Democrats will rue the day they asked that question.
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States would also be free to take the federal financing for Medicaid in finite block grants, along with the flexibility to tailor their programs to the specific needs of their populations and better control costs. The plan also provides for state run high risk pools that guarantee back-up, safety net coverage for all regardless of pre-existing conditions, addressing that problem without burdensome regulations that would sharply raise health insurance costs for everyone.
For Social Security, workers under 55 would be free to choose to invest over one-third of their payroll taxes in personal retirement accounts, similar to the Thrift Savings Plan covering federal employees. Those accounts take over responsibility for paying an equivalent proportion of future benefits, resulting in sharp reductions in government spending over the long run. The accounts are backed up by a federal guarantee that workers will not lose a dollar of their contributions to the accounts, even after inflation. Because long run market investment returns are so much higher than what Social Security even promises, let alone what it can pay, workers should receive substantially higher overall retirement benefits as a result.
For Medicare, those under 55 would receive vouchers starting out at $11,000 per year to be used to buy health insurance in retirement. Low income retirees would receive more depending on their income, to ensure they could obtain essential coverage.
The Roadmap would provide all taxpayers the choice of filing under an alternative, greatly simplified tax code with just two rates even lower than in Reagan’s 1986 tax reform. Joint filers earning up to $100,000 per year, and single filers earning up to $50,000, would pay 10%, with a 25% rate on higher incomes. A generous standard deduction and personal exemption would exempt the first $39,000 per year for a family of four from any income tax.
The plan would promote savings by eliminating as well taxation of capital gains, dividends, and interest, and the entire death tax, which would stop the multiple taxation of the capital essential to creating jobs and economic growth. The arbitrary and unfair Alternative Minimum Tax (AMT) would also be abolished. The corporate income tax, currently with the second highest rate in the industrialized world leaving American companies uncompetitive, would be replaced entirely with a border adjustable business consumption tax of 8.5%, which would restore American international competitiveness.
Those who wanted to continue to use any of the deductions, credits or tax preferences of the current code would be free to do so, by filing under the current complex code with its much higher rates. But those choosing the new alternative could save considerable money and time filing their taxes on a postcard.
Further contributing to a long-term balanced budget is a binding cap on all other federal spending. The massive reductions in federal spending, taxes, and government debt from the entire Roadmap would produce a booming economy, the creation of millions of jobs, higher wages and incomes, and long term prosperity for America, restoring the American Dream. This is exactly what Tea Party activists have been asking for.
Patient Power v. Government Power
Don’t be misled by those, left or right, who are saying Obamacare’s government takeover of health care can’t be repealed. As the above discussion shows, reform of the entire entitlement state is in play, Social Security, Medicare, Medicaid, welfare, and Obamacare.
On health care, the GOP across the board is embracing the Patient Power policies first advanced in 1992 by John Goodman in the pathbreaking book of that same name. That includes expanding the tax break for employer provided health insurance to all workers, as described above, freeing workers to choose their own individual portable insurance, rather than being stuck with what the employer chooses for them. It includes freeing the poor from Medicaid to choose their own health plan as well, and enjoy the same health care as the middle class in the process. It includes the same choice for seniors, expanding all of Medicare into a Medicare Advantage option providing for choice among superior private insurance alternatives. It was the GOP that introduced the popular Medicare Advantage option in the first place.
And it is the GOP now proposing to expand choice further by allowing consumers to choose any health plan in a national insurance market, through interstate sales. Moreover, from Medicaid, to Medicare, to the employer and individual insurance markets, all would enjoy the choice of an HSA that maximizes patient choice and control over health care. With an HSA, only a small fraction of current health insurance dollars go to the insurance company for catastrophic health insurance with a high deductible, with the rest kept under the control of the patient in the HSA to pay for the care of his or her choice directly.
This is in diametrically opposing contrast to the Government Power theme of Obamacare, with its over 100 new government bureaucracies, agencies, boards, commissions and programs taking over and ruling health care. These government authorities will tell doctors and hospitals what are the “best practices” in health care, what works in health care and what doesn’t, what health care is cost effective, what is quality health care and what isn’t, enforcing all of this through the payment compensation system. Under the individual mandate and the employer mandate, the government dictates to everyone exactly what health insurance they must buy. That will be the most expensive insurance including all the politically correct benefits, translating into soaring premiums, which are effective tax increase under the mandates. The government also dictates to insurance companies exactly what health insurance they must sell, to whom they must sell it, and at what price. The government even redistributes premium income among insurance companies through “risk adjustment.” Is there any aspect of health care that Obamacare leaves beyond government control?
Under Obamacare’s Government Power approach, millions will now lose their employer provided insurance to become government dependents, millions of seniors will lose their Medicare Advantage plans, and millions of working people will lose their Health Savings Accounts. Then there are the $2.5 trillion in Medicare cuts over the first 20 years, which begins the effective health care rationing, and the trillions in increased taxes, which the GOP Patient Power approach would also repeal.
Just one week of experience with Obamacare shows how unhinged from reality the ultra-left ruling Democrats who imposed it on us are. Because Obamacare raises taxes on employer provided retiree health benefits, U.S. accounting laws enforced by the SEC require companies to immediately report the resulting losses. So the loss reports are coming in: AT&T $1 billion, Caterpillar $100 million, Deere & Co. $150 million, 3M $90 million. President Obama promised us his government takeover would promote jobs and economic growth by reducing costs for employers, but already it is doing just the opposite.
Democrats shocked by this regulatory compliance have already reacted with a summons demanding documents and Congressional testimony from the companies because their reported real world results “appear to conflict with independent analyses, which show that the new law will expand coverage and bring down costs.” Rejecting any consideration of dissenting data and analysis as a right-wing plot, they rigidly stuck to their own propaganda talking points, and now they and the rest of us will suffer the consequences, building over time into a tidal wave.
I have no doubt that the American people will overwhelmingly support Patient Power over Government Power. Consequently, the Republican campaign to replace Obamacare with Patient Power will just be one long, powerful, party-building exercise right through to Inauguration Day, 2013.