Obamacare Repeal: Follow The Money

The Republicans are going to have to look like they’ve repealed Obamacare (the ACA) to please their base–it’s too central an issue to the batshitloonitarianism guiding the mass communicable psychosis which is the Republican Party to do otherwise. But it’s never made sense why the ACA bothered them–it’s a Republican plan, modeled after Republican Governor Mitt Romney’s plan, which is probably why it has the problems it does (note to Democratic operatives: if you ever regain power, pass Democratic programs, not shitty Republican ones).

On top of that, Republicans don’t have an alternative that will make things better. If they screw this up, the political blowback could be tremendous, as people usually desert parties and ideologies when they have been personally betrayed, especially on the authoritarian-ish side of things (losing healthcare insurance would qualify).

But they do have a financial incentive to remove the ACA. At least a small subset of Republicans do (boldface mine):

When it comes to individual taxes, however, by far the largest revenue source [for the ACA] is a new levy on income. Technically it is part of the Medicare Hospital Insurance tax. But this new tax is a “surcharge,” and it differs from the rest of the Medicare tax in two critical respects.

One is that it falls exclusively on wealthy households ― specifically, on married couples with annual incomes above $250,000 and on single people with annual incomes above $200,000. When Obamacare first became law, the Brookings-Urban Institute Tax Policy Center estimated that initially fewer than 3 percent of tax filers would have incomes high enough to incur the new tax, with the percentage growing slowly over time because the law does not adjust the thresholds for inflation.

The other distinctive quality is that this surcharge includes investment income. That’s a big deal, since the rest of the Medicare tax covers wages only. Wealthy Americans are more likely than others to make a lot of money from stocks, real estate and other holdings, and that’s especially true for the richest of the richest.

For affected households with annual incomes in low six digits (between $200,000 and $500,000), the average tax increase upon the law’s implementation was just $467 a year, according to calculations by the Tax Policy Center. That worked out to an increase of 0.2 percent. Millionaires, however, faced a steeper increase. For filers with annual incomes above $1 million, the average tax increase was $36,310, or an increase of 1.2 percent.

They can afford that kind of money, for sure. But it’s safe to assume most of them would be happy not pay that tax anymore. Which is great, except that if the tax goes away, so will the revenue ― to the tune of $346 billion over the next 10 years, by the CBO’s reckoning…

The policy trade-off here is straightforward. Lawmakers can reduce taxes on the wealthiest Americans or they can plow that money into helping some subset of poor and middle-class Americans pay their medical bills.

Want to guess which option Republicans will choose?

I KNOW THE ANSWER! I KNOW THE ANSWER!

If only the Democrats were competent and could beat the Republicans over the head with this. Then again, if professional Democrats were competent, the rest of us wouldn’t be in this mess.

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3 Responses to Obamacare Repeal: Follow The Money

  1. Net Denizen says:

    From a purely ideological standpoint, they hate it for the same reason they hated Bill Clinton. As you say, a republican plan but it was implemented by a democrat. And that seems to really burn their britches when a democrat takes credit for a republican idea and makes it popular — even if the popularity comes more from the democrat taking credit than it does from the actual program helping anyone. i.e. — welfare reform and the ACA are/were popular because of the president who championed them, not because the policy actually worked well for the people it was designed to affect. My $0.02, adjusted for inflation….

  2. paintedjaguar says:

    Can we all please stop pretending that the reason the Dems betray us is incompetence? On the contrary, they’ve done an exceptional job for their real constituencies during the past 40 years.

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