The difference between the parties

The fight over 1099 reform is one of the best case studies of the differences between Republicans and Democrats that we've seen this year.

Quick background: 1099 reform deals with a tax change in the health-care bill. The provision seeks to recoup taxes that small businesses should currently be paying but aren't. The problem is that the mechanism would mean a lot of paperwork. Enough, actually, that it's probably worth scrapping it. But that means you need to make up $17 billion.

Republicans wanted to do that by cutting public-health subsidies for the poor. Democrats said no. Democrats wanted to do it by cutting subsidies for oil and gas companies. Republicans said no. Democrats came up with another way to do it, this time by closing a tax loophole that allows hedge-fund managers to be taxed at a much lower rate than people in other professions. Republicans don't like this, either.

I really don't understand the vision of the economy, or of need in general, where it makes more sense to cut public-health spending than treat the income of hedge-fund managers like the income of, say, small-business owners. Is there some reason we want lots more people to enter the hedge-fund industry? Or that government should be directly subsidizing oil and gas production? I can at least understand the rationale for public-health programs. That sort of collective action is something you need government to organize. The presence of generous financial incentives for entering the hedge fund industry really isn't.