Last week, yet another damaging video emerged of Obamacare architect Jonathan Gruber talking about Obamacare's "Cadillac tax." The health care law assesses a hefty 40 percent tax on costly, so-called "Cadillac" insurance plans exceeding $10,200 for an individual and $27,500 for a family. However, Obamacare is structured such that the Cadillac tax is pinned to CPI inflation rather than medical inflation. Since the latter is much higher, over time the Cadillac tax would end up being a big tax hike on the middle class. Now economists on both sides of the aisle have argued that the tax exemption for employer-provided health insurance leads to inefficiencies and distortions, but that doesn't excuse how Gruber and Obama dealt with this issue.
In the video, Gruber talked about how in a meeting with the president, the two discussed being intentionally deceptive about this matter since Obamacare would be less viable if it was widely known it contained a middle class tax hike. Via Jake Tapper at CNN, here's the quote from Gruber that set off alarm bells:
"Economists have called for 40 years to get rid of the regressive, inefficient and expensive tax subsidy provided for employer provider health insurance," Gruber said at the Pioneer Institute for public policy research in Boston. The subsidy is "terrible policy," Gruber said.
"It turns out politically it's really hard to get rid of," Gruber said. "And the only way we could get rid of it was first by mislabeling it, calling it a tax on insurance plans rather than a tax on people when we all know it's a tax on people who hold those insurance plans."
That's certainly an alarming quote, especially when you consider what was said about the tax in this 2009 op-ed in the Washington Post by, yes, Jonathan Gruber. It's actually headlined "'Cadillac' tax isn't a tax -- it's a plan to finance real health reform":
Perhaps the strongest is that some insurance plans will be "unfairly" burdened. For example, firms with older employees may have higher insurance costs not because their plans are more generous but because the employees themselves are more expensive to insure. Thus, many claim that this is a tax not on excessively generous insurance plans but on those who happen to have high insurance costs.
But this argument misses an important point: The assessment proposed in the Senate is not a new tax; it is the elimination of an existing tax break that is provided to exactly these firms. But if they receive the same amount of compensation in the form of health insurance, they are not taxed. As a result, the tax code has for years provided a large subsidy to the most expensive health plans.
So if Jonathan Gruber is to be believed, back in 2009 Jonathan Gruber knowingly lied and with a great deal of forethought. In 2009, he repeatedly insisted that the Cadillac tax was "not a new tax" for political expediency even though he would later admit "we all know it's a tax on people who hold those insurance plans." (As another matter, it is also telling that liberal writers routinely characterize a tax exemption as a "subsidy," a notion predicated on a positively Orwellian assumption that all wealth belongs to the government, which has the ultimate say in how it's distributed.)
Given this shocking mendacity, liberal writers -- and even President Obama -- have done their best to suddenly pretend that Gruber wasn't intimately involved in the crafting of Obamacare, when clearly he was. While New York's Jonathan Chait has dabbled in Gruber Trutherism, he's also advancing another bizarre defense -- Obamacare's Cadillac tax is also a GOP idea and they're hypocritical or something for making an issue of it:
Jonathan Gruber’s candid video commentaries have unleashed the latest in a never-ending round of conservative denunciations of Obamacare, the evilest, sneakiest, failing-est, and most unconstitutional assault of freedom ever. Getting in his licks today is Tevi Troy, former Bush administration health official, who takes to the Wall Street Journal editorial page to denounce Obamacare’s “Cadillac tax.” This insidious levy, writes Troy, has a “creeping reach” and a “deceptive design.” ...