Increase cigarette tax to pay for children’s healthcare
As mentioned in my previous post, the United States health insurance system is in crisis and among the innocent victims are children whose healthcare is not covered by insurance. The current safety net for such children is called the State Children’s Health Insurance Plan (SCHIP), and the current authorization for this program runs out in a couple of months – requiring passing of new legislation to reauthorize the program.
However, the federal government is currently trying to operate under the principal that legislation requiring new spending must simultaneously create or specify the source of new or additional funding to cover it. So just over a week ago a bipartisan Senate Finance Committee voted 17-4 for a bill to re-authorize and expand SCHIP and to pay for it by increasing the federal tax per pack of cigarettes by 61 cents (i.e. taking it to $1 per pack federal tax). Both Democratic and Republican Senators backed the proposal, describing it as a “win-win twofer” that funds healthcare for uninsured children and reduces healthcare costs by discouraging smoking. However, President Bush stated that he would veto the legislation because he felt it would transfer people from the private health insurance system over to “government run medicine” and would “entail a huge tax on the American people.”
So President Bush gets to stand up for the interests of the health insurance industry and the tobacco industry at the same time, while preventing uninsured sick kids from poor families accessing healthcare. Another excellent day’s work.
For further details on this story, visit:
I'd love to hear your thoughts on whether you think cigarette tax increases are a fairly good way to fund new healthcare initiatives, or if you think the President is right to veto this legislation.