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July 27, 2009

Robin Hood Rx Robs Small Business

Many town meetings I've held this year have turned into standing-room-only sessions. Such active citizen participation would make the Founders proud of America's 233-year-old revolutionary "experiment." That is, the government works for the people; the people don't work for the government.

Thanks to Iowa's presidential precinct caucuses every four years, Iowans are well known for being active participants in representative government. For 28 years in a row, I've met with Iowans in each of Iowa's 99 counties at least once every year to find out face-to-face what's on the minds of people.

I appreciate when people take the time out of their busy schedules to attend and participate. This year, large turnouts are driven by anxiety about the economic downturn, disaster assistance, unemployment, health care reform and, especially the federal bailouts for the banking and automobile industries that have put taxpayers on the hook for hundreds of billions of dollars.

From one side of the state to the other, Iowans at my town meetings, ask: "When is enough, enough?"

This summer, Congress is hammering out ideas to overhaul the U.S. health care system. The White House and Congress from the outset identified two overriding targets for reform: to curb the spiraling costs of health care (which today absorbs roughly one out of every six dollars spent in the United States) and to expand access to health care insurance for the 47 million uninsured Americans.

 

Regrettably, it seems the big spenders in Washington want to abandon the first goal entirely. They are focusing on sweeping changes to the U.S. health care system that substantially grows the federal role in the delivery of medicine in America.  A partisan band of lawmakers in Congress seems comparable to the medieval looters of Sherwood Forrest. Health bills being pushed by the majority party in the House of Representatives would enact a stiff surtax on small businesses and other higher-income taxpayers, and would also impose a penalty on small businesses that do not provide health insurance coverage to their employees.

So many Iowans have expressed their anxiety about losing their jobs and getting the economy back on the right track. If Congress steamrolls a partisan Robin Hood plan that finances a government take-over of the U.S. health care system on the backs of small business, I'm afraid the economy may never fully recover. Small businesses are the job-creating engine in America, accounting for 70 percent of new private sector jobs. Slapping a surtax of up to 5.4 percent on those earning $280,000 or more a year will not encourage small business owners to create jobs, retain their current employees, and invest in their businesses.

The White House and Congressional Democrats already have crowed their intent to raise marginal tax rates to 36 and 39.6 percent on the top two brackets. They also proposed raising the tax rates on capital gains and dividends to 20 percent and jack up the estate tax as high as 45 percent. The merry band of big spenders would add the Robin Hood surtax on top of those tax hikes to finance the government's gradual control of U.S. medicine. The marginal federal tax rate proposed by House Democrats goes up as high as 48 percent, and that doesn't even include state income taxes. In Iowa, the highest state tax rate is nine percent. Therefore, under the House Democrats proposal, Iowans would face a marginal tax rate as high as 57 percent.

As my constituents ask: "When is enough, enough?"

The director of the nonpartisan Congressional Budget Office splashed cold water on the proposals being advanced, saying "the legislation significantly expands the federal responsibility for health care costs" and does not make fundamental changes to curb medical spending in the future.

Taxpayers can only hope the leadership in Congress and the White House will listen to a nonpartisan voice of reason and put fact before fiction.

As the ranking member of the Finance Committee, I have been working in good faith to broker a bipartisan solution that protects taxpayers, reins in runaway health spending, ties quality outcomes to reimbursements and expands affordable access to health insurance. The U.S. health care system already is riding an unsustainable spending curve that would consume an insatiable share of the federal budget.

But the White House and Democrat-led Congress would have us believe a Robin Hood Rx would remedy the situation. It's more like a prescription for economic disaster.

Robin Hood has been known through the ages for "stealing from the rich and giving to the poor." Folklore is good fiction. But fiction can't disguise the facts. And the facts show the Democratic proposals would send health care spending sky-high and saddle small business with excessive tax increases. Not even Robin Hood can hoodwink those facts.