"The choice you'll have," Mr. Obama warned of the McCain plan during one of the debates, "is having your employer no longer provide you health care." Sounds terrible. But wait, let's consult another one of Mr. Obama's advisers. David Cutler, the Otto Eckstein Professor of Applied Economics at Harvard, put it this way: "Health insurance is not something that is made better by tying it to employment. As a result, essentially all economists believe that universal coverage should be done outside of employment."
That passage comes from Mr. Cutler's 2004 book, "Your Money or Your Life," which outlined a strategy for universal health care. Not surprisingly, Professor Cutler's plan, like Mr. McCain's, also applied subsidies such as "tax credits -- people get a lower tax bill, or a refund from the government, to be used to purchase insurance." In this he was echoing many other liberal health experts such as MIT's Jonathan Gruber, another Democratic policy star.
These advisers know that Mr. Obama's claim that Mr. McCain will tax health benefits "for the first time in history" is particularly disingenuous. For people who stick with employer coverage under the McCain plan, the money employers take out of wages to pay for insurance would be taxed, but the new credit more than covers the bill. The people who decide to buy coverage on their own would see their wages rise. And everyone who joins the individual market -- many of them uninsured now -- would be equipped with new health dollars, instead of paying with after-tax income.