Colleen Conway-Welch
Nursing professor

Colleen Conway-Welch

Colleen Conway-Welch, RN, is the dean of Vanderbilt University’s School of Nursing.

Throwing Good Money After Bad

The administration's proposed tax on the wealthy could supposedly raise $550 billion over the next decade, which is only half the cost of health-care reforms estimated to cost $1 trillion. But, the new tax proposal will lack widespread support since it will impose an enormous burden on small business owners who are not wealthy and generally report business income on their personal tax returns.

In addition, does it make sense to impose this tax on the highest income-generating citizens? Raising taxes on the "wealthiest Americans," and even small business owners, has been found, over many years, to produce lower revenue to the Treasury, not higher revenue. Lower tax rates reduce the incentive to avoid or defer current taxation and lead to higher Treasury tax collections.

Before more taxes are imposed to pay for a broken non-system of health care, why aren't we talking about fixing the system (or lack thereof) first? We are planning to throw good money after bad. All the money in the world will not make our current, fragmented non-system more effective until we all agree that the right provider needs to provide the right care to the right patient in the right setting for the right cost at the right time for the right reason using the right tools. This means allowing non-physician members of the health care team to treat patients under appropriate, mutually-agreed upon protocols and to be reasonably reimbursed. It means solving the litigation problem where many extra tests are being ordered to protect a provider against malpractice suits. It means supporting palliative care where people can die humanely and in the arms of their family. And it means more of a focus on incentives for prevention, better chronic disease management, healthier life style choices, etc.

Corporations like Safeway have figured much of this out for their employees and are installing such incentives with good results.

People are predictable. We have a huge industry now of tax attorneys who help the "rich" avoid taxes -- does anyone seriously think they will go away if taxes are raised even more?

We need to fix and right-size and systematize our health-care delivery non-system before we arbitrarily tax the wealthiest. And, by the way, we do not have 50 million hard-core uninsured - we have half that number. Let's also use the right data on the uninsured to drive decisions.

By Colleen Conway-Welch  |  July 16, 2009; 11:32 AM ET  | Category:  Health Care Reform , Taxes Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
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"Raising taxes on the "wealthiest Americans," and even small business owners, has been found, over many years, to produce lower revenue to the Treasury, not higher revenue. Lower tax rates reduce the incentive to avoid or defer current taxation and lead to higher Treasury tax collections."

I am sure Ms Conway - Welch is a fine nurse, but she should leave economics to others. She says, "Raising taxes on the "wealthiest Americans," and even small business owners, has been found, over many years, to produce lower revenue to the Treasury, not higher revenue. Lower tax rates reduce the incentive to avoid or defer current taxation and lead to higher Treasury tax collections."

This idea has been discredited many, many times and is believed by no respectable economist. The CBO has determined that the Bush tax cuts REDUCED tax revenue by almost $2 Trillion dollars.

If you don't want to go into the nitty gritty, just compare the Clinton Administration with the Bush II Administration. Clinton, with higher taxes, created 20,569,00 new private sector jobs; Bush created 417,000.

You can also compare the period 1946 - 1973 when marginal rates were over 70% with the period 1973 to the present. Real median wages grew 3 times as fast during the first period. In many ways we were much better of (except for the Rich).

Posted by: lensch | July 17, 2009 4:18 PM
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