After getting bashed at last month's debates for her lack of a true plan to pay for a single payer option, Warren released a new plan recently. Lots of misinformation being thrown around about the plan on news media.
I think the most important piece of information regarding her paying for medicare for all was a study that she commissioned from Mark Zandi, the Chief Economist of Moody’s Analytics; Betsey Stevenson, the former Chief Economist for the Obama Labor Department; and Simon Johnson Former Chief Economist, International Monetary Fund and Ronald A. Kurtz (1954) Professor of Entrepreneurship Sloan School of Management, MIT: https://assets.ctfassets.net/4ubxbg...edicare_for_All_Revenue_Letter___Appendix.pdf
Her proposal to pay for medicare for all includes 8 funding avenues, all projected to fun the 20.5 trillion in new federal spending she argues will be needed to fund the new program (when considering previous studies by the Urban Institute on costs to implement medicare for all). She also argues that the government will already be on the hook for in the range of $34 Trillion if we do nothing. If I'm reading her proposal right, the $20.5 Trillion is in addition to the $34 Trillion we will be paying no matter what.
There are certainly some questions that come along with Warren's plan:
I think there needs to be a further study done on how these changes to taxes on profits, investments, and depreciation will effect GDP and unemployment.
I think the most important piece of information regarding her paying for medicare for all was a study that she commissioned from Mark Zandi, the Chief Economist of Moody’s Analytics; Betsey Stevenson, the former Chief Economist for the Obama Labor Department; and Simon Johnson Former Chief Economist, International Monetary Fund and Ronald A. Kurtz (1954) Professor of Entrepreneurship Sloan School of Management, MIT: https://assets.ctfassets.net/4ubxbg...edicare_for_All_Revenue_Letter___Appendix.pdf
Her proposal to pay for medicare for all includes 8 funding avenues, all projected to fun the 20.5 trillion in new federal spending she argues will be needed to fund the new program (when considering previous studies by the Urban Institute on costs to implement medicare for all). She also argues that the government will already be on the hook for in the range of $34 Trillion if we do nothing. If I'm reading her proposal right, the $20.5 Trillion is in addition to the $34 Trillion we will be paying no matter what.
1. Employer medicare contribution ($8.8 Trillion): This will essentially be a payroll tax taking the place of what employers pay for their employees private insurance now. As an added note, small businesses with less than 50 employees would be excluded from the mandated Employer Medical Contribution unless they already are paying employee healthcare.
2. Federal Taxes on Increased Takehome Pay from Eliminated Premiums ($1.4 Trillion) : Her plan is said to eliminate premiums / copays to insurers. That extra money in taxpayers pockets would now be taxed by the government. So if you're saving $3K in premiums every year you would be paying federal taxes on that.
3. Targeted taxes on financial firms ($0.9 Trillion) - More on this later
4. Taxes on large corporations ($2.9 Trillion) - More on this later
5. Taxes on the top 1% ($3 Trillion) - More on this later
4. Taxes on large corporations ($2.9 Trillion) - More on this later
5. Taxes on the top 1% ($3 Trillion) - More on this later
6. Immigration reform ($0.4 Trillion) - They argue that a pathway to citizenship will add that 400 Billion in new net revenue.
7. Eliminating Overseas Contingency Operation Fund ($0.8 Trillion) - Many argue that this is acting as a slush fund for the Pentagon. It was created by Bush to fund the War on Terror and was effectively used to fund the wars in Iraq / Afghanistan and subsequent operations in the region. It was excluded from Congress' budget control measures in 2011. The CBO just came out with a plan outlining the need to seriously alter the fund.
8) Improving Tax Enforcement / Collection ($2.3 Trillion): Narrowing the gap between what's owed and what's paid.
There are certainly some questions that come along with Warren's plan:
A) How are hospitals going to react in the short term to the federal medicare system only paying 110% of the current medicare rate for procedures (Warren's proposal) when private insurance is currently paying nearly double? Will it force closures to medical institutions? Consolidations? Diversification? Increased Competition?
B) How will Employers respond to payroll taxes being implemented instead of their current insurance payments and will those payroll taxes remain in line with what they're already paying?
C) How will raising her current "wealth tax" proposal from 2% on net worth above $50 Million and 3% over $1 Billion to 2% over $50 Million and 6% over $1 Billion effect business investment and tax avoidance.
D) How would her proposed modification of the capital gains tax effect the stock market: She proposes modifying the capital gains tax from being due at the time of sale to being due annually.
E) I think one VERY important point on Warren's plan to tax large corporations. She plans to eliminate accelerated cost recovery (accelerated asset depreciation) from the tax code, which I have long been a proponent of. She also proposes a minimum tax on foreign earnings of 35%. So, if a corporation reports $1 Billion in profits with $0 in taxes in the Cayman Islands, they would be required to pay 35% on that to the US. (Or the difference between the 35% and the % of the taxing foreign country)
I think there needs to be a further study done on how these changes to taxes on profits, investments, and depreciation will effect GDP and unemployment.
Last edited: