Good News from AARP and Bad News from ObamaCare

Two news stories caught my  eye today. Let’s get the bad news out of the way first.

ObamaCare, the albatross that Obama and the Democrats tied around the collective neck of Americans, is really beginning to stink. ObamaCare, you know, the bill that Nancy Pelosi told us would have to be passed before we would be allowed to know what was in it. Well some of that fowl oder has recently been identified. From FoxNews.Com we learn:

Beginning January 1, 2013, ObamaCare imposes a 3.8% Medicare tax on unearned income, including the sale of single family homes, townhouses, co-ops, condominiums, and even rental income.

Hey, america, aren’t you glad that Obama and the Democrats are looking out for your well-being? Now, if you are, for example, approaching retirement age and are planning to sell your home and move somewhere more desirable or if you’re wanting to sell your home so you can move to where the jobs are, you will be obligated to send to your federal government 3.8% of the equity you realize from the sale (assuming you still have any equity).  Yes sir! That should really help the seriously ill housing market to make a rapid recovery. Well, who knows, maybe Obama has a plan for offering waivers on this part of ObamaCare too.

If that is not bad enough, look at this quote from the article:

This will also have a knock-on unemployment multiplier effect on the people who pave roads to new subdivisions. It will require fewer realtors and settlement attorneys to handle the decreased sales volume. Home values will adjust downward in reaction to the penalty tax that a homeowner has to pay to escape a current residence. This will lead to a downward pressure on tax assessments for residential property which will further complicate the efforts of state and local governments to run organizations such as schools.

Yes indeed. ObamaCare is the gift that keeps on giving. Well, that’s enough bad news for a Friday morning. Let me share with you what I consider to be some very good news.

From the Wall Street Journal, we have this breaking news:

AARP, the powerful lobbying group for older Americans, is dropping its longstanding opposition to cutting Social Security benefits, a move that could rock Washington’s debate over how to revamp the nation’s entitlement programs.

Is this a surprising move by the AARP, which has been seen as a major stumbling block to Social Security reform? As an oldster, I’m not all that surprised. If there is one thing we old folks have in common, it is our love for our grandchildren and great-grandchildren (I have a passel of both).

Is the AARP serious? This bit from the article would lead you to believe that they are indeed serious:

In an early sign of its new approach, AARP declined to join a coalition of about 300 unions, women’s groups and liberal advocacy organizations created to fight Social Security benefit cuts. “The coalition’s role was to kind of anchor the left, and our role is going to be to actually get something done,” said Mr. Rother.

Hopefully, I am not painting too rosy a picture here. The article points out that Mr. Rother and the Board of AARP are likely to receive a lot of flak from their membership. The Board does realize this and they  have a plan to address member concerns:

AARP plans to hold hundreds of events for seniors, in every state. At town halls and listening sessions, AARP plans to explain the political and budgetary realities facing the program by playing a game in which participants try to make Social Security solvent.

Do read the entire article. This change in attitude by the AARP could have an important impact on the ongoing budget negotiations in Congress.

You all have a great weekend and I’ll try to do the same.

18 thoughts on “Good News from AARP and Bad News from ObamaCare

  1. The 3.8% tax only applies to any unearned income over the capital gains limit which is 250K for an individual or 500K for a couple. It means that if a couple sells their home and makes more than 500K the amount over 500K will be taxed 3.8%. That is not likely to happen to anyone except the most wealthy, probably 2 to 5% of home sellers (which still doesn’t make it right IMO.)

    This is a simply another way to “tax the evil rich.”

    1. It means that if a couple sells their home and makes more than 500K the amount over 500K will be taxed 3.8%. That is not likely to happen to anyone except the most wealthy…

      Not necessarily. I inherited the family homes (2), and the assessments have soared since that time — in part because high assessments help to fund the local tax coffers. This household’s monthly income is less than $3000 — hardly the income of wealthy folks. Others in our age group are in the same boat.

    2. thanks for that clarification, Adrienne. You are right in that it would affect mostly the rich. But it would also many people who are not rich. For example, an old couple or a widow who lived for over 50 years on say ten acres that was once on the outskirts of a town. But over the years the town grew up around them. A lot of fancy subdivisions and a shopping mall and now their ten acres is worth much , much more than they paid for it . They want to sell and move closer to their son and grandchildren, but they will need every cent they can get to buy a place where their son lives. I think you see what I mean. There many similar situations where people who are not rich will have to pay this stupid Obamacare tax.

  2. I will be glad when this is in the Supreme Court and at least we will have a time frame for a decision!

  3. Adrianne is correct.

    That is a far cry different from what is implied from the Fox News quote about. What we read there implies everyone pays the 3.8% when, in fact, only the very wealthy do.

    That is not to say taxing the rich to pay for Obamacare or any other government program is a good idea. It isn’t. Everyone, rich and poor alike, needs to share the burden of the cost of government.

    It is an unfortunate aspect of current Democrat politics that taxing the rich for everything has become popular.

    The truth is that the collective rich, even taxed at 100% of their earnings, do not make enough to even keep up with our existing yearly deficits, let alone paying for new services in 2013!

  4. Anything the Democrats propose is poisonous. They haven’t had any good ideas since the Secession (…just a joke, folks. I want to restore the Constitution, not run away from it).

  5. I am surprised that Obama has not levied a Medicare surcharge on ATM machines as well. Why shouldn’t they pay their fair share for this healthcare mess? After all, they are putting people out of work, which means that they will not be able to get employee healthcare insurance.
    Has about as much logic as anything else the man has done.

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