President Barack Obama signed the SCHIP bill Wednesday extending and expanding an already existing publicly funded children’s health insurance program. Obama called it a “down payment on my commitment to cover every single American.” Democratic Speaker of the House, Nancy Pelosi and other Democrats hailed the bill, the first in what Republicans view as a drive toward a big government health care system.
Democrats see passage of the SCHIP bill as a victory for the poor, but is it? Look at some of the consequences. Who will actually be paying for the bill?
Although there is debate on whether the bill’s funding plan is really adequate, the cost is touted to be funded primarily by increasing the federal tax on cigarettes from 39 cents a pack by 61 cents, to $1 a pack. That’s a hefty 156% increase in cigarette taxes. And who do you suppose will pay that tax?
Statistics cited by Quitsmokinghub.com show that America’s poor and least educated are the most likely to smoke. Thirty-three percent of those living below the poverty line are smokers. Thirty-five percent of those with 9-11 years of education smoke while only twelve percent of those with a college education smoke.
To a large extent the poor, whom the Democrats claim they seek to help, will be paying a disproportionate share of the taxes to run a government program to insure their children. When you throw the inefficiencies of government run programs in the mix, the main beneficiary is likely to be the Democratic Party itself which has achieved its first step toward socializing the country’s health insurance system.
Another, perhaps unintended consequence of this program is the loss of jobs in small companies which work in the tobacco industry. The Washington Times contained an article which notes that small family owned cigar manufacturers and roll-your-own cigarette businesses may be devastated by the taxes. Job losses in these industries and ancillary businesses such as transportation, package manufacturing and sales will add to the rolls of the poor.
Perhaps I am cynical, but the Democrat’s base is the relatively poorer and uneducated Americans. While using tobacco taxes to disproportionately tax the poor and increase job losses thus creating additional poor, the Democrats can provide handouts claiming to be helping the disadvantaged while actually expanding their base. A larger poorer demographic benefits the Democratic Party.
Smoking Statistics – Study of Demographics Prone to Smoking, http://www.quitsmokinghub.com/smoking_statistics.shtml
Bill Finck, Brutal SCHIP tax provisions, http://www.washingtontimes.com/news/2009/feb/05/brutal-schip-tax-provisions