In These Times: House In Revolt Over Excise Tax, White House Asks Unions to “Celebrate” It

[highplainsdem]

http://inthesetimes.com/working/entry/5394/house_in_revolt_over_excise_tax_white_house_asks_unions_to_celebrate_it/

Friday
January 8
6:23 pm

House members are continuing their strong opposition to the Senate excise tax on so-called "Cadillac" plans that a growing number of economists and labor unions say would raise costs for middle-class families and wouldn't "bend the cost curve," as proponents argue.

At the same time, as Huffington Post reported, the White House and some Senators are continuing to push the now-discredited notion that the by lowering health care benefits employers would somehow end up raising wages, thus generating more tax revenue. An earlier In These Times column dubbed this notion "voodoo economics for the punditocracy."

-snip-

Their members, expressing increasingly opposition during a conference call Thursday among the House Democratic caucus, have good reason to be concerned about the dangers they face politically with polls showing two-to-one opposition against it. -- and the lack of credible evidence justifying the ivory-tower theories justifying a taxation provision that could spell political suicide for Democrats. Rep. Joe Courtney (D-CT), who organized a letter with 190 House members in opposition to the tax, told In These Times, "Pelosi was reporting her conversations with the President, and she has not backed down. The polls are rock solid, and frankly, they're terrible." He cited the recent, under-reported polling of Stan Greenberg commissioned by the National Education Association that showed a sharp upswing in voters who would vote against a candidate if he or she supported the excise tax. "They were very dramatic," says Courtney. "Pelosi has seen those polls, Chris Van Hollen has seen those polls."

But the policy grounds are just as weak as the politics. "The more we peel away the superficial claims, he shakier they are," Rep. Courtney says. "But it's a race against time," given the White House push for passing a bill modeled after the Senate version. But the health benefit tax = wage increases fairy tale doesn't have any solid evidence to back it up. As I noted in a column in Truthout.org, "The Congressional Budget Office said that over 80 percent of the revenues would somehow come from all those raises lavished on employees even though we're slowly emerging from the worst economic collapse since the Great Depression. In fact, surveys show as few as 9 percent of employers would actually give any raises to make up for reduced benefits, according to the Watson Wyatt actuary firm."


With the White House seeming to harden their position, Courtney says, "There's definitely potential for a big impasse." He foresees the upcoming meeting between President Obama and unions on Monday as an effort by the President to convince unions to support this historical health care reform. At the same time, knowledgeable sources say, House leaders and the White House may be open to compromise, and the House leadership, at least, is looking for alternative funding sources that could be acceptable to the Senate, such as raising Medicare taxes on unearned income; the current system essentially exempts wealthy heirs living off of investment income from paying anything towards Medicare revenues.

-snip-

[roguevalley]

1. it will raise wages like tax cuts for the rich will stimulate business.

[SharonAnn]

3. Exactly!

[SharonAnn]

2. Never give up something today for the "potential" of something else tomorrow.

Especially when that "something" is dependent on coporations paying workers.

Not gonna happen!

What in H--l are Obama and the Senate thinking? Unbelievable!