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December 20, 2013

Smart Power Alert, Extreme Hardship Edition

Sacre bleu! So, this cannot be!

This month, Barack Obama gave a speech vowing to make curbing income and wealth inequality a top priority for the remainder of his time in office. He better get to work. As of 2011, he was headed in the opposite direction.

New data is out from the IRS, showing the share of federal income taxes paid by those in each economic strata. Bruce Bartlett points out that the richest Americans have seen their share of taxes declining rather significantly under Obama. Specifically, the richest 1% paid 37.5% of taxes in (recession-damaged) 2008; in 2011, their share was down to 35%. (Their share peaked in 2007, during the boom times—and the Bush administration.) The top 5% of earners also saw their share of taxes decline by a similar margin. So, under the first three years of the Obama administration, the very rich saw their share of taxes go down.

It's almost as though The Smartest President Evah is making this whole inequality thing worse instead of better! Quote of the day (from Ezra Klein, no less!):

1. The individual mandate includes a "hardship exemption." People who qualify can either ignore the individual mandate altogether or purchase a cheap, bare-bones catastrophic insurance plan that's typically only available to people under 30.

2. According to HHS, the exemption covers people who "experienced financial or domestic circumstances, including an unexpected natural or human-caused event, such that he or she had a significant, unexpected increase in essential expenses that prevented him or her from obtaining coverage under a qualified health plan."

3. Today, the administration agreed with a group of senators, led by Mark Warner of Virginia, who argued that having your insurance plan canceled counted as "an unexpected natural or human-caused event." For these people, in other words, Obamacare itself is the hardship.

There's a pleasing circularity to this last observation. It takes real talent to create a law that - in turn - creates a hardship that is then used to circumvent the law that caused the problem in the first place.

Thank Goddess the Smart Folks are finally in charge. Otherwise, we really don't know what we'd do with our time....

Posted by Cassandra at December 20, 2013 06:55 AM

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Well, my first reaction to this was to laugh. I think one pretty much has to, at this point. Beyond that, I almost have to admire the Democrats and particularly the Obama Administration for being able to do all this with a straight face. It takes either serious nerve or serious delusion to argue that one has been somehow an innocent bystander to the train wreck of one's own policies.

Laughing and rather twisted admiration aside, there's this:

If Democratic members of Congress see this as solving their political problem with people whose plans have been canceled, it could help them stand against Republican efforts to delay the individual mandate.

I'm not sure what "political problem" the Democrats think this is going to solve. People whose insurance was cancelled aren't upset because they're going to be fined/taxed for not having insurance. They're upset because they're not going to have (decent) health insurance since the new policies are junk or the new policies are too expensive or the new policies have killer deductibles or all of the above - and the catastrophic policies are no exception.

I'm pretty sure that if someone who has health insurance on December 31 but doesn't have it on January 1 gets seriously ill on January 2, neither he nor his family is going to be giving interviews expressing undying gratitude to President Obama and Democratic Congressmen for sparing them from the individual mandate.

Posted by: Elise at December 20, 2013 10:05 AM

The current debacle, though it doesn't surprise me in the least, has surpassed my wildest expectations.

The more I watch, the more I think this is going to be the mother of all object lessons - on the order of Prohibition. Of course I feel awful for everyone who has been hurt by this. Usually people learn best by personally experiencing the negative consequences of their own decisions, but here a lot of innocent folks are suffering through no fault of their own.

And businesses too. Seemingly there's no awareness that losses get passed to pension funds and savers and investors who can't be conveniently demonized. It just stuns me that the administration seems to expect profit-making businesses who have a fiduciary duty to their shareholders to just embrace the suck.

Posted by: Cass at December 20, 2013 10:37 AM

It just stuns me that the administration seems to expect profit-making businesses who have a fiduciary duty to their shareholders to just embrace the suck.

It does indicate a rather, um, unusual view of the world, doesn't it? Or, more likely, an astonishing lack of contact with reality.

Still, to the extent the insurance companies were willing participants in ObamaCare (and to the extent people invested in insurance companies hoping for a windfall from forcing people to buy insurance), they forgot the old adage:

He needs a long spoon who sups with the Devil.

This doesn't mean I think everyone who is at risk financially deserves whatever disasters befall them; some of them do, some of them don't. I just hope that the object lesson actually takes and people realize you can't get something for nothing; you can't do good by doing bad; a complicated solution to a simple problem is stupid no matter who says otherwise; and when it comes to holding up its end of a deal, the government really does bear a striking resemblance to Darth Vader.

Posted by: Elise at December 20, 2013 11:44 AM

...when it comes to holding up its end of a deal, the government really does bear a striking resemblance to Darth Vader.

With the infinite wisdom of hindsight, I have once again altered our little deal. Pray I do not alter it further, Missy.

Posted by: Barack Obama at December 20, 2013 01:19 PM

Posted by: Darth Vader at December 20, 2013 02:05 PM

Pray I do not alter it further, Missy.

I believe that should be:

Pray I do not alter it further, Mary.


Posted by: Elise at December 20, 2013 04:44 PM

It truly is stunning to watch. Since, I am in general, extremely skeptical about government's ability to solve any problem; I am still amazed at the raw ineptitude.

After passing the law, the administration immediately signed off on exemptions for large businesses...

After writing the regulations millions of more people lost their insurance...

After launching a website that might be the largest IT failure ever...

After launching an ad campaign that could charitably be called laughable...

The same crew will fix it, by using the same mindset. I shudder to think what the fixes will look like.

Posted by: Allen at December 20, 2013 05:45 PM

That lefty/libs thought they could pull this off defines then as full of stupid and hubris.
That they choose to ignore that awful impact of their policies mark them as assholes.

Best Regards,

Posted by: CAPT Mike at December 21, 2013 12:25 AM