She didn't say income, she said wealth

Many Americans, particularly Democrats, think that these figures of $250,000 or $350,000 for raising taxes mean income, and therefore, they are safe. Maybe they don't own a business; just work at a cushy GS job for $120,000 with bonuses. But income isn't wealth. Having a nice income that you can husband and use wisely, is nice. That's how most people become wealthy. But some people, like Ted Kennedy, inherit wealth and have never held a "real" income producing job, but they sure are wealthy. Because I was a librarian at a state university, my father once said I was on the "dole."

Appearing on NBC "Meet the Press," Health and Human Services Secretary Kathleen Sebelius said a tax surcharge on wealthy Americans is "a legitimate way to go forward" and beginning with people who make $350,000 is just a mark on the beach with a very hungry tide, in my opinion. She's really talking about taxing wealth, not income. Sebelius grew up in Ohio (governor's daughter) and vacations in Michigan, but she doesn't seem to grasp basic economics about wealth--another one who's never had an income producing job. Kansas, her state, was in tax trouble before the current melt down and she was the governor.

In fact wealth, not income, has always been behind this administration's health plan. There is such a tiny percentage of income earners paying the biggest portion, and such a huge group paying nothing in federal taxes, that there is no way to pull this off by returning tax rates to their Jimmy Carter days (about 70% for the big earners). ERTA, aka Reagan Tax cuts, dropped rates but "the share of the income tax burden borne by the top 10 percent of taxpayers increased from 48.0 percent in 1981 to 57.2 percent in 1988. Meanwhile, the share of income taxes paid by the bottom 50 percent of taxpayers dropped from 7.5 percent in 1981 to 5.7 percent in 1988." JEC Report 1996.

There's a tiny article in the June 24, 2009 JAMA on "insurance affordability." Essentially, it says that even if everyone had insurance (about 15% don't, and many of those aren't citizens, or are very young adults in part time jobs, or are unemployed, or don't use the government programs available to them) there would still be inequitable health care--the reason being wealth.

"For families with access to employer-based insurance, those with insurance had a median income ($53,130) that was 2.9 times higher than for those without insurance ($18,401). But the median net wealth was about 23.2 times higher for those with employer-based insurance ($78,472) than for those who had access to it but were uninsured ($3,384).

For individuals without access to employer-based insurance, those with insurance (i.e., they were purchasing their own insurance the way we all used to do it), make 2.3 times more than their uninsured counterparts ($41,086 vs $17,690) and their net wealth is 34.6 times greater ($105,819 vs. $3,057).

So you see how this works? If you have decided to be one of the millions to start your own business or go into farming or become an entertainer or film maker or become a consultant using your savings, or inheritance, or capital from friends or family, opting for a lower income in hopes of a better future, you are living on your "wealth" and buying your own insurance. But in the government's eyes (Agency for Healthcare Research and Quality), you are rich and obviously the problem, not the solution--or that's how it will come down. You wait and see. "Wealth, income, and affordability of health insurance," by Drs. Bernard, Banthin, and Encinosa, in the May/June 2009 Health Affairs 28(3), pp. 887-896.

Disclaimer: If you are currently out of work and have lost your health insurance, Obama says, "That's the way the cookie crumbles. Getting my programs rammed through Congress is more important than restoring your pitiful job." (A paraphrase based solely on his behavior.)