Although I’ve shied away from the hot potato that is the healthcare debate, Obama said something very interesting on Sunday that I just have to note:

Appearing on ABC’s “This Week,” Mr. Obama was asked by host George Stephanopoulos about the “individual mandate.” Under Max Baucus’s Senate bill that Mr. Obama supports, everyone would be required to buy health insurance or else pay a penalty as high as $3,800 a year. Mr. Stephanopoulos posed the obvious question about this kind of coercion when “the government is forcing people to spend money, fining you if you don’t [buy insurance]. . . . How is that not a tax?”

“Well, hold on a second, George,” Mr. Obama replied. “Here’s what’s happening. You and I are both paying $900, on average—our families—in higher premiums because of uncompensated care. Now what I’ve said is that if you can’t afford health insurance, you certainly shouldn’t be punished for that. That’s just piling on. If, on the other hand, we’re giving tax credits, we’ve set up an exchange, you are now part of a big pool, we’ve driven down the costs, we’ve done everything we can and you actually can afford health insurance, but you’ve just decided, you know what, I want to take my chances.  And then you get hit by a bus and you and I have to pay for the emergency room care, that’s . . .”

“That may be,” Mr. Stephanopoulos responded, “but it’s still a tax increase.”

Mr. Obama: “No. That’s not true, George. The—for us to say that you’ve got to take a responsibility to get health insurance is absolutely not a tax increase. What it’s saying is, is that we’re not going to have other people carrying your burdens for you anymore . . .”

Mr. Stephanopoulos tried again: “But it may be fair, it may be good public policy—”

Mr. Obama: “No, but—but, George, you—you can’t just make up that language and decide that that’s called a tax increase.”

“I don’t think I’m making it up,” Mr. Stephanopoulos said.  He cited [the] dictionary’s definition of “tax”—”a charge, usually of money, imposed by authority on persons or property for public purposes.”

Mr. Obama: “George, the fact that you looked up Merriam’s Dictionary, the definition of tax increase, indicates to me that you’re stretching a little bit right now. . . .”

Mr. Stephanopoulos: ”I wanted to check for myself. But your critics say it is a tax increase.”

Mr. Obama: ”My critics say everything is a tax increase. My critics say that I’m taking over every sector of the economy. You know that. Look, we can have a legitimate debate about whether or not we’re going to have an individual mandate or not, but . . .”

Mr. Stephanopoulos: “But you reject that it’s a tax increase?”

Mr. Obama: “I absolutely reject that notion.”

So the Baucus penalty is not a tax?  But the Chairman’s Mark of the America’s Healthy Future Act [PDF] calls it an “excise tax.”  (See pg. 32.)  Black’s Law Dictionary also seems pretty clear: a tax is ”a monetary charge imposed by the government on persons, entities, transactions, or property to yield public revenue.”  Even so, under Obama’s approach, any tax on any activity that creates social disutility is (apparently) not really a tax.  It’s just the government saying it’s “not going to have other people carrying your burdens for you anymore.”

-Michael

Update: Reason has picked up on this idea as well.