- Sen. Elizabeth Warren doesn’t yet have a plan to pay for Medicare for All, which is estimated to cost approximately $US30 trillion over a decade.
- There is widespread consensus among economists and political strategists that a single-payer healthcare system would require raising taxes on the middle-class, in addition to a host of other taxes.
- But Warren has refused to answer the question about taxes.Sen. Bernie Sanders says he would raise taxes on middle-class families to pay for the program, but won’t get into the specifics.
- A broad-based tax hike would be a tough political sell, even though single-payer proponents say overall costs will drop for those middle-class families.
- Democrats are torn over whether Warren, who was lukewarm on single-payer for months, can ever move away from Medicare for All if she becomes the party’s nominee.
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The cry refers to the candidate’s proposal to raise taxes on the ultra-rich – by 2 cents on every dollar of wealth over $US50 million.
But it won’t generate enough revenue to fund her most expensive proposal: Medicare for All. And Warren doesn’t have a plan to pay for that approximately $US30 trillion program. Her campaign is planning to release one in the coming weeks.
What might be most notable about Warren’s forthcoming funding plan is how she plans to deal with the issue of taxes.
At the fourth Democratic debate earlier this month, the senator refused to say whether she’d need to raise taxes on middle-class Americans to pay for Medicare for All. She instead argued that costs would go down for those families under a single-payer system that would eliminate their co-pays and premiums.
“I will not sign a bill into law that does not lower costs for middle class families,” she insisted.
Mayor Pete Buttigieg, who supports a public option or “Medicare for all who want it,” called Warren’s answer “extremely evasive.”
Warren’s non-answer came after months of vagueness on the issue. In June, she finally announced she was “with Bernie,” on single-payer. Since then, the pressure on her has mounted to deliver the details on how to fund it.
“Now Elizabeth Warren is a frontrunner and thus her policies are going to be held to a higher level of scrutiny,” Adrienne Elrod, a former spokesperson for Hillary Clinton, told Insider. “If you’re going to champion Medicare for All, you’re going to have to have some way to pay for it.”
Sanders concedes that his plan would require a broad-based tax increase. Single-payer proponents say the system would simultaneously cut significant spending and waste out of a bloated industry by allowing the government to pressure providers to reduce costs.
There is widespread consensus among economists and political strategists that single-payer would require raising taxes on the middle-class, in addition to a host of other taxes. Sanders has released a host of options for how to finance the program, but recently refused to get into the specifics.
“They’re basically going to have to throw every viable possible tax at this, plus maybe cut some money out of the Pentagon,” a progressive Democratic strategist, who requested anonymity to talk candidly, told Insider. “And then they’re probably going to have to come up with a lower cost estimate and maybe hand wave about economic growth, which is what Republicans do.”
But conventional wisdom holds that any effort involving hiking taxes on the middle-class is a political non-starter.
“Any progressive faces a tough sell when trying to get Americans to look at the big picture of their spending,” Ian Russell, a former political director of the Democratic Congressional Campaign Committee, told Insider. “Selling that to the American people is a complicated task that just hasn’t worked before.”
The wisdom of staying vague on taxes and costs
Some proponents of Medicare for All simply reject the question about how to fund the program outright. They argue the plans simply aren’t advanced enough to get into the details of revenue generation.
Marjorie Connolly, the former spokesperson for the ACA at the Department of Health and Human Services, argued candidates need to first flesh out their plans for how to fundamentally restructure healthcare costs – taking on Wall Street, lobbyists, and industries profiting off healthcare – before anyone talks about how to finance the system.
“At this phase of the discussion, I think that the best political strategy is to talk with people about the benefits they would see under this new system,” Connolly told Insider. “I wouldn’t start this conversation by saying eat your vegetables. I would start it by saying here’s how things would be better for you individually.”
Connolly called Sanders’ and Warren’s Medicare for All proposal “blueprints” and “conversation starters” that demand “blue sky thinking on how healthcare money should be spent.”
While critics of single-payer agree there should be a debate about reducing overall costs, they say promises to eliminate Americans’ out-of-pocket expenses should come with receipts.
“Before we talk about Medicare for All or paying for Medicare for All, I agree we should start by talking about reducing healthcare costs overall,” Marc Goldwein, a senior policy director at the Committee for a Responsible Federal Budget, told Insider.
He went on, “I also think it’s reasonable to say, ‘I would prefer the government to have a single insurance company rather than have a bunch of private companies,’ and then we can have that fight. But what I don’t think is reasonable to say is, ‘We’re going to eliminate everybody’s premiums, we’re going to eliminate everybody’s co-pays … and we’re not going to tell you how we’re going to replace it.'”
While Elrod called Warren’s evasion of the tax question “strange” given her plan-heavy campaign, Russell said the move exhibited “political savvy.”
“One of the early questions about Warren was whether she got the rules of conventional politics,” Russell said. “It’s not enough to have a plan, you also have to take seriously the political implications of the plan.”
Those political implications would likely include opening Warren up to attacks both from Sanders on her left and, on her right, from moderate Democrats and Republicans.
Regardless, Warren’s team will release her plan for how to fund Medicare for All in the coming weeks. It could include a host of various measures, including a payroll tax, a business tax, and a consumption tax, The Washington Post reported last week.
Robert Hockett, a professor at Cornell Law School who advises both Warren and Sanders on a range of issues, prefers a payroll tax that would be framed as a public healthcare premium.
“Whether it’s a private premium, a public premium, or a penguin premium, it’s a premium,” Hockett told Insider. “And what matters is whether it’s higher or lower. And it’s going to be lower. End of story.”
Hockett said he wished Sanders hadn’t said taxes will go up on the middle-class. He called the concession an “oversimplification” of the issue.
Too late to pivot?
Democrats are torn over whether Warren can ever move away from her support for a single-payer system if she becomes the party’s nominee.
Russell thinks she could downplay her support for Medicare for All in the general election as Democrats coalesce behind her and shift their focus to defeating Trump. Elrod said there are “plenty of ways for her to pivot” in the general election and push for a public option or improvements to Obamacare.
There’s also the possibility that the Fifth Circuit Court of Appeals will strike down the ACA’s preexisting conditions protections and precipitate a Supreme Court battle over the healthcare law. That would put Republicans even more on the defensive on healthcare and shift the focus away from Democrats’ plans.
But other operatives don’t think Warren can back out of supporting single-payer healthcare should she become the party’s nominee.
“I think Warren’s team is in between a rock and a hard place,” the progressive Democratic strategist told Insider. “They’re definitely locking themselves into Medicare for All through the general election. It’s no longer a viable option for them to move to the centre on that because she’d be seen as a flip-flopper.”