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November 7, 2009, 10:22 pm

House passes health care bill. I wonder if anybody really knows what is in this thing.  I am not much of a political expert, but I don't see how, if the vote was so close in the House, that they are ever going to get this pig through the Senate.  Perhaps go the conference route so they can avoid cloture.

Tags:
Category: Health Care
  • Michael

    I believe that the supreme court would have no choice but to rule much of this bill unconstitutional. Being uninsured is a felony and the bill requires people to report this felony on their tax forms. From what I recall about past court cases on marijuana taxes, the state can't make something illegal and require a person to report their crime to the state.

    Insurance is a commodity like pot, but in this case the government is requiring people to poses the commodity. Those that don't have it must report it to the government and face prosecution.

    The house just opened the door where people and companies that don't own government approved plans, can't be forced to file tax returns.

  • Michael

    I don't see how the Senate can avoid cloture. The house bill is changing anti trust laws, setting price controls on the private sector, and creating a new agency. The Senate can't mask this as a budget bill.

  • http://devilish-details.blogspot.com/ Mesa Econoguy

    There appears to be a fair amount of momentum attached, but that can and probably will change (hopefully). This is a disaster.

    As expected, they’re bulldozing this thing as far as they can get, and they’re going to have to do some fancy footwork in committee.

    I’d like to know what the single Repub from LA got in exchange for voting for this – that’s going to be an interesting conversation.

    Read that WSJ article Coyote linked above, everyone. Staggering:

    An individual earning $44,000 before taxes who purchases his own insurance will have to pay a $5,300 premium and an estimated $2,000 in out-of-pocket expenses, for a total of $7,300 a year, which is 17% of his pre-tax income. A family earning $102,100 a year before taxes will have to pay a $15,000 premium plus an estimated $5,300 out-of-pocket, for a $20,300 total, or 20% of its pre-tax income. Individuals and families earning less than these amounts will be eligible for subsidies paid directly to their insurer.

    As an aside, it is unbelievably disconcerting and downright depressing that a woman as willfully ignorant and incoherent as Nancy Pelosi can get a job anywhere, much less running point for the clueless rubes who shoved this down our throats.

  • GU

    "I wonder if anybody really knows what is in this thing."

    If you listen to the statists, it doesn't matter! Politics is all about getting things done, principles be damned! See: http://www.slate.com/id/2229223/pagenum/all/

  • nom de guerre

    never forgive, never forget. it'll be up to us to do that, because you can be sure the MSM will bury this whole stinking debacle deep into the memory hole as november 2010 approaches. hunt them down, (metaphorically), take their precious jobs and their precious power away from them, and this abortion can still be killed before it's had time to set down roots. before americans "learn" to see "free healthcare" as a sacred right and perk that's **owed to them**, just like the low-cost, first-class service they get from the post office and the DMV and social security.

    be unreasonable. shout them down. refuse any compromise. make it personal. **make them pay**.

    otherwise, might as well just get used to it: they just officially gave us all the finger, told us they don't give a damn what we want or think, and made us their serfs. now it's our move.

  • Michael

    If anyone here has followed Radley Balko's work on crime over the years, the court will let the government make up the evidence, and the court will deny the defense a defense, but the court hasn't gotten to the point where they will let the government force people to file admissions of guilt with the government.

    The House bill is asking people and companies to admit to felonies. If the supreme court upholds mandatory confessions, states are going to look to leave the union. Fly over country isn't going to accept a USSR environment to prop up California and the northeast.

  • Michael

    GU,

    No body knows what is in it. The last I heard there were 900 pages of extras added to the bill to get it passed.

    Ohio has got itself in to trouble having Democrat and RINO governors. The one good thing about our state's constitution is that politicians can't bundle legislation. Each law has to stand on it's own.

    T Boone Pickens is a prime example of what is wrong in Washington. He's all for cap and trade. He admits 95% of the bill is bad for America, but 5% is good for him.

  • chembot

    Although the 9th and 10th amendments practically don't exist anymore, couldn't some of this be fought on either 1st or 14th amendment grounds?

    For the 1st amendment case, couldn't you assert a right to not be forced to associate with the exchanges/gov't insurance? It is an unusual thought I suppose, but this is unprecedented that government is forcing everyone to consume a particular product upon penalty of fines/taxes. (I wonder how many latter day Al Capones convicted of "healthcare evasion" it will take before people get fed up.)

    What a depressing day. If this can't be stopped with all of the protests, town hells, and so forth ranged against it, Cap'N Trade and the rest certainly won't be stopped either.

    I remember in 2004 all the liberals whining that they would have to move to Canada to escape the evil if Chimpy W. Hitlerburton were re-elected. At least they had somewhere to go, whether Canada or Europe depending on the amount of liberal statism they wanted. The depressing thing is that even if you could hop off the Hope and Change Express right now there is practically no where to go.

  • http://maxedoutmama.blogspot.com MaxedOutMama

    The SC will not strike this as unconstitutional, because the issue has already been fought out over prosecuting organized crime for IRS violations. I forget the main case, but the SC has already put their stamp on this.

    Anyway, you have some of the details wrong. It is not that not having insurance is a felony. It is failure to pay the fine for not having insurance that is the felony.

  • Fred from Canuckistan . . .

    If this passes your Senate, America is going to be the world's biggest Laboratory for the Law of Unintended Economic Consequences.

  • http://devilish-details.blogspot.com/ Mesa Econoguy

    Reason for optimism? Michael Cannon over at Cato claims this is

    The Pelosi Bill’s High Water Mark

  • Link

    When I looked at an early House version of Healthcare it was written as a tax bill enforced by the IRS. I expect this is still true in the final House version. There's a reason for this.

    Back in the 1930s, a proposed federally run retirement plan for railroad workers was struck down by the Supreme Court as unconstitutional. The Court said the federal government didn't have the authority to run a funded insurance program. So FDR rewrote his proposed social security plan to be a tax-based "pay as you go" program. With threats that FDR would pack the Court, the Supreme Court blessed this an acceptable use of Congress' taxation powers. At the time, the Court distinguished Social Security from the railroad plan as Social Security created no vested rights and hence wasn't insurance -- in theory, Congress can just stop Social Security altogether at any time.

    All of our current taxes -- income, sales, real estate, inheritance -- are based on the government taking a cut when we do something. Thus, if you just sat on the beach for a year, you'd owe the government nothing. What's different about Healthcare is that you start every January 1 with a government nut to cover. To me this is a significant distinction, but I doubt it's one the Supreme Court would invoke to rule Healthcare unconstitutional. The irony is that many American citizens would be better off being off the grid entirely and pretending to be illegals, working off the books for cash.

    The elephant in the room is that the costs of Healthcare will likely exceed $2 trillion over a decade, over and above the huge fiscal gaps we already have. The "rich" can't bear this alone. Our government is now absolutely structurally broke.

    As someone with a small business I have a critical question. How is "employee" defined for purposes of Healthcare? Can I run several separate "under $500,000' businesses?

  • txjim

    With passage of this monstrosity, the economic doomsday clock is now spinning 100% faster. All I can hope for is we can some how undo all this over the next few election cycles.

  • Eddie

    I think we've seen recently that you really can't underestimates the lengths they'll go to in order to see this passed. I hope the Senate is a different matter, but I'm afraid it might not be.

  • frankania

    Link, When I owned a small business, I had no "employees"; just sub-contractors who I paid cash and they signed receipts for me to discount from the gross monthly income. What they did with regard to their cash income and reporting was none of my concern.

  • Michael

    Link,

    I believe in the last go around over this issue,someone found that an employee is broadly defined. Firing everybody and bringing them back as 1099s won't get you off the hook.

    Check out the "What A Freaking Mess" post. From Missy:

    Missy:

    Now it makes sense why there is an entire section devoted to 1099-MISC filing requirements by businesses to ALL PERSONS, with persons defined as individuals AND CORPORATIONS (and other business entities). They already figured that small business owners would simply look to split and pay across two corporations (ie. lease workers from one or other services from one to the other) and the new regulations on 1099-MISC make perfect sense now!!!

  • Allen

    frankania --> What you mention brings up an important aspect of all of this. It's yet another cost to having a traditional FTE. The impression I have of the state of things in western Europe is that young people simply can't find full time employment. They can only find contract work. Seems like this sort of bill pushes things that way all the much more.

  • GU

    To be clear, in my post above I was being snarky about politicians not reading the bill; I was not defending that practice. I thought the inclusion of the word "statists" made that clear.

  • Michael

    Western Europe has some other problems for first time employees. France has/had a law that required the employer to keep the employee 2 years which made hiring people with no work history too risky.

    Mark Perry just put up a post that individuals and companies will drop coverage and go the fine route. It makes no sense to have insurance when you can wait and buy it after your sick.

  • Bob Smith

    With respect to multiple $500k-payroll businesses, this bill likely looks to ownership percentages to prevent this. Look up "controlled group". The IRS has one definition for income tax purposes, and the Department of Labor has a similar, but more restrictive, one for employee benefits purposes. I'd bet this bill uses the DoL definition.

    Depending on what's actually in this bill, expect the IRS to be much more aggressive in investigating the use of independent contractors, and in assessing tax penalties for not "properly" categorizing them as employees.

    If FICA gets uncapped, the IRS will also be much more aggressive at assessing penalties for under-salaried S-Corporation owners, even if said salaries are very defendable if you want to spend the money on lawyers fighting them, perhaps to the point S-Corporations no longer offer any real FICA relief.

  • Not Sure

    Wed October 7, 2009

    A compromise health care proposal widely seen as having the best chance to win Democratic and Republican support would cost $829 billion over the next 10 years, nonpartisan budget analysts concluded Wednesday.

    http://www.cnn.com/2009/POLITICS/10/07/health.care/index.html

    November 8, 2009

    All this would come at a true cost of more than $1.3 trillion over 10 years.

    http://www.nypost.com/p/news/national/fed_takeover_by_any_other_name_bP2vpUz1aZISrdEqWGSdXO

    Okay- $829 billion to $1.3+ trillion in only one month. Any guesses how much the estimate will be in another month or so?

    And how much it ends up REALLY costing?

  • Michael

    The scoring costs are based on 10% to 15% of the population being on the public plan. If Mark Perry's view is correct that the best financial strategy for individuals and companies is to drop coverage and pay the fine, costs will be unimaginable. The latest CBO numbers I saw indicate that the public option will be more expensive and less efficient than private insurance. I believe Obama used the post office as an example of the efficiencies to be expected in the public option.

  • Dr. T

    Those of you who believe that the Senate will stop this 2000-page fiasco are dreaming. The Senate has 60 Democrats and 40 Republicans. Do you think that ten Democrats will be gutsy enough to vote No? The lap-dog liberal press favors the bill. The AARP now supports the bill. Most citizens believe that the health care bill "needs more work," but they won't throw their representatives out of office if they vote for current bill. I cannot see ten big government-loving Democrat senators voting no or even tabling the bill.

    -----------------------------

    Fred from Canuckistan said: "If this passes your Senate, America is going to be the world’s biggest Laboratory for the Law of Unintended Economic Consequences."

    You are assuming that the bad economic consequences are unintended. I believe that they are intended. They are part of Obama's plan to "save" the US economy by destroying it. The only way he can turn our current mixed economy (capitalism, some corporatism, and a bit of fascism) into a sociofascist economy is to bring our economy to its knees. At that point, most people will welcome a new Mussolini.

  • Michael

    I don't know how long AARP is going to be around. There is another seniors group offering extended membership with their group if you send in your AARP card.

    Dr. T,
    You went on for a bit in "But’s Its My Hard Work Paying Your Unemployment" about people getting cash and not playing taxes on it. You now write "You are assuming that the bad economic consequences are unintended."

    This is the whole point of socialist systems. Government make the environment so hostile that people and business have no choice but to "work" off books with kick backs to the politicians.

    You hate it. I hate it. Warren hates it. But I realize this is the hand our government has dealt the people. I'm not going to harm myself for the betterment of the federal government.

  • bobby b

    "I wonder if anybody really knows what is in this thing."

    Assuming standard office paper, about 7.936 btu's.

    Which leaves me puzzled.

    Given the huge quantity of hot air that went into its making, wouldn't this constitute a violation of the principle of conservation of energy? I understand that, in most examples, the missing energy would have produced work, but here we simply move more towards entropy.

  • Link

    I'm with Dr T. Some version of Healthcare will likely get passed, after months of wrangling. The Democrats have the votes, because the Republicans turned themselves into a minority, minority party.

    We're running huge deficits -- what could be more simulative than $1.8 trillion in deficit spending? -- but we are only seeing modest economic growth, with increasing unemployment. Something is very wrong with this picture. It's unsustainable. Our leaders live in a big bubble, and persist in ignoring this.

    In past years deficits went up because government spending went up. Today, we also have government revenue going down. Our current huge deficit is attributable in significant part to much reduced incomes among the "rich" and corporations. We've become very dependent on these segments to raise our taxes. I don't see these segments recovering to recent levels to deliver these taxes. Obama & Co are doing everything they can to ensure this.

    So how does this play out. I expect continued high unemployment -- a figure everyone can understand. But if the recovery stalls, I expect that in about two years or so we'll also see huge shortfalls in projected government revenues at all levels. Our already huge projected deficits will balloon. What then?

    Like Dr T, I've long suspected that Obama-Axelrod want this to happen. Or they're just really stupid. Doesn't Larry Summers see this, or is he just another idiot savant?

    Link, over

  • Methinks

    There's absolutely no way the "rich" will return to recent levels to pay for this if for no other reason than it won't be worth it. If the marginal dollar requires the same time, effort and risk to produce but you get to keep less of it, there's no incentive to work for it. The "rich" are employees in high risk businesses and business owners. They simply won't bother generating the wealth and the rest will pay in other ways - unemployment, lower living standards and depression.

    Larry Summers might (I don't know for sure) subscribe to the view that people will work harder to keep their disposable income high when taxes are increased. The only problem is that empirical evidence shows otherwise and a plethora of new entitlements will make it theoretically unnecessary. Beyond shelter, food, clothing and at least the promise of health care, why bother busting your butt? If you have a right to all that stuff without working a day in your life, why work even harder than you do now?

    If this passes, our only hope is to vote out the Democrats and vote them out in big numbers. It's possible to repeal this thing before it takes effect.

    The only country that has ever tried this plan on a scale anywhere close to the United States is the USSR - on 150 million people. As a victim of that system for several years, I can assure you that you will not enjoy it.

  • Scott

    "it is a tale
    Told by an idiot, full of sound and fury,
    Signifying nothing."

    No way the Senate can ram this monstrosity through as a "budget bill" meaning they'll need the full 60 votes to pass it, not 50.

    After months of wrangling, if they pass anything, it will not have the public option which means it will not pass the House in reconciliation.

    We've already been through this dance.

  • http://coyoteblog gene stauffer

    if your rep voted for this bs get the ball rolling on a recall election now. don't let the senate think that this will die out. even if you "know" that this won't be successful it will do several things
    a) it will make the house do things other than screw us. (they will have to campain to stop the recall, and possibly against an opponent who's campain can be as simple as "he didn't listen to us".
    b) the senate would be very interested that we the people are that interested, for their own peace of mind will not vote for the senate bill.

    if you don'tknow what to do contact the political rivals of these guys and tell them you'll sign the petition.

  • Methinks

    When I owned a small business, I had no “employees”; just sub-contractors who I paid cash and they signed receipts for me to discount from the gross monthly income.

    When Western economists finally gained access to research materials after the fall of the Soviet Union, they found something interesting: alongside the non-functioning official economy was a gigantic black market which allowed the country to hobble along for decades. I'm pretty certain this is where we're headed - with the IRS replacing much of the function of the KGB.

  • Link

    To Scott,

    I hope you're right. But I wouldn't count on it. Obama-Pelosi are driven to get Healthcare done.

    We have the 60-vote requirement because the Democrats reduced it from a higher requirement back in the 1970s -- when they had 62 votes. It's a roadblock but hardly insurmountable. We may still see the public option.

    Even if Healthcare isn't adopted, it will weigh on us for many months.

  • Scott

    I don't know if anyone is still following this thread...

    But Link, we want this thing to weigh on us for many months. The closer we get to next November the more pressure the Senators and Congressmen up for election will feel and the more you'll see support drop off. This bastard just barely passed the House in the first place and the Senate is shaping up for a knock down drag out just to get a vote on it.

    Obama, Reid, and Pelosi will scream from the mountain tops that we need to move quickly on this, b/c they know that time is against them, but I refer back to my original quote.

    "tis a tale, told by an idiot..." or in this case, 3 of them.