Echo

Remember what you're voting for come November

Thursday, September 11, 2008

The Economic Policy Institute ran an interesting article on compared energy and health care costs, Not just gasoline: The sneakier squeeze on family budgets. The real squeeze on U.S. consumer pocketbooks is health care, rather than energy.


Spanning 2000-2008, health care costs outpaced energy costs by $50 billion. By 2008, households paid $370 billion more for insurance premiums, while energy costs had risen $320 billion.

So when you go to the voting polls, remember that one issue that you will be voting on is health care. Will you vote for McCain’s plan that includes an insurance tax credit for private health care, which would encourage competition in the insurance industry? Or will you vote for Obama, whose national health care plan will likely result in big bills to the American taxpayer.

Please leave comments. Best Rebecca Wilder

9 comments:

Tim Manni September 11, 2008 at 11:26 AM  

Interesting...The economy does seem like the most important topic on voters' minds. I wonder how many people know what will end up costing them more in the long run?

Rebecca Wilder September 11, 2008 at 3:21 PM  

I am nervous for the Republicans. Come November, when employment has fallen for two more months and consumer spending really sucks, voters will forget about all issues outside of their purse strings. Then, exactly one year later, when the housing market is rebounding (well, any movement forward will seem like a rebound), Americans will realize that long-term issues like immigration, climate change, health care, etc., matter too, and at that time the Democratic Congress will pass expenditure sitting on Obama's menu for the week.
Thanks for visiting, Rebecca

Anonymous September 11, 2008 at 8:35 PM  

I'm wondering what you think of the McCain idea of taxing the company contribution/portion of insurance payments? His plan calls for this. For example, if your company pays $500 a month for you and you pay $250 a month, the $500 will now be considered part of your income and will be taxable. In this example it would be an extra $6,000 a month. If you were in the 25% tax bracket that would be an extra $1,500 a year in federal taxes.

Anonymous September 11, 2008 at 8:36 PM  

I meant to say $6,000 a year in extra income not a month.

Anonymous September 11, 2008 at 8:37 PM  

Rebecca, do you work for Fidelity?

Janie September 12, 2008 at 9:52 AM  

MEDICARE! Need I say more??

Rebecca Wilder September 12, 2008 at 11:02 AM  

Hi Anonymous.

Thank you for visiting my blog! I think that a tax on firms is certainly a drawback of the plan, but at least McCain is offering a way to pay for the tax credits. You know, according to Surepayroll survey (http://www.surepayroll.com/spsite/press/releases/2008/release041608.asp), 56% of small businesses currently do not offer employer health benefits. Couple that with the growing share of small businesses in the marketplace, a household-based tax credit, where households can shop for their own needs, looks pretty good to me. The costs to Obama's expansive health care system remake cannot possibly be assessed in full. Look at MA - a state with new statewide subsidized health care - it did not estimate correctly the costs of the system, and one year later, we the taxpayers are having to foot the bill!

Everybody should have access to healthcare - I just want it to be the least costliest way. If Obama's plan was that, then I say go for it. However, I cannot think of any way that passing on the costs of the healthcare system almost entirely in full to the U.S. government will reduce the taxpayer bill.

Guess again - not Fidelity!

Anonymous September 13, 2008 at 1:45 AM  

Judging from the number of other countries out there that have "passed on the costs of the healthcare systems" and yet they have reduced the taxpayer bill when compared with the US.... Seems you have a very limited imagination.

Rebecca Wilder September 13, 2008 at 9:13 AM  

Hi Anonymous,

Again, I would be happy to fund a universal health care system if that is the least costly program to the tax payer. But the U.S. government is already running heavy budget deficits, so paying for a universal health care system can only be done by raising taxes or reducing spending. If tax rates rise for this, it could be a lot! According to the OECD (Table I.1, http://www.oecd.org/document/60/0,2340,en_2649_34533_1942460_1_1_1_1,00.html#table_I1), the U.S. already pays a high average tax rate on personal income (35.3%) in 2007. Look at countries with a universal health care system: Germany (53.1%), Italy (50.7%), Luxembourg (44.3%), Netherlands (45.89%), Sweden (53.1%), France (53.1%), U.K. (37.9%), etc. Exceptions are Canada (32.9%), Australia (32.8%), and Ireland (33.1%) that offer average tax rates in the U.S. range plus a universal health care system. But there are a lot of other taxes out there that would be used for health care: property taxes, sales taxes, VAT/GST taxes. Ireland’s VAT (Table IV.5 on same OECD link) tax rate is 21% - no wonder they can offer relatively low income taxes, but fund big social programs. In order to fund a universal health care system, plus pay for all currently funded social programs (social security, medicare, medicaid, etc.), tax rates will have to go up (or reduce spending) - and evidence suggests that tax rates could rise to the 40%-55% rage.

Rebecca

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