Obama’s Top Three Health Care Campaign Lies

PHIL KERPEN: Obama’s Top Three Health Care Campaign Lies
By Phil Kerpen

Lie Number 1: I Won’t Tax Your Health Benefits

What Obama said on the campaign trail (Newport News, Va., October 4, 2008):

“So here’s John McCain’s radical plan in a nutshell: he taxes health care benefits for the first time in history… Well, I don’t think that’s right.”

What Obama says now:

Obama ally Sen. Max Baucus told the Washington Post that Obama is now willing to tax employer-provided health benefits. Baucus said: “Yeah, it’s something that he might consider. That was discussed. It’s on the table.”

Limiting or ending the tax-free status of health benefits makes sense if it’s used to cut other taxes and put all health insurance—employer-provided or not—on a level playing field. The existing benefit is an artifact of World War II-era price controls and creates a tax penalty for people who buy their own insurance.


But unlike the McCain plan, which would have taxed employer-provided health benefits and used the money to pay for a new health care tax credit, the plan now being considered by Democrats, including Obama, would tax employer-health benefits to fund increased government health care spending. For the 250 million-plus Americans who already have health insurance, this is a raw deal—they pay more taxes and get nothing in return.

Lie Number 2: I Won’t Force You to Buy Health Insurance

What Obama said on the campaign trail (Janesville, Wis., February 13, 2008):

“The main difference between my plan and Senator Clinton’s plan is that she’d require the government to force you to buy health insurance and she said she’d ‘go after’ your wages if you don’t.”

What Obama says now:

President Obama sent a letter to Democratic Senators Ted Kennedy and Max Baucus yesterday that says—using the new code word “responsibility” to refer to the same kind of mandate he slammed in Hillary’s plan:

“I understand the Committees are moving towards a principle of shared responsibility — making every American responsible for having health insurance coverage, and asking that employers share in the cost. I share the goal of ending lapses and gaps in coverage that make us less healthy and drive up everyone’s costs, and I am open to your ideas on shared responsibility.”

While President Obama did say he would like a waiver process in hardship cases, there is no reason to have a mandate other than to force people to buy insurance who don’t want to, mostly young people who are healthy and want to spend their limited income on their young careers and families. According to the Census Bureau, about 60 percent of the uninsured are under age 35, with the highest rates in the 18-24 bracket (28.1 percent uninsured) and the 25-34 (25.7 percent uninsured) bracket. This is about forcing some people who don’t want health insurance to pay for other people through a new government program. It’s more spreading the wealth around.

President Obama is poised to accept this provision for the same reason Sen. Clinton proposed it—to buy off insurance companies. Democrats learned a lesson from the 1993 HillaryCare fight when the insurance companies stopped a Washington health care takeover. The mandate is a giveaway to insurance companies to buy their support this time by forcing healthy young people who use less health care to pay insurance premiums.

Lie Number 3: If You Aren’t Rich, I Won’t Raise Your Taxes

What Obama said on the campaign trail (September 12, 2008, Dover, N.H.):

“I can make a firm pledge. Under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.”

What Obama says now:

Well, it’s hard to keep up because new ideas are floated every day, but they all would involve taxing people who make less than $250,000. In fact, even his income tax hikes for the rich have now been dropped down to start at $235,000. Then there’s the soft drink excise tax, the cap-and-trade energy taxes, and most recently the VAT, a form of national sales tax. And of course the tax on health benefits I mentioned above would also break the only-tax-the-rich pledge.

What all these proposals have in common: we all pay, big-time, likely trillions of dollars in higher taxes for “free” government health care. In fact, that’s probably the biggest lie of all—that government health care is free.

Mr. Kerpen is director of policy for Americans for Prosperity. He can be contacted through www.philkerpen.com. He records a free daily Podcast available here.