Congressional Democrats have chosen an unlikely source to pay for the bulk of their proposed $35 billion increase in children's health coverage: people with relatively little money and education.Well, I have no objection to raising cigarette taxes if your goal is to decrease smoking. But then you have to realize that you're going to get less revenue from the taxes. That's a good thing if all you care about is ending smoking. But if you're depending on that money to fund children's health care then the government will now have an interest in more people smoking.
The program expansion passed by the House and Senate last week would be financed with a 156 percent increase in the federal cigarette tax, taking it to $1 per pack from the current 39 cents. Low-income people smoke more heavily than do wealthier people in the United States, making cigarette taxes a regressive form of revenue.
Democrats, who wrote the legislation and provided most of its votes, generally portray themselves as champions of the poor. They do not dispute that the tax plan would hit poor communities disproportionately, but they say it is worth it to provide health insurance to millions of modest-income children.
All the better, they say, if higher cigarette taxes discourage smoking.
By most measures, the average smoker is less privileged than the average nonsmoker. Nearly one-third of all U.S. adults living in poverty are smokers, compared with 23.5 percent of those above the poverty level, according to government statistics.Once they expand this program as the bill now does to include families earning 3-4 times the poverty rate and pulling some families that have private insurance into the free government insurance, the program will be permanent. We'll never be able to trim it back to more reasonable levels to help the truly poor. And having chosen a "declining revenue source" Congress will have to find funds elsewhere. And there are only so many sin taxes on the poor that Congress will be able to find.
The American Heart Association reports that 35 percent of people with no more than 11 years of schooling are smokers. Those with 16 or more years of formal education smoke at a 12 percent rate.
Non-Hispanic black men smoke at slightly higher rates than do non-Hispanic white men. But the reverse is true among women.
The demographics of smoking and taxation received scant attention during last week's House and Senate debates, perhaps because many Democrats and Republicans agree that cigarettes are the best target for tax increase if the insurance program were to grow. A few lawmakers, however, took a swing.
"I know there is very little sympathy for smokers these days," Rep. Jack Kingston, R-Ga., said during the House debate. "But it is still a tax increase on the backs of the smokers. And in order to get enough money to pay for this, it would require 22 million new smokers."
Rep. Frank Pallone, D-N.J., defended putting the burden of expanded medical care on smokers.
"The tobacco tax is a great way to pay for it," he said, "because if you tax people who are smoking and they smoke less, then we have less health problems."
Rep. Jim McCrery, R-La., did not buy that logic. "To propose funding a growing program with a declining revenue source is, I would submit, irresponsible fiscal policy," he said.