More favoritism for the unions
Betsy's Page
Kimberley Strassel reports on yet another way that the Democrats are catering to their union masters. As the Democrats try to craft some sort of health care bill, they're coming face to face with the reality that they need to pay for this major expansion of the federal budget. They realize that such tinkering around the edges as taxes on soda, salty foods, or tobacco or whatever other sin tax they come up with is not going to produce the sort of revenue that they need for a public option health insurance plan. So they're beginning to talk about the big bonanza of revenues - taxing our health insurance. Never mind that the Democrats excoriated John McCain during the election because his comprehensive reform involved ending the employer tax benefits that have been skewing our health insurance markets for decades.
The bigger problem is that any plan that would tax the so-called "gold-plated" insurance plans would include unions who have negotiated such policies. And the unions are not happy about any plan to tax workers' plans. So they have yelped and the Democrats have jumped to obey. The result is a proposal to exempt union workers from having to pay this tax.
<<< The attack against Mr. Wyden was an early shot across the Baucus-Obama bow, and it resonated. Mr. Baucus officially floated his plans for a tax this week, only with a surprising twist: His levy will not apply to union plans, at least for the duration of existing contracts. In other words, Mr. Baucus intends to tax the health-care benefits only of those who didn't spend a fortune electing Democrats to office. Sen. Ted Kennedy, who is circulating his own health-care reform, has also included provisions that will exempt unions from certain provisions.
The union carve-out is designed to allay the fears of many Democrats who remain outright hostile to a tax on health-care benefits, whether out of principle, political fear or union solidarity. Much will depend on the union reaction, which might remain ugly. Manufacturing unions in particular view their health-care benefits as sacrosanct, and even a delayed tax is still a tax. >>>
Given that the majority of American workers are not members of unions, I wonder how sweet such an exemption would be for non-union voters.
Of course, we don't know what will be in the final plan. For all of Obama's speech-making and townhall appearances to tout his plan for reform, there actually isn't a plan on the table yet. There are several proposals out there, but no clear administration proposal of how to pay for their public option. We hear lots of blather about how we can save so much money from using technology for record-keeping and other such modernization proposals. But no one honestly thinks that such tinkering around the edges would generate enough money to pay for a massive expansion of the federal government into health insurance. The administration isn't doing much to tackle the looming crisis that we're facing with Medicare. Maybe they can work on that before taking on spreading a Medicare-like plan to the rest of the population.
Jennifer Rubin comments,
<<< So what does Obama do? Strassel wryly remarks: “The president may well be attracted to the dollars of a benefit tax, but he’s waiting to see if he can blame Congress for dragging him into it.” There is something to that. It is a strange phenomenon that on the president’s single biggest legislative priority, he never came up with his own comprehensive plan. It’s that darn governing thing. After all the dog-and-pony shows, the campaign-style events, the shows of “solidarity” with interest groups, and the platitudinous speeches, you have to come up with something that at least seems it could work. And that’s plainly not the administration’s strong suit. >>>
As with the stimulus plan, the budget plan for 2009, and energy plans for cap and trade, the Obama administration is content to let the Democrats in Congress come up with the proposals. Then the President will jump in and try to use his popularity to sell whatever these guys come up with. He'll need all those smooth rhetorical skills to sell all the new taxes that they come up with as not violating all his sworn promises not to raise taxes on anyone earning under $250,000 a year.
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