Death and Taxes

[jackofallgeeks]

So, right now, I have two main concerns with the Presidential race:
healthcare and taxes. I imagine those are pretty big points for most
people. I'm not terribly well-informed and I'm just tossing my opinion out
there; with any luck someone wiser than I can stop by and add something of
substance.

Healthcare is a significant concern for me right now.
(Even more so considering my impending marriage and intent on having
children in short order.) I have health coverage from my employer, but the
whole thing is so tangled and complex that I generally avoid using it
because it's so much of a hassle and if I ever needed to use it, I
really have no idea what would be covered or how much. That's not simply a
matter of looking at my coverage plan, either, as the whole thing is written
in legal-speak and there are so many rules and gotchas that even things I
know are covered may be more expensive or even not covered at all if
I'm not careful about following procedure. Nevermind the fact that a lot of
this depends on my Insurance deciding that I needed the care in the first
case, which isn't a given or necessarily an easy thing to determine.

I blame the whole mess on the fact that, essentially, the ones paying for
the healthcare are not the ones recieving the care. That is, someone other
than me is calling the shots. This means that (1) it doesn't matter if I
get shoddy service because my voice is small and not backed by money, and
(2) since payment for the care is coming from someone else far removed from
me and my medical needs, the decision on the necessity any care or procedure
is divorced from my situation. (Nevermind that the whole system can be
gamed by unscrupulous health professionals -- my mom thought it was odd that
she could never get a return appointment with her physician in less than 15
days until she learned that if he sees her a second time within two weeks
she doesn't owe a second copay.)

Obama and McCain seem to be split between Government-run 'universal'
healthcare, and a more-open competition between private insurers. Which
makes sense, as that seems a typical line to draw between Democrats and
Republicans.

What concerns me about Obama's plan basically boils down to the fact that
the problems see with the curent plan can be reduced to inefficiency and
removing decision-making/money-spending from the direct customer. The
Government almost never does anything efficiently and is
arguably even more removed from the people recieving care than insurers
are. The Government would have a say in whether or not my treatment is
necessary, and what kind of priority it gets. And with the government
footing the bill for all citizens, I anticipate that prices will go up and
availability will go down (nevermind the increased spending needed to fund
the Government's side, which will surely lead it increasing taxes regardless
of what's claimed).

McCain's plan, as I understand it, is... to stop employer-funded health
plans? And give the money to the people to get their own plans? I'm not
really very clear on it, but my understanding is that the 'payback' would
essentially mean that you'd pay the same as you pay now (most emplyers have
you pay part of the premium and the cover the rest), but you would have the
freedom to choose whatever plan and whatever oprovider you wanted. This
puts the "buying-power" back into the hands of the direct consumer, and I
think that's a good thing. If you don't like the service you're getting,
you really can "vote with your feet" and go somewhere else that better suits
your needs. I expect that'll make competition between insurers tighter
which should drive prices down and quality up, but it depends on the
details and it wion't be quick, nor probably simple. The lack of
hand-holding may be a downside for people who aren't used to making such
healthcare decisions on their own, but I'm not sure on the effects of that
point. Still, I like it a whole lot better than handing the whole thing off
to the government.

I know even less about their tax plans than I do about
their healthcare plans, so this comes with even more salt. Obama claimes
that he won't raise taxes except on the to 5% of people who earn $250,000 a
year (or something), and on businesses. But I recall he also said that he's
not going to renew the 'temporary' cuts that Bush put in place. So he may
not 'raise' taxes, but we'll all be paying more. What's more, taxing
businesses only ever leads those businesses to raise their prices,
effectively taxing the rest of us. It'll make it harder for the
average American to purchace day-to-day goods and services. Plus, it seems
to me that putting more financial strain on businesses in a time when the
economy is already aching (extra taxes and fewer customers isn't conducive
to business health) seems like a really bad idea. To be fair, though, I
don't really know anything at all about McCain's tax plan. Apparently he'd
be taxing us for the... whatever it is, the 'extra' money from his
healthcare plan. I haven't untagled that bit yet, either. I think it's
unlikely that he plans on hiking taxes for businesses which, for better or
worse, I think is at least safer for the current economy.

Comments

[dikaiosunh.livejournal.com]

Re: Health care.

Single-payer health plans are not generally more expensive than "market"-based ones (more on the quotes in a sec), for two reasons. The US pays the highest % of GDP (when you combine private and public spending) on health care of any industrialized nation.

1. They can negotiate with providers re: prices. Doctors get paid less most places than they do in the US, and drugs are bought more cheaply (there's no evidence that this influences the quality of our health care - our indicators are worst than most industrialized countries, so we're not clearly "buying" anything with our increased costs).
2. For insurance, large pools tend to bring average prices down better than small pools. Insurance is essentially a method of off-loading risk; average prices go down the most if the risk is spread around widely, and among folks who all experience different levels of risk. A purely laissez-faire system with insurance companies would be great for young healthy people (assuming you don't get unlucky) and awful for anyone else.
3. If there's only one payer, you can reap the benefits of preventative care better - Blue Cross has less incentive to make sure I get preventative care b/c by the time I don't have colon cancer, I may be with Kaiser.

McCain's plan, incidentally, works like this (as I understand it):
1. Let insurance companies sell across state lines (this would amount to massive deregulation, since most rules about how they have to operate are state rules - think why credit card companies are all registered in Delaware - but that's not an insurmountable problem if you wanted to reintroduce federal rules).
2. Give everyone a $2500 (individual)/$5000 (family) tax credit to buy health insurance.
3. Pay for this in part by taxing the health benefits employers provide as if they were salary (the other part is by reducing the ever-popular "earmarks and government waste" - Obama is guilty of this fantasy source of revenue as well).

The problems with this plan are essentially that only in la-la fantasy world is the tax credit actually adequate to pay for a health plan. And, taxing employer benefits would induce some employers to stop offering them - how many is a hard question to answer, but almost everyone agrees it'd be *some* (the low-end estimate I've seen is 1 million, the high end 20 million or so).

Incidentally, we have rationing of health care *now*. It's just that your HMO is making the decision, rather than the government. Given that our current system has led to sub-par health outcomes compared to other similar states (i.e., Canada and Europe), I think it's at least a toss-up in theory about whether companies or the government would do a better job. And the VA, the US' home-grown "socialized" system, Walter Reed notwithstanding, has a pretty good record.

The reason for the scare quotes before was that, of course, the US doesn't have a pure market system. It's regulated, we have medicare/medicaid/VA/federal health pools/SCHIP/etc., and we allow the uninsured to use emergency rooms and the state eats the cost. So, you occasionally see proposals for making our system more market-oriented rather than less. It's hard to say how that would work out - no developed nation does it that way. And given the fact that most people are not fully qualified to judge the necessity and quality of their care (you may get a second opinion, but unless your a doctor, you're largely relying on other's opinions, in a high-stakes area), I'm not convinced that the full information provisions required for theoretical market models to work are anything near realized.

The comment on taxes is quicker: there's no solid empirical evidence linking explicit tax rates and economic performance. The US economy boomed under Clinton, who raised corporate taxes. We had tax rates during the mid-20th century that dwarfed the current ones, and that was the fabled time of manufacturing prosperity.

Incidentally, whatever you think about taxes, anyone who tells you that there's any hope of a balanced budget (or close) in the nearish future is working on the assumption that the Bush tax cuts sunset as planned in the original law (and probably no AMT patch).

[dikaiosunh.livejournal.com]

Oops. Scratch what I said about McCain's plan inducing employers to drop plans by taxing employers. I misspoke and was working over lunch. Employees would be taxed on the benefits (in a way that would be partly offset by the credit). The numbers I was looking at were on how many uninsured would get insured under McCain's proposal, not the other way 'round. Perils of looking stuff up quickly.

[dikaiosunh.livejournal.com]

Oh, also, Obama's plan isn't a single-payer one. It just *should* be, and will work to the extent that it's closer to one. And no, his plan to pay for it also doesn't cover its projected costs.

You can get a decent nonpartisan run-down here:

http://www.factcheck.org/elections-2008/health_care_spin.html

Only for Now...

[ambereternal.livejournal.com]

Healthcare:
You need to find out if your employer provides you with an HMO, POS, or PPO health plan, and Once you know which one you're on, it's fairly simple to figure out the intricacies. What Obama wants to do is keep the healthcare we have right now, with one exception. He wants employers to pay a higher percent of their employees' healthcare, and he wants to offer government-funded healthcare to those who can't afford it. (i.e. - elderly, poverty-stricken) McCain wants to tax employees on employer-provided benefits. For example, right now I don't pay anything for health care. My healthcare benefits are completely provided by my employer, and nothing comes out of my pocket for them. The value of my health care is approximately $3,800/year. Under McCain, I would be taxed on an extra $3,800/year that I'm not earning! This won't matter for everyone, but if your salary is borderline, it makes a big difference. Let's say you earn $38,000/year, and have benefits like mine. McCain will add that $3800 to your income, despite the fact that you don't actually have that money, and tax you to it. You are now being taxed on a "salary base" of $41.8k/year. That pushes you up into a higher tax bracket. So you're paying more taxes, and at the end of the day you're bringing home less money, which means things get harder for you and your family. Not easier. Economic crisis continues, and evenutally we're all standing in bread lines again...

On the other hand, I hate Obama's tax plan just as much as McCain's health plan. It sounds really good to everyone to not have tax cuts for anyone earning less than $250,000/year. Except that a lot of small business owners earn more than that on paper, but take home much less than that after paying business expenses. This tax plan is big business' best friend. That makes me sad on several different levels.

To be honest, we're going to be taxed more in the long run no matter what happens. It's a necessity. I would rather have it done by Obama removing the temporary tax relief President Bush (stupidly) put in place than by raising my tax bracket because of employer-provided health care benefits.

Re: Only for Now...

[dikaiosunh.livejournal.com]

Just FYI, while there may be other problems with it, small business expenses are tax-deductible (with some few exceptions). So Obama's stated plan would only hit you if your take-home was over $250k.

[quix.livejournal.com]

Have you checked out http://glassbooth.org/ ? It polls you on issues you're concerned about and then provides you with not only a recommended candidate, but links to back up the reasons, so it can also help educate you on these issues.

Is it bad that I'm afraid to admit my political leanings in my own blog?

[jackofallgeeks.livejournal.com]

I have now.

Not surprisingly, 75% for McCain, 54% for Obama, and 70% for Barr (who?). Decent information on there, so I had my quiz spread broad-but-shallow on the issues. I may narrow it and dig deeper, see if that changes things.

[jackofallgeeks.livejournal.com]

Also not surprising: the deeper I did down on a smaller handful of issues, the better Barr looks, and the more McCain and Obama look the same. *sigh*

[quix.livejournal.com]

Bob Barr is leading the Libertarian party. Ron Paul (whom you may have heard of) has also been described as a libertarian. Try this quiz and see if your beliefs echo that of Libertarian. http://www.okcupid.com/politics

[jackofallgeeks.livejournal.com]

-laughs- Oh, I know I'm a Libertarian -- at least, of one stripe or another. They tend to be a fractious bunch yet. It earns a sigh, though, because no one except a Republican or Democrat is going to win the election any time in the near future.