CRISTINA OSMENA: CalCare promises to be a disaster

There is a bill up in the State of California Legislature. Medical Justice Warriors will probably love it. I just made up that term, but it seems appropriate: people who believe that healthcare is a fundamental human right and that perhaps the life support machines, and the medical staff and the medical professionals and that really good hospital food come from some infinite place and just need to be transferred to our dimension of life and molecules and the rules of economics. Not sure who is obligated to do that. The government? Someone else’s government? Someone else other than the MJW’s, undoubtedly.

It’s an interesting idea that has graduated to religion in some circles. I have recently been spending some time in a hospital in California (I wasn’t the patient). They are amazing places. Unlike the Philippines, where you have to keep thinking twice about your bill (and still worry about the quality of care), California hospitals give you what you need first–the most sophisticated solutions to life-critical problems. When you ask for the bill, you get that answer that sounds like it’s made in heaven: “This is not the time to worry about things like that.” Medical care, in some circumstances, has become an infinite resource, as needed, of course. Thus, the subculture of Medical Justice Warriors.

Bring in the intellectual heavy hitters that make up the California state lawmaking body and, boom, you get a proposed plan that makes no sense. The solution is lofty enough: medical coverage for everyone who lives in California–everyone, including those who have just arrived from the Philippines on tourist visas, and those who have crossed in over other borders. This includes everything Obamacare offers plus vision and dental, etc. It’s all going to be free if you need it, paid for out of a Trust Fund set up by the State of California, funded by grants from the state and federal governments and, in case that’s not enough (because I know where I will tell my relatives and friends in the Philippines to go when they need new contact lenses or a root canal), they’re going to tax the assets of the wealthy. Yes, a wealth tax.

It’s not spelled out in the CalCare descriptions in detail and, I understand, it’s hard to figure out how to execute on a wealth tax. First, it will have to amend Proposition 13. Second, how does one value the wealth of individuals if their assets are not publicly traded? Nevertheless, the California legislature believes that they can squeeze more money out of the wealthy, because they just didn’t complain that much the last time they raised taxes on the rich (2012) or the time before that (2008).

Here is the problem: people don’t need to leave California to protect their money. Nevertheless, they eventually will leave. But the first thing that will leave are the assets. Companies will be owned elsewhere in accounts that the State of California will not be able to find. People who are excellent at dodging taxes in the first place will be the ones who will be able to stay. The honest ones will eventually leave. The gap between rich and poor is not the only problem with the wealth structure of California. The state is losing its middle class. Just look around the Bay Area. Look at San Francisco. See who is left. The problem is that the state population is morphing into a two-class place: rich and poor. It is what kind of rich people that stay behind that is cause for concern.