Actually, you don’t have to raise taxes to pay for healthcare

October 15, 2009

Great piece of analysis from the Tax Foundation:

A new analysis by us finds that over a 20-year period, the health care bill written by Sen. Baucus and passed Tuesday by the Senate Finance Committee includes enough spending cuts in Medicare and other current government health programs to reduce the budget deficit over the long term, even without a proposed excise tax on “Cadillac” health plans.

CBO projects that cuts in Medicare and other health programs would save $404 billion between fiscal year 2010 and 2019. Assuming the savings from Medicare cuts continue growing at the same rate beyond 2019, savings could reach a total of $1.8 trillion over the next 10-year period, 2020-2029, for a total deficit reduction of up to $988 billion over 20 years. If Congress were considering a 20-year budget window instead of ten years, Chairman Baucus’s proposed excise tax on Cadillac health plans would not be necessary to pay for the plan.

Me: Of course the spending may not happen, while the tax increases most assuredly will. Such is the way of Washington.

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