Thursday, September 17, 2009

If Money is Fungible, So are Taxes!

Yesterday, Democrat Max Baucus rolled out his plan for health care reform. Looking much like a man with a really bad body odor problem, he stood by his lonesome on a stage to announce his plan. Nary a Democrat or Republican was there to stand by his side.

For those who don't know who Baucus is, he is a Senator from Wyoming and the supposed leader of a group of 3 Republicans and 3 Democrats who have been trying to draft a bipartisan bill on health care reform.

The reason that Baucus found out that one "was the loneliest number" on that stage is because neither Democrats or Republicans are united with him on it.

The real stupidity in the Baucus proposal is how it's paid for. The Democrats don't like it because it gets a majority of its revenue by taxing health insurance companies for providing "Cadillac" health care plans -- plans like those that the union workers get. The Republicans are against it because it fails the tort reform test and because it is another $836 billion boondoggle tax scheme.

Baucus seems to think that his "paying for it" plan is a winner because he would hit the insurance companies with a 38% tax for providing certain first-class health insurance plans. Therefore, it would meet Obama's goal of not increasing the Federal deficit. His logic is that America won't balk at his taxing scheme because Americans already hate insurance companies. But, the stupidity of this Senate Finance member is that money doesn't come out of thin air. In order to pay the 38% tax on those Cadillac insurance plans, the insurance companies will have to pass that cost on to the consumer. So, in a round about way, we will all pay the price. It just won't be, technically, a hike in our taxes. It will just be higher prices that are forced by taxes. That's the fungibility of taxes when they are imposed on a supplier of any product or service.

In addition, Baucus would charge doctors and drug companies for a "hit list" of what somebody in government will ultimately determine as being luxury drugs and/or procedures. This form of punishment by taxation may, in fact, put some life saving drugs and techniques out of the reach of many Americans. The insanity of such a tactic is that most all common place medical procedures of today started out as very expensive procedures. Those would include things like stents and bypass surgery for heart patients. Kidney transplants and a variety of other procedures. For drugs, its the same. They start out as expensive "patented" medications and they ultimately wind up as cheap generics. Now, Baucus would make new procedures and new drugs even more expensive. This would either slow or completely stifle any new innovation.

Lastly on the "paying for it" bandwagon: If you don't have insurance, you will pay; and, pay big. A typical American family could get hit with as much as a $3800 annual fine for not having medical insurance. Families with kids who are just struggling to survive can't afford this type of "pound of flesh" punishment from our government.

More and more, I really think we're dealing with a complete bunch of idiots. Obama and the Congress keep telling us that the high cost of health care will break America if those costs aren't gotten under control. So, to control costs, they have insanely decided to raise the costs of health care by at least a trillion dollars. Then, to make sure health care doesn't get any better and maybe less expensive, they would stifle innovation with other taxes. Lastly, they refuse to control the awards for medical malpractice lawsuits -- awards that have been doubling almost every 7 to 8 years.

That's a great future for health care in America!

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