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The Spectacle Blog

Report: Dems to Grant Special Exemption to Unions on "Cadillac Tax"

By Philip Klein on 1.13.10 @ 2:15PM

In their latest effort to pass a health care bill by any means necessary, Democrats have struck a "tentative deal" with their big labor allies to exempt union benefits from a tax on high value health care plans, CongressDaily reports.

The idea itself is nothing new. Back in June, Senate Finance Committee Chairman Max Baucus floated the idea of shielding union benefits from the new tax, but it was set aside. In September, President Obama declined to take a clear position on this so-called "carve out." But now that the excise tax has become a sticking point in negotiations between the House and Senate -- and one that threatens to cost Democrats union support for the bill -- the exemption idea is evidently back in play.

If this policy is adopted, it would mean that there could be two Americans receiving the exact same benefits, but one American may be taxed and one wouldn't, and the only difference would be one of them being a member of a union. This is unseemly and unfair, even by the standards of Obamacare. It has nothing to do with policy-making. It's simply an outright bribe to a constituency that has contributed handily to Democratic campaigns.

UPDATE: New details here.

View all comments (58) | Leave a comment

Al Adab| 1.13.10 @ 2:52PM

Clear violation of the 14th amendment. If we have to exempt one favored group from a tax, should we not consider that the tax itself is ill considered?

jOY| 1.13.10 @ 11:24PM

THE WHOLE DAMNED THING IS UNCONSTITUTIONAL!!! LIBERTY, JUSTICE, FOR THE PEOPLE, BY THE PEOPLE. INDIVIDUAL LIBERTY FIRST, STATES' RIGHTS SECOND, AND LIMITED AND FINALLY, FEDERAL LEVEL.

Hunte Campbell| 1.14.10 @ 3:02AM

Easy solution- create a union at home and get it certified, join it and then get the break.

NonUnion| 1.14.10 @ 12:26PM

Agreed. Let's see, if you have to carve out exemtions to the "Cadillac tax" for unions, exempt Amish and Cristian Scientists from the penalty for not having insurance, exempt Nebraska from Medicare cuts, shouldn't we all just be exempt from the whole d**n thing?

HowardO| 1.14.10 @ 5:32PM

Just one more example of the Constitutional Law Prof violating the Constitution's idea of treating people in similar situations similarly. Another way of assuring this WH is for some of the people, NOT for the whole electorate! Sounds like multiple Supreme Court appeals to decide!

JulianusRex| 1.15.10 @ 4:15PM

It's something like this that will get him impeached.

Lily| 1.13.10 @ 2:59PM

Doesn't this violate the equal protection clause. And if not - then what in the hell would?

Lily| 1.13.10 @ 3:01PM

And, hey, couldn't well all 'unionize' - then 'collectively bargin' our healthcare (wink - wink) and be exempt ourselves?

BYW - I am thinking of converting to Amish to avoid this mess altogether. ...tis a blessing to be simple....

Al Adab| 1.13.10 @ 3:14PM

Maybe that is the underlying plan. Unions keep losing members but, if there is a financial incentive to join... WOW, those Dems really are Machiavelian after all. I wouldn't put it past 'em.
Thanks Lily

Patriot| 1.13.10 @ 3:30PM

Disgusting, corrupt democrats--there's gonna be a BIG backlash. Don't they see it coming? It's a tsunami.

John Galt| 1.13.10 @ 3:31PM

I agree that this must violate the Fifth and Fourteenth Amendments. For that matter, doesn't the Cornhusker Kickback do the same?

Don Jacobson| 1.18.10 @ 3:15PM

As a Cornhusker I can say you bet. Absolutely disgusting. Sen Benedict Nelson claims it was for all states, yet also claims it is budget neutral. Nebraskans will see through this nonsense. I hope the rest of the nation rejects this as well.

dvd| 8.30.11 @ 4:01AM

In a decade of interchangable superhero movies desperately trying to enter the Superhero Pantheon,my wife and kids:The Complete Series Box Set on dvd

Stumpy Pepys| 1.13.10 @ 3:42PM

Why do we continue to acted surprised? Constitution...What Constitution!

Margie| 1.13.10 @ 3:56PM

That's right, pepys, Obama said he considers the Constitution obsolete. He's proving that now.

ncatty| 1.13.10 @ 4:36PM

We don't have a constitution.

Greg| 1.13.10 @ 4:39PM

"Badges?!?!?! We don't need no stink'n badges!!!"

http://www.youtube.com/watch?v=TFwprS_L6tg

Jeff| 1.13.10 @ 3:48PM

If I sit down with my NR rep and discuss our health care options isn't that "collective bargaining" on a micro scale ? Do I get an exemption ?

Jeff| 1.13.10 @ 3:49PM

should have been "HR rep" ... :(

ncatty| 1.13.10 @ 4:35PM

"It is simply an outright bribe.." You forgot to say "another" outright bribe.

Grant| 1.13.10 @ 5:12PM

I have two questions regarding this proposal's constitutionality:

1. Would it violate equal protection as it is not facially neutral and instead discriminates among people by basis of a certain classification?

2. Would it violate freedom of association by coercing persons to join unions?

Luke Taylor| 1.13.10 @ 5:20PM

What impact will this bribe have on the potential of card check legislation? My gosh! Where has our country gone in the last year? Can't wait until the 2010 mid-term elections and the 2012 Presidential election to get rid of the thugs.

MarkJ| 1.13.10 @ 7:18PM

My Fearless Predictions if the union exemption stays and ObamaCare is actually signed into law:

1. Lawsuits lodged by aggrieved parties will start flying like beer bottles at the Dew Drop Inn on a Saturday night.

2. ObamaCare will be tied up in legal knots for years (assuming it isn't defunded and/or repealed first).

ALVal| 1.13.10 @ 9:59PM

They must know that many of these deals that they're making will be found to be unconstitutional but the law will contain a clause preserving everything but those provisions that are found to be unconstitutional. In other words, these are unenforceable promises that they're making. When they are found to be unconstitutional, they can blame the right wing Supreme Court.

DrTomVoter| 1.13.10 @ 7:56PM

Any political junkies that were surprised by this need to turn in their pajamas. Did you really think that the Dems would bite the hand that feeds and leads them? Now, there is the little sticky problem of how to now make it "deficit neutral." But they'll just go to 8 years of taxes with no benefits. Problem solved. If you doubt that, lose the slippers too.

Bill45| 1.13.10 @ 10:11PM

As a constitutional equal protectionmatter, the government drawing lines between unionized workers and non-unionized workers will likely be subjected to the rational basis test, that is, is the line drawn by the govt rationally related to any legitimate interest.

I look forward to learning the pretextual "legitimate interest" the Dems come up with to explain what everyone knows is a bald-faced political payoff.

Joe| 1.13.10 @ 10:54PM

I guess, as a Union member, what we should have done is take our negotiated wage increases and rather than being responsible and using them to care for the health of our members, took it all in the form of taxable income and let everybody figure out healthcare on their own.

Of course then if anyone had a family member with a pre-existing condition - oh well they're on thier own.

I pay over $14,000 to my union health and welfare trust, with my plan I pay 20% for everything up too $2500 and there is a million dollar cap, it is not a cadillac plan. I make just over 60,000 and live in one of the most expensive places to live in the US, who thinks I should pay an additional 2400 in taxes?

KG1| 1.15.10 @ 3:36PM

So, I should pay my bills and a chunk of yours too? If you are going to rob me at least put the gun to my head personally. No need to bring the government in on it.

John| 1.15.10 @ 4:18PM

Joe,
I don't think anyone should pay it - I think obamacare needs to be flushed. but the reality is - why should unions be left out. That is a garbage excuse, that I am sick of hearing - you took reduced wages in lew of health care. I call BS on unions for that lie.

Heather| 1.15.10 @ 4:18PM

That is the whole point... NOBODY should be paying that! This whole plan is public robbery. I don't see how anyone can defend this idea. Two people, same income, same plan, and only one pays additionally. Weren't we all supposed to learn to play fair on the playground?

chris| 1.15.10 @ 6:55PM

Here's the thing...
I have *no* health care. I used to pay 16,800 a year for health care with a 20% cap. Can't afford it.

So, yes, comparitively your plan *is* a cadillac plan, since the primary cause of rising health care costs is mandated coverages absent funding. Ie., the funding shortfall for medicare and medicaid has to be made up on the backs of insured. Which drives prices.

Estragon| 1.15.10 @ 11:13PM

Oh, well, sure - you capped knees for Obama, so you deserve special treatment!

Another thug with his hand out . . .

MARK| 1.16.10 @ 7:46AM

Joe,
I am a merchant marine.I used to be S.I.U. So i was in the Union as well.I got out because of the herd like mentality.What Union members must realize is.It was (not all)but a big push by yourself and other Union members to elect a socialist type of gov.Now we must all suffer same.Untill a new gov. can be elected.

Stimpy| 1.14.10 @ 12:48AM

Well Joe, my health plan is similar to yours, as is my salary, only I'm not in a union. If I have to pay, Then your DAMN RIGHT I THINK YOU SHOULD PAY!!!

mario| 1.14.10 @ 3:57PM

The thugs protecting the thugs, you union thugs will get yours, always do.

Bob| 1.15.10 @ 5:22AM

Did I miss something, where does it say of the people,by the people and for some of the people!

mulp| 1.15.10 @ 3:32PM

Hey, Medicare shouldn't be limited to people over 65, and a few select others! I demand Medicare for all or Medicare for none!

Hey, Republicans, where are your condemnation of the selective coverage by Medicare - I demand you promise to repeal Medicare, or extend Medicare to everyone!

NObamacare| 1.15.10 @ 4:44PM

That's not a good comparison as Medicare is specifically designed to assist senior who tend to have more frequent and higher health care needs and who often are not able to continue the health coverage they had prior to retirement. There is an obvious deliniation between that "class" and those who do not qualify. There are also income contingencies with Medicare. Nice try, though.

L Dean| 1.15.10 @ 3:37PM

It's obvious that all members of Congress need a remdial class in U.S. Constitution 101. November is the first offering of the class. We can hardly wait.

Dave Kantor| 1.15.10 @ 4:00PM

Union backroom deal is just another reason to lynch the Dems in 2010. Obamma-ramma really cares about congress, huh? I guess as long as he is re-elected, the world is saved by his almightyness!

RichN| 1.15.10 @ 4:22PM

All animals are equal but some animals are more equal than others said the pigs.

Jim Torguson| 1.15.10 @ 4:40PM

Alternative:

All animals are equal but PIGS are more equal than others.

Not pure Orwell but I like it better.

Good will

JohnR22| 1.15.10 @ 4:30PM

Is anyone surprised? The Dem Party is OWNED by big labor and the Trial Lawyers Assn. They speak and the Dem Party hops. So...the most overpaid, spoiled and self-destructive aspect of our society (Big Labor) will be fiscally propped up one more time with this bill. I guess the folks on minimum wage will just have to suck up a slightly larger tax hike so the obese retired union slobs can retain their cadillac health plans.

owen| 1.15.10 @ 4:34PM

This is so unbelieveable to me. As a small business operator, we provide our employees with what is called "cadillac" coverage (i.e. POS, dental, drug etc.). I will have to pay an additional tax that GM/UAW won't? Hey, bro, my employees all vote.

Dumbfounded| 1.15.10 @ 4:40PM

JOE,let me see if I understand this.If a non-union enginerer at Ford makes $90,000 and a Union assembly line worker work for the same wage and the both have a $28,000 Cadillac Policy, one should be taxed(the engineer) and one shouldnt(the Obama spporting union member). Isnt it alittle embarassing taking such a positon.If this becomes law, dont be surprised if people start boycotting union made products.

Paul| 1.15.10 @ 4:56PM

There is nothing new to the discovery that some Americans pay taxes on benefits that others do not. If you are self employed, none of your health care premiums are tax priveledged. Those with corporate or union plans have been unfairly freeloading a long time.

pottfullofpith| 1.15.10 @ 5:18PM

The squabbling in the posts is unfortunate and adolescent, but it points up an very important feature of Obamacare: somebody's gotta pay for it. The notion that it is somehow free or "deficit neutral" or will save money in the long run are lies so blatant as to be insulting. Medicare costs were underestimated by a factor of about 9 when it was being debated, and it now supposedly inlcudes 50 billion in "waste, fraud and abuse" annually, an ANNUAL figure for WASTE roughly equal to SIXTEEN times what it cost in its first year and half of TOTAL 1990 expenditures. How can anyone take seriously a cost saving promise? Please recall that the primary argument for Obamacare was to "bend the cost curve." Anyone who really believes that will happen, please raise your hand; the attendants will now move through the audience and help you put on your straight jackets.

Lance| 1.15.10 @ 5:31PM

The mother of all tea parties needs to come together in DC as the Democrat party prepares to brings to a vote. Put all previous tea parties to shame.

sub| 1.15.10 @ 6:41PM

take nobama to court on this one, 14h amendment violation. he'll die trying to get that $ out of my fingers....

Bernd Harzog| 1.15.10 @ 7:04PM

Can you just imagine the unintended consequences of this! I am self employed. My premiums fall into the "Cadillac" category. I join a Union (any Union - even one I make up). I avoid the tax for an extra N years. Does anyone writing this bill even have a brain?

Cheers,

Bernd

valwayne| 1.15.10 @ 10:48PM

Unseemly and unfair? This deal is the most corrupt political payoff in history!!!! Average working Americans will be paying through the nose so that Obama can bribe the unions and government workers. Our Government is controlled by the corrupt "Chicago Way"! Isn't their a single Democratic Senator so sickened by the corruption that they will put an end to this and just say NO!!!

Chicago John| 1.16.10 @ 12:20AM

Obama swore to uphold the Constitution when he took office, but he has broken that oath so many times. There is no more "equal protection" under our Marxist president!

djmelfi| 1.16.10 @ 2:48AM

Obama doesn't know there is something wrong with handing out the peoples money to crooks, that's the SYSTEM in Chicago, Illinois Obama:"I won and its my job to divvy up the stash. . . 2 for me, 1 for Andy, 2 for me, 1 for David, 2 for me 1 for the Afl-CIO, 2 for me, 1 for Nebraska. . . .

TheEnforcer| 1.16.10 @ 8:36AM

Either vote DemocRAT....or else!!!!

LittleTimmy| 1.16.10 @ 8:23PM

If the unions get an exemption from this tax, I will boycott US union made products and services as much as possible.

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