A Curious Statement from Gov. Romney

I’ve been at a conference in Hawaii for a few days, so I don’t know if anyone called Mitt Romney to the mat for this extraordinary statement he made during the most recent GOP presidential candidates’ debate (quoth The New York Times):

But Mr. Romney took aim at Mr. Giuliani’s recent proposal to offer people $15,000 in tax deductions to help them buy health insurance. “We have to have our citizens insured, and we’re not going to do that by tax exemptions, because the people that don’t have insurance aren’t paying taxes,” he said.

I think Romney is wrong when he says, “We have to have our citizens insured.”  But at least that point is debatable.

Did Romney actually say, “we’re not going to do that by tax exemptions”?  Are you kidding me?  Not only does Romney’s own Massachusetts health plan use tax breaks to expand health coverage – that’s all it uses.  That law requires employers to offer a type of health plan (a Section 125 “cafeteria plan”) that extends the federal tax exclusion for employer-sponsored health insurance to the “employee portion” of the premiums.  The whole point of the “Connector” is to extend that exclusion to health plans your employer doesn’t offer, and to make sure workers don’t lose the exclusion when they change jobs.  Even the controversial requirement that all residents purchase coverage is an attempt to use a tax break to expand coverage.  If you buy coverage, you get the personal exemption from the Commonwealth’s income tax.  If you don’t buy coverage, no exemption for you.

And what’s this about the uninsured not paying taxes?  The Census Bureau reports that 17 million of the people it counts as uninsured had household incomes over $50,000 per year.  The Tax Foundation suggests that over half of the uninsured pay either income or payroll taxes, meaning that Romney is not even half-right.

(If Romney wants universal coverage, and tax breaks won’t accomplish that, how’s he gonna do it?  More government spending?)