The irony of the medical device tax standoff
There are any number of contradictions and ironies in the federal budget stalemate that has shut the government down, none more than the focus on a repeal of the medical device tax as a way out of the quagmire.
Many Republicans, save the fully entrenched right, are abandoning the idea of using the budget and debt ceiling deadlines to force the “defund and repeal” of the Affordable Care Act. But, clearly, they have to save face somehow and many are now focusing on a repeal of the 2.3 percent medical device tax as a way to claim a partial victory at the expense of Obamacare. It is a pelt they will wear when they return to their districts to show they can and will chip away at the president’s signature initiative.
The Republicans seeking out a victory point to the tax as a bipartisan pain in the butt, citing public statements from the likes of Sen. Elizabeth Warren of Massachusetts and Sen. Al Franken of Minnesota, both darlings of the left and reliable votes to retain Obamacare. They also cite a Senate resolution in March where a bipartisan majority voted its disdain for the tax.
But therein lays the first of the ironies, not to mention the contradiction of someone like Warren preaching the tax-killing gospel of House Speaker John Boehner. Warren and Franken, as well as their respective junior Democratic colleagues from their home states, Sens. Ed Markey and Amy Klobucher, said while they would support a repeal, they cannot entertain it as part of a deal to get the government running again. Which raises the question: If Congress passes a “clean” budget bill and debt ceiling measure, and then lawmakers respond by repealing the medical device tax, what’s the difference? Perhaps none, but it looks good.
Some Democrats, such as Sen. Max Baucus, the chairman of the Senate Finance Committee, fears a repeal of the tax could trigger other industries coming to Congress for relief, removing some $370 billion needed to fund the initiative. (One can almost hear Republicans saying, “From your lips to God’s ear.”)
Opponents of the tax say it has already cost the flight of “tens of thousands” of jobs around the country as device manufacturers flee to more hospitable sites around the globe. But the Annenberg Foundation’s Factcheck.org found little evidence of that, only a white paper from a conservative think tank estimating 43,000 jobs will be lost because of the tax. Also, as supporters point out, devices that are imported will still be subject to the tax, though exports are exempt, giving US-based companies a leg up in international markets. About the only ones who have an unchallenged claim are veterinarians. The device tax will be passed onto them because they use many of the same machines used for humans but without the offsetting benefits because there is no individual mandate to insure Rover.
Perhaps the biggest irony is who would benefit from the GOP’s effort to repeal the tax – the bluest of the blue states. Warren and Markey and nearly all the state’s congressional delegation are behind a repeal because Massachusetts is second only to California, who last voted for a Republican president 25 years ago, in the size of the medical device industry. Not far behind are Franken’s home state of Minnesota, squarely in the Democratic column since 1956, and Illinois, home of the guy Obamacare is named for.
Perhaps Republicans might want to rethink their efforts to use the defibrillator paddles on the patient and slap a DNR on it.
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