Tuesday, May 12, 2009

Next Time It Won't Be Tea...

President Obama's proposed overhaul of the health-care system may cost a projected $1.2 trillion. That will have to be paid for in real dollars, and the government has only once source of real dollars: Us.

So there will have to be ways to get that money from us in order for it to be available for that system. The government will increase taxes somewhere in order to get that money from us, because that is the way government gets money from us. The Senate Finance Committee is hearing proposals about what kinds of taxes can be enacted to raise the money. Among those proposals is one from the Center for Science in the Public Interest to tax sugary sodas and drinks a few extra cents.

The Congressional Budget Office, which crunches numbers on proposals like this, estimates that bumping the price of a 12-ounce soda by three cents will raise $24 billion towards the health care plan. If you want to crunch some numbers on your own, you will find that this tax would fund two percent of that estimated $1.2 trillion.

Except, of course, that it won't. The Center's proposal wouldn't tax diet drinks or drinks that are considered healthier, which fits with its goals of promoting consumption of healthier products. So instead of buying sugary sodas, fruit drinks, energy drinks or other things that the Center says are bad for you and which now cost more, you would buy drinks that they say are good for you. Fewer sugary drinks sold means fewer tax dollars come in from selling them, leaving you a couple billion short when the bill is due.

Chances are good that the people who support such a tax are aware of this. They aren't advocating it as a serious method of raising money for a health care plan, but as a way of using the federal government's power to tax to influence behavior in a way they think is better for people. The use of small numbers is a way to sort of sneak this idea through -- in order to fund all of the plan's costs, for example, that 12-ounce can of tooth decay would need to cost $1.50 more than it does now. Do that and nobody would buy the stuff, and nobody who wants to drink it would sit still for the tax, either. Congresspersons of all stripes would receive, I am sure, a landslide of public opinion against that kind of measure.

I drink the diet stuff myself, so I wouldn't be out any money in this idea. But the problem comes in when we realize that no one elected the Center for Science in the Public Interest to guide our behavior. It also comes in when we think about what other kinds of impacts this change could have. People stop drinking soda and start drinking, say, water. Bottled water. Plastic-bottled water. Waitaminute, says the Sierra Club. Plastic bottles make up a lot of trash and we've been trying to reduce how much trash we throw away. Maybe we'd like a tax on them in order to reduce how many of them get made.

I don't know about you, but that's not a series of dominoes I want to see start falling.

1 comment:

latoberg said...

No one has accused policy think tanks, lobbyists, or politicians of being logical, rational, coherent, or consistent in anything they do.