Commentary Magazine


The Opposition Coalition

Conservatives will most likely nod in agreement with this critique of the Senate’s health-care plan:

The last thing the American middle class needs right now is a big new tax on health insurance plans. … But the U.S. Senate wants to further impoverish the American middle class. As many as 30 million working people will pay a massive new tax in the first five years of the Senate health care reform plan. …

The tax would apply to one-fifth of all employers in 2013, the first year that health reform takes effect. More and more people would get hit each year after that. The threshold for taxable plans is indexed for inflation, which doesn’t rise as fast as health care costs.

Here’s an example of how it would work for federal workers covered by the Blue Cross/Blue Shield standard plan. Single people in the plan will immediately pay an average of about $1,600 more per year for 10 years. Families will get hit in the third year, paying an average of about $2,000 more per year for 10 years.

By 2022, the Blue Cross/Blue Shield standard family plan will cost $5,500 in taxes per worker. Single people could pay as much as $3,500 per worker.

Middle-class families in private and public sector jobs, union and non-union alike, will be hit hard by this tax on health care benefits.

Yuval Levin? Sen. Jim DeMint? No, it’s Teamster president James Hoffa. Nevertheless, the President Obama is bent on adopting the Senate tax scheme. The result, as Hoffa and conservative critics of the plan have observed, will be a repudiation of the president’s pledge not to tax those making less than $200,ooo. Democrats, who fancy themselves as the protectors of “working” Americans, are understandably nervous about the president’s desire to impose a heavy tax on their constituents:

“We did in our house bill something that protects middle class Americans from having to pay more for health insurance and health insurance reform,” Rep. Xavier Becerra, D-Calif., a member of the House leadership, said Wednesday. “So far we want to stay to that principle.” House members “have been very clear on that issue and working with the president to stick to what he said when he was campaigning for president, we’re trying to make sure this does not affect middle class Americans,” Becerra said.

So far they want to stay to that principle? Well that doesn’t sound like Hoffa’s members are going to be able to count on Becerra and his colleagues. And if the Democrats do follow the president’s lead, a political firestorm may well ensue.

What’s at risk here is an unraveling of the Democratic coalition that elected Obama and the Democratic majority. Union members, elite urbanites (who will get slammed with new taxes), high-tech entrepreneurs (who get a new employer mandate), young voters (who will have to buy insurance plans they don’t want), and older voters (whose Medicare benefits will be slashed) may find common cause with fiscal conservatives, libertarians, and, yes, those angry Tea Party protesters, who all find ObamaCare objectionable. Obama, Pelosi, and Reid seem determined to ignore all these groups. For the sake of passing a “historic” bill and out of fear of appearing inept, they seem bent on passing something their own core political supporters find highly objectionable. Do they really imagine they can do so with no adverse political consequences?

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