Medical Savings Account Legislation: The Good, The Bad And The Ugly

After years of bipartisan legislative proposals to create tax-free Medical Savings Accounts (MSAs), months of partisan congressional wrangling over whether to include MSAs in health insurance reform proposals and weeks of discussion on various MSA demonstration projects, Congress passed a law that includes a limited version of Medical Savings Accounts. The legislation has some good and some bad points, but the future fight over who can have an MSA likely will get ugly.

Taxpayer Choice

After more than 30 years of the War on Poverty, the federal government has proven one thing: it does a bad job of dispensing welfare. Hardly anybody is happy with the result. However, there is a better alternative: taxpayer choice.

Fighting the Rising Tax Burden

Recently released data from the Department of Commerce reveal that federal, state and local taxes consumed a record 31.3 percent of gross domestic product last year – the highest level in U.S. history. Even at the height of World War II in 1945 total taxes only consumed 25 percent of GDP.

Five Steps to Effective Regulatory Reform

Congress should take five more steps toward meaningful regulatory reform. The first involves revisiting and improving the reforms Congress has made. The last four represent a sharp break with the past and radically alter the federal government's future regulatory efforts.

The Minimum Wage Trap

With the exception of the Card-Krueger findings, virtually every major study that has ever been done has found significant job losses from an increase in the minimum wage. But even if one accepts the Card-Krueger findings, evidence of other unfavorable effects makes an overwhelming case that the minimum wage should not be raised and that, in fact, abolishing it would do more for those it is intended to help.

Consensus on Health Reform

A consensus is emerging on the right way to reform our health care system. The consensus stems from the recognition that the tax system has shaped and molded our health care system and is responsible for many of its problems. Health reform, therefore, requires tax reform.

Principles of a Flat Tax

There is a better way of taxing. Under a flat tax, all income is taxed, and it is taxed at the same rate. Furthermore, income is taxed only once, at its source, when it is realized.

Benefits of the Flat Tax

A flat or single-rate income tax would replace the current system of five rates and hundreds of deductions, credits, exclusions, etc. This change is grounded in widely accepted principles of taxation.

Private Prisons Succeed

Clear and convincing evidence from the United States and elsewhere shows that privatizing criminal correctional facilities results in better public service at a lower cost than government operation.

A "Long-Term" Solution to a Medicaid Problem

The spending explosion in long-term care is in large part a direct result of perverse federal income tax incentives that subsidize insurance for current medical expenses but penalize insurance for long-term care expenses. However, both the U.S. House and Senate have passed legislation to correct this tax inequity.