CBO estimate on Baucus bill is not accurate and breaks Obama's promise.
Democrats are delighted and the GOP is scrambling after yesterday's announcement suggested the Senate version of the bill will be a cost cutter. A major hurdle the liberals had to clear was to convince Americans that reform was coming and it meant saving money. Polls suggest most Americans are reluctant to believe an 800+ billion dollar bill can save anything, but the CBO certainly gave Obscure proponents a huge boost.
There is just one major problem with CBO's analysis and it would appear that the bill was crafted and modified specifically to extract this kind of conclusion. Several weeks ago CBO estimated the Baucus bill would add to deficit, now suddenly the bill will decrease the deficit - what gives?
The bill is front loaded. Taxes on all related medical devices under $100 and higher rates for "Cadillac"/"gold-plated" insurance plans begin as early as 2011. However the actual implementation of the bill and the benefits provided via this so called reform start only 3-5 years out. The catch is that CBO projects cost analysis only 10 years out into the future and who ever crafted the bill understands that. So the estimate is based on 10 years of tax collection, but about 5-7 years of actual cost. If you want a simple way to create a bill that looks profitable, front load it. It's nothing more than a sham to quiet up the opposition under a false premise of saving costs.
Americans understand one other simple fact, or at least we hope they do, NO government social program ever cost as much or less than originally projected. Never. In fact as more time passes and the bureaucracy/waste/corruption/inefficiency begin piling up faster and faster social programs balloon out of control in non linear fashion. If you are not convinced, consider: Medicare and Medicaid. These two programs were promised to consume a fraction of their costs today and by 2030 these programs are projected to double. Even programs with linear cost increases are broke, like Social Security and can only be salvaged by taxing more and more Americans.
Lastly, Obama promised and somehow convinced people making less than $250,000 will not experience a tax increase. Given his definition of taxation, he probably continues to believe this blatant even though the Baucus plan will levy a massive tax burden on the middle class. True, our income tax brackets will remain static, but every single medical expenditure will cost more. In fact in order to pay for the Baucus bill, over 518 billion dollars will be raised through taxation! For what? According to the CBO, to insure 25 million people.
Why is this even being debated?
There is just one major problem with CBO's analysis and it would appear that the bill was crafted and modified specifically to extract this kind of conclusion. Several weeks ago CBO estimated the Baucus bill would add to deficit, now suddenly the bill will decrease the deficit - what gives?
The bill is front loaded. Taxes on all related medical devices under $100 and higher rates for "Cadillac"/"gold-plated" insurance plans begin as early as 2011. However the actual implementation of the bill and the benefits provided via this so called reform start only 3-5 years out. The catch is that CBO projects cost analysis only 10 years out into the future and who ever crafted the bill understands that. So the estimate is based on 10 years of tax collection, but about 5-7 years of actual cost. If you want a simple way to create a bill that looks profitable, front load it. It's nothing more than a sham to quiet up the opposition under a false premise of saving costs.
Americans understand one other simple fact, or at least we hope they do, NO government social program ever cost as much or less than originally projected. Never. In fact as more time passes and the bureaucracy/waste/corruption/inefficiency begin piling up faster and faster social programs balloon out of control in non linear fashion. If you are not convinced, consider: Medicare and Medicaid. These two programs were promised to consume a fraction of their costs today and by 2030 these programs are projected to double. Even programs with linear cost increases are broke, like Social Security and can only be salvaged by taxing more and more Americans.
Lastly, Obama promised and somehow convinced people making less than $250,000 will not experience a tax increase. Given his definition of taxation, he probably continues to believe this blatant even though the Baucus plan will levy a massive tax burden on the middle class. True, our income tax brackets will remain static, but every single medical expenditure will cost more. In fact in order to pay for the Baucus bill, over 518 billion dollars will be raised through taxation! For what? According to the CBO, to insure 25 million people.
Why is this even being debated?
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