By Michael Starr Hopkins
December 20, 2019 at 5:00 am ET
Boris Johnson’s recent victory in the United Kingdom must be a wake-up call to Democrats. After all, the British people just proved that voters will not embrace far-left, extremist policies – even if the electorate is not in love with their current, conservative leader. In 2016, Democrats ignored similar lessons from the U.K.’s Brexit vote – and lost the White House.
Now, Democrats must find ways to demonstrate to voters that we are not so far to the left that even Donald Trump is better than the Democratic nominee.
The way Democrats can appeal to these centrist voters – who dictate control of the White House and Congress – is to support politically moderate laws and policies. This is why Speaker Nancy Pelosi agreed to the updated version of North American Free Trade Agreement, called the United States-Mexico-Canada Agreement, the same day she allowed impeachment to move forward. Because she knew that the trade agreement was important to working-class, centrist voters.
Another agenda Democrats should support is the repeal of the medical device tax.
Let’s start with the tax’s impact on jobs and economy. If it goes into effect as written, the device tax could threaten over half a million jobs supported by the medical technology sector. Jobs that, on average, pay about 37 percent more than the national median and guarantee hundreds of thousands of families a ticket to the middle class. We know this because the last time the tax’s suspension was lifted, the medical technology industry saw a net loss of 29,000 jobs at a time when the overall economy was growing steadily, and employment was rising in most other sectors.
Second, the device tax could restrain innovation by making it more difficult for medical technology firms to invest in research and development. An analysis from the first time the tax took effect – before Congress enacted the first of two separate suspensions – found that medical device companies reduced their research and development spending by one-third during the first year the tax was in effect. A reduction in critical research funds means that firms may be forced to delay the development of new technologies that could benefit patients with rare and deadly diseases.
Third, from a purely tax policy perspective, the device tax just doesn’t make sense — especially for those interested in ensuring the United States has a fair and efficient tax system. As an excise tax, it applies a flat 2.3 percent surcharge to the sale of almost any medical device – from surgical gloves to CT scanners.
But perhaps most importantly, progressives should recognize that the device tax is no longer fundamental to supporting the Affordable Care Act. While it is true the tax was among the various revenue-raising measures to fund the ACA, today it couldn’t be further removed from President Barack Obama’s signature healthcare law. In the nearly t10 years since the ACA was enacted by Congress, the device tax has been suspended for seven of them — all the while millions of American families gained health insurance through Medicaid and the newly subsidized exchanges.
In fact, Democrats have already voted by overwhelming margins to repeal another tax formerly associated with the ACA. A bill to repeal the so-called “Cadillac tax,” which would have applied a 40 percent excise tax on “high value” health plans sailed through the House of Representatives in July with all but three members of the Democratic caucus voting in favor of repeal.
So, if Democratic lawmakers are comfortable standing shoulder to shoulder with their Republican colleagues to repeal the Cadillac tax, then they should have no problem voting to get rid of the device tax for good. A bipartisan bill to do so, the Protect Medical Innovation Act of 2019, already has 65 Democratic co-sponsors. There’s no reason such a bill – which would protect jobs, preserve patient access to innovative treatments, and ensure a just and efficient tax system – shouldn’t get the support of the entire Democratic caucus.
By supporting policies like eliminating the medical device tax, Democrats can show voters that while we may support tax increases for the super-rich, we will look for opportunities to cut taxes that hurt the working poor, or can stifle the economy. In other words, if Democrats seem reasonable, and not extreme, we can defeat Donald Trump in 2020, which must be the top priority for every Democrat.
Michael Starr Hopkins is a Democratic strategist and the founding partner of Northern Starr Strategies.
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