Yesterday, in an interview with Sean Hannity, former New York mayor Rudy Giuliani alleged that Sen. Barack Obama’s (D-IL) plan to reduce taxes for the middle class was a ploy to create “a welfare system” in the U.S.
Sen. John McCain’s (R-AZ) health care plan also redistributes tax dollars, however, through a $5000 tax credit for families to purchase health care in the individual market. Noting Giuliani’s hypocrisy, Alan Colmes asked, “How is that different than John McCain giving $5,000 to everybody for health care? Isn’t that a handout?” Giuliani claimed a tax credit isn’t a “handout”:
GIULIANI: He’s not going to give — he’s not going to give anybody $5,000, that is totally misrepresenting his program, as you say we do. The reality is he’s going to give you a tax credit for $5,000. We get tax credits for all kinds of things. That’s not a handout.
COLMES: Isn’t that a handout?
GIULIANI: It’s a deduction, it’s a deduction from the income that you earned. It’s a tax credit like you get a tax credit for tuition, like you get a tax credit for other things.
Colmes astutely observed, “That is redistribution of wealth.” Watch it:
McCain’s health care plan does indeed involve a $5,000 “handout.” McCain’s tax credits and “Guaranteed Access Plan” (GAP) allow the government to redistribute wealth to those who choose to purchase health coverage or those who cannot afford or find plans in the individual market.
Like McCain’s broader economic proposals, his health care tax credit is unsuitable for the poorest, sickest individuals. Instead, it provides a “one-sized fits all” tax credit, meaning everyone would get the same amount regardless of their previous health or wealth. Warren Buffet would thus get the same tax credit as his secretary.
Earlier this month, McCain himself praised government health care. Referring to his GAP proposal, McCain said that if someone “is not able to qualify for any health insurance policy, we will establish government approved plans to give them the health insurance they need.”