A 42% National Sales Tax?

That’s one of the plans Democrats have in order to pay for their Medicare For All plan.   If Democrats are able to shove this Medicare for all down our throats, we’re in big trouble.  It may not affect most of us here that much but it will our children and grandchildren.

If you’re a Democrat who supports “Medicare for All,” pick your poison. You can ruin your political career and immolate your party by imposing a ruinous new sales tax, a gargantuan income tax hike or a surtax on corporate income that would wreck thousands of businesses.

This is the cost of bold plans.

Supporters of Medicare for All, the huge, single-payer government health plan backed by Bernie Sanders, Elizabeth Warren and several other Democratic presidential candidates, say it’s time to think big and move to a health plan that covers everyone. Getting there is a bit tricky, however. A variety of analyses estimate that Medicare for All would require at least $3 trillion in new spending. That’s about as much tax revenue as the government brings in now. So if paid for through new taxes, federal taxation would have to roughly double.

The Committee for a Responsible Federal Budget (CRFB) has done voters a favor by spelling out what kinds of new taxes it would take to come up with that much money. Warren justifies many of her programs by saying all it would take is “two cents” from the wealthy. That’s a reference to her 2% wealth tax on ultra-millionaires. But Medicare for All would be so expensive that if you taxed top earners at 100%—that’s right, if you took all the income of couples earning more than $408,000 per year—you’d still fall far short. And everybody getting taxed at 100% would obviously stop working.

Okay, that won’t do it. So what will? CRFB outlined a variety of options. A 42% national sales tax (known as a valued-added tax) would generate about $3 trillion in revenue. But it would destroy the consumer spending that’s the backbone of the U.S. economy. A tax of that magnitude would be like 42% inflation, wrecking consumer budgets and the many companies that depend on them, from Walmart and Amazon to your local car dealer.

Other options include a 32% payroll tax split between employers and workers or a 25% income surtax on everybody. Or, the government could cut 80% of spending on everything but health care, which would include highways, airports and the Pentagon. Or here’s a good one: Just borrow the money and quadruple Washington’s annual deficits.

The best idea might be charging every enrollee in the new program $7,500 per year, so they’d be paying directly for the coverage they’re getting. Some people pay more than that now for health care, by purchasing insurance outright or sacrificing pay raises in exchange for employer coverage. It would still be a nifty trick to propose that to voters.

The upside to these impossibly draconian scenarios is that nobody would pay anything for health care, except in the $7,500 example. And it’s possible that Medicare for All would cover health care for more people at a lower total cost than we spend now, meaning the average cost per person would go down. The problem is transitioning from what we have now to whatever Medicare for all would be. And it’s a giant problem, like crossing the Mississippi River without a bridge or a boat. The other side might look great but you’ll die before you get there.

Warren, Sanders and others tout the virtues of this magical health care program without explaining what it would cost. Sanders has at least suggested some possible ways to pay for it, including premiums paid by enrollees, a wealth tax on millionaires and income tax rates as high as 52%. Warren has been cagier, saying only that under her plan “costs” would go down for middle-class families. Under pressure to explain, Warren has pledged to come up with a financing plan soon. Now, maybe she doesn’t have to.

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3 Responses to A 42% National Sales Tax?

  1. bogsidebunny says:

    Most elite Democrats, Republicans and Hollyweird assholes won’t mind. Almost 100% of what they possess is owned by phony corporations that will absorb the draconian tax and they’ll continue to drive around in their $120,000 Mercedes SUVs while laughing at the dregs who only earn $60,000 a year paying $45,000 for a Toyota Corolla.

    We’re DOOMED!

  2. Toxic Deplorable Racist B Woodman says:

    If a “Medicare For All” passes, that would be the opening flag for a “purge” of DildoCrats, Libtards, and fellow followers.
    Think of it not as murder, but of relieving an overcrowded, over stressed, under funded, under resourced medical system; i.e., more and better medical care for you and me after the dust settles and funerals are done.

  3. Eskyman says:

    Watch out for any sign of a “value-added tax” being enacted into law. That’s what the UK has in their VAT, & Australia has as G.S.T. or Goods and Services Tax. Do NOT let it happen here!

    These sneaky taxes are applied whenever the goods/services are passed from one place or person to another; so when something is imported, the tax is applied when it’s imported; then when it goes to distribution, it’s applied again; every time there’s a middleman, that tax gets added on.

    None of this is apparent to the buyer. In Oz, there’s no tax applied at the checkout; so you have no way of knowing that the $8.73 jar of peanut butter imported from the USA only cost $1.15 to begin with, and all the rest of the price you pay is taxes.

    I read of a guy who had a minor fender-bender, where he got rear-ended in his new Kia. His rear bumper was mashed in; being plastic, it wasn’t repairable. His panel beater said he had a choice; he could replace the bumper with an exact replacement good for a 2km/hr crash, or get the heavy-duty replacement which was rated at 5km/hr. He opted for the heavy duty replacement. Either one had to be ordered from the factory in Korea; one cost some $A100, the heavy one cost $A150 or so.

    When the $150 replacement bumper finally arrived at the workshop, the customer was billed around $A2500.00! Magically through the application of the GST, the price had ballooned!

    The customer was most upset; but the deal was done, and he was stuck with it. The Aussie Gov’t was delighted, they made out like bandits!

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