-By Warner Todd Huston
Senator Jay Rockefeller (D-W.V.) says that the newly released healthcare plan crafted by Senator Max Baucus (D- Mon.) will raise taxes on the middle class. Imagine that, one Democrat accusing another of raising taxes. These are strange and wondrous times, indeed.
The Baucus plan features new taxes on so-called high-end healthcare plans obtained through employers. Beginning in 2013, a 35 percent excise tax on insurance companies for “high-cost plans” will be instituted. These “high-cost plans” are “defined as those above $8,000 for individuals and $21,000 for family plans.”
This tax will be levied on the whole cost of the plan, not just the part that the employees pay.
Baucus expects that this tax will raise $200 billion in tax revenue. But Rockefeller thinks this tax will be raised on the backs of the middle class, especially those among his West Virginia coal-miner constituency.
Referring to Baucus, Rockefeller said, “He should understand that (his proposal) means that virtually every single coal miner is going to have a big, big tax put on them because the tax will be put on the company and the company will immediately pass it down and lower benefits because they are self insured, most of them, because they are larger. They will pass it down, lower benefits, and probably this will mean higher premiums for coal miners who are getting very good health care benefits for a very good reason. That is, like steelworkers and others, they are doing about the most dangerous job that can be done in America.”
Of course, we all know that taxing something results in less of that something being done. Raising taxes on boats, for instance, results fewer boats being purchased. Raising taxes on cigarettes causes more people to quit smoking. Raising taxes on gasoline results in less driving.
The end result is that the tax revenue never meets expectations of the tax raisers.
What will happen in the case of this excise tax on “the rich” and their healthcare plans will result in such plans being reduced so that they do not fit the limits. It will result in employers reducing benefits, plans being dropped, and other provisions for healthcare being made all to avoid the confiscatory tax.
And so, Max Baucus will find that his expected $200 billion will likely not be realized.
This is just one more small reason why the Baucus bill is a horrible one. But it is also part and parcel to the mistake that Democrats are making with all their tax raising bills.
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Warner Todd Huston is a Chicago based freelance writer, has been writing opinion editorials and social criticism since early 2001 and is featured on many websites such as NewsBusters.org, RightWingNews.com, CanadaFreePress.com, StoptheACLU.com, TheRealityCheck.org, RedState.com, Human Events Magazine, AmericanDailyReview.com, and the New Media Journal, among many, many others. Additionally, he has been a frequent guest on talk-radio programs to discuss his opinion editorials and current events and is currently the co-host of “Life, Liberty, and the Pursuit of Conservatism” heard on BlogTalkRadio. Warner is also the editor of the Cook County Page for RedCounty.com.
He has also written for several history magazines and appears in the new book “Americans on Politics, Policy and Pop Culture” which can be purchased on amazon.com. He is also the owner and operator of PubliusForum.com. Feel free to contact him with any comments or questions : EMAIL Warner Todd Huston
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