Would you like to pay a unicorn tax?

Years ago, one of my favorite radio hosts, Stephanie Miller, described a big problem with California’s ballot initiative system. In case you’re not familiar, California has a system that allows laws to be created or amended (all the way up to amending the state constitution) by a direct popular vote of the people. During an election, these laws (or amendments) are listed on people’s ballots, and everyone simply votes “yes” or “no” to each individual initiative.

On the surface, especially for those not familiar with the system, it may seem like a wonderfully democratic way to approach things. What could be more free and fair than a popular vote? But because small, individual measures are always presented piecemeal for a vote, people often react without thinking about how different measures might be related or what the consequences might be.

So, the ballot initiative “conversation” always goes like this:

Ballot Initiative #1: Would you like everyone to get a free unicorn?

Why yes, that sounds great! I love unicorns!

Ballot Initiative #2: Would you be willing to pay a unicorn tax?

No, that’s absurd! Why would I want to pay a unicorn tax?

So it goes: the state ends up passing–by popular vote–lots of things that sounds really grand, but then also ends up–also by popular vote– refusing to do anything that would actually pay for those very same things.

[For those of you who don’t completely follow the “unicorn” joke: The government’s revenue stream is taxes, so the only way that the government is able to provide any good or service is through some form of taxation. If you want public roads, you need to have some part of your tax money dedicated to paying for those government-funded roads. They end up being “free” roads for you to use, but they only get built and maintained through your tax dollars. The same is true of education: when the government talks about providing “free” education, what they mean is providing a mechanism through which they can use tax dollars to pay for education.  So in this joke, the first question asks “would you like a free unicorn?” with the understanding that the only way that the government could provide everyone with a “free” unicorn would be to pay for the unicorns through the tax system, i.e. by having some kind of “unicorn tax”. But, since people never voluntarily say they want to pay any kind of tax, the voters put themselves in a bind: they have just passed a law asking the government to give out unicorns, while voting down the law that would have allowed the government to actually pay for it.]

This problem is side-stepped somewhat when legislation is being crafted by legislators who know what they are doing, because they take into account the “big picture”: they look at the way different pieces of a system of legislation fit together; they figure out how piece A will pay for piece B, and so on; and in an ideal world, people with different views end up compromising to come up with something that nobody thinks is perfect, but that at least contains elements that will balance out and contribute to the law functioning as a whole system.

At the federal level, however, we currently do not have legislators who know what they are doing. This is how we end up with things like the Republican American Health Care Act, which keeps the stuff that is popular about Obama’s Affordable Care Act, like the subsidies and the prohibition against lifetime limits on coverage, but gets rid of all of the things that actually pay for the popular stuff, like the mandate that everyone must have insurance and the taxes and penalties associated with that mandate.

In case you are unclear about the details, let me state that again in very plain language: The Republican American Health Care Act keeps all of the parts of Obamacare that people like (and which cost money), and gets rid of all of the things that actually pay for it.

The Republican replacement for Obamacare is the plan that promises everyone a unicorn, and also promises not to make them pay a unicorn tax.

We’ve seen that that has done to California’s budget deficit… and if the AHCA is actually passed and signed into law, we will get to see what it does to the federal deficit as well.



Leave a Reply

Your email address will not be published. Required fields are marked *

Comment

You may use these tags : <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Trending Articles

Keep up with my writing!You will only be notified about new articles. No ads, no petitions, no digests, no nonsense.