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The Solution Is to Take Less of People’s Income, Not More of It!

The administration is open to TAXING and SPENDING on everything and everyone under the sun.

It is the height of duplicity, after the President's election commercials blasted McCain for even suggesting this, without mentioning the corresponding tax break that went with it.

"Government's view of the economy could be summed up in a few short phrases: 'If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.'" ~ President Ronald Reagan (1986)

 

 

~~~~~

http://www.nytimes.com/2009/03/15/us/politics/15health.html?_r=1&pagewanted=print

March 15, 2009

Administration Is Open to Taxing Health Benefits

By JACKIE CALMES and ROBERT PEAR

WASHINGTON — The Obama administration is signaling to Congress that the president could support taxing some employee health benefits, as several influential lawmakers and many economists favor, to help pay for overhauling the health care system.

The proposal is politically problematic for President Obama, however, since it is similar to one he denounced in the presidential campaign as “the largest middle-class tax increase in history.” Most Americans with insurance get it from their employers, and taxing workers for the benefit is opposed by union leaders and some businesses.

In television advertisements last fall, Mr. Obama criticized his Republican rival for the presidency, Senator John McCain of Arizona, for proposing to tax all employer-provided health benefits. The benefits have long been tax-free, regardless of how generous they are or how much an employee earns. The advertisements did not point out that Mr. McCain, in exchange, wanted to give all families a tax credit to subsidize the purchase of coverage.

At the time, even some Obama supporters said privately that he might come to regret his position if he won the election; in effect, they said, he was potentially giving up an important option to help finance his ambitious health care agenda to reduce medical costs and to expand coverage to the 46 million uninsured Americans. Now that Mr. Obama has begun the health debate, several advisers say that while he will not propose changing the tax-free status of employee health benefits, neither will he oppose it if Congress does so.

At a recent Congressional hearing, Senator Ron Wyden, an Oregon Democrat whose own health plan would make benefits taxable, asked Peter R. Orszag, the president’s budget director, about the issue. Mr. Orszag replied that it “most firmly should remain on the table.”

Mr. Orszag, an economist who has served as director of the Congressional Budget Office, has written favorably of taxing some employer-provided health benefits and using the revenue savings for other health-related incentives. So has another Obama adviser, Jason Furman, the deputy director of the White House National Economic Council.

They, like other proponents, cite evidence that tax-free benefits encourage what Mr. McCain called “gold-plated” policies, resulting in inefficient and costly demands for health care and pressure on employers to hold down workers’ pay as insurance expenses rise. And, they say, the policy discriminates against those — many of whom are low-income workers — who do not have employer-provided coverage.

When Senator Max Baucus, Democrat of Montana, advocated taxing benefits at a recent hearing of the Finance Committee, which he leads, Treasury Secretary Timothy F. Geithner assured him that the administration was open to all ideas from Congress. Mr. Geithner did, however, allude to the position that Mr. Obama had taken as a candidate.

The administration’s receptivity to the idea is owed partly to the advocacy of Mr. Baucus, whose committee has jurisdiction over tax policy and health programs, and to support from Republicans. There is less enthusiasm among Democrats in the House, though the health debate is at an early stage and no comprehensive plans are on the table.

Also, Mr. Obama’s own idea for raising revenues for health care — limiting the income tax deductions that the most affluent taxpayers claim — has run into opposition not only from Mr. Baucus but also from his counterpart in the House, Representative Charles B. Rangel, Democrat of New York, who is chairman of the Ways and Means Committee.

Mr. Obama’s proposed limit on deductions would raise an estimated $318 billion over 10 years, or half of his proposed “health care reserve fund.” That is a fraction of the revenues that could be raised from taxing employer-provided health benefits.

In the campaign, Mr. McCain estimated that taxing all health benefits would raise $3.6 trillion over a decade — “a multitrillion-dollar tax hike,” one Obama advertisement said.

The Congressional Budget Office says that including health benefits in taxable income could mean $246 billion in additional revenue for a single year. Stopping short of full taxation, as Mr. Baucus and others suggest, would mean less new revenue.

The latest government figures, for 2007, show that 70 percent of the 253 million people with health insurance received at least some of their coverage through employers. Employment-based insurance covers three-fifths of the population under 65.

Those who want to tax benefits in whole or in part make two main arguments. They say the tax exclusion is a generous subsidy that insulates employees from the true costs of health care, leading them to demand more of it and driving up overall costs. Critics also say the policy is unfair because it favors higher-income people. “It’s too regressive,” Mr. Baucus said. “It just skews the system.”

But in a blueprint for health legislation that he issued last November, Mr. Baucus said taking the exclusion on health benefits out of the tax code would go “too far” and “cause widespread disruption in employer-based health benefits.” Mr. Obama has also said he wants to preserve employer-provided coverage. Mr. Baucus, in his paper, cited other options, like taxing benefits above some value, taxing only wealthy employees or both.

However the proposal is devised, advocates will not have an easy time selling it.

Republicans, like Mr. McCain and former President George W. Bush before him, tend to favor taxing the benefits to finance other incentives for people to buy their own insurance. But given Mr. Obama’s use of the issue in his campaign, Republicans are unlikely to support a change unless the president himself proposes it, a senior adviser to Senate Republicans said.

Many Democrats, especially House liberals, are opposed. “It’s a dumb idea,” said Representative Pete Stark of California, chairman of the Ways and Means Subcommittee on Health. “We have to maintain as much as we can of the employer payments.”

Administration officials often say they will not repeat the mistakes of former President Bill Clinton, whose plan for universal health insurance collapsed in 1994. But Frank B. McArdle, a health policy expert at Hewitt Associates, a benefits consulting firm, said, “If President Obama agrees to cut back the tax break for employee health benefits, he will risk repeating one of Mr. Clinton’s errors by disrupting health insurance for people who have it and like it.”

Some big businesses consider nontaxable employment benefits a tool for recruiting and retaining workers. The United States Chamber of Commerce opposes eliminating the exclusion on health benefits, but James P. Gelfand, senior manager of health policy, said the group had not taken a position on limiting it.

Organized labor, a pillar of the Democratic Party base, considers the benefits among the union movement’s historic achievements for the middle class. But a split could be developing between the manufacturing unions, which have negotiated rich benefit packages, and the growing service employees unions, which include many low-wage workers without generous benefits.

Alan V. Reuther, legislative director of the United Automobile Workers, said: “These proposals would represent a tax increase on working families. They would undermine good health care coverage.”

But at the

Service Employees International Union

, which was an early supporter of Mr. Obama,

Dennis Rivera

, the coordinator of the union’s health care campaign, said that while his organization was “predisposed not to agree to the taxing of health benefits,” he would wait to pass judgment. The union, Mr. Rivera said, wants to see how any tax changes fit into the overall effort to revamp the health care system. “We need to see the total picture,” he said.

Josie06 Josie06 56-60, F 10 Responses Mar 14, 2009

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Hmmm. Not sure about this. As I understand things; there are many options on the table for discussin right now. The health care system, or network, in the U.S. while having the absolute best in the world, is unbalanced. (lol... I have to go through two days of phone alls and paperwork to get an appt. and I have decent ins.) <br />
So...before I pass judgement I want to see what actually comes to the bill stage for a vote.

OOOPS! Obama is Bush on steroids. OOOPS!

OOOPS!<br />
More bad news Josie.<br />
BUSH pushed this one in 2006!!!

Well, the truth will be in the pudding. I'm waiting to see. There are just differing opinions (and we know what people say about opinions LOL) out there. I'll believe it when I see it.

NO! He was 'Present' in Illinois and he was 'Present' in the US Senate.

I think the Obama team is learning that there are those that will talk if the money is right. He doesn't just have his team anymore; there are others around with eyes and ears that will let things out. Remember Obama wasn't in Washington long enough to figure out how everything worked before he started running for President. He is still wet behind the ears (lack of experience)

We'll have to wait and see. You have a source JojoWazoo that says he's not going to do it ... the article has sources that says he agreeable to it. We'll have to see the bill as it develops in Congress.<br />
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Obama open to taxing some health benefits<br />
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03/15/2009 International Herald Tribune | http://www.freerepublic.com/%5Ehttp://www.iht.com/articles/2009/03/15/america/health.php<br />
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March 15, 2009 | Jackie Calmes and Robert Pear <br />
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Obama adviser: insurance taxes not off the table (health insurance benefits)<br />
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03/15/2009 | 3/15/2009<br />
AP ^ | http://www.freerepublic.com/%5Ehttp://www.google.com/hostednews/ap/article/ALeqM5i2HbVZqnybAUOTg0sw5Zh7K8iRrQD96UG78O2<br />
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One of President Barack Obama's leading economic advisers says the White House is opposed to taxing health insurance. But Christina Romer is not ruling it out. She heads the Council of Economic Advisers and says the administration would not rule out taxing health benefits. The New York Times reported Sunday that the administration is considering such a move. <br />
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i think possibly there is something afoot and the general public (us) are not going to like it.

If you listened to Meet the Press today. Dr. Romer stated over and over again that President Obama was against taxing health care. David Greggory tried several times for her to state the opposite, but she didn't. Who has the knowledge and insight in to what the Obama Administration is thinking about health care and taxes, but Dr. Romber herself. The "Liberal Media - New York Times" should get off the band wagon of just putting out "gossip," and instead listen to what the Obama Administration are saying about their policies.<br />
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Romer said: "Obama is against taxing health care"<br />
<br />
Dr. Christina Romer, chairwoman of the White House Council of Economic Advisors, took a slightly different tack from other administration officials on the hugely controversial issue of whether President Obama would support taxing health-care benefits in order to pay for expanding health care to uninsured Americans.<br />
<br />
Romer said Obama personally was opposed to the idea, as he had been when Sen. John McCain (R-Ariz.) brought it up during the presidential campaign. She would not rule out the idea that Obama would support such a proposal if it were approved by Congress.<br />
<br />
"He is still opposed to it," Romer said during an appearance on NBC's "Meet the Press." "He certainly was very critical and very skeptical of it [during the campaign]. It is certainly not in our [budget] proposal. We have proposed other ways to deal with health care and to fund it. So it is not something he supports."<br />
<br />
"I am not going to say one way or the other," Romer added. "I think what President Obama has said from the beginning is there is no such thing as Democratic or Republican ideas. They're just good ideas. He will listen to good ideas. This is not one he has ever supported."

Words do have meaning ... i've said it all along. However to day many believe that the meaning is the meaning of the moment.<br />
<br />
That is not true.

the obama team with come up with a great new name for getting the tax so that it sounds like a good thing. You know like Free Choice, and 95% tax cut...... <br />
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it is all a play on words and we know that once his budget plan is passed new taxes will come from every direction to pay for it.