Washington is now in the middle of a government shutdown because Democrats have chosen to block funding for essential services unless Congress agrees to extend the temporary COVID subsidies first enacted during the pandemic.
These higher subsidies were originally pitched as a temporary COVID measure. They have since morphed into a costly Washington giveaway that funnels billions to insurance companies and high-income households.
Despite Democrats’ repeated denials, what they are really demanding is not an extension of temporary aid for working families but a massive $1.5 trillion expansion of COVID subsidies. These were designed, in part, to qualify illegal aliens for coverage at the expense of American taxpayers. This is not about protecting the vulnerable — it is about dramatically expanding government welfare far beyond its original scope.
These subsidies cost nearly $40 billion a year, or $350 billion if extended through the next decade. Allowing them to expire on schedule simply restores the original structure of the law, ensuring help goes to those who genuinely need it without saddling taxpayers with billions in wasteful spending. Almost all low-income Americans — 93 percent of those on Obamacare — will continue to get subsidies under the original law. A family of four earning $125,000 will still qualify for generous assistance.
Democrats demanding an extension have been open about their goal. Rep. Maxine Waters (D-Calif.) recently said, “Democrats are demanding healthcare for everybody.” That is not about helping struggling families. It is about expanding a sprawling entitlement to consolidate political power, including restoring benefits for illegal immigrants, while taxpayers pick up the tab. It is 2025, but Democrats are willing to hold hostage federal funding for veterans, rural hospitals, and law enforcement unless they get $1.5 trillion in COVID-care spending.
The COVID-era expansion of subsidies created a system in which even individuals making hundreds of thousands of dollars per year qualify for taxpayer-funded help. In an example provided by The Wall Street Journal, a family in Arizona earning $600,000 per year, a married couple in West Virginia making $580,000, and a single professional in Vermont earning $180,000 are all eligible for these subsidies.
These are not families in need. Democrats are cutting off funding for veterans to save welfare checks for the wealthy. Further, these subsidies for the rich distort the private insurance market and drive premiums higher for everyone else. Why should a young worker earning $65,000 per year be subsidizing healthcare for wealthy Americans who take advantage of the system?
It must also be emphasized that every extra dollar sent out in subsidies flows directly into the pockets of insurance companies, which profit from the illusion that premiums are affordable while the true costs climb higher. Premiums have risen nearly 80 percent since 2014 and have more than doubled since 2011. Shielding consumers from those costs with taxpayer money does nothing to fix the broken system — it only hides the problem while perpetuating it.
There is also the matter of fraud. Reports of phantom enrollment and improper payments reveal how easily taxpayer dollars are wasted in a program with weak oversight. And when government extends untargeted subsidies, it discourages small businesses from offering coverage, pushing more Americans into the costly government-run exchanges while shrinking choice and competition.
Most importantly, Americans do not support the Democrats’ brinkmanship on the shutdown. A new national New York Times/Siena poll shows that the overwhelming majority of voters — Republicans, independents, and even many Democrats — say Democrats in Congress should not shut down the government over COVID subsidies. Although Democratic voters themselves are split (47 percent want the shutdown threat, 43 percent do not), the broader public is crystal clear: nearly two-thirds of Americans oppose using a shutdown as leverage.
This finding confirms that a broad majority rejects the idea of holding troops’ paychecks, veterans’ benefits, and essential services hostage just to secure more subsidies for the wealthy.
President Ronald Reagan once observed that “no government ever voluntarily reduces itself in size. Government programs, once launched, never disappear. Actually, a government bureau is the nearest thing to eternal life we’ll ever see on this Earth.”
That truth is playing out again today. What was sold as a temporary COVID-era measure has become yet another Washington entitlement Democrats now want to make permanent — regardless of cost, regardless of fairness, and regardless of the will of the American people.
Democrat officials need to know that independent voters are fully aware of the danger of runaway spending and Washington’s addiction to corporate welfare. Independents see this fight for what it is: a brazen attempt by left-leaning politicians to force through massive new spending that the public does not support.
As Americans endure the fallout of this shutdown, it is worth remembering what Democrats are fighting for: not for relief for working families, but for $1.5 trillion in new subsidies that would even make illegal immigrants eligible for taxpayer-funded benefits. That is not fairness. It is Washington at its worst.
Americans will still receive extensive federal support where it is truly needed, but big insurers and high earners will no longer enjoy taxpayer-funded windfalls. Letting “temporary” COVID subsidies expire is the common-sense position. Rejecting this extension is not a partisan choice — it is the responsible choice, and it reflects both fiscal prudence and the wishes of the American people.
David McIntosh, a former Republican congressman from Indiana, is President of the Club For Growth.
