President Obama may break his campaign promise not to raise taxes on people making more than $250,000 to help pay for his signature initiative of healthcare reform.
By Wendell Goler
Tuesday, June 30, 2009
When it came to taxes, candidate Barack Obama seemed to clearly draw a line in the sand.
"If you are a family making less than $250,000 a year, you will not see your taxes go up," Obama said repeatedly on the campaign trail last year.
But that line in the sand may get harder to spot now that Obama has assumed power and as some lawmakers lobby to tax a portion of the most generous employer-provided health insurance policies to help pay for the president's signature initiative of health care reform.
"The president's going to watch the process," White House spokesman Robert Gibbs said Tuesday about efforts to overhaul the health care system. "He's going to be flexible, and we'll evaluate as we go."
Obama has proposed limiting itemized deductions for people who make more than $250,000 a year, but that would only raise a third of the lowest estimated cost of adding 40 or 50 million people to the ranks of the insured.
Computerized medical records and other efficiency improvements and emphasizing wellness and preventive care could further reduce costs but not nearly enough, according to Ryan Ellis of Americans for Tax Fairness.
"What the president is talking about won't even pay for a fraction of that," he said.
The first President Bush learned the cost of breaking a campaign promise on taxes can be high. Bush failed to win a second term in 1992 after reneging on his earlier declaration: "Read my lips. No new taxes."
Ellis says Obama already broke his tax promise when he increased the tax on cigarettes a little more than two weeks after taking office to pay for an expansion of the children's health insurance program.
"There aren't many rich smokers in the United States," Ellis said.
Republican presidential nominee John McCain's proposal to tax health care benefits drew strong criticism from the president during the campaign.
White House officials say privately McCain's proposal was a long way from taxing a small portion of employer provided health benefits. And the president told ABC News he's against even that, though he's willing to listen to the proposal, at least for now.
Aides say one lesson of past failed attempts at health care reform is, don't draw lines in the sand.
"Bright lines that cause people to leave the table," Gibbs said. "Everybody's still at the table."
If bright lines cause people to leave the table, bright lights are why presidents prefer not to negotiate in the press. Gibbs says Obama's clearly laid out his financing plan. He just won't say "Read my lips."