Bush Vetoes SCHIP Expansion

Bush just vetoed a multibillion dollar bill expanding the SCHIP health care program, which would have increased budget deficits as well as cigarette and cigar taxes.

The tax on premium cigars would have gone from 5 cents per cigar to as much as $10 per cigar. But such tax increases would not have been enough to pay for the added costs of the program.

Although the SCHIP program started out covering poor children, it now covers some childless adults, and the bill would have expanded the program to cover certain households making as much as $82,600 per year.

The bill Bush vetoed has a lot of flaws, such as its hidden price tag, violations of Congressional budget rules, perverse incentives, subsidies for those who already have health care coverage, and resulting job losses in poor regions.