I was watching Fox News yesterday as the SCOTUS ruling upholding Obamacare’s individual mandate came to light. Commentary was all over the map for the first 30 minutes, but then began to rapidly zero-in on the accusation that this was now a tax on the middle-class. They had found their message, and from then on sang out in perfect harmony. It was kind of amazing.
“(Americans will) like it even less when they understand it’s a tax,” Sen. Mike Lee, R-Utah, told Fox News.
One curious element is that nothing related to the mandate is different today than it was last week—excepting the label. The notion that people’s view of the mandate will change as a result of a renaming is a blatant play to the ignorance of the audience.
Still, even if we accept the new label of “tax”, is it really a new financial burden on the middle class as conservatives are saying?
For those who are currently uninsured and financially able to afford healthcare, Obamacare will impose a new financial drain. Although, in return they get health insurance. We can call that a tax if you like.
But on the flip side, those who are currently insured are presently picking up the tab for the uninsured through higher insurance premiums and medical costs. Getting the uninsured into the pool lowers policy rates for the rest of us. This is even more true as other popular provisions of Obamacare, such as preventing coverage denial for pre-existing conditions, comes into force. The net result of this is a lowering of the financial burden on the currently insured, which is a significant majority of citizens.
If forcing the uninsured into the pool is a tax increase, then it only seems fair the reduced costs to the insured be considered a tax cut. At worst, this is a wash. At best, the tax cuts for the majority will significantly outweigh the tax increase to the minority.
Will there be individuals who will pay more as a result of Obamacare? Sure. But many more of us will pay less. So it’s pretty hard to argue in aggregate that this is a tax increase on the middle class.