Tax or penalty?

With the decision by the Supreme Court regarding the Affordable Care Act (affectionately known as Obamacare) we are seeing posturing from both sides on how to frame the debate moving forward. The White House is sticking to the term "penalty" to describe the tax assessed to those who don't buy health care insurance while those on the right such as Tommy De Seno on Fox News suggest that there is no precedence for a tax without an exchange of money.

The reality is that our tax code is filled with penalties similar to the one the Supreme Court just ruled constitutional. If you aren't married you pay a tax penalty, if you don't have kids you pay a tax penalty, if you don't own the home that you live in you pay a tax penalty, if you earn your income in the form of wages instead of capital gains you pay a tax penalty.

So regardless what you want to call it this ruling doesn't establish some completely new Marxist taxing tool, it just uses the tax code to promote certain behaviors. Is this the job of the government? Maybe. Maybe not. But if the government telling you what to do is the problem with the health care tax penalty then it is also a problem with the other penalties that we currently enjoy which help some and hurt others.