McCain’s Plan to Give-Away Tax Revenues to Insurance Giants

October 22, 2008 08:40 – 08:40

McCain is harping and carping on how Obama’s plan is to “spread the wealth” around. But, that’s exactly what McCain’s plan to destroy job-based health plans would do.

McCain would tax everyone’s health benefits to finance a $2,500 credit (for individuals) that then gets paid to every worker[‘s chosen insurance company]—even workers who don’t presently have coverage. So, in effect, McCain would tax my brother’s health benefits, give his insurer $2,500 of the tax revenues, but also give mine $2,500. And since I don’t have any employer-based health benefits to tax, this amounts to spreading the health-wealth around.

But, it gets worse. While Obama’s plan amounts to a 3 percent boost only to the top tax bracket and affects fewer than 5% of workers, McCain’s plan taxes health benefits at their top earnings bracket and affects everyone who receives job-based health benefits. So, if you earn $260,000 after deductions, Obama’s plan would cost you $300 (3% of the amount over $250,000). If your employer currently pays $12,000 for your benefits (that’s the national average), McCain’s plan would cost you between $1,200 and $4,200 (based on the 2008 current minimum and maximum tax brackets of 10% and 35%). Note that your actual take-home pay would not change. If you currently earn $260,000 after deductions, McCain’s plan would cost you $3,360—over ten times the amount you would pay under Obama’s plan. If you currently earn $335,000 or more, McCain would make you pay $4,200 in new taxes out of your current take-home pay.

And who gets this money? Under Obama, you do. Obama’s plan puts money into the hands of the middle class so you can help get this economy going and growing. McCain’s plan puts money into the deep pockets of insurance companies.

To sum it up:

Obama would give a tax break to 95% of workers and small businesses

McCain would tax everybody’s health benefits and give the proceeds to insurance companies

We’ve had 8 years of tax-give-aways for America’s richest companies. We don’t need four more years of the same failed welfare-for-the-rich policies. McCain just doesn’t get it. His reverse-Robin-Hood plan takes from you and gives to the rich. McCain isn’t right. And he isn’t right for America.

(What I want to know is why a 527 hasn’t packaged this into an attack ad on McCain to counter his misleading attacks on Obama. Obama’s “redistribution” is miniscule and affects very few voters, while McCain’s plan taxes everybody with employer-paid health benefits and gives the proceeds directly to insurance companies.)

Later this week, I will explain how McCain’s Insane Plan could destroy America’s job-based health benefits system by making it too expensive for employers to offer. If you liked McCain’s 100 Years War plan that could keep American troops in Iraq until the year 2100 or later, then you’ll love his health plan.

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