Armed with a map and stats from John Eckberg, Cook Medical media relations director, the Washington Post’s Wonk Blog editor Ezra Klein makes a convincing argument for why the medical device excise tax repeal effort is so “compelling.” Here are Klein’s reasons why the medical device excise tax is “weak”:
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The lobbyists helped [with the repeal effort], of course. But the reason the lobbying effort has been so successful is that there are a lot of medical device companies in this country, and they’re spread out across a lot of states and a lot of cities, and that’s given them pull with a lot of different members of Congress.
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The other reason the medical device tax is weak is it hits a very specific, very organized industry that can mount a very aggressive, and reasonably persuasive, campaign against it.
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. . . [T]he point is that the medical device tax isn’t just in trouble because the medical device industry is rich. After all, rich people are rich, but no one is seriously talking about repealing Obamacare’s tax increases on them. Rather, the medical device tax hits a geographically diverse, highly organized and reasonably sympathetic industry that’s able to make a set of arguments (offshoring, job creation, innovation) that legislators find compelling.
Best quote:
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I don’t think the medical device tax will have a devastating effect on the medical device industry. But if you were designing optimal tax policy you’d never design a medical device tax. It will cost some jobs. It will force some firms to go under and others to offshore jobs. It would be much better to tax something broad that we want less of, like carbon or high-speed financial transactions, then something narrow that we want more of, like medical device companies.
For the full article, including pleas from medical device company CEOs and workers, click here.
