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Soak The Rich

Tom PattonI used to want to be rich. Really. It seemed like such a pleasant way to spend my latter years. Denny Crane is something of a role model, at least as far as a scotch and a cigar on a high rise balcony with a good friend. Or even just in the back yard. It seemed to be something to aspire to.

But today in the WaPo online, is news of a plan that’s been introduced in the U.S. House of Representatives that would ask the wealthiest 2 million people to fund health care for everyone.

“House Democrats yesterday unveiled a plan that would force the richest 2 million U.S. taxpayers to shoulder much of the cost of an expansion of the nation's health-care system, agreeing on a provision to impose a surtax of as much as 5.4 percent on those making more than $1 million a year.”

Still want to join that club? Yeah, me too. But when did success become a stigma?

There are some 300 million people in the U.S., and according to the Post, there are some 37 million without health insurance of some kind … usually provided by their employer … so a touch over 10 percent.

About what’s unemployed right now. Any crossover there, you think?

But it’s not just the millionaires. The health care surtax would start on individuals earning $280,000, and families with income above $350,000. Still out of my league, but at least that might someday be in reach. Of course, if executive salaries wind up being controlled by Washington, then it’ll just be the television, movie and rock stars who wind up paying the surtaxes anyway. And they should be happy to do so since, for most of them, their guy won … yes?

Senators seem to understand this a bit better, since WaPo reports they have pretty much abandoned the blatant “soak the rich” mantra for one that spreads the responsibility a bit more, but it’s still there and even staunch Democrats admit it’s a “tough sell.”

Could those people afford to pay the surtax without feeling too much of a pinch? Maybe, but is that the point? Most people admit that some taxes are necessary, and that access to health care should not be the purview of a few. But the alternative plan floated during the election of providing a tax credit to allow people to shop for health insurance in an open market sure didn’t get any traction, and the word “bipartisan” hasn’t had a lot of meaning in DC for a long time. So one shouldn’t hold one’s breath waiting for both sides to come together and sing “Kum-By-Ya” anytime soon. The Democrats are in charge, and they’re likely to try to make big changes in the way health care is delivered, and paid for, in this country.

But when you scratch below the surface, it seems that “single payer”, when it comes to a government program anyway, is something of an oxymoron. In this instance, the Government isn’t a single payer, it’s a moneychanger. And for health insurance, it will apparently be moving money from those people making more than $280,000 to shareholders in insurance companies who are in the business of … making money. They’re a legitimate, for-profit business. That is unless you think insurance companies are going to sit still while the government guts their profit lines. It might happen, but you’ll want to pop a big bag of popcorn to watch that spectacle.

The way our health system is structured now, we all need some kind of insurance. Fee for service is just not really feasible for most of us. But while Americans said they were voting for “change”, where the rubber will meet the road is when that “change” affects you. That’s not to say that its bad, or that it’s not coming. Change is difficult, usually slow to come, and often the ultimate consequences are not felt for years to come. This is a time for restraint, because it needs to be done right the first time. I’m pretty sure a knee-jerk “soak the rich” scheme is not the best way to approach it. It might make a pretty sound bite, but it’s very possibly very bad policy.

6 Responses »

  1. As my Economics professor once said, "If you overtax the rich, they will flee to a financially favorable country." This may be an opportunity for a startup airline "FLEE USA" that flies directly to some new tax-free island.

    Our medical care in the United States is incredible to say the least, but it is delivered poorly. Duplicate tests and multiple studies at each specialist, internist and practitioner for the same medical problem is burdensome. In addition, the weight of malpractice premiums is forcing our best and brightest doctors to retire early. Fixing these two problems will refill our medical coffers and force insurers to reduce premiums.

    We must address overmedicating, too. These giant corner pharmacies are no more than legal drug pushers.

    Let's get started.

  2. A book titled The Sovereign Individual predicted over-reaching, over-taxing, overbearing [American] government more than 10 years ago. Read it, and plan for the inevitable.

  3. This is amazing to me. And what’s more it really comes down to taxation without representation because you will be hard pressed to find any of our representatives who have actually read any of this bill let alone the cap and trade bill.

    Add to that the news I saw last night that a company like Goldman Sachs earned over 2 billion in profit last year and didn’t pay any tax and I’m left scratching my head.

    My plan is to get out of debt asap and get some money into wealth securing assets and commodities because I have a feeling that the worse isn’t over.

    You are right, you know. This makes wanting to reach the American dream of wealth and security less appealing. Why try if the government is going to take half of what you earn? Shot for mediocrity. Depend upon big brother. Maybe that’s the desired effect. Slavery to the system.

  4. Tom, in your second paragraph you use the word "ask", as in those (rich people) affected would have a choice.

    When it comes to taxes there is no choice, you know that.

    And I totally agree with the remarks by Paul and Kurt. We as a country are headed down the path to economic and social ruin, led by the pie-in-the-sky socialists who now govern our country.

    For the past 40 years we have been fostering and nurturing a class of people who are dependent on government (read: taxpayer) handouts literally from cradle to grave. Now that class of people has finally realized that they have the numbers to vote to keep the largesse' coming.

    They are no longer content with just receiving the golden eggs, now they want to cook the goose, too. When that happens we are all in trouble.

  5. In 1937, Beatrice Kaufman said "I've been rich, and I've been poor. Rich is better." That made sense during the Great Depression and New Deal (when some wealthy Americans were also frightened of a socialist takeover), and it still makes sense now. Not one American is going to stop trying to accumulate wealth just because of a few dollars in taxes. Try to evade taxes? Of course. But give up on greed? I don't think so.

  6. Government run healthcare is absolutely the worst possible solution to a very serious problem. At one time, health insurance was easily affordable by almost everyone in the country. For those few who couldn’t afford it, there were free clinics run by volunteer physicians. That was before the Government got involved by forcing mandates on insurance companies and, even worse, by giving us Medicare, Medicaid, etc. Health insurance, as that term is used today, is really not insurance against medical emergencies – it’s prepaid health care. Government created the disastrous problem they’re now trying to solve.

    That said, however, the "rich" - many of whom have gotten that way via Wall Street, have been allowed to keep their riches, thanks in large part to a bailout by the middleclass and working Americans. If we absolutely, positively MUST have socialized medicine in this country, seems to me its only fair to soak the “rich” to pay for it, since we paid for their bailout. It’s payback time.