It's real. . . and it's fantastic
Elizabeth Warren introduced her Medicare 4 All plan funding last week and she pulled it off with ZERO new taxes on the middle class.
Funny thing is, detractors immediately countered that taxes will go up on the middle class because the middle class will have higher take home income and that will be taxed. So, yeah, I guess middle class taxes will go up to the extent that middle class take home pay goes up. Take home pay will go up because you will get to keep the health insurance premium you are currently paying out. Health insurance premiums are a tax free deduction while take home pay is not. This increase in take home pay is worth $11 trillion and is bigger than the biggest tax cuts in the history of the country, and will be largely enjoyed by the middle class.
Medicare 4 All will cost the country less than current health care costs the country. Many costs will be shifted from the private sector (which is inefficient at managing health care due to market power imbalances caused by the consumers need to have health care which reduces their negotiating power) to government. In the Warren plan this results in a reduction of premiums and deductibles paid mostly by the middle class and an increase on taxes paid by the wealthy, more efficient health care insurance administration, and other government efficiencies explained below.
This plan is actually better than I expected from a fiscal standpoint. The average American will have more take home pay AND more financially secure health care.
So how is the plan funded?
- A wealth tax. A 2% tax on wealth over $50 million dollars and a 6% wealth tax on wealth over $1 billion dollars. This means if you own $50 million + $1 dollars you will pay a 2 cent wealth tax. If you own $1 billion dollars you will pay a wealth tax of ~$20 million dollars. If you own $2 billion dollars you will pay a wealth tax of ~$80 million, approximately 4% of your wealth. Yes, this has the added benefit of greatly reducing wealth inequality - a feature, not a bug.
- Raise capital gains taxes to equal income taxes for the 1% (I've advocated for this for a long time) and mark--to market for the 1% so they pay the tax every year at its current value. Also, the wealth inequality reduction here is a feature not a bug ($200 billion).
- Current company health care insurance premiums will be converted to a tax ($900 billion)
- Current individual health care insurance premiums will become take home pay and will be taxed at the individuals income tax rate ($1,400 billion)
- Better tax law enforcement (this is a real thing and not a gimmick. Republican Presidents and Legislatures over the years have worked to systematically reduce the ability of the IRS and government in general to enforce tax collection on the wealthy. In fact, today the IRS is more likely to audit the poor than the rich because the IRS can't afford to keep up with the legal fees of the rich. This is by design. It can be stopped and it will result in higher tax revenues) ($230 billion).
- Tax on financial transactions ($80 billion)
- Reduce accelerated depreciation ($125 billion)
- Corporate tax on foreign earnings ($165 billion)
- Immigration reform that will result in higher tax revenues (based on CBO analysis) ($40 billion)
- Reduce defense spending ($80 billion)
Keep in mind that detractors will tell you all this is unrealistic (likely some of the same people who told you the Trump tax cuts would pay for themselves, and that we could implement democracy in the Middle East if we just conquered Iraq, and that the Bill Clinton tax increases would ruin the economy, etc.). The same false criticisms of Obamacare will come out for this plan. The revenue increases won't happen, the government will fail to provide the services, we will all be bankrupted and subject to death panels. Don't believe this garbage. Don't buy into fear - fear that we can't do with health care what every other advanced country in the world does. U.S. healthcare is riddled up and down with inefficiencies. It is very reasonable to expect we can create a more efficient health care insurance system and Elizabeth Warren has the plan.
Every Democrat should support this plan.
Elizabeth Warren introduced her Medicare 4 All plan funding last week and she pulled it off with ZERO new taxes on the middle class.
Funny thing is, detractors immediately countered that taxes will go up on the middle class because the middle class will have higher take home income and that will be taxed. So, yeah, I guess middle class taxes will go up to the extent that middle class take home pay goes up. Take home pay will go up because you will get to keep the health insurance premium you are currently paying out. Health insurance premiums are a tax free deduction while take home pay is not. This increase in take home pay is worth $11 trillion and is bigger than the biggest tax cuts in the history of the country, and will be largely enjoyed by the middle class.
Medicare 4 All will cost the country less than current health care costs the country. Many costs will be shifted from the private sector (which is inefficient at managing health care due to market power imbalances caused by the consumers need to have health care which reduces their negotiating power) to government. In the Warren plan this results in a reduction of premiums and deductibles paid mostly by the middle class and an increase on taxes paid by the wealthy, more efficient health care insurance administration, and other government efficiencies explained below.
This plan is actually better than I expected from a fiscal standpoint. The average American will have more take home pay AND more financially secure health care.
So how is the plan funded?
- A wealth tax. A 2% tax on wealth over $50 million dollars and a 6% wealth tax on wealth over $1 billion dollars. This means if you own $50 million + $1 dollars you will pay a 2 cent wealth tax. If you own $1 billion dollars you will pay a wealth tax of ~$20 million dollars. If you own $2 billion dollars you will pay a wealth tax of ~$80 million, approximately 4% of your wealth. Yes, this has the added benefit of greatly reducing wealth inequality - a feature, not a bug.
- Raise capital gains taxes to equal income taxes for the 1% (I've advocated for this for a long time) and mark--to market for the 1% so they pay the tax every year at its current value. Also, the wealth inequality reduction here is a feature not a bug ($200 billion).
- Current company health care insurance premiums will be converted to a tax ($900 billion)
- Current individual health care insurance premiums will become take home pay and will be taxed at the individuals income tax rate ($1,400 billion)
- Better tax law enforcement (this is a real thing and not a gimmick. Republican Presidents and Legislatures over the years have worked to systematically reduce the ability of the IRS and government in general to enforce tax collection on the wealthy. In fact, today the IRS is more likely to audit the poor than the rich because the IRS can't afford to keep up with the legal fees of the rich. This is by design. It can be stopped and it will result in higher tax revenues) ($230 billion).
- Tax on financial transactions ($80 billion)
- Reduce accelerated depreciation ($125 billion)
- Corporate tax on foreign earnings ($165 billion)
- Immigration reform that will result in higher tax revenues (based on CBO analysis) ($40 billion)
- Reduce defense spending ($80 billion)
Keep in mind that detractors will tell you all this is unrealistic (likely some of the same people who told you the Trump tax cuts would pay for themselves, and that we could implement democracy in the Middle East if we just conquered Iraq, and that the Bill Clinton tax increases would ruin the economy, etc.). The same false criticisms of Obamacare will come out for this plan. The revenue increases won't happen, the government will fail to provide the services, we will all be bankrupted and subject to death panels. Don't believe this garbage. Don't buy into fear - fear that we can't do with health care what every other advanced country in the world does. U.S. healthcare is riddled up and down with inefficiencies. It is very reasonable to expect we can create a more efficient health care insurance system and Elizabeth Warren has the plan.
Every Democrat should support this plan.
"They're eating the pets"
3 time Republican nominee for President
3 time Republican nominee for President