RUSH: By the way, as far as the State of the Union is concerned, tax increases on your health benefits, ladies and gentlemen. Have you heard about this? Yes, here’s how it’s going to work. The average benefit — and 150 million Americans have health insurance through their employers, and right now that’s a benefit. It’s income that’s not taxed. You don’t see it, but it’s what it costs the employer to pay you, so you’re not taxed on it. I’ve been predicting this. I just didn’t know a Republican would come up with the idea, but I’ve been predicting this for the longest time. Here’s the deal. Average American health care plan, 150 million of you supposedly have your health care paid by your employer, which it’s being paid by you, you just never see it. Bottom line is, there’s $11,500. The tax will be on employee benefits over $15,000, and there are some of those. The average is 11,500.
So, for example, if it costs your employer $17,000 for your health care plan, you will pay a tax on $2,000. ?Oh, that’s not bad, Rush.? (Laughing.) You know what happened with Social Security when it started out versus where it is. You know what happened to the income tax when it started out versus where it is. It won’t be long before that 15,000 is down to ten, and then down to eight. Once they start increasing taxes, folks, I told you two weeks ago, we are probably living at a moment where our taxes will never, ever be lower than what they are. In addition to that, the president is going to propose a 20% reduction in the use of gasoline. How is this going to happen? Well, they’re going to raise the CAFE standards. We went through that in the nineties with Clinton. Going to raise the CAFE standards and promote conservation and alternative fuels and the like. No mention of the speed limit. Gosh, I hope they don’t do that. And, by the way, I can’t find it, I haven’t seen the text to the whole thing. I can’t find any added impetus to start drilling for our own oil. The Democrats want to prevent that wherever and whenever they can, while claiming that they want to reduce our dependence on foreign oil.
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RUSH: Twana in Atlanta, you’re next, welcome to the EIB Network.
CALLER: Hi, Rush. I just ? (loud phone distortion)
RUSH: What the hell is going on? Are you being attacked out there?
CALLER: I’m here.
RUSH: Where are you?
CALLER: I’m in Atlanta.
RUSH: Are you in the men’s room at Hartsfield? The noise out there was incredible.
CALLER: Sorry. Anyway, can you hear me now?
RUSH: Yeah, I hear you now. Yeah, I don’t even want to know what was going on. It might be obscene.
CALLER: Sorry.
RUSH: Yes.
CALLER: Well, my point is, in light of what the president is planning to talk about tonight and adding yet another element of government roads, you know, Rush, I’ve been a card-carrying Republican since Reagan, and I am simply bamboozled by this guy. I don’t know where he stands on the conservative issues, and to be honest with you, let’s just say that the minority in the Congress and the Senate comes up with a plan to try to win in ’08. It seems to me they’re going to have Bush to overcome. I’m so irritated by this.
RUSH: I’m having trouble. If the minority in the Congress and the Senate come up with a plan to try to win in ’08, you mean the elective office or some piece of legislation?
CALLER: No, if they try to take back the Senate and the House of Representatives in ’08, you know, their Republican base is still having to look at what Bush is doing to increase government.
RUSH: Have you noticed a trend out there, though, Twana? Have you see what’s happening in California with Arnold Schwarzenegger? Do you know how seductive liberalism is? Here’s Arnold Schwarzenegger giving away the state, giving away the farm. Health care benefits and insurance for children of illegals, paid for with tax increases called loans. Of course, the Democrats are out there applauding this. Liberalism is seductive as it can be. When you’re in government, your job is to spend money, and when you have unlimited amounts of it to throw around, it’s a temptation, I guess, that some can’t resist.
This business of taxing benefits, I’m surprised it’s taken this long to do it. It is on income, and you are not being taxed on it. There are a lot of other circumstances where this kind of thing does result in independent contractors and so forth having to pay tax on it, because it’s treated as income. Like, for example, a gift, the maximum you can gift anybody in a 12-month period I think is now $12,000, maybe 13,000 this year. Anything above that, you pay a tax on. You get an exemption of so much for your life, but if you surpass that, the tax rate on gifts is 49%, something like that. There’s precedent for this. I’m just surprised that it’s taken this long. As for the effect on Republicans and their electoral chances in ’08, it’s not just the president who has wandered off the reservation on some of these things.
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RUSH: I feel so bad. I feel so bad. I played a trick on you people. I must now apologize for it. I only told you half the story about the tax increase on health care benefits. I did this on purpose to get your attention, and judging by my e-mail, it has worked. Because I want you to listen, I want you to know what the other half of this is. I don’t like the fact that there’s a tax increase here. With the level of taxation we already face, I’m universally opposed to it. We’ve got so much money being produced by this people of this country, there?s just fraud and waste and redundancy all over this budget. It’s obscene. But that aside, in addition to proposing a tax increase on health care benefits above $15,000 per employee, the president is also going to propose a tax cut for those of you who purchase your own medical insurance, and he would finance that tax cut you’re going to get by buying your own health insurance with an unprecedented tax on a portion of high priced health care plans that workers receive from their employers.
The initiative, which the president briefly reviewed in his radio address on Saturday, has a dual purpose. It would create a financial incentive for the estimated 46 million to 48 million Americans who lack health insurance to buy it, and it would rein in — wait a second. I thought they didn’t have it because it was so expensive they couldn’t afford it. But, see, they don’t tell you that many of these uninsured are uninsured by choice. They are young and they have no concept of illness, catastrophic or otherwise. They don’t plan on dying tomorrow. They don’t plan on being in a car wreck or any of that, you know how the young people are, so they’re running the risk that they’re not going to need it. They’re looking at the actuarial tables and they’re finding that taking the risk is pretty sound. They’re not the kind of people that spend every day in the doctor’s office and then at the emergency room. I don’t know what percent is, but I’ll bet you close to half, I think I read close to half of these 46 to 48 million estimated uninsured are underestimated or uninsured by choice, on purpose.
?The president said today the tax code unfairly penalizes people who do not get health insurance through their job. It unwisely encourages workers to choose overly expensive gold-plated plans. The result is that insurance premiums rise and many Americans cannot afford the coverage that they need.? I’m sorry for tricking you on this. But the reason I wanted to do it, the reason I decided to do it is because this is a really robust, and actually it’s like Mitt’s plan in Massachusetts where he’s requiring everybody to have it and buy it. They’ve got to have it like auto insurance, and the incentive is if you buy your own, you’ll end up shopping, and you’ll get better prices, and maybe you won’t buy as much, you won’t go for these gold-plated things so that you don’t have to worry about it, you’ll just buy what you need, and this will introduce market forces into the health care system which we’ve all agreed needed to be done decades ago, and when you introduce market forces, you lower prices.
For you people who choose not to go out and pay for your own insurance, welcome to tax increases, because you’re going to get soaked if you continue with these gold-plated plans. You’re not going to get soaked actually because the entire amount is not going to be taxed. It’s every dollar over $15,000 annually in your health care benefit package, work will be taxed. Don’t know what the rate is. So it’s ultimately an attempt here to introduce market forces and privatize as much of the health care system as possible or get it started because this is the fix for this, just as it is with Social Security. Now, the libs are going to fight this tooth and nail. I don’t care if it’s No Name-Calling Week or whatever, they are going to go bananas with this. Oh, I know, they’re already saying it’s dead on arrival, but after he does the speech tonight, when most Americans hear it for the first time, wait ’til you hear the response and wait ’til you hear the Drive-Bys tonight and tomorrow. They are going to go bonkers. ?The only way to fix health care, Rush, is for government to pay for it for everybody, and for you and everybody else, Rush, to be dependent on government, because government cares, and government can do it the best, Mr. Rush Limbaugh.? Blah, blah, blah, blah, blah.
So dead on arrival. It’s an attempt to introduce market forces. The thing I don’t like about it, and it’s a small part, this was the trick, it’s one of our guys proposing a tax increase. The way it can be spun, Bush proposes tax increase, period. And it could be just like I did when I tricked you. Again, I’m sorry for that, ladies and gentlemen. It won’t happen too many more times in the future.
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RUSH: If you are just tuning in and you’re wondering what did I do to trick the audience, I told them that President Bush was going to tax a portion of health care benefits as income, is going to announce it in the State of the Union address tonight. Then I waited for a half hour to drop the other shoe. The other shoe is there is a huge tax cut being offered to people who buy their own health insurance. This is an effort to reduce the price in the cost, because the average health care benefit for an employee today is $11,500. The proposal tonight, which the Democrats have already said is dead on arrival anyway, is that every dollar over $15,000 of health care benefits will be taxed. The purpose here is to try to get people off of employer programs and buy their own, for the express purpose of shopping it. Most people aren’t going to go out and buy $15,000 policies or even 11 or $12,000 policies, every year, not going to do it, especially when most people think that health care is free.
Let’s face it, most people who have health care as part of their employment, never see the money. You get your card, you get a co-pay, you get whatever, your deductible and this sort of thing, but the overall insurance, you don’t pay for it, you don’t think. You are paying for it. You just never see the money. It’s what the employer has to pay to employ you, and so it goes somewhere before it ever gets to you. Now, what you could do, a movement would be, ?Okay, employer, instead of giving me the insurance, give me what it is it costs and I’ll go buy my own.? I don’t think that’s going to happen. So one of the problems here, even if it weren’t dead on arrival, as the Democrats say, and they run the Congress right now, how many people do you think who are under the impression as far as all practicality is concerned, that health insurance is free, it’s a benefit, are going to go out and pay for it, with what? How many families do you know that just have four or five thousand dollars hanging around, not used, to go out and buy health insurance? Probably, if the employer does, if it happened, as it progressed, theoretically, hypothetically, I doubt that the employer would make up in salary what you no longer are going to take as a benefit. But we have to see how that worked itself out.
So the bottom line is, yeah, it’s theoretically great in the way that it would introduce market forces, but health insurance still isn’t cheap even if you do buy it yourself, and the number of people without vouchers — this is really the voucher program without vouchers, and I’ve been in favor of this for I don’t know how long. You get a voucher for whatever health care coverage you get every year, and then whatever you don’t spend you get to keep. That would encourage people shopping for medical services like they shop for everything else. But it’s all moot, folks, dead on arrival. The Democrats don’t want any part of this. They don’t want any part of market forces, private sector involved in this as little as possible, is what they want. They want the government, they want single pay, they want national health care, Hillary’s going to rev that back up. They want everybody dependent on them for health care. You know how big health care is to people. It’s something that people literally panic over if they don’t have it, other than those who are choosing not to have it. So big brouhaha.