Posted on 10/24/2009 5:37:49 PM PDT by reaganaut1
AMERICANS seem to like the idea of broadening health insurance coverage, but they may not want to be forced to buy it. With health care costs high and rising, such government mandates would make many people worse off.
The proposals now before Congress would require just about everyone to buy health insurance or to get it through their employers — which would generally result in lower wages. In other words, millions of people would be compelled to spend lots of money on something they previously did not want, at least not at prevailing prices.
Estimates of this burden vary, but for a family of four it could range up to $14,000 a year over the next decade, according to the Congressional Budget Office. Right now, many Americans take the gamble of going without insurance, just as many of us take our chances with how much we drive or how little we exercise.
The paradox is this: Reform advocates start with anecdotes about the underprivileged who are uninsured, then turn around and propose something that would hurt at least some members of that group.
To ease the burdens of the insurance mandate, the reform proposals call for varying levels of subsidy. In some versions, such as the current Senate bill, subsidies are handed out to families with incomes as high as $88,000 a year. How long will it be before just about everyone wants further assistance, and this new form of entitlement spending spins out of control? It’s possible to lower insurance subsidies, but then the insurance mandate would impose a bigger burden on the people we are trying to help.
A subtler problem is what economists call “implicit marginal tax rates.”
(Excerpt) Read more at nytimes.com ...
Liberal politics to the tee!
Why the surprise?
“Implicit marginal rate” is when someone is receiving a means tested benefit from the government.
For example, if a working food stamp recipient gets an increase in income, they not only have to pay more in taxes but they also become eligible for less food stamps based on their increased income.
It will be a similar here.
But the message is redundant: those who live like that already know how to play the game. They aren't likely to forget the rules overnight, and the current government is not likely to come up with an incentive for them to produce something useful.
If your subsidy fades faster than the the rise in income, you are essentially paying a higher marginal tax rate.
For example, if your income increases $10,000 and as a result you lose $5,000 in subsidy, then you are essentially paying a 50% marginal tax rate on that additional income (on top of the 25% income tax you already pay on that extra income).
No idiot will work harder to earn that extra $10,000 only to see the government steal a net total of $7,500 from it. They would rather stay at the lower income level and work less.
Watch out, NYT. Let’s not stir things up too much. You don’t want obama coming after you, do you? Consider this a warning.
A choice between work you love and living - a lot of people choose to live. Doesn’t help the tax base, though.
IMHO, through reading the various proposals, requiring money be spent on insurance, then taxing that as income, would mean I would be taxed on money I could never collect nor spend as I see fit.
That isn't income, no matter how you put it, especially if I use my normal under 2k a year in medical costs for the whole family. Instead, it is a loss.
100+K=100+K/year
Well, Tyler Cowen is bordering on LINO, Libertarian in name only. I doubt Thomas Sowell or Walter Williams would get in the NYT.
We're having that trouble right now with Romneycare. The Dems in the state legislature have larded up the basic requirements so much that it's IMPOSSIBLE for an individual, who is not covered under a group or employer policy to find a plan that less than $1500 a month! They're even requiring that ALL plans sold in the Commonwealth provide for Prescription Drug Coverage. Forget about purchasing a high deductible, Catastrophic plan; they don't exist here, and I called every single one of the companies writing policies here. The only high deductible plan I found, was very expensive, because everything, after the deductible was met, was covered 100%.
We're not looking for an insurance company to pay for our basic doctor visits, or even my Pap Smears, Mammograms, Ultrasounds for my heart, or even a colonoscopy every 5 years for each of us! We'd prefer to have a Catastrophic plan that will cover the majority of the costs of MAJOR problems that would require hospitalization. Since those, hopefully, wouldn't happen too often, it's likely that plan would cost less than $7K a year. With the remaining $11K we wouldn't be paying for the larded up plan, we could open an HSA, pay for ALL our typical out of pocket medical expenses, and all our Prescription Drugs, and likely STILL have money left over!
Of course, that won't sit well with the Democrats, who are counting on everyone paying through the nose for their Insurance so we can subsidize those plans the government will pay for for the middle class folks who make too much to qualify for Medicaid.
Take from each according to their means
..and give to others according to their needs.
You got, so give it up. Or Else.
Everything else is just chatter.
We knew what you meant
For millions of Americans it will be a PUBLIC MANDATE."
No, FRiend, I had. The government took enough in taxes each of the last five years to pay off my house and buy a new vehicle.
It has been my experience that the taking doesn't quit because one's circumstances change, it continues based on last year's income.
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