The silver lining in the Supreme Court’s upholding of the Affordable Care Act for Republicans was the court’s ruling that the fine to be paid by people who can afford it but choose not to buy insurance was a “tax” not a “penalty.”
Their spokesman, Rush Limbaugh, rushed to the airwaves to declare, “What we now have is the biggest tax increase in the history of the world.”
And what we have there is a big, fat lie:
But when you compare the projected revenue effect of the individual mandate to the actual revenue effects of other, actually large tax increases, the claim becomes laughable.
We used the Treasury Department’s four-year data on the revenue effects of large tax increases signed by Ronald Reagan, George H.W. Bush and Bill Clinton; along with CBO projections of the revenue effect of the mandate adjusted for its GDP projections during the mandate’s first four years.
The mandate is tiny by comparison.
And, from Kevin Drum:
This is so stupid it hurts…
[But] let’s be fair: When Republicans talk about ACA’s tax increases, most of them are talking about all the taxes in the bill, not just the penalty. But they’re still off base. There have been 15 tax increases of significant size since 1950, and Jerry Tempalski, a tax analyst in the Treasury Department, has estimated the size of all of them as a percentage of GDP. Tempalski hasn’t estimated the eventual size of ACA, but PolitiFact took a crack at it using the same methodology, and they figure that ACA amounts to a tax increase of 0.49% of GDP seven years from now. That places it tenth on the list.
It’s fair for Republicans to complain that ACA includes a bunch of new taxes. It does. Most of them fall on high earners and corporations, not the middle class, but they’re still taxes. However, the “biggest tax increase in history” nonsense is crazy, and no news outlet interested in accuracy should let it pass without challenge.
The bottom line, from Josh Marshall:
I’ve got a question: Just how stupid are all you reporters? No, that’s not a rhetorical question. Whether you want to call the ACA health care mandate a tax or not is mainly a semantic point. It’s a penalty or tax or perhaps a tax penalty on people who refuse to purchase health insurance, even after they received subsidies that make it possible. But Republicans are now saying it’s the ‘biggest tax increase in history’ — either of America or the universe of whatever. But this is demonstrably false.
The Congressional Budget Office says the mandate penalty will raise $27 billion between 2012 and 2021. $27 billion over a decade. Anybody who cares to can do the math. But if you want to call it a ‘tax increase’ — which is debatable — it’s clearly one of tiniest ones in history.
The real problem here for Republicans is that if the penalty in the Heritage Foundation’s mandate in Obamacare is a “tax,” then the Romneycare, which is also based on the Heritage mandate, also included a tax, which means that as governor, Romney raised taxes on Bay Staters.
Those are the semantics that are driving the Romney campaign’s flipping and flopping. If the penalty is a tax, then Gov. Romney raised taxes — and that would put him in bad odor with Republican Party boss Grover Norquist and the anti-tax fetishists in the GOP base.
- Section: News & Comment