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Home Publications Blogs Beat the Press David Brooks Has Not Heard About the Affordable Care Act

David Brooks Has Not Heard About the Affordable Care Act

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Tuesday, 20 September 2011 04:20

That's what readers of his column complaining about President Obama's speech on the budget must conclude. He is upset that Obama:

"whispered about seriously reforming Medicare but then opted for changes that are worthy but small."

If Brooks has heard about the Affordable Care Act (ACA), he would know that it actually provides for large cost controls in Medicare. According to the Medicare trustees report, these cost controls would eliminate almost 80 percent of the long-run deficit projected over the program's 75-year planning horizon.

Brooks could read about these changes in the Congressional Budget Office's (CBO) long-term budget projections. CBO projects that future deficits will be manageable if the controls in the ACA are allowed to take effect. However, CBO concluded that Congress will reverse itself and not allow the controls to bite. However, it seems odd to blame President Obama for the fact that future Congresses might reverse the cost controls that he put into the Medicare program and it is simply wrong to claim that he did not do anything to restrict costs.

It is also worth mentioning that Brooks misrepresents the relative tax burdens of the wealthy and the middle class. He excluded payroll taxes from his calculations, which are extremely regressive. Also, there are a small number of very wealthy people who do in fact pay very low tax rates because the bulk of their income comes from capital gains. This is exactly the situation that President Obama described.

Comments (3)Add Comment
...
written by joe, September 20, 2011 3:51
there are a small number of very wealthy people who do in fact pay very low tax rates because the bulk of their income comes from capital gains.

during the housing and dot com bubbles, more than 2/3 came from capital gains.

Capital gains subject to preferential rates
Percent of AGI in 2007 = 65.68%
Percent of AGI in 1998 = 70.25%

SOI-Tax Stats-Taxpayers with Top 400 Adjusted Gross Income
http://www.irs.gov/taxstats/ar...02,00.html
...
written by urban legend, September 20, 2011 9:42
The "regressive" nature of Social Security is by design by FDR. Yes, Social Security taxes are capped at a certain income, but benefits are capped, too. There is a fairly tight correlation between taxes contributed and benefits. FDR feared, probably rightly, that making Social Security comparably progressive to the income tax would undermine political support, since it would tend to be treated as a welfare program.

There are plenty of other regressive taxes that undermine the mildly progressive character of the income tax.
...
written by Union Member, September 20, 2011 9:47
Uhh, David Brooks is so wrong, so often, about so many things, could it be that he is just dishonest?

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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