When it comes to taxing health insurance benefits, President Barack Obama hasn’t said yes, and may never. But he and his top aides won’t quite say no, either, to an idea he attacked sharply in his campaign for the White House.
Instead, they are in full straddle, a well-known Washington maneuver accompanied by a vocabulary designed to obscure.
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“That was not in the president’s plan. It was not in our budget,” the administration’s budget director, Peter Orszag, said after the possibility of taxing benefits was raised — not for the first time — by Democratic Sen. Max Baucus, chairman of the Senate Finance Committee.
Read literally, Orszag’s response was a mere statement of fact, possibly meant to signal discouragement or administration disapproval, but far short of a flat rejection.
Obama’s budget calls instead for hundreds of billions in savings from Medicare and a tax increase on upper-income wage earners to help finance his signature health care proposal. Democrats in Congress have been slow to warm to either. Baucus has said repeatedly he is looking at all possible alternatives to help pay for the president’s goal of subsidizing health care for millions who now go without. Orszag’s matter-of-fact response could be explained as simple courtesy to Baucus, a senior senator and a committee chairman with enormous influence on health care matters.
Or he could have been opening the door to a tax increase, as he seemingly was several weeks ago when he said the administration was interested in hearing more from Congress on Baucus’ idea.
Whatever it was, Senate Majority Leader Harry Reid was equally noncommittal in his comments a few hours later at the Capitol. “At this point, nothing is off the table. Nothing is on the table,” said Reid, D-Nev. At this point, the White House isn’t clarifying, either.
After meeting with the president at the White House, Baucus told reporters: “It’s on the table. It’s an option.”
It seemed anything but that last fall, when Sen. John McCain, R-Ariz., proposed taxing health insurance benefits and Obama spent millions on campaign commercials attacking the idea.
One ad accused McCain of favoring “taxing health benefits for the first time ever … taxing health care instead of fixing it. We can’t afford John McCain.”
A second Obama ad called McCain’s approach “the largest middle-class tax increase in history.” Driving the point home, it contended the “McCain tax could cost your family thousands. Can you afford it?” In mid-April, on a day millions of people were filing income tax returns, White House press secretary Robert Gibbs noted Obama’s campaign pledge not to raise taxes on wage earners making less than $250,000 a year.
Asked whether that applied to insurance premiums, he indicated it did, saying there were no caveats attached to the promise.
At the same time, he said, “the president has said that everybody involved — and Congress, the president, interest groups representing doctors and patients, hospitals, the pharmaceutical industry — should bring their ideas to the table.”
