Friday, October 3, 2008

McCain's Health Plan

Ross Douthat offers a good explanation of the economic principles behind the McCain Health Care Plan:
...the typical family will get their $5,000 credit from the government, and something like the remaining $7,000 they need to buy health insurance will show up in their paycheck. Except that a lot of Americans will actually come out ahead, rather than just breaking even, since McCain's plan offers a flat credit regardless of income, whereas under the current system the dollar value of your tax deduction - and thus the compensation your employer is incentivized to give you - goes up as your income rises.

Therefore, if you want the cost of health insurance to decline and a $7,000 pay raise as well, vote for McCain