I’ve read that Ludwig von Mises was asked one time what he would do if he were king for a day.  He replied without hesitation, “Abdicate.”  When the neocon godfather William Buckley was running for office in New York he was asked what he would do first if elected.  He wryly said, “Demand a recount.”  Laughing with my libertarian stock broker buddy one time about these quips, he said, “Know what I would do?”  ”I would eliminate the withholding of taxes and move election day to one week after tax day.”  ”Everyone would have to write a check and know how much they were paying and have that fresh on their mind at the next election.”  

This, of course, will never happen as the goons in D.C. would have a hard time collecting all of the loot they desire without resorting to violence.  The thief is safer (and more effective) who’s withholding your wages, rather than relieving you of them after they’re in your possession.  It occurred to me recently that Social Security and Medicare and state and federal withholding are not the only items withheld from paychecks.  Health insurance is, as well.  Just as many in the workforce don’t quiet know what amounts are stolen from them every month in the form of taxes, as are unaware of the amounts withheld for the purchase of health insurance.  After all, employers don’t provide health insurance benefits.  They simply divert money that would otherwise be paid in wages to purchase health insurance benefits for their employees.  

Here’s my point.  What sort of lobbying power must the insurance industry have to have arranged this?  Neither political party has ever addressed this.  This withholding setup prevents a competitive market where consumers scratch their heads and compare insurance products on price and value then make a purchasing decision.  This leads me to my second point.  This setup is the reason the tax code discriminating against the individual “pre-tax” purchase of health insurance exists.  Changing this part of the tax code is one of the most obvious ways to improve the affordability of health insurance.  This change would loosen the grip that employer withholding represents and make insurance companies compete for customers rather than receive them by default.  Think any money has changed hands on this arrangement?

Now let’s take it to the final stage.  Forget about a competitive insurance market.  Forget about employers “providing” insurance and the tax game of withholding their premiums from your paycheck.  How about a system where the purchase of insurance is guaranteed by the taxpayers for everyone and those who don’t have it are penalized?  Wonder why the big insurance companies were all for this?  Still think Obamacare was passed to help the sick?  What were the real reasons for all of the “high fives” when the Unaffordable Care Act passed?

G. Keith Smith, M.D.