But the fact has always been clear that states that have used systems of complexity have lost coverage. Arkansas instituted work requirements with complicated paperwork and lots and lots of people lost their health insurance because you ask them to verify every month. The whole system is sort of designed to keep people out of health care.
--:-- Ezra Klein: So just to step back, and I know there was a robust debate about the One Big Beautiful Bill, but the heart of that legislation was fundamental. It's a complicated tax bill, but the truth of that legislation at its most base components was that unlike any legislation that has been passed by a Congress in at least my life, the legislation itself provided a massive tax cut to the wealthiest. It extended middle-class tax cuts, but a big innovation was large-scale tax cuts to the wealthiest Americans, a lot of corporate tax cuts, but really the structure of the legislation and cuts to SNAP and Medicaid. And Republicans really had this big argument about fraud, etc. But that was all also just honestly, can I say bullshit on this? It was just BS. It was just ridiculous. And the fundamentals of that is Republicans have been trying to undo the expansion of the welfare state. Lots of people got health care coverage over the last decade, and they really think that we're spending too much on that. And that's really fundamentally why the legislation was so unpopular, because — there's a lot of ways they can be in step or both parties are up for grabs — but fundamentally, I think Americans did not think that the big problem in America is that too many people had health care.
--:-- Ezra Klein: One reason you know that Americans didn't think that is that Donald Trump never runs saying that. He continuously runs saying he's going to protect Medicare. He's going to protect Medicaid. He's going to fix the Affordable Care Act, give this country the health care it deserves. And to a large extent, when I talk to congressional Democrats, to them, at this moment, the Democratic Party's brand is not shining, shall we say.
--:-- Neera Tanden: I think that's fair.
--:-- Ezra Klein: This is their big political opportunity. This is the issue that Americans care about, that they also trust Democrats on. This is the issue where Donald Trump is repeatedly betraying promises to people, right? Saying he wouldn't cut Medicaid and then doing so, saying he would fix the Affordable Care Act and then allowing a gigantic premium spike to happen. And I had somebody who's very involved in the Democratic effort to take back the House say to me, basically, look, the most dangerous thing Donald Trump is doing is his effort to sort of corrupt the government into an authoritarian tool. But the most effective tool Democrats have against him is health care policy. They believe that the way they're going to win the House back is on health care.
--:-- Neera Tanden: Yeah. I mean, look, there's a fascinating marriage of convenience between sort of the pro-state kind of populists and the libertarians. And you know that this isn't popular not just because Donald Trump didn't run on it, but also Donald Trump never talks about this. He never talks about OBBBA. He never — I mean, I knew we were winning this debate during the consideration of the bill. Unfortunately, we don't live in a world where public opinion actually dictates how congressional leaders act. They were dedicated to — they sped up the debate because it is so unpopular.
--:-- Neera Tanden: But I think what's really important to think about is how people hear these things. Right? And we could talk for hours about there are a lot of people who pay a lot of attention to politics or a lot of people who don't pay a lot of attention to politics. That has always been the case in the United States. There are always people that — we've always run elections that way. And I think this is a really crucial part of this discussion, which is in a world where lots of people are not paying attention to politics and they are pretty stressed out in their lives, what are the things that feel real in their lived experience?
--:-- Neera Tanden: And, you know, I'd just be candid that I am genuinely petrified by what the president is doing to weaponize the U.S. military against cities. But I also think we have to acknowledge that a lot of people live in places that are not in cities and they're kind of not paying attention to the news every day and they're struggling to get by. And it is totally legitimate. And I think we have to say this. It is totally legitimate for that person to be pretty anxious about making ends meet and hearing about health care costs for them going up.
--:-- Neera Tanden: I think the truth of the country that we're in right now, and maybe we wish everyone talked about one issue versus another, but people understand this cost of living problem. What's fascinating about America, but it's not just America, it's around the world. We just ran a conference with leaders, center-left leaders, progressive leaders from Western countries — Europe, Canada, Australia. And three years after 9% inflation in the United States, people care about cost of living today as much as they cared about it back then. That says to me that there is an overall sense that people are feeling out of control of how they afford their life.
--:-- Neera Tanden: In that world, democracies mean leaders have to meet voters where they are. There's no referee. The voters win. And this is an issue where I think there's actually more opportunity. The thing that's so fundamentally amazing about the first eight months of Trump — I expected a lot of the authoritarian threat. I am genuinely surprised by their creativity, but it is horrifying. But the thing that is most remarkable and so different from the first four years of his administration is he is actually getting away with hurting working class people this time.
--:-- Neera Tanden: His big legislation in the first four years that would have hurt working class people was the repeal effort to undo the Affordable Care Act. And we stopped him. Democrats stopped him. This eight months, he has passed legislation that will mean people lose their health care. Working class people lose their health care. Utility rates will go up. And he has a tariff policy that means the price of goods will go up. And who faces that cost disproportionately? Working class people.
--:-- Neera Tanden: So we have to have alternatives for people. But what you talk about really matters, particularly when you're in the opposition. And I think it is crucial that we talk about the pain that Trump and Republicans are delivering, having voted on it or delivered it through his executive actions on tariffs. They are delivering pain to working class people every day. And we have to keep our eye on that ball.
--:-- Ezra Klein: One of the arguments that I made about a shutdown, and that others made about a shutdown, is that it's an intentional event. The problem Democrats have had is not that they don't have a message. They have lots of messages, arguably too many. It's that nobody cares what they're saying because they don't have power. And the shutdown, what it's already doing, is forcing a debate. You turn on the news and you see Johnson and you see Schumer and you see Jeffries and you see Thune and they're talking about health insurance subsidies. They're talking about the Democrats' best issue.
--:-- Ezra Klein: We are devoting a full show to it here because there's something happening on it. It's not just out there as one of the million policy problems flitting about the ether as Donald Trump sends the National Guard into cities. Democrats have been very skittish about using the leverage they have. I think people don't actually realize how much leverage they have not been using. They didn't just skip the shutdown in March, but they're helping Republicans get closure on the National Defense Authorization Act and all kinds of things. They are not throwing sand in the gears and creating crises as much as they could because they've been quite frightened about what they get out of it and what happens if Donald Trump moves into a reprisal mode.
--:-- Ezra Klein: But one thing they get out of it is a modicum of control over attention. And then they actually have to win the argument. You can't pick a bad argument and lose. It's not going to help you. But already you see the Trump administration starting to take their own danger on health insurance subsidies seriously. Nothing matters in politics if people don't know about it. Nothing matters if people either can't feel it or even if they are feeling it, but there's not the attention to tell them how to interpret what's happening to them. But one thing the shutdown is doing, it seems like it's working, is shining light on this issue in particular, which is what Democrats, on some level, in addition to whatever negotiations they have, set out to achieve.
--:-- Neera Tanden: Yeah, I agree with that. I might offer an amendment, which is I think the reason why this is getting coverage is because Democrats have leverage on the 60 votes. Look, Republicans and Democrats, we all live in a media ecosystem. The challenge is there is a lot of news created by the Trump administration. But also, if something feels like a fait accompli, it does not actually get that much attention.
--:-- Neera Tanden: I'll give an example. Republicans nuked the filibuster in the lead up to the OBBPA. Essentially they blew that up on a 50-person vote. They blew up the filibuster on being able to package nominees together. Democrats basically didn't go along. They blew up the filibuster. And no one in America knows about this. That might have been a big debate a year or two or three or four or five years ago in normal politics. But in a world in which Trump is threatening the National Guard into cities, it does seem like minutia.
--:-- Neera Tanden: So I think the real issue here is having a fight over a major scale issue and also having the ability to possibly win the fight. At a time where part of the Democratic brand is poor because people perceive it, even Democrats perceive it, as weak. That is why it is important for all leaders within the party to use opportunities where they have leverage to speak out. Leadership is a social contract. It's like, I'm going to follow you and you are going to protect me or look out for me or do something for me.
--:-- Neera Tanden: We've talked about some of the authoritarian threat in the country and a real sense of anxiety and fear amongst Democrats about how much our country is transforming in our eyes. It is not unreasonable for people, when they are scared, to look for their leaders to be strong. So I think that is also part of the politics of all of this. Here's an opportunity for Democrats to stand up for something that helps the American people in a way that every voter can understand. It's not an intellectual exercise about congressional powers versus Article 1 versus Article 2 versus Article 3. It is a real-life debate about people's lives. And that is an opportunity that has not come before and may not come again before the midterms.
--:-- Ezra Klein: The Trump administration's response on this, separate from their messaging, is, "You think a shutdown is leverage for you? No, it's leverage for us." You probably saw that President Trump tweeted an AI-generated music video of Office of Management and Budget Director Russ Vought — Project 2025 fame. Nice of him to acknowledge that a year after the election. The video shows Russ Vought as the Grim Reaper. "Russ Vought is the Reaper. He wields a pen, the guns and the brain. Here comes the Reaper. Dens your babies. Here comes the Reaper."
--:-- Ezra Klein: The idea is that the shutdown gives Trump and Vought powers to remake the federal government in some wholly new way, that they can do things during a shutdown that they couldn't otherwise do. And Democrats should fear what they're going to do. What powers does it give them?
--:-- Neera Tanden: Legally, it doesn't give them more powers. Legally, it's actually supposed to give them less powers because it's illegal to fire people during a shutdown while they're furloughed. That is actually in the law. Now, I appreciate that law is sort of questionable with this president. But I think there's two things going on here.
--:-- Neera Tanden: One, Trump uses fear as an asymmetric asset. This Grim Reaper meme is exactly him trying to get Democrats to give in out of fear. Trump is like any other bully. The more you fear his discretion, the more you're going to do what he wants, which is pre-cower. That's the power of bullying. It makes you do things that the bully wants without him actually having to throw that punch.
--:-- Neera Tanden: But I also think there's something completely different about this, which is an underrated part of all this. We have never had a negotiation over the budget between the Congress and the president take place like this while the president is fully committed to unilaterally closing down agencies. I think the American people blame Trump because he's been closing down agencies or trying to close down elements of this government for eight months. The public sees everything against a backdrop. Do we even know if the Department of Education is fully functional right now? He tried to close the agency, then a court reopened the agency, then they lost a decision. It's really hard to keep track what's open and closed. In a government shutdown, it feels like it's a matter of degree, not a matter of existence of whether these agencies are working or not.
--:-- Neera Tanden: So I think fundamentally, you should not give in to the bully just threatening people. It's kind of horrifying. And we shouldn't reward this kind of behavior. But also, I understand why people care. They care about human beings, and I do too. But fundamentally, he's going to get worse if he's not stopped. We're in month eight. This is an opportunity to push back.
--:-- Neera Tanden: What is really crazy and really terrible is Republican House and Senate members have lost power to the president. This is a system that Trump has hacked. Our founding fathers expected congressional leaders to care about their power. That is the idea of separation of powers — that while the president might have a lot of power, members of Congress of both parties would jealously guard their power. That is what he has hacked. He has scared his own members into ceding power to him. What really should happen here is Republicans who actually care should secretly hope that Democrats win this debate so they can get back to having dignity. I just wonder every day, do you look in the mirror and just have dignity? I just wonder what these people think they're doing.
--:-- Ezra Klein: The specific argument that they're making about what Vought can do is that they can do mass firings. I think there's two things worth talking about with that. One is, as you say, that is facially under the law illegal. Now, they've done a lot of illegal things. The Supreme Court seems to be relatively eh about things you would have thought were illegal. But this would be pretty flagrantly illegal.
--:-- Ezra Klein: The other is a more fundamental conceptual question. This idea that destroying a federal government that you run is a good move for you. They're treating the federal government, which they are in charge of, as a hostage Democrats need to stop them from shooting. To be clear, I do not want to see the federal government shot. But usually when you're the president and you run the executive branch, you don't want the executive branch to fall apart. And if you've been listening to some of Trump's cabinet appointees, they don't seem to want their agencies gutted. I believe this is why DOGE functionally stopped.
--:-- Ezra Klein: So I guess you could just try to attack things only Democrats like in government. I think that would be illegal. But I'm curious how you think about that. My view is that if they had wanted to continue gutting the federal government, they would have. They have the power to do it. The fact that Russ Vought has not been doing much more than he has been doing suggests to me that the Trump administration actually has not wanted to do all these things. At a certain point, they are running the federal government and they need it to work for them. A lot of this is smoke and mirrors. They would be shooting at their own administrative body now, as opposed to just something that's the Democrats' job to protect and manage.
--:-- Neera Tanden: Yeah, so I think what's fascinating about this whole "I'm going to shoot the hostage that is actually my agency" is — look, I have been on the other side of this. I was in the White House in the last four years where we were worried about Republicans shutting down the government. The truth is, people generally think that the president is in charge. So the president is always worried, or they should always be worried, about owning a shutdown. But also when you have a shutdown, it really matters what happens in the first 24, 36, 48 hours.
--:-- Neera Tanden: If you're thinking rationally about this, they basically threatened to have the firings. The moment you should really want to scare everybody would have been Thursday. I really thought Russ Vought was going to start his mass firings Thursday, Friday morning, in order to pressure Democrats very quickly to reopen the government. That didn't happen. And I think the reason — and it still hasn't happened. They keep threatening it. It still hasn't happened. I don't wish it to happen. I hope it doesn't happen. But I actually think that when Donald Trump does things like this, it makes clear to people that he's relishing the whole situation and that he owns the shutdown more than anything else. It looks like he's in control of the situation, that he's using it as an excuse to fire people. And he literally says, "I'm going to fire people from Democrat agencies." What is a Democrat agency? The agencies that help working class people — Labor and whatever. Who knows?
--:-- Neera Tanden: But fundamentally, the weird back and forth — and I think Republicans are clearly back channeling to him not to do this — I think it makes them look like they own the pain to people because they do own the pain to people.
--:-- Ezra Klein: Well, that's another piece of this. The other thing that they have been doing is freezing money for projects in blue states. It speaks to the irony here of Democrats pushing a shutdown to try to protect tax credits that help red states and Republicans responding by freezing infrastructure money in blue states. I've been talking to Democrats about this and universally what they're saying to me is that it is uniting their side and hardening their resolve.
--:-- Ezra Klein: I think there's a bit of an analogy to the tariffs here. Trump has used tariffs to break a bunch of other countries and try to bring them closer in line with what he wanted. In trying to do that to Canada, he united Canadians and destroyed the political career of the more Trump-like right-wing figure who was expected to be the next Canadian prime minister. That is in large part how Mark Carney got elected. In Brazil, it has united a lot of support around Lula. When people feel that you are punishing them unfairly, even if it is hurting them — New York does not want to see money for the Second Avenue Subway frozen. It tends to turn them against you. People don't enjoy being bullied.
--:-- Ezra Klein: Normally what the president does during a shutdown pushed by the opposition party is say, "Listen, I'm a thoughtful, reasonable person here. I would love to negotiate over anything. What I want to do is turn the lights on and I'm not going to let you hold the federal government hostage." Instead, Donald Trump is saying, "I am so excited to use this shutdown as cover to push an extremist agenda I wouldn't even have done three weeks ago. I'm going to freeze a bunch of money from blue states and I'm not really going to negotiate with you." It's not a way of deflecting blame.
--:-- Neera Tanden: No. And I think people sniff this stuff out. It's really interesting you mentioning Carney. Look around the world. Who are the leaders who are actually popular in their countries? Carney, Lula, in Australia Prime Minister Albanese. These are people who are actually gaining in popularity because they are standing up to Trump.
--:-- Neera Tanden: What's so fascinating about this moment is that Trump has a modus operandi that has worked against a series of institutions over these last eight months. It is to bully and scare you and to use the power of the federal government against them in a world in which media networks are caving, law firms are caving, some universities are caving. This has been a very effective strategy for him to just literally scare the shit out of people. But the truth is, bullies work by bullying. If you are not bullied by the bully, then half of their job is gone.
--:-- Neera Tanden: So I think the irony of this whole situation is that he has a way of working, which is to try and scare you. And if you just hold firm and let it pass, it will be okay. I've heard from people in agencies who are worried about getting fired, but they think it's more important for Democrats to hold firm against Trump because they know if he is allowed to get away with this, it will only get worse.
--:-- Ezra Klein: It's also a longtime strategy that Trump's various opponents have used against him, which is to provoke him into overreaction. And I think here, this is a great example of an overreaction. He closes Second Avenue Subway. He's closing all these construction projects that affect New York. I think the idea was to punish Chuck Schumer and Hakeem Jeffries in order to maximize pain. But then these projects affect New Jersey as well — Gateway Tunnel, other projects. So it's not just limited to New York City. And then that raises the question of what everyone thinks about that.
--:-- Ezra Klein: Mikey Sherrill, the Democratic candidate for governor, immediately attacked the president for unnecessarily closing down this project. And then the question went to the Republican candidate. He basically said, "No one's asking me about this." He really is avoiding saying Donald Trump has done something wrong, even though I think there's 95,000 jobs at stake. So I do think it creates interesting counter pressures in ways that perhaps Republicans have not thought through.
--:-- Ezra Klein: It gets to the usual question of the shutdown. A shutdown over time will cause pain. What Trump is trying to do is accelerate with the grants and the funding. He's trying to cause pain to blue states faster than a shutdown naturally would. If Russ Vought begins laying off vast amounts of the federal workforce, maybe that would cause pain faster. But we're pretty early in this. The thing that will happen is that functions of the government, if there's not a deal, will begin to either degrade or shut down. You might not have air traffic controllers getting paid and begin to have flight delays. You might have national parks close. Usually you try to stay out of the way of that and blame the other party for it. But talk to me a bit about what that might look like. If this week there's no deal, if next week there's no deal. If we're looking at a shutdown of four weeks, five weeks, six weeks, when this stops being a media story about a negotiation and begins to be something that's happening to Americans, what will they feel?
--:-- Neera Tanden: There will be stories about people not being able to get passports as easily and stories about the national parks. And there will definitely be stories about veteran services and things like that. What is interesting about this shutdown debate — I've been in various shutdowns — but there are two issues in people's heads. What does the government do broadly? And then, if Democrats are capable of holding on to this line, which I think they will be, there'll be another pain in people's heads as well, which is premium shocks.
--:-- Neera Tanden: What's been really interesting about this shutdown is that there haven't been as many stories as we usually get in a shutdown in the first couple of days of problems, in part because I think people are a little more inured to those kinds of stories given the world we're in. But there will be more and more stories like that. Everyone sees things online. The argument of Republicans for the last year has been, "We should do DOGE. We should do DOGE on steroids because the federal government is useless." And now they're the big champions of keeping it open. I just think at a fundamental level, people understand that this is bullshit.
--:-- Neera Tanden: The whole debate comes down to Democrats basically saying, "Let me help you. Help me help you. You don't want these premium tax credits to expire." If I were Thune and Johnson, I would know that Trump basically wants to make a deal as well at some point. He's not going to live like this forever. I'm sure he's much more focused on the National Guard and cities. But fundamentally, his voters are going to be hurt by this in a world where his economic approval numbers are already low and cost of living numbers are already low. Anyone rational in the White House will know that they want to make a deal eventually. And do you think he's going to be so loyal to Johnson and Thune to not pull the rug out from under them? No.
--:-- Neera Tanden: My take on all of this is that maybe before we get the mass firings, we will get a deal.
--:-- Ezra Klein: Do you have any sense yet of the outlines of what that deal might look like? Do you think that is clear? People talk a lot about Jeanne Shaheen, Democratic senator from New Hampshire, has become a key go-between with Republicans. Are you hearing outlines of something taking shape or not yet?
--:-- Neera Tanden: What I hear is that there are a lot of conversations, but that none of them are engaged with Schumer and you have to engage the leader. And he's holding on to his posture of really not negotiating on this. Maybe things will change. I think Republicans had a lot more confidence last Wednesday that Democrats would fold. I think they expected the Republican message machine to work on immigration, which it is not. People are not buying this immigration debate two to one. Republicans even think this debate is around health care, not immigration.
--:-- Neera Tanden: The fact that they went to their go-to of scaring people about illegal immigrants and it hasn't worked — the coverage really still is on health care. And it's going to get worse and worse on health care because people are going to get these shocking premium hikes in the mail and then people will have to decide. People will decide not to get coverage. These are going to be stories we all live with.
--:-- Neera Tanden: The challenge here — and just to be honest — Mike Johnson basically saying he's not going to take up this legislation. He doesn't even have the House in this week. How seriously are they taking this? It has made it difficult for moderate Democrats to say, "Yes, we can negotiate," because whatever deal they strike with Thune has to get agreed to by Johnson. Otherwise, what are they all doing? But fundamentally, this will come down to Trump.
--:-- Ezra Klein: Then, always our final question. What are three books you'd recommend to the audience?
--:-- Neera Tanden: My absolute top recommendation is *Why Nations Fail* by Daron Acemoglu and James Robinson. The essential theme of the book is that inclusive political systems create inclusive economic systems. Exclusive political systems create extractive economic systems. To boil it down, it's saying that democracy is good for capitalism and markets and actually people's economic success. Oligarchy is really bad for economic growth, and it is why countries tend to fail. I think it is a description of our history, but also a warning sign about our future.
--:-- Neera Tanden: *The Sirens' Call* by Chris Hayes. It's slightly different, but the most important element of politics is attention. We talk a lot about political leaders' biography and geography and their ideology, but fundamentally their ability to convince people of their position, to defend against attacks, and to have a vision for the future all depend on how much people want to hear and listen and be led by them. That is all a function of people being first willing to pay attention to what you say. I think that is a really interesting understanding of the world.
--:-- Neera Tanden: And then *End Times* by Peter Turchin. It falls a little bit on the *Why Nations Fail* theme, but gives a sense of why we are in this moment itself and what explains the Trump era based on how people have felt stuck for a long time. It makes me think about how we need a political system that is answering more fundamental questions than perhaps it has so far.
--:-- Ezra Klein: Neera Tanden, thank you very much.
--:-- Neera Tanden: Thanks so much for having me.
--:-- Ezra Klein: This episode of "The Ezra Klein Show" is produced by Roland Hu. Fact-checking by Michelle Harris with Kate Sinclair. Our senior audio engineer is Jeff Geld, with additional mixing by Aman Sahota. Our executive producer is Claire Gordon. The show's production team also includes Annie Galvin, Marie Cascione, Jack McCordick, Marina King, Kristin Lin, and Jan Kobal. Original music by Isaac Jones, Carol Saburo, and Pat McCusker. Audience strategy by Kristina Samulewski and Shannon Busta. The director of New York Times Opinion Audio is Annie-Rose Strasser. Thank you.
