Robert Reich makes the case for doing it at length. He suggests you could generate the money needed to finance health care reform without entirely scrapping the health care exclusion:
The good news is that a program providing universal health care doesn’t need the full $246 billion a year generated if every employee now receiving tax-free health benefits had to start paying taxes on them. Obama’s health care reserve fund needs around $650 billion over ten years. So a sensible and politically feasible alternative is to limit tax-free employer-provided health benefits to workers whose incomes are under, say, $100,000 a year, and subject those with higher incomes to progressively higher taxes on them.
This seems fine to me. I’m not sold on the idea that this particular tax increase is overwhelmingly superior to other options, but the really important thing is to (a) do the health care reform and (b) find a way of paying for it that congress will go for. If this is congress’ favored approach, I’d be happy to go along.
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