I Have a Gripe

March 21, 2010

A Cliff-Notes Version of the Healthcare Bill

I just received my weekly newsletter from my Representative Rodney Frelinghuysen. I am proud to say he is voting against the healthcare bill that is going to the floor tomorrow.

In his newsletter, he listed what I consider a “cliff notes” version of the new taxes and what the IRS will be up to if this little gem passes. I have posted it here. I think you will find it interesting.

Here is a partial list of the tax increases in the Pelosi health care bill:

  • If you don’t buy health insurance (as dictated acceptable by a new federal czar), you will be fined up to 2.5% of your income even if you pay all of your medical expenses yourself. If your company does not provide “acceptable” health insurance to all workers, the company will be fined up to $2,000 per employee. (This proposal alone may require the hiring of 1,600 new IRS employees.  See attached data sheet from the House Committee on Ways and Means);
  • An additional Medicare tax on self-employment income and wages.  This removes the current cap on wages subject to this tax and it will effectively move the top income tax rate from 35% to 43.4% within a couple of years;
  • For certain taxpayers, the bill increases the Medicare FICA tax from 2.9 percent to 3.8 percent and for the first time, this tax will be extended beyond wages to include interest, dividends, capital gains, annuities, royalties, home sales and rents.  This new tax will be particularly damaging to New Jersey’s seniors, many of whom depend on their interest, dividends and annuities to cover their monthly expenses and potential nursing home costs;
  • There is a 2.9% tax on all medical “devices”, which basically means everything used in a doctor’s office or hospital. Including gowns, syringes, wheelchairs and the like.  This will increase health care costs for everyone who does not get free government insurance;
  • The deduction for medical expenses is currently limited to those expenses that exceed 7.5% or your income. This will be raised to a threshold of 10% of your income. This means that fewer people will get any tax relief from medical expenses they pay for themselves;
  • There are various taxes on anything a person might do to pay for their own medical expenses. Things like Health Savings Accounts, Cafeteria Plans, and Flexible Savings Accounts are ways for people to save their OWN money for their OWN medical care on a pre-tax basis. Under the bill, they will be limited and taxed;
  • A 10% tax on tanning services;
  • A tax on self-insured health plans. This is another penalty on those who try to pay for their own health care;
  • A new tax on pharmaceutical manufacturers, an important employer in New Jersey. This will raise the price of medicines for everyone who does not get them from the government for free;
  • A new tax on “Cadillac” health plans. This is a tax of up to 55% on any health insurance that costs over about $800 per month including employee and employer contributions. This tax does not apply if you are a union member or your plan is from AARP or Blue Cross Blue Shield of Michigan;
  • There is a new tax on all “for-profit” health insurance companies (except for a few favored ones).  This will also raise the costs of premiums for everyone not getting free care from the government.

Combined, these new taxes will cause medical costs to go up and private sector job creation to go down, increase budget deficits and national debt, and force physicians to stop seeing Medicare and Medicaid patients. It will cause fewer people to pay for their own care, and more to seek government care.

In the end, the Pelosi health care proposal adds up to more taxes, more spending, and more deficits.  This is a bill American cannot afford.

Highlights of New IRS Authority

Under H.R. 3590 – the Senate-passed health bill
(Source: House Ways and Means Committee Minority)

  • IRS agents verify if you have “acceptable” health care coverage;
  • IRS has the authority to fine you up to $2,250 or 2 percent of your income (whichever is greater) for failure to prove that you have purchased “minimum essential coverage”;
  • IRS can confiscate your tax refund;
  • IRS audits are likely to increase;
  • IRS will need up to $10 billion to administer the new health care program this decade;
  • IRS may need to hire as many as 16,500 additional auditors, agents and other employees to investigate and collect billions in new taxes from Americans;
  • Nearly half of all these new individual mandate taxes will be paid by Americans earning less than 300 percent of poverty ($66,150 for a family of four).

SPECIAL EXEMPTION: The Senate-passed bill prohibits the IRS from imposing these taxes and penalties on illegal immigrants.

February 2, 2010

The Budget, the Deficit and Monopoly Money

Filed under: Uncategorized — alvb1227 @ 3:01 am

By the time I got home tonight, my eye was twitching again. Why you might ask? The latest proposal to come from the White House…the 2011 budget.

President Obama is proposing a mixed bag budget totaling $3.8 trillion dollars. Now, I do agree with the President that the tax payer’s money shouldn’t be spent like “Monopoly money,” but this proposed budget will increase the deficit by $1.56 trillion. Depending on how the budget evens out, and who you believe, this will result in 10% – 25% of our  GDP will be deficit. Most economists are saying the GDP related to the deficit will be approximately 10.6%. Those same economists say anything above 3% is unsustainable. The President says it will result in approximately 3% of the deficit related to the GDP and will more than likely stay that way for the foreseeable future. If this continues, we will wind up becoming part of China, since they own a large amount of our debt. A perfect example is what is going on with the Taiwan arms sale. Anyone see the issue here?

Now, I’m the first one to admit that I am far from a math scholar, but I don’t understand how you can increase the budget and the deficit and lower the GDP related to the deficit. The White House is talking about making “hard choices,” like the nine million that were cut from the Parks Service. Meanwhile, they boast the biggest budget ever for the EPA, most of which is related to clean energy technologies.

Now this is where I really get annoyed. The President wants to develop a deficit panel to establish a hard plan to control and ultimately reduce the deficit. Republicans rebuffed this idea. When President Bush suggested the same idea, the Democrats rebuffed. I ask…why? This is where I say the President doesn’t need to lecture us like four-year-olds during the State of the Union, but we should be lecturing those in Washington. Why was this idea OK with one side, but not the other and now the same idea reversed?

In my opinion, this is where egos and political parties should be checked at the door. Our Representatives in Washington are supposed to represent all of us, not their party. I am a registered Republican, which is no great secret, and I want to smack them all upside the head like an Italian grandmother would and tell them to wake up! This includes Bob Beckel and Sean Hannity, who I am watching at the moment. Normally I like listening to you two spar because you have thought-provoking, informed opinions. I hate this “well, they did this” and “well when your party was in power, blah, blah, blah.” This back and forth exemplifies exactly what is wrong with Washington.

Didn’t the President just talk about PAYGO (pay as you go) during the State of the Union last week? If the American public can’t pay bills with Monopoly money, neither should the federal government.

November 18, 2009

Welcome to My Snarky World

I believe everyone should use the common sense God gave them. Unfortunately, not everyone does. This blog will document my rants and raves of those who make me crazy.

To give you some background:

  • I am a fiscal conservative
  • I am a social moderate
  • You (unfortunately) can’t legislate to prevent stupidity
  • If you can’t talk on the phone and drive at the same time, using a hands-free headset really won’t help

Stay tune on my regular rants.

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