The story on John McCain and the employer health deduction seems to get more complicated as you dig into it. His web site says that McCain will "reform the tax code to eliminate the bias toward employer-sponsored health insurance." Since the tax code's bias towards employer-sponsored health insurance is the employer-sponsored health insurance deduction, that seemed like fair proof that he was going to eliminate the thing. Additionally, that's what his aides said he was going to do, and what conservative health commentators kept saying he was going to do. It seemed politically suicidal, but hey, that's the Straight Talk Express for ya. But a couple weeks after releasing his plan, McCain apparently "clarified" his remarks, which is to say he went back on its central element. Now, he was going to eliminate bias by making employees pay the taxes of their employers -- "employees who have employer-provided health insurance would be taxed on the portion of their coverage that their employer pays." They'll get tax credits to help offset these new taxes -- and make no mistake, this, even more so than closing the employer deductions, is a brand new tax that we've never seen before -- but wonks have looked into that strategy, and the models show that it will still amount to a nice little tax increase. Also, it's stupidly complicated, and forces McCain to give individuals new taxes and tax credits when he could accomplish the same thing by ending employer deductability. Now, I have no problem with a tax increase. But someone should ask McCain why he's doing so much lying, clarifying, and backtracking.
