President Obama, being grilled by George Stephanopoulos on Sunday about whether the “individual mandate” (making everyone buy expensive health coverage, with fines for those who don’t), amounts to a tax increase:
Nobody considers that a tax increase….You can’t just make up that language and decide that that’s called a tax increase…My critics say everything is a tax increase.
“Where do Obama’s critics get these wacky ideas?” wonders Michael F. Cannon, health policy analyst for the Cato Institute.
Uh, here’s where, as Cannon discovered:
* Princeton economist Uwe Reinhardt, quoted in this 1987 article by Larry Summers, now chairman of Obama’s National Economic Council:
[Just because] the fiscal flows triggered by mandate would not flow directly through the public budgets does not detract from the measure’s status of a bona fide tax.
* Larry Summers himself, writing in 1989:
Economists have generally devoted little attention to mandated benefits regarding them as simply disguised tax and expenditure measures… Essentially, mandated benefits are like public programs financed by benefit taxes… [If] the mandated benefit is worthless to employees, it is just like a tax from the point of view of both employers and employees…There is no sense in which benefits become “free” just because the government mandates that employers offer them to workers.
* Columbia University economist Sherry Glied, Obama’s assistant secretary for planning and evaluation for the Health and Human Services Department, writing in the New England Journal of Medicine in 2008:
The mandate is in many respects analogous to a tax. It requires people to make payments for something whether they want it or not. One important concern is that the government will provide insufficient funds for the subsidies intended to accompany the mandate. In that case, the mandate will act as a very regressive tax, penalizing uninsured people who genuinely cannot afford to buy coverage.
* The Congressional Budget Office in 2009:
Under some proposals, firms would be required to make payments to the federal government if they chose not to offer health insurance to their employees, and individuals who did not comply with the requirement to obtain insurance would have to pay a penalty. Such payments would be equivalent to a tax or a fine, and the government’s receipts should be recorded in the budget as federal revenues.
Crackpots, all of them.