Editore"s Note
Tilting at Windmills

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September 20, 2009

OBAMA SCHOOLS STEPHANOPOULOS ON INDIVIDUAL MANDATES.... This was one of the livelier exchanges between President Obama and George Stephanopoulos on today's ABC News' "This Week."

The host argued that an individual mandate would force people to spend money, which necessarily makes the idea "a tax." The president disagreed -- strongly.

OBAMA: Well, hold on a second, George. Here -- here's what's happening. You and I are both paying $900, on average -- our families -- in higher premiums because of uncompensated care. Now what I've said is that if you can't afford health insurance, you certainly shouldn't be punished for that. That's just piling on. If, on the other hand, we're giving tax credits, we've set up an exchange, you are now part of a big pool, we've driven down the costs, we've done everything we can and you actually can afford health insurance, but you've just decided, you know what, I want to take my chances. And then you get hit by a bus and you and I have to pay for the emergency room care, that's...

STEPHANOPOULOS: That may be, but it's still a tax increase.

OBAMA: No. That's not true, George. The -- for us to say that you've got to take a responsibility to get health insurance is absolutely not a tax increase. What it's saying is, is that we're not going to have other people carrying your burdens for you anymore than the fact that right now everybody in America, just about, has to get auto insurance. Nobody considers that a tax increase. People say to themselves, that is a fair way to make sure that if you hit my car, that I'm not covering all the costs.

STEPHANOPOULOS: But it may be fair, it may be good public policy...

OBAMA: No, but -- but, George, you -- you can't just make up that language and decide that that's called a tax increase.... What if I say that right now your premiums are going to be going up by 5 or 8 or 10 percent next year and you say well, that's not a tax increase; but, on the other hand, if I say that I don't want to have to pay for you not carrying coverage even after I give you tax credits that make it affordable, then...

At that point, Stephanopoulos referenced Merriam Webster's, to try to nail down a precise definition of a "tax." The president responded, "George, the fact that you looked up Merriam's Dictionary, the definition of tax increase, indicates to me that you're stretching a little bit right now. Otherwise, you wouldn't have gone to the dictionary to check on the definition."

The host added, "But your critics say it is a tax increase."

Obama replied, "My critics say everything is a tax increase."

And here endeth the lesson.

Steve Benen 10:25 AM Permalink | Trackbacks | Comments (82)

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Comments

...just 'effing awesome. Just another tidbit on how allegedly "liberal" commentators have bought totally the wingnut framing, and how somebody effectively tells them to STFU.

Despite his wavering on health care and his despicable caving to the needs of the National Security State, Obama can be quite good at times.

Posted by: bobbyp on September 20, 2009 at 10:32 AM | PERMALINK

I love this line:
"But your critics say it is a tax increase."

His critics also say he's a foreign-born Communist fascist...

Posted by: Chris S. on September 20, 2009 at 10:40 AM | PERMALINK

"My critics say everything is a tax increase [and many of them are comparing me to Hitler and say I want to kill their grandmothers, so why should we take them at all seriously?]

Finsihed.

Posted by: zoe kentucky on September 20, 2009 at 10:40 AM | PERMALINK

More please!

Posted by: Kevin on September 20, 2009 at 10:44 AM | PERMALINK

Steve, you should have a spoiler alert for those of us not on East Coast programing. But I'll forgive you.

Posted by: about time on September 20, 2009 at 10:46 AM | PERMALINK

Right, this is as much a tax increase as having your employer deduct more from your paycheck to cover the increase in premiums.

Posted by: tomj on September 20, 2009 at 10:48 AM | PERMALINK

We need universal health care to cure the US of tax hysteria.

Posted by: cld on September 20, 2009 at 10:49 AM | PERMALINK

Sorry to be a spoiler, but this is an argument Obama (whom I admire and support) is going to lose. When people realize insurance is now mandatory, most of them (especially conservatives but not exclusively) will see the federal government taking money out of their pockets to help poorer people get health care. The mandatory part makes it a tax, the "spreading the burden" part makes it socialism. Republicans will scream both at the top of their formidable lungs and completely drown out Obama's reasonable arguments. This is as predictable as the sunrise and I'm surprised the administration hasn't seen it coming.

Posted by: dalloway on September 20, 2009 at 10:50 AM | PERMALINK

George Stephanopoulous is a dullard, not to mention a shameless careerist without loyalty to anyone or anything other than himself. But everybody knows that.

Posted by: John B. on September 20, 2009 at 10:51 AM | PERMALINK

good god, wee george is a friggin idiot.

wanna bet that exchange will never be on gma's morning show?

Posted by: linda on September 20, 2009 at 10:53 AM | PERMALINK

Define: tax,

Money paid to the government other than for transaction-specific goods and services.

http://en.wiktionary.org/wiki/Tax


An insurance premium, therefore, mandatory or not, is not a tax.

Posted by: cld on September 20, 2009 at 10:54 AM | PERMALINK

Of course, there is no guarantee that even with a larger pool that premiums will actually go down, so it's all just smoke and mirrors and Obama's behalf.

Posted by: LewScannon on September 20, 2009 at 10:55 AM | PERMALINK

Remind me again how Stephaopoulos was supposedly really smart back in the '90s? Talk about reverse evolution in only one decade...

Posted by: TCinLA on September 20, 2009 at 10:55 AM | PERMALINK

Taxes are paid to the government, not private health / auto insurance companies.
It CAN'T be a tax increase if there is no money going to the government.

If there were a public option, then maybe you could say...


Whoa! I just had an idea....

Posted by: toowearyforoutrage on September 20, 2009 at 10:56 AM | PERMALINK

heh ... and look what the nyt has reduced it to in their 'highlights of obama's 5 broadcast interviews':

Health care:

He said requiring people to get health insurance and fining them if they don't would not amount to a backhanded tax increase. ''I absolutely reject that notion,'' the president said.

http://www.nytimes.com/aponline/2009/09/20/us/politics/AP-US-Obama-Interviews-Highlights.html

Posted by: linda on September 20, 2009 at 10:57 AM | PERMALINK

Translation for wing-nut tools who still don't get it:

George, the "critics" to which you're referring long ago squandered all semblance of credibility and continue to do so every time the open their mouths or get on their keyboards.

So, if I understand you correctly, you want to be counted as one of that crowd's mouthpieces, thus losing any vestige of credibility you may have once had.

That is, you are a wing-nut tool, George.

Posted by: kleven-stein on September 20, 2009 at 10:58 AM | PERMALINK

oops, i take that back -- that 'highlights' piece is an ap product; not the nyt.

Posted by: linda on September 20, 2009 at 10:59 AM | PERMALINK

Beautiful example of framing -- what the right's been so good at. Now, finally, Obama has taken the right's tax frame and broken it over his knee in one blow.

C'mon, left, let's build the new frame -- finally!

Stephanopoulos smart in the '90's? Maybe. But what we know for sure is that working for broadcast/cable media requires you to leave your brains at the door.

Posted by: PW on September 20, 2009 at 11:06 AM | PERMALINK

I voted for Obama but he is mistaken if a government mandated cut in your salary will not be perceived as a tax- the auto insurance analogy is a poor one as cars are optional- and though one could argue what's fair and what is not- a person certainly should have a choice in deciding not to pay an insurance company riddled with immorality to support fat cats (not to mention misbegotten religious reasons). Also, if he really thinks his approach will cut costs I have a bridge to sell. Macroeconomically speaking, his plan represents a monetary transfer from the working middle class (the 80% that will not use the services)- to the 1) elderly 2) rich insurance company 3) the poor. Personally, I could not imagine a worse plan. To be clear, the rest of use, (I am including myself), will not see any changes. If I was a wealthy GOPer, I could not be happier. Let them eat cake and pay the high deductibles, HAHAHA.

Posted by: Raoul on September 20, 2009 at 11:19 AM | PERMALINK

It is utterly disingenuous to claim that the individual mandate is just the same as the requirement to have auto insurance. If someone doesn't want to buy auto insurance, he can choose, at least in principle, not to own a car. (And as I understand it, a great many residents of New York City don't.)What would be the equivalent option in the case of health insurance?

Furthermore, should anyone be comfortable with someone else deciding what is or isn't "affordable?"

Posted by: Steve on September 20, 2009 at 11:28 AM | PERMALINK

that 'highlights' piece is an ap product
=========================

Gee, there's a shock.

Posted by: Fleas correct the era on September 20, 2009 at 11:33 AM | PERMALINK

George has certainly come a long way !
He use to be for "the people" when he was actively involved in the Clinton Administration.
"Now" that he is a wealthy Celebrity, he sounds like a man for "the RICH people."
His roundtables seem to have 3 Right-Wingers and 2 Dems ALWAYS.
I have seen his 2nd rate show for the last time today.

Posted by: ParityFanatic on September 20, 2009 at 11:41 AM | PERMALINK

re: Steve

Gee - I don't have a whole lot of choice when the insurance companies decide what I and my employer have to pay for health insurance. If I didn't work for a big company I'd have even less choice. If I were in the individual market I'd have still less choice AND I wouldn't be able to get coverage for pre-existing conditions (which the insurance companies have a genius for discovering way after the fact so they have an excuse to cancel policies).

Oh yeah - AND I STILL wind up paying extra to cover people who don't have insurance and wind up in emergency rooms unecessarily.

I think the comparison to car insurance is reasonable. You can decline to drive a car and that decision doesn't impose a cost on other drivers. It's a bit harder to decline mandatory health insurance and guarantee that you won't impose a cost on others. (But maybe this is where we NEED death panels...)

Posted by: Butch on September 20, 2009 at 11:43 AM | PERMALINK

"If someone doesn't want to buy auto insurance, he can choose, at least in principle, not to own a car."

The only "equivalent" would be an individual signing an agreement that they would not seek medical care if they were sick, and would have to register this fact with a database that providers would use to refuse treatment.

The comparison to auto insurance is valid only in the sense that it is mandatory shared risk. Lots of people are unhappy about this mandate as well, as mandated car insurance has resulted in an equally complex and unregulated insurance industry. Tried getting a "liability only" policy lately?

The policy direction is politically insane, scrapping a popular public option while embracing what will be an enormously unpopular mandate

Posted by: markinnc on September 20, 2009 at 11:45 AM | PERMALINK

Individual mandates - what a mess. I understand the concept, expand the coverage pool to reduce everybody's cost and risk (this is how health care co-ops started during the Depression), but it sure sounds as if people are being forced to spend bucks. Oh, and I was forced to get car insurance, but I never saw my rates go down back then or now (and I have a very good driving record).

Much easier to just say "Medicare of all" and "everybody is covered."

Too bad Washington still seems to be in the pocket of the insurance companies and Wall St banksters.

Posted by: Glen on September 20, 2009 at 11:52 AM | PERMALINK

Talk about a double standard. When our state enacted mandatory auto insurance, I cannot recall anybody calling it a "tax." And now because a federal health care reform might require everybody to get health insurance, this is suddently a "tax?"

Get real.

For the record, I do not favor mandatory health insurance. Tax credits do not cut it! What good is a tax credit if you cannot afford to pay the premium? This whole tax credit business is a product of the radical right during the Nixon/Ford and Reagan eras. Tax credit just don't do any good when you can't afford to pay the cost of something during the year. They're a phony solution to anything.

Posted by: Dan Lauber on September 20, 2009 at 11:54 AM | PERMALINK

Macroeconomically speaking, his plan represents a monetary transfer from the working middle class (the 80% that will not use the services)- to the 1) elderly 2) rich insurance company 3) the poor.

Wait, 80% of the middle class never uses health insurance if they have it? In the course of a year, none of them catch the flu, break a bone, or even get a checkup? None of their kids get sick even once?

That seems like an awfully high number, don't you think?

Posted by: Mnemosyne on September 20, 2009 at 11:57 AM | PERMALINK

After the depressing performances of the past administration AND our illustrious media one might have hoped for some "CHANGE" with an intelligent, articulate president who has a desire to do some things differently...BUT NO WAY...and just as we have someone who doesn't hurt your ears/brain to listen to our media reps who do the interviewing seem to be more BUSHLIKE than ever...the bias and idiocy of their questioning makes one want to gag! Obama could be ON somewhere 24/7 and still not EDUCATE this American public...they need folks like Limpballs and Beck hollering batshit crazy crap to penetrate their thick skulls...Obama has more class than this country deserves.

Posted by: Dancer on September 20, 2009 at 12:25 PM | PERMALINK

"'The host added, "But your critics say it is a tax increase.'"

And the host is a journalist, who... Oh, never mind.

Posted by: Steve in Sacto on September 20, 2009 at 1:11 PM | PERMALINK

The car is optional. The human body isn't. So, yes, the analogy is flawed. Pity.

Reading between the lines though, it would seem that Obama is making a tacit assumption that there will be a public option. In which case, mandatory insurance will not place everyone at the mercy of extortionate private premiums and unscrupulous mistreatment.

Only by the invocation of a public option does the tax argument properly collapse.

Posted by: Goldilocks on September 20, 2009 at 2:27 PM | PERMALINK

Of course the individual mandate is a damn tax increase, give me a freakin' break. If you want to argue that soemthing is a tax only if you pay it to the govt, fine, but you only win on technical grounds. The fact is that the govt is forcing you to spend the money, it's economic impact is exactly the same as a tax. Obama, and Steve Benen, are entirely wrong on this one.

And that's why higher subsidies are essential. According to the Baucus plan, the individual mandate would be a very regressive tax, and that would exact a terrible toll on moderate income families.

Honestly, this blog really falls down when it comes to economic issues.

Posted by: g. powell on September 20, 2009 at 2:44 PM | PERMALINK

Stephanopoulos is such a gruesome little tool. President Obama should have reached across, grabbed him by the shirt and tie, and decked him.

Posted by: electrolite on September 20, 2009 at 2:55 PM | PERMALINK

I think Obama was brilliant in the way he cuffed Steph around the studio in this exchange, but as for the substance of his argument, I agree with several others above this is NOT a winning argument. Period.

I think mandates and tax credits are horseshit, and Obama is parsing just as much as Georgie by declaring an added financial burden imposed by the government as "not a tax increase."

If the government is deciding how much is "affordable" for families and forcing people to write a check—I don't give a shit whether that check is to the IRS or CIGNA. It's effectively the same thing as a tax increase—but worse: A tax increase comes incrementally in small bites from your paycheck or once a year. Insurance premiums are a monthly hardship.

Posted by: Mr Furious on September 20, 2009 at 3:14 PM | PERMALINK

Stephanopoulos is correct. It is a tax increase. And Obama's comparison of health insurance to auto insurance is crap.

If this health insurance exchange is going to be so great, and it's going to offer health insurance that's so affordable, it doesn't need a mandate. If it's going to be so useful and reasonably priced, then just make everyone in the country pay it, oh, like maybe when we pay our income taxes every paycheck.

If it's so great, who'd complain about it?

But that's the problem. None of these plans seem to provide insurance that's much better than what's out there now; and the plans certainly do very little to provide the basics that we need like annual checkups and minimum twice-a-year dental cleanings and check-ups.

Posted by: NealB on September 20, 2009 at 3:37 PM | PERMALINK

Georgie-Porgy pudding pie
The president just raised and lowered
the price of the pie.
You don't have to eat and neither do I
But if you do I don't have to pay for your pie.

I would pay a tax increase just to make sure HC ins. was affordable and it covered everybody. If my taxes go up at least my premiums would go down and 42,000 people a year wouldn't have to die from no ins.. But you just wanted to demean Obama more than find a workable solution Georgie.
The president didn't make you look bad Georgie...you always look bad but sometimes someone needs to make your ego confirm it.

Posted by: bjobotts on September 20, 2009 at 4:17 PM | PERMALINK

dalloway says:"...The mandatory part makes it a tax, the "spreading the burden" part makes it socialism. Republicans will scream both at the top of their formidable lungs and completely drown out Obama's reasonable arguments. This is as predictable as the sunrise and I'm surprised the administration hasn't seen it coming..."

They scream this anyway but the premise of mandatory auto ins. shuts them up. This way they don't have to worry about getting hit by someone with no ins.. Taxes go up = premiums go down but everyone gets covered. btw...there are no legitimate republicans left...just the mad dog crazies who believe we are a democracy only when they are in power. This 70-100,000 screamers are outnumbered by tens of millions. The majority has taken our country back already...from them...and now we are trying to fix it after they all but destroyed it.

Posted by: bjobotts on September 20, 2009 at 4:25 PM | PERMALINK

The mandatory part makes it a tax, the "spreading the burden" part makes it socialism. Republicans will scream both at the top of their formidable lungs and completely drown out Obama's reasonable arguments.

After the invasion of Iraq, the Bush administration drafted a new Constitution for the Republic of Iraq. Republic being a nation ruled by law. Article 31 of the Iraqi Constitution states:

"First: Every citizen has the right to health care. The State shall maintain public health and provide the means of prevention and treatment by building different types of hospitals and health institutions."

Second: Individuals and entities have the right to build hospitals, clinics,or private health care centers under the supervision of the State, and this shall be regulated by law.

Funny, I didn't hear any Republicans screaming when Bush set up a socialist/communist state in Iraq...

Posted by: Glen on September 20, 2009 at 4:48 PM | PERMALINK

The auto ins comparison shouldn't be taken literally ...it's the 'spirit' of the comparison. To be literal you must 'imagine' that everyone must own a car. And get this straight...you are already paying for the uninsured...and your own premiums have doubled and will double again if we don't change the system now. You bitch about a tax you might have to pay when you know you will pay an increase in premiums and deductibles. And those who can't afford ins will be subsidized so tax credits won't matter to them but they will still get ins.. Universal coverage may mean higher taxes but it damn sure means lower to none on premiums. We know what we have isn't working so why criticize the details of change when nearly anything is better than the status quo.
We are the government and we can change what doesn't work but we must at least start the process of change if we are to get anywhere. It's not a tax, it's a premium decrease for some and an increase for others. This is why priv ins is spending millions to prevent change.

btw...how come 70,000 tea baggers get such media coverage yet the 40,000 who camped out for days to get free medical treatment got zilch in media coverage.

Obama is right...and is taking us a step closer to single payer universal health care ins coverage that one day will be not for profit.

Posted by: bjobtts on September 20, 2009 at 4:54 PM | PERMALINK

First, I agree with those who look at mandated (ie; mandatory/compulsory) health insurance as an onerous transfer of wealth from the pocket of citizens into the pockets of corporations.

Whereas automobile insurance is only compulsory if you drive, health insurance is compulsory if you are **ALIVE**. That is what makes it egregious.

It is not the DUTY of every living American to enrich insurance company shareholders, and that is precisely what is being discussed here.

OTOH, those people already paying for health insurance through an employer-backed plan are already surrendering their "monthly hardship" and probably won't be worse off than they were before.

Still, if the payment of these fees is to be compulsory, the money should go to single-payer pool & not one cent should be paid to enrich shareholders.

Posted by: sidewinder on September 20, 2009 at 4:56 PM | PERMALINK

Let's be clear what's going on here: The plan is to outsource univeral coverage to private companies and insurance premiums are the taxes to pay for most of the costs. It's a regressive tax.

A true progressive would tax the wealthy to pay for the bulk of this program (which probably should be Medicare-for-all anyway), but Obama won't support that.

So Steve Benen, who doesn't understand the issue, got punked by Obama.

Posted by: g. powell on September 20, 2009 at 5:51 PM | PERMALINK

Do I understand this correctly?

Situation 1: Person A doesn't have health insurance now and will pay for health insurance in the future. Stephanopoulos says that the government mandate is a "tax increase" on person A because the government is forcing A to pay for something A didn't pay for before.

Situation 2: B has health insurance right now but B's health insurance premium is higher than it needs to be--on average $900 per year--because B is "taxed" (using Stephanopoulos's definition) to cover health care for uninsured A.

So let's say A is "taxed" when A is forced to pay for health insurance. By the same reasoning, won't B's "taxes"--B's health insurance premiums--be CUT when A pays for his or her own health care? Won't B pay on average $900 less when he or she is no longer forced to pay for A's health care? Isn't that a good thing?

I don't want to touch Stephanopoulos's confused idea that American citizens pay "taxes" to private insurance companies. This conflation of government and corporate entities is just creepy.

Posted by: PTate in MN on September 20, 2009 at 6:31 PM | PERMALINK

g. powell,

"A true progressive would tax the wealthy to pay for the bulk of this program (which probably should be Medicare-for-all anyway), but Obama won't support that."

One little problem: what happens to your wonderful progressive program if the "wealthy" sugar daddies supporting it are eventually taxed out of existence, start playing hide 'n' seek with the IRS, or simply vote with their feet?

Furthermore, not a few doctors would be, in your eyes, "wealthy." What makes you think they wouldn't either a) deliberately work less--and earn less money--to avoid paying Uncle Sam any more than necessary or b) simply get out of their chosen field altogether and go into something more lucrative? Hmmmmmmm?

g. powell, old boy, I daresay creating the ObamaCare Utopia might be a rather sticky wicket if there aren't any doctors, nurses, or remaining "deep pockets" to back it up.

Posted by: MarkJ on September 20, 2009 at 6:51 PM | PERMALINK

"Won't B pay on average $900 less when he or she is no longer forced to pay for A's health care? Isn't that a good thing?" - PTate

Certainly possible in your scenario, however, my experience is that prices ratchet up substantially easier than ratchet down.

Also, catastrophic health insurance plans (I have one) carry lower premiums because deductibles are quite high. At the risk of my father calling me a "weanie" I haven't seen a doctor since having my umbilical cord cut (only a slight exaggeration).

In all likelihood these plans will not qualify for the insurance exchanges (as currently proposed) and be eliminated or penalized.

Posted by: m on September 20, 2009 at 6:52 PM | PERMALINK

If it's going to be so useful and reasonably priced, then just make everyone in the country pay it, oh, like maybe when we pay our income taxes every paycheck.

If it's so great, who'd complain about it?

Yes, because right now no one ever complains about the amount of taxes taken out of their paycheck or whines that the people who mostly pay their income taxes through payroll deduction aren't "really" paying income tax like the people who write a yearly or quarterly check do.

Posted by: Mnemosyne on September 20, 2009 at 7:05 PM | PERMALINK

MarkJ -- Raising the marginal rate a few percentage points on the wealthiest Americans won't cause them to emigrate to China or Russia, or tax them out of exisitence. I'm tired of pointing this out, but the top marginal rate in the 1950s was 90%, and the economy did fine.

Not all doctors, like GPs, make lots of money. (I guess "hmmmmmmm" is suppose to be making some kind of a point.). Besides, I'm talking about the new ultra-wealthy class.

The irony is that many of the ultra-wealthy support higher marginal rates. Like Warren Buffet. Because they know it's good policy.

So spare the usual conservative clap-trap.

Posted by: g. powell on September 20, 2009 at 7:09 PM | PERMALINK

Whether you call it a tax or a premium or a credit or a subsidy is not that important. What matters, for households and businesses, is net annual expenditure on health care. If net annual expenditure falls as a result of reform, that is good - especially if conjoining with a net improvement in service.

It seems the discussion above has lost sight of the wood for the trees. A small net increase in 'tax' balanced against a larger overall decrease in insurance premiums and deductibles would be a huge benefit for everyone and the economy.

Short of universal health care, the public option is the only component that has a realistic chance of achieving such a desirable result.

Posted by: Goldilocks on September 20, 2009 at 7:23 PM | PERMALINK

"The irony is that many of the ultra-wealthy support higher marginal rates. Like Warren Buffet. Because they know it's good policy." - g

Research "Hauser's Law" -- tax receipts as a percent of GDP have consistently remained at about 20% of GDP regardless of the highest marginal tax rate (ranging from 28% to 90%) since shortly after WWII.

In a nutshell, increasing marginal tax rates will not increase total tax receipts.

Posted by: m on September 20, 2009 at 7:33 PM | PERMALINK

The non-conservative backlash against the individual mandate reveals to me that it's not just conservative Americans whose social responsibility extends only so far as it doesn't cost them anything. I'm amazed that even liberals don't see having health insurance as a responsibility. Notice that the complaints here aren't that the premiums will be unaffordable, they're against being forced by law to have health insurance as a matter of principle.

Most of us would prefer a nationalized of single-payer system that is primarily financed via progressive taxation. But that's not going to happen. The only path to health care reform in the US now is via combining the current system of private insurance, mostly employer-based, with universality. That being the case, there is absolutely no avoiding the individual mandate and that some people are going to be forced to pay health insurance premiums that they would rather not. Certainly, the subsidies should be generous. But at middle-class and higher income levels, they shouldn't and won't make the premiums for people in the exchanges any less than that of the majority who are getting coverage via their employers.

Basically, the people complaining are saying one of three things. That they would willingly pay to the government the same amount of money that they grudge paying to insurance companies; that they would be willing to directly shoulder all health care costs as an alternative to the individual mandate (that is, there is no mandate, but anyone who chooses to be uninsured would legally surrender all conventional forms of medical debt relief, including bankruptcy); or they want health care that is subsidized by other people of similar means (that is, a peer earning a similar income but with coverage), which is the current situation.

The first is unrealistic, the second would result in the majority who chose this route complaining of the injustice of being impoverished by unexpected medical bills without recourse to bankruptcy, and the third is very irresponsible and selfish.

Finally, the argument that a comparison to car insurance is inappropriate is unconvincing because A) a great many people don't choose to forgo a car and do drive without insurance; and B) for a large majority of the population of the US, having a car isn't optional. If you don't know this, you've never lived anywhere with poor public transit and have never had a potential employer inquire as to whether you have your own transportation.

Indeed, in these places, some argued once upon a time—just as people are here—that requiring auto insurance was a form of regressive taxation. That argument was unconvincing because it was incontrovertible that the uninsured, whether poor or not, were forcing insurance rates higher. If you look at state comparison, the higher the rate of uninsured, the higher the auto insurance premiums. It's true that reductions in insurance company costs doesn't easily translate into lowered rates; but that's an argument for greater competition or regulation, depending upon your chosen ideological preference. It's not an argument for denying the simple accounting reality that the less insurance risk is spread, the higher the insurance premiums.

Posted by: Keith M Ellis on September 20, 2009 at 7:45 PM | PERMALINK

Since the public option appears to be off the table, mandatory health insurance certainly is not a tax, since there is no mandate to pay money to the gvmt.

What we need here is a new, much more horrifying word to describe the money that the gvmt mandates that citizens pay to private corporations. How about "corporate welfare"? Wait, that's already taken....

Posted by: Disputo on September 20, 2009 at 7:53 PM | PERMALINK

m-- Hauser's Law is a not serious economics, it's simply an observation, there is no theoretical backing so it doesn't tell you anything about the future or how to conduct policy.

Why should tax receipts be 20% of GDP? Why not 30% or 35%? Just because it has been that way in the past doesn't mean a thing.

Posted by: g. powell on September 20, 2009 at 7:55 PM | PERMALINK
Tax receipts as a percent of GDP have consistently remained at about 20% of GDP regardless of the highest marginal tax rate (ranging from 28% to 90%) since shortly after WWII.

In a nutshell, increasing marginal tax rates will not increase total tax receipts.

The latter is false even if the former is true—and yours is a dishonest argument.

Tax revenue as a percent of GDP has largely been stable simply because politicians, especially in the US, are conservative about such things. There is little support, and a lot of opposition (as we see recently) to greatly alter the overall rate at which the US government taxes the economy, or for that matter, its overall involvement in the economy. What's happened is that reductions in the highest marginal rates has been offset by widely-distributed increases in the middle-class tax burden. It didn't have to be that way, and it wouldn't have to be the case that increases in the higher marginal rates would be offset by decreases in the middle-class burden. But it probably would. There is no true economic law here, it's just an accident of history.

Posted by: Keith M Ellis on September 20, 2009 at 7:56 PM | PERMALINK

Basically, the people complaining are saying one of three things.

Wrong on all accounts, Keith. What people are saying is that they do not want to be forced to give their hard-earned money to the corrupt insurance industry.

Posted by: Disputo on September 20, 2009 at 7:57 PM | PERMALINK

Keith -- Great analysis.

Health care reform can win me over when someone can make me believe consumers of healthcare that make poor lifesytle choices -- leading to more expensive health care -- will be penalized (monetarily, not with a shorter lifespan) to disincent that behavior.

I have an adult son that can't get individual health insurance because he is forty pounds overweight and a mother that has required extensive surgeries (paid for by medicare) as a result of a lifetime of smoking.

By the way, neither expect their neighbors to pay for their poor choices.

Posted by: m on September 20, 2009 at 7:59 PM | PERMALINK

A health insurance "mandate" like Obama is pushing in the Max Tax bill (you know, like the very opposite of what Obama said was for when he campaigned) isn't a tax- its much worse than one!

Forcing Americans to write large checks to the health insurance companies for crappy insurance is more like playing Russian roulette with 5 loaded chambers. Arguing that it is not really a tax to the beltway gasbags will be the least of Obama's worries.

Posted by: dinsdale on September 20, 2009 at 8:10 PM | PERMALINK

m- So your adult son can't get insurance in part because his mother made poor choices. What's your point? That's a good thing?

Posted by: g. powell on September 20, 2009 at 8:11 PM | PERMALINK

Keith M Ellis -- I have no idea what your point is.

Posted by: g. powell on September 20, 2009 at 8:17 PM | PERMALINK

g -- "Hauser's Law" is an observation sustained over six decades. It's not a theory because it has yet to be explained, though many hypothesis exists. Let's revisit this in a year and see if "tax receipts" more closely track "tax rates" or GDP.

Posted by: m on September 20, 2009 at 8:27 PM | PERMALINK

m -- No, you don't test the theory over one year, especially during a downturn. Your argument is not serious. Keith M. Ellis makes my point better in his rebuttal to you. I just don't understand his point about healthcare -- too long for my pea-sized brain.

Posted by: g. powell on September 20, 2009 at 8:35 PM | PERMALINK

Since the public option appears to be off the table,[...] -- Disputo, @19:53

Apparently not; Obama still seems to be hanging onto it. What's more, I saw somewhere (not sure now where; have been cruising through too many places), that he also said that he would not sign a bill which he didn't think was good for the American people. That's the first time I've heard him threaten a veto, however mildly. And I'm not sure how much trust to put into that statement -- I've been getting shorter and shorter on trust recently -- but, still...

The adherence to the public option is here:
http://thinkprogress.org/2009/09/20/obama-public-dead/

Posted by: exlibra on September 20, 2009 at 9:07 PM | PERMALINK

Dalloway is either stupid or brainwashed. Either way, Dalloway is spouting such ridiculous crapola s/he belongs in the Beck Claque.

Posted by: Cal Gal on September 20, 2009 at 9:23 PM | PERMALINK

I agree mandated health insurance is not a 'tax.'

But I think tax-funded health insurance would be a GOOD idea.

Especially if real progressivity were returned to the income tax, and income tax paid for health insurance.

Posted by: Single. Payer. Now. on September 20, 2009 at 9:29 PM | PERMALINK

You know, people really get frosted by "having to pay for something," but especially if others are getting subsidies or are getting for free.

The answer is to give it to EVERYONE for "free."

No-nothings complain that "Europeans" (as if Canada were in Europe) "pay 50%" in taxes to get their "socialized medicine."

WAKE UP SHEEPLE! You already pay, what, 25% to 38% in federal INCOME tax, AND you're soon going to have to pay 50% MORE just for health insurance.

50% for ALL your taxes, AND you get free health care included? It would be a damn BARGAIN, sheeple.

Posted by: Sarah Barracuda on September 20, 2009 at 9:37 PM | PERMALINK

George Stephanopoulos's flawed logic shows his brain doesn't work as fast as his mouth.

Posted by: pj in jesusland on September 20, 2009 at 10:19 PM | PERMALINK
Notice that the complaints here aren't that the premiums will be unaffordable, they're against being forced by law to have health insurance as a matter of principle.

Generally I am more specific with my objective to a mandate... I think mandates are the wrong approach, but I am 100% opposed to a mandate if there is no public option. Period.

I think a reform package lacking a public option is deeply flawed and potentially bad. A bill without a public option that has a mandate is a non-starter for me.

Posted by: Mr Furious on September 20, 2009 at 10:30 PM | PERMALINK
Won't B pay on average $900 less when he or she is no longer forced to pay for A's health care?

I wouldn't recommend holding your breath waiting for that rate reduction...

Posted by: Mr Furious on September 20, 2009 at 10:32 PM | PERMALINK
Research "Hauser's Law" -- tax receipts as a percent of GDP have consistently remained at about 20% of GDP regardless of the highest marginal tax rate (ranging from 28% to 90%) since shortly after WWII.

Just a wild guess here, but perhaps the fact that the top earners now possess a far larger portion of the money probably accounts for that..."In 2007, the top 5% of income earners paid over half of the federal income tax revenue.[31] The top 1% of income earners paid 25% of the total income tax revenue."

Posted by: Mr Furious on September 20, 2009 at 10:41 PM | PERMALINK

The point that a mandate is necessary does not accurately encompass someone who works on a freelance basis and has no steady income. If you receive income this way (like lots of day laborers, tech consultants, etc.) what are you supposed to do when you can't afford the premium for a short time period? Insurance companies aren't going to let you slide. Tax credits aren't going to help. And living check-to-check you have no way to pay a lump sum. Hell, you're lucky if you can afford to pay anything.

Also, anyone paid under the table isn't going to be helped by a tax credit. There are lots of people barely surviving because they are paid under the table - housekeepers, babysitters, lawn mowers, etc. They're worried about feeding themselves, not if they bothered to file a 1040. Heck, I know someone who hasn't fined a tax return in 10 years.

If you live pay check to pay check and that check isn't on a regular basis, a mandate is going to force you to pay fines. And don't talk about financial responsibility, as many of these people are the ones that owe big to pay-day loan operations.

Posted by: Mark LIlback on September 20, 2009 at 11:10 PM | PERMALINK

How long did Stephanopoulos spend writing his script, thinking up his list of questions for when he would have the president of the US in front of him?

What is the obsession with these on-air political personalities having to label, instead of discussing the issues? Not only did he waste the time trying to get Obama to validate his perception, when Obama didn't and gave an explanation, Stephanopoulos insisted, again and again.

Who cares what it's called?

Posted by: Pete on September 20, 2009 at 11:30 PM | PERMALINK

Why can't we have a business mandate as well? Why just an individual mandate? Companies can get better rates. The argument that insurance premiums would be more affordable doesn't take into account that the only standard for setting premiums at first is the current standard of high premiums.

I'm also disturbed by the fact that although insurance companies won't be able to discriminate against pre-existing conditions, it doesn't say anywhere that the premiums don't have to reflect the higher risk. So what happens if the insurance companies decide that those premiums need to be exorbitant and the individual is still forced to buy it?

I don't like the argument that people don't want to pay for someone else's bad behavior. I have diabetes but have worked hard since I was diagnosed in 1990 to keep my blood sugar under control. That argument guarantees that I will be punished because no matter how well I take care of myself, the diagnosis has already been made. It is also inherited. Who gets to decide why and how my conditions, or any one elses', have come about. It's a slippery slope for discrimination against anyone who is ill regardless of the reasons. The ill would become the new gay.

Posted by: Always Hopeful on September 20, 2009 at 11:58 PM | PERMALINK

Lovely - I enjoyed it - Great but,

When are we seriously going to "Raise Taxes" to cover Two Un-funded Wars and One Un-funded Drug Plan part D? None have ever been funded by our congress and are existing on money borrowed from international lenders who will soon start demanding higher rates of interest.

Hello reality! Hello high fuel prices. By By Dollar ! Don't even mention the job losses.

Tax Cuts - The republican answer to everything until it all tipps over. You can fool your selves
for a while but not the international investors.

End of Empire! End of the Exclusive American!

Posted by: Robert Barnes on September 21, 2009 at 12:53 AM | PERMALINK

Obama replied, "My critics say everything is a tax increase."

Yes, yes, YES! Finally someone is not scared to tell the plain truth.

Posted by: Nancy Irving on September 21, 2009 at 4:25 AM | PERMALINK

Which would you rather have: a small "tax" increase or bankruptcy if you get sick? Millions will grab at the opportunity.

Posted by: bob h on September 21, 2009 at 7:49 AM | PERMALINK

Of course, Obama doesn't have to convince Stephanopoulos that mandates aren't a tax increase. He has to convince the average voter and that's a damn difficult job since Americans have been thoroughly brainwashed into thinking anything that raises revenue is a tax and all taxes are bad. Republicans have led us into the era of the free lunch -- where nothing has to be paid for, because taxes are evil. Regardless of whether or not Obama schooled Stephanopoulos about mandates and taxes, I have no doubt that he failed to convince most, if not all, Americans who currently oppose his health care agenda.

What I thought was most important here was the familiar image of a president getting hamstrung by his own promises -- especially when those promises are unwise to begin with. After George H. W. Bush's experience with "Read my lips," one would think all presidential candidates would avoid any kind of absolute promise that could come back to haunt them once they were in office.
Similarly, Obama was foolish to repeatedly state that health care reform can't raise the deficit by even so much as a "dime." Surely, if we could manage reform that would raise short term deficits modestly, while providing substantial long term savings, that would be a fair and responsible trade-off -- except Obama can't make such a trade-off without being hammered by his own (unwise) words.

Posted by: oh really on September 21, 2009 at 9:00 AM | PERMALINK

Well, George, I have to buy auto insurance to drive mycar, dos that make it a tax? What an idiot.

Posted by: Stetson Kennedy on September 21, 2009 at 9:04 AM | PERMALINK

Have you read the bill, Steve?

Page 29, Subtitle D;

Excise Tax. The consequence for not maintaining insurance would be an excise tax. If a taxpayers MAGI is between 100-300 percent of FPL, the excise tax for failing to obtain coverage for an individual in a taxpayer unit (either as a taxpayer or an individual claimed as a dependent) is $750 per year. However, the minimum penalty for the taxpayer unit is $1,500. If a taxpayers MAGI is above 300 percent of FPL the penalty for failing to obtain coverage for an individual in a taxpayer unit (either as a taxpayer or as an individual claimed as a dependent) is $950 year. However, the maximum penalty amount a family above 300 percent of FPL would pay is $3,800.

Posted by: Sandra Kay on September 21, 2009 at 9:17 AM | PERMALINK

"the bill", Sandra? Which ONE of the bills currently being floated is that particular paragraph from??

Posted by: Butch on September 21, 2009 at 10:49 AM | PERMALINK
Of course, Obama doesn't have to convince Stephanopoulos that mandates aren't a tax increase. He has to convince the average voter and that's a damn difficult job since Americans have been thoroughly brainwashed into thinking anything that raises revenue is a tax and all taxes are bad.

The individual mandate doesn't "raise revenue". The premium which is the consequence of the mandate—and that's what people are complaining about—is paid to private insurers (or to a publicly-run insurance company, if the public option is included), not the government.

Wrong on all accounts, Keith. What people are saying is that they do not want to be forced to give their hard-earned money to the corrupt insurance industry.

That would be covered by the first of the three things I listed: "...that they would willingly pay to the government the same amount of money that they grudge paying to insurance companies".

I see this as a legitimate thing to dislike, but I don't see it as a legitimate argument against the mandate or health reform in general. As an argument about this version of health reform, it effectively is saying that without either a government run insurance or health care system, the present situation is better than what is being proposed. Disliking having to pay private companies for health insurance is a poor excuse to continue the status quo with its millions of uninsured, rescission, and the other injustices and abuses this reform will address. It's selfish.

Posted by: Ketih M Ellis on September 21, 2009 at 11:35 AM | PERMALINK

electrolite on September 20, 2009 at 2:55 PM:

"Stephanopoulos is such a gruesome little tool. President Obama should have reached across, grabbed him by the shirt and tie, and decked him."

Obama would be castigated for such an action. On the other hand, if every guest on MTP were to do so to Fluffyhead the ratings would definitely improve.

Posted by: Bob Johnson on September 21, 2009 at 11:40 AM | PERMALINK

To Butch:

The bill Sandra Kay is referring to is the Baucus bill George S and Obama were discussing in the piece referenced above. I watched the exchange as well as the followed the Dem criticism of the Baucus bill thursday when they specifically cited their disapproval of the "excise tax."

I understand the desire to defend Obama's health care reform efforts, but this is not an instance to do the victory dance. This exchange was disappointing at best. When the bill defines the action as a tax, it is foolish to try to pass it off as a non-tax. Obama did not do his homework (or at least his people didn't) and then knowingly embarked on a five interview string to promote the reform efforts. I want reform, too. But this was a ridiculous and preventable error. Even to me, a supporter, he looked like he was unprepared.

Posted by: GAt on September 21, 2009 at 1:27 PM | PERMALINK

I'm with you, "oh really"

The "not one dime" line pisses me off as well. If that costs us a better plan, it's a mistake. Straight up.

Of all the things we've spent money on that add to the deficit, this is probably the only one that would be worth it

Posted by: Mr Furious on September 21, 2009 at 3:24 PM | PERMALINK

I mean, this is a joke right? It CAN'T be a tax just because HR 3200 Sec. 401 (the House bill) calls it a tax??

=========================================
Sec. 401. Tax on Individuals Without Acceptable Health Care Coverage.
(a) In General.
Subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new part:

PART VIIIHealth care related taxes

subpart a. tax on individuals without acceptable health care coverage.

Subpart ATax on Individuals Without Acceptable Health Care Coverage

Sec. 59B. Tax on individuals without acceptable health care coverage.

SEC. 59B. TAX ON INDIVIDUALS WITHOUT ACCEPTABLE HEALTH CARE COVERAGE.
(a) Tax imposed.In the case of any individual who does not meet the requirements of subsection (d) at any time during the taxable year, there is hereby imposed a tax equal to 2.5 percent of the excess of
(1) the taxpayers modified adjusted gross income for the taxable year, over
(2) the amount of gross income specified in section 6012(a)(1) with respect to the taxpayer.


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