Lawmakers know a dirty little secret about proposals to make
prescription drugs a universal entitlement in Medicare: It could
cost your children crucial tax breaks that will help them get a
house, keep their own health insurance and put their own kids
through college.
Adding a prescription drug entitlement to the financially troubled
Medicare program will just hasten its plunge into bankruptcy,
Heritage Foundation tax and budget experts Brian Riedl and William
Beach write in a Sept. 24 essay. To keep the Great Society program
afloat means income taxes will have to be raised by an average of
18 percent through 2030 just to keep the program solvent. To make
that colossal hike happen, Riedl and Beach say some options
include:
- Raising most income tax rates by 7 to 9 percentage points
each;
- Ending the home mortgage tax deduction, child tax credit and
earned income tax credit; or
- Repealing the tax exclusion that exempts employees from paying
taxes on the value of their health insurance.
"Of course, lawmakers won't tell you that," Riedl and Beach
write. "They seem content to spend now and leave the inevitable tax
hikes to future Congresses."
They should be. They don't have to pay for what they propose-if
they keep quiet.
For more information or to receive an e-mail version of
"Medicare Maladies," contact [email protected] or call
Heritage Media Services at (202) 675-1761.
