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President Obama Offers a Taxing Definition

September 21, 2009 9:44 AM

President Obama and George Stephanopoulos got into a somewhat contentious back and forth yesterday about whether or not the penalty for those who do not abide by the individual mandate in the health care reform bill offered by Sen. Max Baucus, D-Mont., constitutes a tax.

You can watch their exchange HERE.

"Under this mandate, the government is forcing people to spend money, fining you if you don’t," Stephanopoulos said. "How is that not a tax?"

"Well, hold on a second, George," said the president. "Here -- here's what's happening.  You and I are both paying $900, on average -- our families -- in higher premiums because of uncompensated care.  Now what I've said is that if you can't afford health insurance, you certainly shouldn't be punished for that.  That's just piling on. If, on the other hand, we're giving tax credits, we've set up an exchange, you are now part of a big pool, we've driven down the costs, we've done everything we can and you actually can afford health insurance, but you've just decided, you know what, I want to take my chances.  And then you get hit by a bus and you and I have to pay for the emergency room care, that's…"

"That may be, but it's still a tax increase," said Stephanopoulos.

"No," said the president. "That's not true, George.  The -- for us to say that you've got to take a responsibility to get health insurance is absolutely not a tax increase.  What it's saying is, is that we're not going to have other people carrying your burdens for you anymore than the fact that right now everybody in America, just about, has to get auto insurance. Nobody considers that a tax increase. People say to themselves, that is a fair way to make sure that if you hit my car, that I'm not covering all the costs."

Said Stephanopoulos: "But it may be fair, it may be good public policy…"

"No, but -- but, George, you -- you can't just make up that language and decide that that's called a tax increase," said the president. "What...if I say that right now your premiums are going to be going up by 5 or 8 or 10 percent next year and you say well, that's not a tax increase; but, on the other hand, if I say that I don't want to have to pay for you not carrying coverage even after I give you tax credits that make it affordable, then…"

Stephanopoulos cited Merriam Webster's Dictionary definition. "Tax -- 'a charge, usually of money, imposed by authority on persons or property for public purposes.'"

"George, the fact that you looked up Merriam's Dictionary, the definition of tax increase, indicates to me that you're stretching a little bit right now," said the president. "Otherwise, you wouldn't have gone to the dictionary to check on the definition….I absolutely reject that notion" that it's a tax increase.

Hmmm.

Well maybe someone should tell that to the author of the bill.

Because, as Politico's Chris Frates points out, it's all right there on page 29 of the bill: "Excise Tax. The consequence for not maintaining insurance would be an excise tax."

To be more specific, if a taxpayer‘s modified adjusted gross income is between 100-300 percent of the federal poverty level, "the excise tax for failing to obtain coverage for an individual in a taxpayer unit (either as a taxpayer or an individual claimed as a dependent) is $750 per year. However, the maximum penalty for the taxpayer unit is $1,500."

If a taxpayer‘s modified adjusted gross income is above 300 percent of federal poverty level "the penalty for failing to obtain coverage for an individual in a taxpayer unit (either as a taxpayer or as an individual claimed as a dependent) is $950 year" -- with a maximum penalty of $3,800.

"Exemptions from the excise tax will be made for individuals where the full premium of the lowest cost option available to them (net of subsidies and employer contribution, if any) exceeds ten percent" of their adjusted gross income.

So…it's not a tax?

- jpt

September 21, 2009 | Permalink | Share | User Comments (129)

User Comments

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Why do some (MR. Preident, and his like-minded ilk) see PERSONAL RESPONSIBILITY, as something Government intervention fosters; when history obviates the opposite. Generations have been destroyed by liberal governmental interference in the natural ebbs, and flows of a MATURING society. Every government scheme to save people from their own choices, (Social Security, Medicare, Medicaid, Welfare...) has only served to weaken people, who likely would have prospered if they had known they were their OWN safety net.

If ANY of these programs had been TEMPORARY, some true success might have been achieved. History, note above examples, proves that nothing the government does is ever temporary, when it expands government control. (Also reference the income - tax...)

Make the expectation that people are, and WILL BE respnsible for themselves in EVERY WAY. Even the handicapped, depending on their particulars, should be expected to be the best they can be. That expectation may drive them to heights they would not have otherwise achieved.

Then individuals, families, churches, private charities, and the like; all of whom have been empowered by keeping saving, and investing THEIR OWN MONEY could provide a safety net. If at the end of these redundant safety nets, someone were to fall through, the government could provide a temporary, skeletal net, until other arrangemnts could be made.

Of course, WE may be too soft, and weak to do something like that now. Thanks to BIG GOVERNMENT!

Posted by: GoodMojo | Sep 22, 2009 3:06:38 PM

"I have yet to hear the responses to what the republicans have offered- tort reform, buying across state lines, eliminating denial for preexisting conditions, being able to keep your insurance if you loose your job. Why aren't these major components of these bills?"


I have yet to hear why the waste and fraud in Medicare/Medicaid hasn't been addressed. I have also yet to hear why liberals think that the FedGov can run healthcare yet can't get the USPS in the black.

Posted by: Ripoff | Sep 22, 2009 8:58:01 AM

We'll have to see what happens with the "tax."

For the benefit of those with reading problems:

Because, as Politico's Chris Frates points out, it's all right there on page 29 of the bill: "Excise Tax. The consequence for not maintaining insurance would be an excise tax."

Posted by: Page 29 | Sep 22, 2009 8:36:19 AM

I might get in trouble if I say Barack Obama lied again but... I guess he's just telling another stinker again. You betcha! Psst.. Don't anybody say "LIE" say fib.

Posted by: Walsh | Sep 21, 2009 10:11:20 PM

"If taxes are increased to get health care reform done. But, the costs go down more than the increases. Aren't you net sum total ahead?"

No way to tell unless you specify how much the services will be curtailed. And if you think that 30 (or is it 47?) million people can be added to the system, expenditures on services can be reduced (e.g. $500 million in Medicare cuts), but services will remain unchanged--well, if you think that, you probably think that the Baucus bill does not contain a tax.

Posted by: Fascist Hyena | Sep 21, 2009 8:21:45 PM

Obama the self proclaimed "definition" czar speaks. Can the U.S. Citizen expect a new box on their W-2 forms or maybe new ammounts in the existing ones? If it is not a tax, will the U.S. Citizen be refunded any or all of the non-tax(untaxed). If they don't get hit by a "bus". Perhaps the non-tax will already be spent, or would that be a tax?

Posted by: Reflect09 | Sep 21, 2009 8:00:03 PM

the bill explicitly calls it a tax

***

Regarding the bill, the fun starts tomorrow. There are over 564 proposed amendments to work through. Some look really good. We'll have to see what happens with the "tax." Olympia Snowe, John Kerry and Maria Cantwell worked together on an amendment to ensure the cap grows a little bit faster so it doesn't tax average policies (at least not as quickly), and it permanently raises the cap for individuals and families between 55 and 65 years of age. I'm sure others are looking at it as well.

Posted by: Alyson | Sep 21, 2009 7:15:02 PM

Joe Wilson? Anybody?

Posted by: CH | Sep 21, 2009 6:48:04 PM

Did you see that Ivan Marte, the ex-chairman of the Rhode Island Republican Hispanic Assembly, has announced that he’s quitting the Republican Party because he was embarrassed by Rep. Joe Wilson’s “you lie” outburst at President Obama? He wrote--

“I do not want to continue being a member of a party in which the members of the party express themselves in that way.” He also called Wilson’s behavior “shameful” and “uncivilized, ” and said
that Wilson’s outburst was the last straw in a series of disappointments that led him to break with his party. He mentioned that in his humble opinion, the GOP needs to seriously reevaluate their position on reaching out to minority groups.

Posted by: Alyson | Sep 21, 2009 7:10:34 PM

Well, if the Baucaus Bill passes..next will be the Cap & Trade that will hit your paycheck with another tax..one that will cause you to spit blood!! The only "change" that Obama was talking about is the "change" left in your paycheck! What you libs do not understand is simply this..people who "WORK" and do not look for handout, take care of themselves, don't like to work their butts off just to have the government take 60% of their paycheck for some lazy slob who won't go get an education and a JOB! Libs are always looking for a handout or someone else to do everything for them! Hard working people are fed up with always having to pay someone else's way! Start paying your own way for a change and you won't want someone telling you to cough up your hard earned dollars either!!

Posted by: ross | Sep 21, 2009 6:55:23 PM

So Obama vehemently denies that it's a tax.. in spite of the fact that the bill explicitly calls it a tax.

Anybody? Anybody? Joe Wilson? Anybody?

Posted by: CH | Sep 21, 2009 6:48:04 PM

My point is simple. In the state where I live, beginning in April gasoline prices rise by 10 cents a gallon.
It's not a tax. My cost is 10 cents a gallon higher, no matter what the price of oil.
If taxes are increased to get health care reform done. But, the costs go down more than the increases. Aren't you net sum total ahead?

Posted by: minority-rulers | Sep 21, 2009 6:12:48 PM

special delivery you misunderstood my meaning. I was saying trading a government administrator for a health care administrator might save us money.

Posted by: minority-rulers | Sep 21, 2009 6:05:38 PM

Name calling, very intelligent and mature way to respond. You're the prime example of why Obamma is having such a hard time reforming a failing system. You calling me an idiot is like coal calling a snowman black.

Please understand there is no bill yet.
You object to Americans being forced into insuring themselves. Why is that?
It makes perfectly good sense to me. Before auto insurance became mandatory in most states, you took your chances driving your car to the grocery store. If you were hit and seriously hurt by an un insured driver, you were plum out of luck. Now most states have at least minimal required limits.
I read a posting a few weeks ago.
I know what my income is. I don.t concern myself with yours. If you make more than I do, that's a good thing for you. I can not spend your money. Nor can you spend mine. Furthermore the taxes you are so against are not going to be imposed on your gross income. During trial it was once pointed out to me that trying to explain Gross Income, Adjusted Gross income, Taxable income, would only confuse the jury.
IMO, you do not understand the income tax scenario. IMO, you do not understand the penalty scenario.
Instead of hurling insults at me. Instead try explaining how the finance bill as Baucus proposed it will work and how it will affect you.
Keep in mind, there still has not been a formal bill sent to the House or the Senate. Bashing a bill that does not yet exist is just saying no. And no, i am not a left wing fruit-loop. Just someone who takes time to look, listen and read about issues which will affect my family.

Posted by: minority-rulers | Sep 21, 2009 5:53:58 PM

Beck is not a journalist and he has never claimed to be one. He is a political commentator.

Posted by: joedoe | Sep 21, 2009 5:35:39 PM

Glen Beck is likely your idea of a journalist.-

Get over him...

Posted by: A Liberal | Sep 21, 2009 5:12:33 PM

***

Oh, heck no. I'm basing the villain in my "great american novel" on him.

Posted by: Alyson | Sep 21, 2009 5:29:11 PM

"President Obamma, IMO, is struggling..."

Truer words were never spoken.

Posted by: Enough | Sep 21, 2009 5:23:52 PM

Stpphonopolous gave president Obamma a pretty tough interview. The toughest I have seen. Obamma had a hard time as he kept hitting him on the tax question.

Fox News, led by Rush Limbaugh, Glenn Beck, and Bill O'reilly have a combined audience of 40-50 million listeners and viewers daily. Some suggest Limbaugh is the surrogate leader of the republican party. I only read about the liberal media. Why doesn't anyone discuss how hard hit president Obamma gets by these
three?

Posted by: minority-rulers | Sep 21, 2009 5:19:16 PM

Mike C, i'm hardly suggesting the government should or could turn our country into a utopia. Youn have greatly expanded what I suggested in my prior posting.
I'm discussing health care. Not investments, savings, oe other issues. Solely and strictly health care.
IMO, there is no difference between increasing costs and higher taxes.
IMO, President Obamma is trying to make that point. If you pay more in taxes, bit the cost of what you are paying those taxes on goes down further than the tax increase. Don't you come out ahead. I say potatoe. You say Potahto.
President Obamma, IMO, is struggling to differentiate the differences of higher taxes will create lower costs.

Posted by: minority-rulers | Sep 21, 2009 5:13:29 PM

-Glen Beck is likely your idea of a journalist.-

Get over him...

Posted by: A Liberal | Sep 21, 2009 5:12:33 PM

Serial Liar...

bordering on a certifiable nut...

Obama has to be one of the stupidest men to ever hold the office of President. No wonder he has hidden his college work from prying eyes. 100% Guaranteed that Obama was a D+ political science student.

Add to that his complete life of failures and it is obvious that Obama is truly an idiot.

Posted by: LogicalSC | Sep 21, 2009 5:11:25 PM

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