Tuesday, July 21, 2009

Health Care: Sharing the costs

Now, I know I have no business commenting on health care reform. I haven't been following the debate, I know nothing of the plans or the details, and I have no time to look anything up. But I read today's NY Times story, cheerily titled (in print but not online) "Obama Pushing, But Early Vote on Health Fades" and my heart sank imaging the stories of yet another president whose early swagger was lost to the Republicans --NO I mean demons -- of health care reform.

Deep in the story there's a quote in response to the House plan to raise the income tax threshold Obama suggested to raise money to pay for the plan from $280,000 and over for single earners and $350,000 for couples to $500,000 for single people and $1,000,000 for couples. Eric Toder a tax economist at the Urban Institute is quoted as saying, "I really do not understand the politics of trying to sell health care reform, which is supposed to be for the benefit of the vast majority of Americans, and saying it should be paid for only by people making over $1 million....If it's worth doing, and I think it is, more people should be willing to pay for it."

Now, I would agree that more people than just the rich as defined here should be willing to pay for health care reform. I'm fine with the original income levels, quite frankly. But I'd point out that more people would pay for health care reform simply by paying their taxes. And I'd ask what is the relative percentage of income those making over $500K and $1 million currently pay in taxes to those making less than that? I'd ask that for the lower threshold, too. And I'd bet that couples making over $1 million pay relatively less in taxes, proportionally speaking, than those making significantly lower incomes. Just a guess. A wild guess from a blogger without the time to look up the answer. I'm just guessing.


Nicole said...

Well, you'd think that, but you'd be wrong. Much as I would also like this idea to be true, in the midst of an email fight with my brother over the Obama tax plans, I did some research. See this link for the actual figures, at least on federal taxes. Column labeled "cash income" indicates the percentage of total national income earned by each income quintile, as well as for top 10%, 5%, and 1%. Column labeled "all federal tax" is the percentage of all federal taxes paid by each income group. Bummer. http://www.taxpolicycenter.org/numbers/displayatab.cfm?DocID=1818

Nicole said...

I see the link was truncated; do a google search on "T08-0079" and it should bring up the table on the tax policy center website. Fair Warning: Tax Policy Center is a project of the Urban Institute and Brookings Institute. That is, left-leaning wonks.

Robin Aronson said...

Well, thank you for clarifying and yet is there a difference between the obligation that the top tax payers have and the actual dollars they end up paying? I remember seeing a story in the NY Times about a large accounting firm that did some very aggressive accounting for top earners. Very top and very aggressive. I know this stinks of fear of conspiracy and yet I can't help myself. I also don't feel bothered by top earners paying more than those who make significantly less. It doesn't seem unreasonable Now I have to buy some lemonade from Helen.