GOP to Impose Huge Tax Increase in their Health Care Reform Plan

Want to know how to argue against Republican opposition to the Affordable Care Act? Turn the tables on them with their own incredibly costly plan that includes shifting the burden to labor...you and me. Another gift to business.

After reading through a number of conservative articles critiquing their own parties plans, something Democrats better start doing, I found it a treasure trove of talking points that would kill them in political ads this midterm.

Simply, their plan in some ways repackages ObamaCare, while putting in place everything that made the individual market deadly and unaffordable. And they need one thing to happen; free market competition must lower costs. Anyone want to roll the dice on that pipe dream?

Forbes: There has been a kind of intellectual laziness, a belief that there’s no need for critics to come up with better reforms, because Obamacare will “collapse under its own weight,” relieving them of that responsibility ... it’s not going to collapse. And that makes the development of a credible, market-oriented health-reform agenda more urgent than ever.

The Republican Study Committee put out a plan last fall that would replace Obamacare by capping the employer tax exclusion, and making a standard deduction for health coverage available to everyone. A similar plan proposed by George W. Bush in 2007 would have expanded coverage by 11 million ... Obamacare aims to expand coverage by 30 million, not 11 million. And so a replace plan in 2017 will have to contend with the fact that it is likely to throw people off of their existing, ACA insurance. 

The following includes what we have now; keeping your insurance alive to avoid getting rejected for pre-existing conditions and "high risk pools" paid for by taxpayers so insurers can make higher profits. And instead reducing medical errors, the GOP would reduce malpractice settlements to victims. Oh yea, it's grows the deficit and spends more:

The new Coburn-Burr-Hatch proposal, called the Patient Choice, Affordability, Responsibility, and Empowerment Act (“Patient CARE Act”) wouldn't maintain ObamaCare’s individual mandate, nor its requirement that insurers offer coverage to everyone regardless of pre-existing health conditions. This structure ... described as a “repeal and replace” ... is remarkably similar to the one that Obamacare uses. What are the key differences? The CBH plan would grow its subsidies and tax exclusion cap at a higher rate than Obamacare does—CPI+1% vs. CPI+0% for Obamacare ... the CBH plan would spend more on subsidies, and recoup less in revenues, than Obamacare does. It won’t satisfy the purest Obamacare haters ... And it won’t drastically shrink the scale and scope of federal spending on health care, at least in the near term.

Here comes deregulation, and the fantasy that health care is a consumer product:

Deregulate ... a process that is likely to make health insurance less costly over time. If health insurance is less costly, then federal spending on health insurance can shrink alongside.

BIG GOP TAX INCREASE:

Except the Coburn-Burr-Hatch plan (read it here) amounts to a big tax increase. The main way that it remains budget neutral is by making employer provided health insurance plans, which are currently not taxed, partially taxable as income. In fact, this income replaces income that, under ObamaCare, comes from taxing companies, including the tax on medical device companies paid by firms like Medtronic MDT -0.62% and Stryker SYK +0.15%. This fact has not escaped the notice of some prominent health reform allies. 

“It is a huge tax increase on workers without any confidence that they will be able to afford health insurance in the future,” says Bob Kocher, a partner at venture capital firm Venrock who previously worked in the Obama administration.

It is “essentially a very large Republican tax increase,” says Ezekiel Emanuel, the Diane V.S. Levy and Robert M. Levy University Professor of Medical Ethics and Health Policyat the University of Pennsylvania and another former Obama advisor. “It’s quite clear the plan is to put a bigger burden on middle class Americans.”

How big a tax might this be for an average American family? Ezekiel has some numbers. 

The average employer health plan for a family of four costs $16,351, according to the Kaiser Family Foundation, and the employer covers 72% of that, or $11,772. Thirty-five percent of $11,772 is $4,120.35. The employee’s share of the Social Security and Medicare payroll tax is 7.65%, or $315.21. Assuming this family of four is in the 25% marginal income tax bracket, that would add another $1,030.09, for a total tax increase of $1,345. (For more from Emanuel, see this Times piece.) 

Removing a bunch of corporate taxes so that the middle class can pay more seems like a political non-starter, even given the public backlash against Obamacare. This plan would likely mean that more people would lose insurance, or be forced to go to smaller networks of doctors. Those are the same criticisms levied against the Affordable Care Act.

What the plan does emphasize is the degree to which any plan to reform the insurance system can seem like a zero-sum game – the money has to come from somewhere. 

Republicans wrong about Obama's Job Killing tax increase, Revenue Loser.

If you are over your head in debt, you two choices; go bankrupt or increase revenues and pay it off.

But we had another choice: If the Republican Party claimed increased revenues (taxes) are a job killer, and the reverse (tax cuts) would bring in more money, than what is happening right now is not possible.

Big problem!! So what can Republicans do to change the narrative and not look like con men? They have to spin-away being this wrong (spin highlighted):

Fox News: Recent estimates may lend credence to Republican claims that the federal coffers are well fed on taxes. The Congressional Budget Office estimates the federal government is on pace to bring in a record $2.7 trillion in tax receipts this fiscal year. The increase reflects a steady post-recession rise in revenues. They ticked up 6 percent in 2012, but according to the CBO could jump 11 percent in 2013. The expected tax boost comes after Congress allowed for an increase in tax rates for top earners, and for the expiration of a 2-point payroll tax cut. The agreement will play a big role in boosting revenues this year -- and is also the No. 1 reason cited by Republicans for not wanting to agree to more tax increases as part of a new budget deal. 

Tax increases work. They didn't kill jobs, or tank Wall Street. Business owners didn't suddenly close up shop. Surprised?

And who’s reminding Americans how wrong Republicans were?

But here’s the rub; Republicans spent like drunken sailors between 2001 and 2008 and left Obama with a $1.2 trillion deficit. Now they don’t want to pay it off with increased tax revenues. Instead they want to skip right to tax rate cuts (revenue neutral even), and slash safety net programs. It’s faster that way and...doesn't make any sense. 

GOP's "base-broadening, rate-lowering" tax reform Big tax increase for many.

This really is an eye opener and must read.

Gov. Scott Walker wants to lower state and property taxes. This is the same disastrous plan George Bush implemented in 2001 when he claimed tax surpluses meant over taxation, and passed the debt swelling tax cuts. Those Clinton surpluses would have wiped out debt and provided funding need to reform out tax code and other costly programs. A simple thing like changing the tax code would cost taxpayer about a trillion dollars, which puts us deeper in the hole. 

But Walker's plans may just collide with congresses plans to rate lowering tax reform and "base broadening." And for those who want to turn Wisconsin deep red politically, aren't going to like how that gets done. Ezra Klein lays it out for us:

Base-broadening, rate-lowering tax reform.” It sounds so good, right? But what if you call it what it really is? Charity-destroying, home-shrinking, state-burdening tax reform.

Doesn’t sound as good, does it?

But that’s really what we’re talking about. The term ”base-broadening, rate-lowering tax reform” has the advantage of vagueness: No one knows what it means. And as former OMB director Peter Orszag points out, 90 percent of the value of those deductions comes from just three categories: “taxes paid (mostly state and local taxes), home-mortgage interest and charitable contributions.”

So when we say “base-broading, rate-lowering tax reform,” here’s what we’re really saying: Tax reform that’s paid for by cutting tax breaks for charities, homes, and state and local taxes.

Then there’s the deductibility for state and local taxes. Removing that deduction will pound taxpayers who reside in high-tax cities or states — which means it’ll hit those cities and states by making them less attractive places to live. And note the political economy: those states and cities are disproportionately blue. All 10 of the highest-tax states went for Obama in 2012, while eight of the 10 lowest-tax states went for Romney.

“Base-broadening, rate-lowering tax reform” isn’t magic. It’s more of a magic trick: It relies on obfuscation and misdirection to distract the audience from the tax increases.

But limiting itemized deductions in order to raise revenues is a tax increase, and we should be honest about where it’s coming from. The answer, overwhelmingly, is charitable deductions, the home-mortgage interest deduction, and the state and local tax deduction. Perhaps it’s better to raise taxes on those activities rather than raise marginal rates. But that’s the conversation we need to be having.

Repeating the term ”base-broadening, rate-lowering tax reform” over and over again isn’t getting us anywhere.

Historian Whines Tax Increase on the Rich waste of time and too Small. Dem's Conspire to Pit Tea Party against GOP.

They even have tabloid writers doing nonfiction in the tea party movement.

I couldn't resist passing along this “blame game” editorial by a conservative historian, that supposedly brings to light another Democratic conspiracy theory pitting tea party extremists against moderate Republicans. 

It’s almost comical to hear all the Republican excuses as to why we should not cut a $3 billion deduction for private jets, or allow a $67 billion yearly increase in taxes on the wealthy. It’s just not enough money to make a big difference in deficit reduction. Yet smaller amounts, measure in the millions (like funding for PBS), will magically wipe out the deficit.

With that in mind, check out this totally ridiculous editorial that starts with the false premise that any of this makes sense:

Fox News: Historian Arthur Herman: The goal of getting Republicans to agree to raise taxes is not to raise new revenues. After all, allowing the Bush tax rates to expire for wealthier Americans will bring in perhaps $67 billion a year; Warren Buffet’s plan for a thirty percent minimum tax rate for millionaires another $5 billion. That’s spit in the ocean compared to annual deficits of $1 trillion and counting–let alone a $16 trillion national debt.

The Democratic conspiracy theory is just more conservative projection:

The real goal is to detach Republicans from their Tea Party and conservative base, and wreck any chance of a repeat of 2010's GOP surge–not to mention recapturing the White House in 2016. What a Republican capitulation on taxes will really mean is a future of political defeats stretching out beyond the horizon, as a disheartened base either stays home or wages bitter Tea Party versus Establishment primary fights like the ones that cost them the Senate this year. They don’t just want to take away Republicans’ voters.

Yes, it’s the Democratic Party’s fault for pitting tea party extremists against moderate Republicans:

They also want to destroy their sense of honor and integrity. They know it will make Republicans more compliant for future deals, and more alienated than ever from the voters they will need if they ever get another chance to salvage what’s left of this country.

And isn't saving and taking back our country the most insane and authoritarian objective ever?

Ben Stein and William Kristol destroy "spending problem" lie, call for Tax Increase on Rich.

I've edited together a number of appearances by Ben Stein and William Kristol, two guys I don't consider geniuses, but represent the most outspoken pundits pushing the Republican platform.

Republicans know the truth about tax cuts, tax increases and the need for additional revenue, but refuse to acknowledge that.

As much as Stein and Kristol are blowhards and difficult to watch, sit through the video below, as Stein and Kristol expose how deceptive they've been to the voting public. The fact that Bill O'Reilly and the others at Fox News believed all this propaganda says more about their inability to recognize bullshit when they hear it than repeating GOP talking points.

I suggest you hear their arguments for raising taxes and the arguments the Fox News losers give to dispute the obvious. Sure it's what we've been saying for years, but now we know, they know, we're right. This is good stuff.

Republicans to RAISE TAXES!!! Regressive gas tax better than taxing rich.

Road builders and private contractors for the state are so important to Scott Walker and the Republican legislators, that they'll even INCREASE TAXES.

That's right, a tax increase on gas at the pump. Don't forget, these conservative Santa's in reverse,  removed gas tax indexing a few year ago, saying the automatic increases were unfair and out of control. Guess they weren't after all. I know, Democrats bought into the idea too. But for me, I always look at who comes up with these big fat ideas in the first place. With this increase, Wisconsin would have the highest gas tax in the nation.

Make no mistake, Republicans are about to increase taxes. Period. Just like they did with the Earned Income Tax Credit, with no criticism from their own tax averse voters. This is one of those moments the Democrats should vote no on the increase, and hang this on the Republicans. WKOW:

Ben Stein Blows Fox News Hosts Minds with Talk of Tax Increases

Ben Stein openly apologized to Fox News for suggesting the necessity of balancing the budget by including tax increases. Just amazing stuff:

If Companies Consider Employees their biggest Expense, Why would we want the U.S. to be run like a business?

The guys with all the money are the biggest whiners and doomsayers.

These corporate Chicken Little's are so apoplectic about a possible tax increase that they've even warned their employees that jobs will be cut and benefits slashed if Democrats got their vote.

But wait, how much anguish have employees had to endure since wealthy Wall Street bankers crashed the global economy? And just as relevant, how have CEO's fared in all of this?

See what happened to a growing middle class after the Great Recession, before and after. For Wall Street, it was just another bump in the road. According to the Economic Policy Institute:

And from 1973 to 2011, men in the more blue collar manufacturing sector has tanked due to offshoring, like the jobs at Bain Capital's Sensata Technologies plant:

Republicans to Raise Taxes on Poor!!

Spread the word and make it clear to everyone, Republicans are going to raise taxes. Period.

Scott Walker to this day claims he never raised taxes when in fact, he did just that to balanced the budget. He reduced the Earned Income Tax Credit...essentially forcing the working poor to pay more in taxes. The media has given Walker a pass on this lie. 

From Religion and Ethics Newsweekly, was this story about the house Republicans move to increase taxes on the poor in a similar way. They'll tell you the poor never earned their tax credit, so it's not really a tax increase. Bull. But there is opposition, including the Catholics church and other religious groups that have clearly said it's against church doctrine. So much for our supposed "Christian based" constitution. 

BUSINESS WIRE: Rev. David Beckmann, president of Bread for the World, joined other national Christian leaders today in urging Congress to continue the current Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) benefit levels.

"The food budget is usually the first thing families cut when times get tough, but tax credits like the EITC and CTC help struggling families put food on the table and make ends meet," said Rev. Beckmann. "It is morally unjust that lawmakers consider allowing tax credits that are vital to hungry families to expire, while wealthy people retain reduced rates for their income over $250,000, and estates as large as $10 million are exempt from taxation."

It’s almost mind boggling to think we would extend the Bush tax cuts for the wealthy, knowing how much that much of what was supposed to be a temporary cut, would add to the deficit. 

Does it break the “no tax” pledge? No, not under the new definition and down the rabbit hole logic behind the increases. Why conservatives would vote for, and allow their Republican candidates to tax the poor but not the rich, is just as crazy; the tax credits take money from those who earn it, and give it away to those who didn’t.

Here’s how brutal the cuts will be:

The House of Representatives is scheduled to vote soon on whether to extend the 2001 and 2003 tax cuts. If passed, HR 8 would eliminate additional EITC marriage penalty relief, prevent families from earning even $1 of the Child Tax Credit until they make at least $13,000, and reduce Earned Income Tax Credit benefits for families with three or more children.

Social engineering of the worst kind; it's population control, where American families are penalized for having more than three kids. Gee, I hope they don’t ban contraception...they what....?

Here’s what the cuts will do;

If families are no longer able to count earnings below $13,000 towards the child tax credit, 8.9 million families would be harmed, including 16.4 million children. If the CTC credits are allowed to expire, 3.7 million families would lose the child tax credit entirely, including 5.8 million children.

So much for these families having any extra spending money, creating demand, and boosting the economy. 

Romney Plan: Poor and Middle Class would love to pay more so they can save the rich money.

It looks like my hypothesis appears to be right on the money, so to speak. The idea that Republicans care about saving taxpayers money, is bogus. Republican policy will cost the bottom 95 percent more, whether in the form of lost tax breaks or money out of pocket in premiums or fees.

Take their dire predictions that employers will drop employee coverage once “Obamacare” is in place. That's factually wrong. But Romney’s plan will do away with the tax break for employer-provided health care. Without that deduction, an important business expense, employers will drop employee coverage immediately.  

Even my conservative friend goes ballistic defending the rich for the simplistic upside down concept, "it's their money, not the governments." 

So I have to assume, my friend will love the following Romney plan:

Mitt Romney’s plan to overhaul the tax code would produce cuts for the richest 5 percent of Americans — and bigger bills for everybody else, according to an independent analysis set for release Wednesday. The study was conducted by researchers at the Brookings Institution and the nonpartisan Tax Policy Center, who seem to bend over backward to be fair to the Republican presidential candidate.

They even look at what would happen if Republicans’ dreams for tax reform came true and the proposal generated significant revenue through economic growth.

None of it helped Romney. His rate-cutting plan for individuals would reduce tax collections by about $360 billion in 2015, the study says. To avoid increasing deficits — as Romney has pledged — the plan would have to generate an equivalent amount of revenue by slashing tax breaks for mortgage interest, employer-provided health care, education, medical expenses, state and local taxes, and child care — all breaks that benefit the middle class.

Even if tax breaks “are eliminated in a way designed to make the resulting tax system as progressive as possible, there would still be a shift in the tax burden of roughly $86 billion [a year] from those making over $200,000 to those making less” than that.

What would that mean for the average tax bill? Millionaires would get an $87,000 tax cut, the study says. But for 95 percent of the population, taxes would go up by about 1.2 percent, an average of $500 a year.

And remember, some don't pay any taxes:

Sen. Maj. Leader Harry Reid suggests Romney didn't pay any taxes for 10 years. HuffPost: "A month or so ago, he said, a person who had invested with Bain Capital called his office. 'Harry, he didn't pay any taxes for 10 years,' Reid recounted the person as saying. 'He didn't pay taxes for 10 years! Now, do I know that that's true? Well, I'm not certain,' said Reid. 'But obviously he can't release those tax returns. How would it look?'"

Republicans are now promising to raise taxes on poor and middle class, while keeping Norquist Pledge

Funny thing, I thought Republicans were against raising taxes. If the GOP can make some end run excuse, and fabricate an upside down reason why a tax increase isn't one, think what they might be able to do when they target something you like. Think about it.



Ezra Klein gives one really good example here, where Orin Hatch allows a tax increase for the middle class in the Tax Hike Prevention Act:

Republicans very quietly raising taxes, and the Democrats are quietly protesting?

We've seen major mistakes by the Republicans fade quickly because the Democrats forgot to complain.

The tax increase on Wisconsin's poor, via the reduction of the Homestead Credit and the Earned Income Tax Credit, is one huge standout. Has anyone mentioned that? No. Scott Walker continues to brag in his ads that he divided the people of the state without raising taxes. But he did raise taxes, officially. Anyone want to mention it?

My heart sinks when I think of how bad Democrats are at fighting. It's surprising the party has any kind of political prescience at all.

Rachel Maddow and Ezra Klein take a look at the list of tax increase here and in other states, all without a peep from Democrats. Hopeless.

Republicans want to raise your taxes!!! The focus group tested term? “Skin in the Game.”

Say it with me; Republicans want to raise your taxes!!! Republicans want to raise your taxes.

That would mean the majority of American’s will see their taxes go up dramatically if the Republicans “skin in the game” plan becomes policy.

They want to raise your taxes. Really. They're even telling us that we deserve a tax increase. 

The earned income tax credit is now being reframed as welfare, government money “handed out” to families who didn’t earn what they're getting back. Wisconsin Republicans said just that when they reduced the credit. 

The earned income tax credit is a refundable tax credit primarily for individuals and families who have low to moderate earned income … When the tax credit exceeds the amount of taxes owed, it results in a tax refund

It was a terrific idea way back in 1975, even for Ronald Reagan:

Enacted in 1975, the initially modest EIC has been expanded … the Reagan Tax Reform Act of 1986, and was further expanded in 1990, 1993, and 2001.

Here's a how Sly in the Morning, at WTDY 1670, framed the issue using the psycho rantings of conservative talker Vicki McKenna:

And it's not just McKenna either. Neil Cavuto and his fellow band of conservative thieves are working off the same script; they’re demanding that even the poor have some “skin in the game.”

Republicans want to raise your taxes, or “Skin in the game” = “Raise your taxes.”

If Cavuto is anything, he's crystal clear about the conservative attempt to repackage what we would normally call a tax increase. Is asking the poor for anything, even a dollar, really a serious suggestion. It's a policy based purely on envy and class warfare in the same class. 

So what’s the end game? If the poor pay something, what will they get in return? A tax increase for the wealthy? What does happen when the poor and middle class have skin in the game?

What changes?