Update (Jim)– Senator Lindsey Graham agrees with SOS. It’s a must watch below.
While Senator Ben Nelson (D. Neb.) is basking in the glow of his hard fought victory to make changes to the Senate health care bill, let me throw a bit of cold water on the celebration.
By now, you know that the good Senator has decided to leap off the fence and support the health care legislation because Senator Harry Reid (D. Nv.) has made changes in the legislation at Senator Nelson’s request. Earlier this week, Nelson had proclaimed that he could not and would not support the bill unless the language prohibiting the expenditure of federal funds on abortion was strengthened, and certain other “unspecified” changes, were made.
On the abortion front, what Senator Nelson agreed to was, in fact, a weakening of the abortion language, but, we now know what “unspecified changes” he was really after, and those “concessions” he got for tumbling off the fence.
Under the bill, the bulk of the uninsureds in this country will now be covered by expanding Medicaid, and, although the federal government will pay for those increased costs initially, beginning in 2017 the states will have to do so…that is, all states except Nebraska. As of 2017, and into the foreseeable future, you will get to pay for all increased Medicaid costs in Nebraska.
But, I wonder whether this provision will withstand constitutional muster, and, here is why. Article 1, Section 8 of the Constitution gives Congress the power to tax, but it also states,
…all Duties, Imposts, and Excises [i.e. taxes] shall be uniform throughout the United States.
Under this provision, Congress could not pass a law saying, for instance, that the lowest income tax bracket is, for example, 15%, except in Nebraska, where it it 10%. And yet, albeit through the back door, that is exactly what Nelson negotiated. Although Nebraskans will pay the stated 15%, they will receive an instant “rebate” of their tax dollars to cover whatever their increased Medicaid costs are, thus, effectively lowering the federal income tax rate in Nebraska. Or, perhaps better said, increasing the taxes on everyone in this country more than they would have increased, just to cover the federal government’s new obligation to Nebraska.
To be sure, tax dollars spent by the federal government in states are not directly proportional to the tax dollars collected from the citizens of that state, nor need they be. For example, Oklahoma may well receive more tax money for federal highways than it’s proportionate share of the national highway budget.
But, what Senator Nelson pulled off is unprecedented. Everyone else, but those living in Nebraska, gets to pay for Nebraska’s share of Obamacare.
Yes, Nebraska, there is a Santa Claus.
Update (Jim): The SOS was way ahead of the game on this one … now backed by none other than Senator Lindsey Graham this morning on CNN.