Gruber Video #6: 'Mislabeling' Cadillac Tax to Deceive the Voter

Jonathan Gruber missed his calling. He would have been an outstanding used car salesman.

Jake Tapper of CNN uncovered another video where Gruber celebrates his subterfuge — this time, in hiding whom the so-called “Cadillac Tax” on employee based insurance plans would hit.

“Economists have called for 40 years to get rid of the regressive, inefficient and expensive tax subsidy provided for employer provider health insurance,” Gruber said at the Pioneer Institute for public policy research in Boston. The subsidy is “terrible policy,” Gruber said.

“It turns out politically it’s really hard to get rid of,” Gruber said. “And the only way we could get rid of it was first by mislabeling it, calling it a tax on insurance plans rather than a tax on people when we all know it’s a tax on people who hold those insurance plans.”

It should be noted that advocates of a single-payer system have been wanting to get rid of the tax break for employers because it makes it too easy for companies to offer their workers good insurance policies. By forcing employers and their workers to pay the full price for premiums, many smaller companies will be forced to drop their group plans and throw their employees on to the state exchanges.

Gruber’s perfidy is incredible, as evidenced by his rationale for mislabeling the Cadillac Tax:

(The White House press secretary said at a press briefing in 2010: “I would disagree with your notion that it is a tax on an individual since the proposal is written as a tax on an insurance company that offers a plan.”)

The second way was have the tax kick in “late, starting in 2018. But by starting it late, we were able to tie the cap for Cadillac Tax to CPI, not medical inflation,” Gruber said. CPI is the consumer price index, which is lower than medical inflation.

Gruber explains that by drafting the bill this way, they were able to pass something that would initially only impact some employer plans though it would eventually hit almost every employer plan. And by that time, those who object to the tax will be obligated to figure out how to come up with the money that repealing the tax will take from the treasury, or risk significantly adding to the national debt.

“What that means is the tax that starts out hitting only 8% of the insurance plans essentially amounts over the next 20 years essentially getting rid of the exclusion for employer sponsored plans,” Gruber said. “This was the only political way we were ever going to take on one of the worst public policies in America.”

Unions and employers who object in 2018, he noted, “at that point if they want to get rid of it they’re going to have to fill a trillion dollar hole in the deficit…It’s on the books now.”

(When the Cadillac tax was first rolled out, it was explained by Obamacare backers as a tax that would only impact those with “high end plans” — not all employer sponsored plans. A White House economic adviser in 2009 set “the record straight” by saying “the excise tax levied on insurance companies for high-premium plans, the so-called ‘Cadillac tax,’ will affect only a small portion of the very highest cost health plans — a total of 3% of premiums in 2013.”)

The level of cynicism and arrogance it takes to pull this off is astonishing. You want to reach into the video and wipe that supercilious smirk off his face as he gleefully recounts how he bamboozled Americans.

Republicans should call this jerk to testify and then make him squirm by playing back each and every video.

Watch the video on the next page.