J. Neil Schulman
@ Agorist.com
@ Agorist.com
I’ve been looking more closely at H.R.3200 – “America’s Affordable Health Choices Act of 2009,” now that it’s heading to President Obama’s desk today for signature, as well as the possible reconciliation that may or may not follow.
My bottom line:
The Fed Giveth, and the Fed Taketh Away, Messed be the Name of the Fed.
The new law is such a patchwork quilt of new or revised taxes, subsidies, mandates to states, benefits and penalties to and from businesses and individuals of varying income, age, and other status that it’s far too complex for anyone to predict the unintended consequences with any accuracy.
Will it enrich the giant health-insurance companies or bankrupt them, triggering a government takeover like we saw last year with General Motors? I’m not sure anyone can say for sure — not even the health-insurance actuaries or the politicians they lobby.
Will tax subsidies and new premiums from millions of younger and healthier people being mandated by federal law to purchase health insurance policies act to counter the increased costs to insurers from being required to pay the medical costs of already seriously sick people — not being able to drop their policies, no yearly or lifetime caps, and federal price-controls on health-insurance premiums?
For someone like me — too young for Medicare, but obese and Type-II Diabetic, classic “pre-existing conditions” — will I be able to buy affordable health-insurance? Or will the few insurers available to me in Nevada stop selling health-insurance entirely in a state where casino-subsidized all-you-can-eat buffets are the most popular eateries?
I can’t figure that out; there are too many imponderables. But my first thought was to outline a new movie script in which health-insurance executives are behind a new miracle weight-loss drug that — like Fen Phen, but even more deadly — ends up killing off millions of fat Diabetics like me, saving the health-insurance companies billions.
Anyone who thinks the argument that a federal mandate on individuals to purchase private health-insurance policies will be struck down as unconstitutional because refusing to buy something isn’t an act of interstate commerce doesn’t understand how small a legalistic change this is when compared to tax policies that have been in effects for generations.
If the IRS tax code can tax you at a higher rate if you’re single rather than married, or at a different rate if you have “passive” sources of income rather than “earned” income, why would anyone think the Supreme Court is going to find unconstitutional a provision in the IRS code taxing you at a higher rate if you don’t purchase a health-insurance policy?
Don’t count on the high-court conservatives. In Scalia’s and Roberts’ McDonald v. Chicago grilling of plaintiff’s attorney Alan Gura about the “privileges and immunities” clause in the 14th amendment, it was apparent how little they want to rock the boat. You think they’re going to put the first serious dent in the Federal Income Tax?
The problem goes deeper than most conservatives think.
It’s taken from the onset of the federal income tax in 1913 to 2010 — 97 years — for the American people to get a clue that the federal government’s ability to reward or punish individual behavior by taxing you at higher and lower rates has totalitarian consequences.
Make no mistake. Any revolt against the new federal mandate to purchase health insurance — a policy enforced by the IRS — will in the end be a revolt against the power of the federal government to control your behavior through income-tax rates and exemptions. If you’re not ready for that eventuality, don’t even start.
What else aside from taxing you more if you don’t buy government-mandated health insurance can the tax code make you do? And when will the American people say, “That’s enough”?
The original Boston Tea Party was a tax protest. Guess what? The new federal mandate to purchase health insurance is an income tax penalty if you don’t buy it — and will be enforced by the IRS.
For most of my lifetime any opposition to the federal income tax has been a fringe movement — sometimes on the left, as a war protest, sometimes on the right, by objectors like Irwin Schiff who make various constitutional arguments against the income tax that federal courts have regularly dismissed as not only frivolous, but a trial on the court’s patience. But I can’t remember a time when opposition to the federal income tax has been widespread enough to constitute a popular movement.
The Tea Party won’t prove anything by supporting Republican candidates who would raise your taxes in a heartbeat if it gave them power to punish abortions — or keep out illegal Mexicans, or put more cops on the street.
The proof would be protests and resistance against the tyrannical power of the federal government to control your behavior through its power to tax you.
September 12, 2009 Taxpayer March on Washington, D.C. / Nathaniel Currier 1846 Lithograph “The Destruction of Tea at Boston Harbor”
Only if this actually develops will we know whether the new “Tea Party” movement has anything in common with those who conspired to stage the multiple-felony — and not entirely non-violent — anti-tax action of December 16, 1773, in which anti-government extremists painted themselves like native warriors and destroyed three ships’ entire cargos of tea.
My comic thriller Lady Magdalene’s — a movie I wrote, produced, directed, and acted in it — is now available for sale or rental on Amazon.com Video On Demand. If you like the way I think, I think you’ll like this movie. Check it out!
March 23, 2010 - 6:26 am
One of the things in the bill worth watching are the inverted incentives. By subsidizing the the ability of low wage workers to get medical insurance coverage, they will be drastically decreasing their incentive to increase their income. Income increases will in very large measure go to increased health care insurance premium payments instead of the pocket of the worker.
Insurance companies having to ignore existing conditions when taking on a new customer is interesting. In Michigan, Blue Cross must ignore existing conditions because of their original special public State Corporate Charter. In competition with companies that don’t Michigan Blue Cross, of course, became loaded-up with all the sick and their rates are drastically higher than other insurers. Blue Cross has been struggling for years to get rid of this provision of their Charter, but have been unsuccessful politically.
The way they get around the problem is to charge outrageous rates to individual subscribers who tend to have “pre-existing” conditions and charge decent rates to business customers with numerous employee. Statistics guarantee that the business customers will have a relatively normal number of pre-existing conditions while individuals usually go to Blue Cross ONLY if they can’t get coverage elsewhere! Blue Cross also offers NO drug coverage to individuals because otherwise individuals in need of drugs would flock to Blue Cross!
Under the new patchwork bill, how can insurance companies assure they get only the “normal” number of pre-existing conditions? There will have to be a “high risk” pool created by the government to deal with this. . .
For many many reasons, this new “patchwork” bill will be unsustainable and move toward complete socialized medicine. If it can’t be stopped before it goes into effect and replaced with relatively free-market oriented reforms, it’s the New Dark Age within a decade or so. . .
March 23, 2010 - 6:30 am
Neil:
How about the demonization of the overweight that is beginning? This, along with the demonization of other behaviour related maladies, can only intensify if this bill actually goes into effect!
Am I the only one who remembers that the definition of “obesity” was changed a few years ago so that the category would look bigger and more menacing?
August 24, 2012 - 7:07 am
Sir,
First, I must apologize for necromancing this post, but…
Wow.
Just. Frigging. WOW!
I’m STUNNED at how all the “conservative leaders” were “shocked” (SHOCKED I tell you!) at Roberts’ “tax” decision yet you called it over two full years before!
I’ve just discovered your blog and am now reading “Alongside Night.” Finding I liked it, I decided that I’d read the blog-posts interspersed, and… Here I am!
I was prompted to comment however by “#2″ above.
In ~1990 I was (as I still am) 5’8.5″ tall and weighed ~190# – thus (according to all the “actuarial charts” on the borderline between “obese” and “morbidly obese.”
Yet – at the exact same time – I was being castigated by my Doctor that my body-fat level was TOO LOW! Yes – there is a “too low” level that they consider unhealthy, and I was significantly BELOW that point!
See, my 190# came from a 28″ waist and a 48″ chest, thighs that were 22.5″ each, and so-on… Aside from the impossibility of buying pants that fit (seriously – try finding jeans to fit THAT body!) I was having no real problems, but according to their CHARTS I was simultaneously much too fat and much too lean!
As to “the demonization of the overweight” — this is the point that I’ve been trying to push to people since the nightmare of “obamacare” first became obvious.
The *MINUTE* We The People become responsible for your medical expenses, then we also gain the RIGHT to regulate your weight, your diet and exercise, smoking and drinking, and other “private choices”!
There is *NOTHING* to stop CONgress from passing a law that doubles your tax-rate unless you spend your two weeks’ paid vacation at a “fat farm” – in fact I’d have to argue that We The People have **EVERY** right to mandate that!
We also have the right to mandate that you use birth-control we can verify (ie: “norplant” or “the shot”) until your both >25 and married, or anything else we may dream up which will reduce the amount of scarce resources you take from our “medical coverage”!
I have been simply STUNNED at the number of people who vociferously cheer the Obamacare mandate, yet even more stridently deny these things I tell them!
“*NOBODY* can tell me when to have a baby! This is a ‘free country’!” No, honey – so long as you have the “right to choose” to reproduce but not the RESPONSIBILITY to *PAY* for your choices (instead being allowed to make *ME* pay!) then **NONE** of us are **FREE**!!
Period.
All this mess has ever been is (1) a POWER-grab! and (2) a quid-pro-quo to the Free S#!+ Army (“FSA”) to ensure they’ll keep voting for the Democrat (branch of The Government-) Party!
And yeah – I still expect that this will engender a revolt eventually — or at least be one of the “straws” that lead to such an eventuality… I am but one who has openly declared that I will violate the “mandate” simply because it *IS* a mandate.
I am not alone!
August 24, 2012 - 8:48 am
Necromance away!
You’re the sort of reader I write for.
Thank you.
Neil