Healthcare and Income Inequality

Fight disinformation: Sign up for the free Mother Jones Daily newsletter and follow the news that matters.


David Leonhardt says that healthcare reform is the most significant effort to attack growing income inequality since the beginning of the Reagan administration:

A big chunk of the money to pay for the bill comes from lifting payroll taxes on households making more than $250,000. On average, the annual tax bill for households making more than $1 million a year will rise by $46,000 in 2013, according to the Tax Policy Center, a Washington research group. Another major piece of financing would cut Medicare subsidies for private insurers, ultimately affecting their executives and shareholders.

The benefits, meanwhile, flow mostly to households making less than four times the poverty level — $88,200 for a family of four people. Those without insurance in this group will become eligible to receive subsidies or to join Medicaid. (Many of the poor are already covered by Medicaid.) Insurance costs are also likely to drop for higher-income workers at small companies.

Bill Clinton’s tax changes in 1993 — increasing the top marginal rate on the rich, uncapping Medicare taxes, and increasing EITC for the poor — deserves a place on this list too, but Leonhardt is right to call healthcare reform an even bigger assault on income inequality. Rejiggering tax rates is one thing, but it’s neither as permanent nor as potent as creating a program whose benefits flow primarily to the middle class and below. What’s more, now that healthcare reform has been started, it’s almost certain to become more expansive and more generous to the middle class over time. Legislation like this is the second best way we have of producing a genuine impact on growing income inequality.

(The first best way, of course, is creating rules of the road that boost middle class income and rein in top level incomes in the first place. Universal programs like healthcare are #2. Tax changes are #3.)

MOTHER JONES NEEDS YOUR HELP

We have about a $200,000 funding gap and less than a week to go in our hugely important First $500,000 fundraising campaign. We urgently need your help, and a lot of help, this week so we can pay for the one-of-a-kind journalism you get from us.

Learn more in “Less Dreading, More Doing,” where we lay out this wild moment and how we can keep charging hard for you. And please help if you can: $5, $50, or $500—every gift from every person truly matters right now.

payment methods

MOTHER JONES NEEDS YOUR HELP

We have about a $200,000 funding gap and less than a week to go in our hugely important First $500,000 fundraising campaign. We urgently need your help, and a lot of help, this week so we can pay for the one-of-a-kind journalism you get from us.

Learn more in “Less Dreading, More Doing,” where we lay out this wild moment and how we can keep charging hard for you. And please help if you can: $5, $50, or $500—every gift from every person truly matters right now.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate