The Obama administration deserves all the criticism it is receiving about its grossly incompetent roll-out of the Affordable Care Act.
It cant be lambasted enough for its Nixonian deceit, from President Obamas repeated lie, If you like your health plan, you will be able to keep your health plan, to the administrations initial claim that its websites troubles were due to popular demand.
But those are sideshows that will pass; healthcare.gov will work (someday) and Obama has shown a Teflon quality Ronald Reagan would have envied.
I come not to bury Obama but to offer him back-handed praise. Obamacare will finally force Americans to decide whether we want to remain a low-tax nation where individuals decide whats best for themselves or become a high-tax welfare state where the government is ever more empowered to act in what it believes is the collective good.
Since Lyndon Johnson ushered in the Great Society during the 1960s, the United States has been a two-track nation. One side is the Dont tread on me tradition of self-reliance and rugged individualism that stretches back to our founding. The other is the growing sense that the government must take an ever-more active role in providing for its citizens.
Today about half of all Americans live in households that receive government assistance. The number of Americans on food stamps has risen more than 70 percent since 2008, to 48 million, and the new Medicaid expansion could provide free government health care to an additional 21 million people.
While one track is more closely associated with Republicans and the other with progressives, there has been a broad consensus amid the partisan bickering: Both groups enjoy the goodies and neither wants to pay for them. Thats why the size of government has grown no matter which party was in charge. The result is a national debt now close to $17 trillion.
President Obama pretended to square this circle while running for office in 2008. Famously, he told Joe the Plumber he wanted to spread the wealth but assured him that he would take only from the wealthy, which he defined as individuals making more than $200,000 and families earning more than $250,000 per year. His message which he had to deliver to get elected by an American people unwilling to absorb higher taxes was that he would never ask the middle class to sacrifice. Only the fat cats need worry. More free lunch for everybody else.
The ACA changes that. In selling his plan, the president appealed to the bedrock American desire to control our hard-earned dollars, saying the law would save the average family up to $2,500 a year. He also touted all the free services, from contraception to maternity care, people would receive.
Anyone who passed fourth grade math knew this was impossible. Someone has to pay for Medicaid expansion. Someone has to pay for enhanced coverage and for the subsidies promised to individuals earning up to $46,000 a year and families of four making less than $94,000 purchasing policies on the state and federal exchanges. Someone will have to pay a year from now when the employer mandate kicks in. Those costs will be paid by cost shifting, broad new taxes and much higher premiums borne by many in the middle class.
The ACA is a great leap forward toward Obamas goal of redistributing wealth not just from the affluent but from the middle class that has largely been insulated from the costs of government.
Youd never guess it from the presidents demand that the rich pay their fair share of taxes, but the United States has the most progressive tax system in the developed world. We are good at soaking the rich. And yet we also have one of the lowest tax rates in the world. U.S. taxes at all levels of government claim about 25 percent of GDP while most European nations take around 40 percent.
Obamas policies are moving us toward a European model, where everyone (including the poor through value-added taxes) pays high taxes that are used to reduce inequality. It is a system that limits the benefits of success and the penalties for hardship. It would move us from our current Robin Hood approach to one where the have-somes increasingly support the have-nots.
Given our massive debt and our expanding welfare state, the free lunch is ending. The American people now face a time for choosing: Will we start paying our growing bills or cutting our expenses?
Contributing columnist J. Peder Zane can be reached at email@example.com.