The suggestion that a health care overhaul be funded by taxing doctors is made in in a Congressional Research Service report linked at the TaxProf blog. Here is the report's discussion of the income tax surcharge proposed by Rep, Charles Rangel, and of the argument that it would hurt small business and job creation:
data suggest that while business income may be somewhat more concentrated than income overall, much of small business income is associated with passive investments, stockbrokers, lawyers, doctors, and accountants who are unlikely to be innovators or important sources of job creation for lower and moderate income individuals.
In addition, questions could be raised about the argument that small businesses are important as sources of new jobs. Small businesses create more jobs but also are the greatest sources of job loss. … Aside from the issue of the number and quality of jobs, there is no need for a permanent policy to create jobs. While a stimulus aimed at creating jobs may be needed in an economic downturn, there is no need for a permanent policy directed at this purpose; the economy creates its own jobs as evidenced by the growth in the employment supply over time.
If a major objection to the provision is the effect on small businesses, income from selected types of business operations (presumably not for lawyers, doctors, or stockbrokers) could be excluded from the surcharge.
What better enapsulation could there be of the contempt for which Congress holds the American health care system than the casual assumption that doctors are "unlikely to be innovators," or, for that matter, sources of job creation? And what better example of the substitution of protektzia for rule of law than the idea of creating a tax that would apply to high-income earners only if those earners work in politically disfavored professions such as those of lawyers, doctors, and stockbrokers? And what irony that the laissez faire attitude that the "economy creates its own jobs" is invoked by those who don't believe that the economy creates its own affordable health insurance, or its own limits on commodities speculation, or its own incentives for energy-efficient automobiles. The whole report has to be read to be believed.
