A lot of health care legislation news has been about the opposition conservatives and some pro-life liberals have toward federal taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. dollars being used to fund abortions. The Stupak Amendment of course passed the House and there will be likely be debate in the Senate for something similar. No matter if one is pro-life or pro-choice, there is some logic behind legislation resembling the Hyde Amendment (a similar spending limitation on the annual appropriations bill for the HHS) on a health care bill. Some are very much opposed to an act, and if they can’t stop others from performing it, they at least don’t want to fund it. It is a variant of the benefit principle of taxation (like an anti-benefit principal).
But with health care legislation it’s complicated. If government insurance crowds out private options, as some rightly fear, and the public insurance that is left must exclude abortion, now one has pro-life values thrust upon others. (Notice the scarcity of private insurance available without one needing a subsidy is implicit in some arguments against things like the Stupak Amendment.)
It is a problem when an individual’s tax dollars are spent on other people’s goods, like with health care. Spending represents an individual’s values. And individuals have an array of values that cannot be properly represented by government spending. If it could, then 100% tax rates might not be too bad. If a major good now becomes public, or heavily subsidized, who decides what that good looks like? It must be a political decision if not a market decision. And whatever that decision is, it now affects a large mass of population.
Drinking soda, smoking cigarettes, having an abortion—these things before mainly had an affect on the person taking part. But if I am sharing costs with all of America, those externalityAn externality, in economics terms, is a side effect or consequence of an activity that is not reflected in the cost of that activity, and not primarily borne by those directly involved in said activity. Externalities can be caused by either production or consumption of a good or service and can be positive or negative. arguments for obesity start to make sense (though they are still wrong), and now I have a greater interest in what my neighbor buys.Share