Throughout his presidential campaign, President Obama routinely promised that no one earning less than $250,000 would see their taxes increased. In fact, he promised not to raise taxes for those individuals by "one single dime." Yet if the health care proposal currently being debated in the Senate Finance Committee were to become law, this promise would be shattered. I was very disappointed last week when a proposal requiring the fulfillment of this promise was voted down in the committee.
The Finance Committee's proposal contains an "individual mandate," which requires almost all Americans to have insurance. A report issued last week by the Joint Committee on Taxation and the Congressional Budget Office outlined the extent of the burden this would impose on the middle class. The report projects the federal government will raise about $2.8 billion via individual mandate penalties. The Finance Committee is depending upon the revenue from this tax to pay for health care reform. An astounding 71 percent of the money reaped from this tax--$2 billion--would be taken from those families earning $120,000 or less per year, or individuals earning $59,000. These are the very people President Obama swore to protect. This is a back-door tax increase, and a disingenuous way of dropping the hammer on the American people.
The most distressing part of this middle class tax increase is that the Finance Committee was given a chance to eliminate it. My Republican colleague and Finance Committee member, Senator Mike Crapo of Idaho, offered an amendment last week that would have required the legislation to abide by President Obama's promise. The language literally would have prevented the legislation from imposing any sort of tax on those who earn less than $250,000. Twelve Democrats voted against keeping the President's word, and essentially in favor of taxing the middle class. Only one Democrat voted with Republicans on this amendment, and unfortunately it failed 12 to 11.
In addition, the current legislation already passes costs onto state budgets by significantly expanding Medicaid coverage, which forces states to foot part of the bill. This would require states to either increase taxes or cut important programs.
The rhetoric of the health care reform debate is not matching the reality. Congress must put its "money where its mouth is" and keep the promises made to the American people. If this legislation passes, the middle class will find itself taxed on all sides. We'll face: a new health insurance system that passes new costs down onto states; an individual mandate that penalizes taxpayers directly; and a new 40 percent tax on many insurance plans, which is sure to be passed onto consumers through higher insurance rates. There simply has to be a better way than broken promises to reform our health care system.