Research Briefing

Congressional Dems About To Make Obama’s Government Takeover Of Health Care Even Worse For Job Creators 

TODAY, DEMS WILL MAKE OBAMA’S JOB-KILLING HEALTH CARE EXPERIMENT EVEN WORSE …

Obama Signed Government-Run Health Care Experiment With New Regulations That Will Force Businesses To Pass Costs To Consumers And Hire Less Workers. “‘Those who are likely to be affected are those who work at smaller firms where coverage isn’t as comprehensive and their employer doesn’t subsidize much of the premium cost,’ said Elizabeth McGlynn, associate director of RAND Health, a division of the RAND Corporation. … And for employers compelled by the mandate to add or enhance coverage, she said, the higher costs might very likely be passed on to consumers of their products or services, or prompt them to hire fewer workers.” (Katharine Q. Seelye, “Employer Mandate Becomes Sticky Issue In Reconciling Bills,” The New York Times’s “Prescriptions” Blog, 10/31/09)

But Congressional Dems’ “Fixes” To Obama’s Bill Will Nearly Triple The Tax, Applying It To Seasonal Employees. “APPLICABLE PAYMENT AMOUNT… in subsection (d)(1), by striking ‘$750’ and inserting ‘$2,000…’ FULL-TIME EQUIVALENTS TREATED AS FULL-TIME EMPLOYEES.—Solely for purposes of determining whether an employer is an applicable large employer under this paragraph, an employer shall, in addition to the number of full-time employees for any month otherwise determined, include for such month a number of full-time employees determined by dividing the aggregate number of hours of service of employees who are not full-time employees for the month by 120.” (Sec. 1003, H.R. 4872, “Health Care And Education Reconciliation Act Of 2010,” As Passed By The House, 3/21/10)

CREATING AN AVALANCHE OF COSTS FOR SKI INDUSTRY IN COLORADO, NEW HAMPSHIRE …

Rep. Betsy Markey (D-CO) Voted For A Bill That Would Have Colorado Ski Resorts Facing “A Stunning Blow” Of “Between $9 Million And $14 Million In Penalties” Annually. “‘The potential impact to Colorado Ski Country member areas is somewhere between $9 million and $14 million in penalties (per year),’ Steamboat Ski and Resort Corp. President Chris Diamond said Tuesday, citing a Colorado Ski Country USA estimate. ‘It’s a stunning blow to any large employer like ours that employs seasonal staff.’” (H.R. 3590, Roll Call Vote #165, Approved 219-212; D 219-34; R 0-178, 3/21/10; Mike Lawrence, “Health Policy Raises Red Flags At Steamboat Ski Area,” Steamboat Today, 3/24/10)

• Impacting An Industry That Generates Thousands Of Jobs And Over $1.7 Billion For Colorado Annually. “According to a recent Colorado Travel Year Report by Longwoods International, travel spending by overnight visitors to Colorado in 2008 totaled $9.6 billion. Of that, $1.7 billion -- or 18% -- was related to skiing. Those dollars are not just generated on the slopes, but by the hotels, rental shops, restaurants and other businesses dependent on cold-weather vacationers.” (Bruce Kennedy, “Colorado Ski Industry Generates Higher Revenues,” DailyFinance.com, 3/20/10)

Rep. Paul Hodes (D-NH) Voted For A Bill That Would Have New Hampshire Ski Resorts Facing “As Much As $1 Million In Fines.” “The assessment is $2,000 per employee, which, according to SkiNH lobbyist Bruce Berke and group president Alice Pearce, could mean as much as $1 million in fines to the big ski resorts, some of which hire as many as 500 seasonal workers. Also affected would be any business that hires on a seasonal basis, and, like most nationally, do not offer health insurance.” (H.R. 3590, Roll Call Vote #165, Approved 219-212; D 219-34; R 0-178, 3/21/10; John DiStaso, “Granite Status: Ski Resorts Worry Health Care Reform Will Have Chilling Effect,” The Union Leader, 3/25/10)

• Impacting An Industry That Generates Hundreds Of Jobs And $560 Million For New Hampshire Annually. “The New Hampshire ski industry generates about $560 million annually in visitor spending and about $60 million in tax revenue. Approximately 10 percent of the state’s wintertime jobs are related to skiing, and New Hampshire is one of the nation’s top five states in terms of the total economic benefit derived from skiing.” (University Of New Hampshire, “NH Skiers Facing Downhill Slide Of Diminishing Ski Areas, Press Release, 11/9/09)

COSTING LARGER EMPLOYERS IN ILLINOIS AND IOWA HUNDREDS OF MILLIONS OF DOLLARS …

In February 2009, Obama Said “You Can Measure America’s Bottom Line By Looking At Caterpillar’s Bottom Line.” (President Barack Obama, Remarks To Caterpillar Employees, East Peoria, IL, 2/12/09)

But Caterpillar Inc. Said Obama’s Bill Would Increase Their Costs By $100 Million In First Year, “Place [Them] At A Disadvantage Versus [Their] Global Competitors.” “Caterpillar Inc. said the health-care overhaul legislation being considered by the U.S. House would increase the company’s health-care costs by more than $100 million in the first year alone. … ‘We can ill-afford cost increases that place us at a disadvantage versus our global competitors,’ said the letter signed by Gregory Folley, vice president and chief human resources officer of Caterpillar. ‘We are disappointed that efforts at reform have not addressed the cost concerns we’ve raised throughout the year.’” (“Caterpillar: Health Care Bill Would Cost It $100M,” Dow Jones Newswires, 3/19/10)

• “Caterpillar Inc. Said Wednesday It Will Take A $100 Million Charge To Earnings This Quarter To Reflect Additional Taxes Stemming From Newly Enacted U.S. Health-Care Legislation.” (Bob Tita, “Caterpillar Takes Hit On Health Care,” The Wall Street Journal, 3/25/10)

And Iowa’s Largest Employer, John Deere, Is Losing $150 Million This Year Because Of Dems’ Government-Run Health Care Law. “Deere & Company, Iowa’s largest manufacturing employer, said in a statement this morning that the recently-passed health care legislation will cost the company $150 million after tax this year… Golden said Deere and other companies warned congress in a letter last December that the imposition of a tax on the prescription costs would force publicly-traded corporations like Deere to publicly account for the extra costs. Deere said the impact of the legislation had not been included in its forecast for a profit of $1.3 billion for this year…” (Dan Piller, “Deere Says Health Care Bill Will Cost It $150 Million,” The Des Moines Register’s “Green Fields” Blog, 3/25/10)

• Iowa City’s Democrat Mayor Matt Hayek Doesn’t Think Obama’s Bill Addresses Exploding Health Care Costs. “I’m a Democrat, but I run a small business. I’m an attorney and we’ve got a law firm with 15 employees here in Iowa City. Our health care costs are going up about 20% a year and as mayor of Iowa City, I work on our budget. We’ve got about 600 employees on a full-time basis and health care costs as a function of our budget are alarming as well. The ever-increasing costs of health care for small business and for governments is just incredible and I don’t know that this addresses that.” (MSNBC’s “Live,” 3/25/10)

KILLING MEDICAL INNOVATION JOBS IN MASSACHUSETTS

Obama’s Government-Run Health Care Bill Will Burden Medical Device Makers With An Excise Tax. “Under the legislation signed by Obama, medical-device companies would be slapped with a sales tax of about 2.9 percent to raise about $2.2 billion a year to pay for the health-care overhaul. Under a companion ‘reconciliation’ bill now being debated in the Senate, the tax is set at 2.3 percent and would start Jan. 1, 2013.” (Jay Fitzgerald, “Beware The ‘Jobs Killer,’” The Boston Herald, 3/25/10)

CFO Of Zoll Medical Corp. In Massachusetts Called The Bill “A Jobs Killer” That Would “Force” Them To Move Jobs Overseas. “‘This bill is a jobs killer,’ said Ernie Whiton, chief financial officer of Chelmsford’s Zoll Medical Corp., which employs about 650 people in Massachusetts. Many of those employees work in Zoll’s local manufacturing facility making heart defibrillators. ‘We could be forced to (move) manufacturing overseas if we can’t pass along these costs to our customers,’ said Whiton.” (Jay Fitzgerald, “Beware The ‘Jobs Killer,’” The Boston Herald, 3/25/10)

• “The Medical Device Industry Is Huge In Massachusetts -- 225 Companies Employing About 50,000 People.” (Byron York, “Scott Brown: ‘It’s Me Against The Machine,’” The Washington Examiner, 1/14/10)
• “‘They’re Beating Up On The Guys Doing The Best To Create Jobs,’ Said Tom Taylor, Chairman Of The Massachusetts Medical Devices Industry Council And Founder Of Roush Life Sciences.” (Jay Fitzgerald, “Beware The ‘Jobs Killer,’” The Boston Herald, 3/25/10) 

AND KILLING STUDENT LOAN JOBS IN INDIANA

Reps. Brad Ellsworth, Baron Hill And Joe Donnelly (D-IN) Voted For Obama’s Government Takeover Of Student Loans, That Could Lead To Lenders Cutting 35,000 Jobs. “But the student loan industry estimates that nearly 35,000 jobs would be lost if the federal government lent directly to students and only let private companies service the loans. Sallie Mae, one of the largest private lenders, would cut an estimated 2,500 workers in Pennsylvania, Indiana, Delaware, Virginia, New York and Ohio. Nelnet, a student lending company based in Nebraska, has already laid off employees in Indiana and Florida and could cut additional workers in Colorado.” (H.R. 3590, Roll Call Vote #165, Approved 219-212; D 219-34; R 0-178, 3/21/10; Alexander Bolton, “Dem Plan To Twin Healthcare And Student Lending Complicates Vote,” The Hill, 3/8/10)

Including Hundreds Of Sallie Mae Jobs In Indiana. “Just to be clear, we’re not discussing the pros or cons of the health bill; it’s the Christmas tree ornaments that Congress hung off it to assure its passage. The main one (at least that we know of so far; it takes time to wade through 2,409 pages of legislation) will expand the government’s Pell Grant programs at the expense of private student loan originators such as Sallie Mae. The result: Under a worst-case scenario, Muncie might lose 700 jobs at its Sallie Mae call center on the city’s north side. A Star Press article on Tuesday said the company might have to cut its 8,600 total workforce by 2,500 workers and reduce its national locations from 25 to about six. It’s unknown how Muncie might fare if the company starts closing offices.” (Editorial, “Health-Reform Package Contains Nasty Surprise,” The Muncie Star Press [Indiana], 3/25/10)