Friday, March 12, 2010

Subsidies for abortion and other things: economic standards versus accounting standards

Congressman Bart Stupak, a Democrat from Michigan, has gotten a lot of press lately. He has vowed to oppose health reform if it does not contain restrictive provisions on abortion. In particular, he and the U.S. Conference of Catholic Bishops oppose the Senate bill's treatment of abortion. In the Senate bill, people buying coverage through the exchanges would have to make a separate payment to cover the actuarial value of the abortion services in a plan.

Mr. Stupak's argument is that because the government is providing tax credits to people to buy insurance plans, that is the same as funding abortion because even if they use their own money to buy abortion services, they wouldn't have been able to do so without the subsidies. The only solution, in his mind, is that plans on the exchanges cannot offer coverage for abortion.

Clearly, Stupak isn't an accountant. The Generally Accepted Accounting Principles, which guide the accounting practice in the US, contain provisions that deal with segregation of funds. A religious soup kitchen receiving public subsidies would separate funds used for religious purposes from public subsidies under GAAP.

If GAAP standards aren't enough, then we must also eliminate the tax exclusion for employer-based health care: most employer plans offer abortion services. Furthermore, we should stop paying taxes: they fund the government's purchase and maintenance of nuclear weapons, and the only potential use for nuclear weapons is murder (or perhaps deflecting incoming asteroids and propelling spacecraft, but that's another story).

I've argued that tax expenditures, which occur when a government excludes something like employer-sponsored healthcare, from taxable income, are effectively subsidies. That is true but it is completely different from arguing that GAAP standards are meaningless. They are not the same because if the government provides you a tax credit, those dollars could have been used for anything from buying abortion, to buying food, to buying components for the nuclear weapon you're building in your back yard. If the government wanted to change that, it would have to take the incredibly intrusive steps of controlling every cent you spent.

I do not want my taxes funding offensive nuclear weapons or wars, but the solution to that is not to stop paying taxes. The solution is to help educate people to seek peace and to urge my politicians to vote for peace. If you think abortion is bad, then unless you want to ban it and force people to use coat hangers instead, your solution is to educate people not to have abortions, to teach people to refrain from having premarital sex or to use contraception properly, and to create socioeconomic conditions that reduce the need for abortions.

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