Ken Garcia: Governor’s health care plan taxes meaning of the word ‘fee’ 

Gov. Arnold Schwarzenegger has made enough bad movies in his career that you would think he’d know when he’s been handed a lousy script.

For even his considerable charm, bravado and his marketing-savvy staff are not enough to push the idea that the public will be paying for his whopping pile of programs, including his $12 billion universal health care plan, with "fees.’’

When is a fee not a tax? When it’s packaged as part of an election-year promise.

Now, I realize that the governor won an easy campaign against Democratic candidate Phil Angelides in part based on the challenger’s muddy idea to raise taxes. But that doesn’t alter reality or make soaking taxpayers for state services something that it’s not.

Our celebrity governor may think he can sell fog in San Francisco and sunshine in Los Angeles, but the last time I looked a "levy’’ was just another term for tax, no matter how many special effects you throw into the mix. This may be Schwarzenegger’s biggest evasion since he filmed "Predator.’’

He’s certainly not the first politician to try to circumvent the "tax’’ moniker, but unlike the elder George Bush, nobody is even going to bother to read his lips. Universal health care may be a good prescription for California, but residents of the Golden State are not going to accept that a plan to charge employers, doctors and hospitals to pay for the new system is a fee and not a tax. And you know that Schwarzenegger is struggling with his pitch when he starts referring to the payment plan as a "loan.’’

Does that mean the $12 billion loan will be refunded to us? At that rate, we might be able to live off the interest. And maybe the state of California should be refunding our property taxes — I mean fees.

The governor is nothing if not disciplined in his effort to avoid the "t’’ word at all costs, except, of course, when pummeling his opponents with it. During one of his debates with Angelides, he pointedly said: "I can tell by the joy in your eyes when you talk about taxes ... look out there right now and just say, ‘I love increasing your taxes.’’’

Schwarzenegger apparently gets dreamy over loans and fee increases — maybe he was meant to be treasurer.

This tricky proposition of selling a tax as a personal fee hike may be truly bipartisan, because members of both parties are going to have trouble with it. But it’s the state’s Republicans who are in a veritable frenzy over the idea, with a host of them claiming that any funding for a health care plan is going to require a two-thirds majority vote — just like most new tax plans do. And business groups are not exactly lining up to empty their pockets for the health care plan, just because the governor is adamant that he is sticking to his "no tax’’ pledge while levying new payroll "fees.’’

"This does not, in our view, meet the criteria for a new fee,’’ said Jon Coupal, president of the Howard Jarvis Taxpayers Association. "It needs to be called for what it is, a tax increase. There are things in his health care plan we like, but a tax increase is not one of them.’’

Coupal said he found it hard to see how the governor could remain stuck on the concept that pushing a payroll tax to pay for a health care program was not a tax. "It is very difficult to argue from an intellectually honest perspective, that this is not a tax increase.’’

But the words "intellectually honest’’ don’t come up a lot in Sacramento or Washington or any other place where big-name politicians ply their trade. Former President Bill Clinton used to describe his tax increases as "investments’’ — and so many pols have broken promises not to raise taxes that they have worn out their dictionaries in search of a new euphemism.

When pushed on the tax, uh, fee, plan, Schwarzenegger generally has reverted to Plan B, as in bob and weave, and clearly all those fight scenes he’s filmed over the years have helped him look smooth. Yet Schwarzenegger is likely going to be a GOP army of one if he continues to maintain — against all logic and reason — that a 4 percent payroll levy is not a tax.

At one point recently the governor said the difference between a fee and a tax was largely a matter of opinion. And by that he probably means a court’s opinion, because that’s likely where the tax issue will be decided.

No one said it would be easy selling universal health care. The governor just didn’t realize it would be so taxing.

Ken Garcia’s column appears Tuesdays, Thursdays and weekends in The Examiner. E-mail him at or call him at (415) 359-2663.

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