Today's Papers: Obama Creates Health Care Piggy Bank

Everybody leads with President Obama's decision to put some money in a piggy bank. In the budget proposal that will be released today, Obama will announce that he wants to start his promised overhaul of America's health care system by creating a $634 billion reserve fund over the next 10 years that will be paid for by increasing taxes on the wealthy and cuts in government spending. At the centerpiece of the plan is a call to gradually reduce the value of itemized deductions that those in the highest tax brackets can take for things like mortgage interest and charitable contributions. Separately, Obama will also propose to extend his tax cuts for most Americans and pay for them with the revenue he would get from polluting industries. These two proposals, combined with Obama's stated goal of rolling back some of the Bush administration's tax cuts, add up to "a pronounced move to redistribute wealth by reimposing a larger share of the tax burden on corporations and the most affluent taxpayers," declares the New York Times. USA Today calls the $634 billion reserve fund "a big step toward extending health coverage to 46 million uninsured and subsidizing premiums for others who have insurance." But the administration made it clear it was just the first step, and most papers cite an administration official who characterized it as a "very substantial down payment" on Obama's health care goal. The plan contains few details on how the money would be used. "Rather, the president's proposal to raise revenue is intended to signal his seriousness about moving the talks forward on Capitol Hill," notes the Los Angeles Times. TheWashington Post points out that this "strategy is largely intended to avoid the mistakes of the Clinton administration, which crafted an extensive proposal in secret for many months before delivering the finished product to lawmakers, who quickly rejected it." The proposal to raise taxes is expected to create a huge ruckus in Congress, and one of the key questions will be "whether a change to the deductions formula would discourage charitable giving among the wealthy," says the Wall Street Journal.