Posts Tagged ‘health plan’

Obama’s Tax and Health Plans WILL Hurt Businesses – And Ultimately American Workers

October 9, 2008

There’s quite a bit of confusion about Obama’s tax plan and its effect on small business and American workers.

John McCain stated during Tuesday night’s debate that most small businesses would see their taxes increase due to Barack Obama’s tax plan.  Barack Obama corrected him and said that only a small percentage of small businesses would see their taxes go up.  Both men are wrong.  And both are right.

Obama may or may not be right when he says that only a small percentage of small business would see their taxes go up under his economic plan – as it is written now (in at least its fourth version).  He hasn’t specified whether he will tax on the basis of net or gross, whether inventory counts as total part of total income, and so on (because the media will NOT do its job and press a liberal on economic details).  But regardless of how the specifics pan out, don’t forget that Bill Clinton similarly campaigned on a tax relief for the middle class economic plan – and he immediately taxes on the middle class early in his first term.  Given the high likelihood of a Democrat-controlled Congress that is eager to have massive government social projects, another such “undeclared” tax hike on the middle class is actually quite likely.

John McCain may have been incorrect in how he phrased his objection during the debate, but he is still right enough to win the argument if the facts actually come out.  He was probably wrong in saying that most small businesses would see their taxes increase in terms of the total number of businesses.  If you earn a living mowing lawns, and have no employees, or you have a business out of your home, you probably won’t be paying any higher taxes.  But keep in mind that a small business can have as many as 500 employees (up to a 1,000 in some industries) and be classified as “small.”  And such businesses are the real engine of our economy.  If a small business even employs a handful of employees, it is likely its revenues easily exceed Obama’s $250,000 figure.  It is these businesses which hire the most workers, and it is these businesses that Obama will start taxing.  It is also these businesses which will suffer the most even from a modest increase in their operating costs.  Many are skating on pretty thin ice as it is.  They can’t just sell more stock.

If Barack Obama raises the taxes for these small business owners, there will be layoffs.  And as his plan is right now, he is promising to raise their taxes.  Realize that we are in a tough economy.  It is harder to obtain loans.  Fewer people will be buying.  Small businesses will be struggling to survive, and if Obama does what he promises to do – particularly when he is going to force businesses to start paying health care as well – you WILL see layoffs.

Meanwhile, Obama is decrying John McCain for wanting to give tax breaks to big oil.  John McCain does NOT want just to give tax breaks to big oil (actually it was OBAMA who voted with Bush for the last big energy bill giveaway to big oil); he wants to lower taxes for ALL corporations.  Most nations realize that lowering taxes for corporations has resulted in corporations creating more jobs and more tax revenues, and that more corporations will be attracted to their country.  But not the United States: we have the second highest corporate tax rate as it is.  Obama wants to be “#1.”

Is that good for our struggling economy?  Your vote on November 4 will be your answer that question.

Another thing Obama wants to do is impose requirements for businesses to provide comprehensive health care for their employees or pay into a government fund.  Small businesses would be ostensibly exempted from the requirement, and would get a 50 percent health-care tax credit to help ease their cost of employee coverage.  People with pre-existing conditions – which often impose the largest cost on the health care system – cannot be denied coverage.  Businesses who hire such people will be forced to grin and bare it.

I wonder how many older workers will be fired in order to hire new – and less expensive – younger workers?  Under Obama’s plan, I’d sure be looking at my older employees as “potential health care time bombs” just waiting to explode.

Do you think that businesses and corporations will begin to pay very close attention to the health of the employees they hire, or do you think they won’t care about how much a new workers’ mandatory health care will cost?

Between raising taxes, and mandating expensive new requirements, many businesses and corporations will experience a genuine double whammy.  Do you think American businesses are made of money, or do you think they are vulnerable?  You will be answering that question in your vote on November 4.

One thing is extremely important to understand: Obama’s health care plan is modeled on the Massachusetts plan.  How are things going there?  Well, in the three years of the program’s existence, the tiny state is now already facing cost overruns of over $400 million.  Does that sound like a rousing success?  Massachusetts is facing a projected 85% increase in its costs by 2009 – which should set up a serious red flag that such programs are MASSIVELY underfunded.

You need to understand something else that emerged from Tuesday night’s debate: is health care a basic right?  Obama answered “yes.”  What does that mean?  It means that you have a duty to provide me with health care.  You have a constitutional, government-imposed duty to give me health care – no matter what – even if it costs you and your family to do so.  Am I an alcoholic who needs a liver transplant?  You owe me a new liver.   Did I sustain a brain injury riding my motorcycle without a helmet because I like to feel the wind in my hair?  Doesn’t matter.  I have a fundamental constitutional right to that liver, or to that brain surgery and all the long months of incredibly expensive therapy.  If I have a right to health care in the sense that Barack Obama believes, nothing else matters.

Do you understand how expensive this can all get?

Do you understand that Barack Obama is essentially talking about socializing a quarter of our economy?  Do you trust your government’s track record?

Your vote will be your answer to that question.

Barack Obama’s health care plan is estimated to cost $1.6 trillion in 10 years.  But that doesn’t take into account the very sort of cost overruns and cost increases that are even now plaguing the very state that Obama is basing his own plan upon.  What is going to happen to our economy given the extremely real likelihood that Obama’s massive national plan runs into similar issues?  Do you believe our economy is strong enough to bear the brunt of these massive cost increases?

Your vote will be your answer to that question.

Let me also point out something else: if businesses and corporations are forced to absorb shocking new costs, do you believe they will just swallow their profitability, or do you think they will pass their new costs onto you through higher prices?  Barack Obama keeps talking about his “95% of Americans will get a tax break” (which means that 30-40% of Americans who don’t actually pay income taxes will get an IRS-subsidized welfare check).  Will that check compensate for the higher prices you are likely to pay across the board for virtually everything you buy?

Again, your vote on November 4 will answer that question.

Don’t be too suprised if you vote yourself right out of a job.

Obama Health Care Plan Would Send Costs Soaring, Cost Jobs

September 16, 2008

John McCain’s health insurance plan would probably not significantly lower the number of uninsured in the country, and it is possible under his plan that insurers could re-locate to states with less onerous health care mandates, say experts.

But the same experts claim that Barack Obama’s plan “would require new, large, and rapidly growing federal subsidies that are unlikely to be sustainable, fiscally or politically” and that “job losses or pay cuts would result” from his plan.

I don’t know about you.  But I like option A a lot better than option Barack.

But Barack Obama supporters will probably argue that this objective comparison of health care plans fails to consider the fairy dust that Obama would sprinkle over his plan that would make all its pitfalls magically go away.

Economists take critical view of health plans

By KEVIN FREKING, Associated Press Writer Tue Sep 16, 12:12 AM ET

WASHINGTON – John McCain’s health plan won’t lower the ranks of the uninsured. Barack Obama’s fails to curb the soaring cost of health care, meaning initial gains in helping more people buy health insurance would eventually be undermined.

That’s the assessment of health care economists who critiqued the plans of the two presidential candidates.

The critiques, published in the journal Health Affairs on Tuesday, reflect fundamental disagreements over how to improve access to health coverage. They also sound warnings about what could go wrong with each candidate’s plan.

McCain would dramatically reshape the way millions of people get health insurance. The Republican would do away with income tax breaks for health insurance obtained through the work place, instead treating the payments as taxable wages.

In exchange, he would give people a $2,500 tax credit for individuals who buy health insurance and a $5,000 tax credit for families that do so.

The tax credit could help people buy insurance through their employer. Many would also use it buy coverage directly from insurers in the individual market. They could select from insurers licensed in any state. With more competition, costs would fall and quality would increase, McCain reasons.

Analysts writing in the journal warned against that approach.

They said employers would be less likely to offer coverage if they knew their workers could get it elsewhere. In all, the authors projected that 20 million people would lose their employer-sponsored insurance under McCain’s plan, while 21 million people would gain coverage through the individual market — little more than a wash.

And as monthly insurance premiums rise and the tax break stays the same, even that gain would erode.

Another concern is that insurers would gravitate to states with less onerous coverage requirements. For example, 29 states insist insurers in the individual and small group market cover cervical cancer screenings. They could locate in states without such requirements.

Obama wants the government to subsidize the cost of health coverage for millions who otherwise would have trouble affording it on their own.

The Democrat would set up a kind of government-run shopping mall that would negotiate prices and benefits with private insurers. One choice would be a government-run plan. No participating company could turn someone away because of pre-existing cancer, heart disease or diabetes. Nor would someone have to pay a higher monthly premium based on those conditions.

The government would subsidize the cost for many who buy coverage through this exchange. But analysts say using third parties to subsidize the cost of a product exacerbates health inflation. Consumers and providers act as if any service that might yield some value should be covered. After all, it’s largely somebody else who is picking up the tab.

“Any major expansion of coverage will be costly, and the Obama promise of affordability would require new, large, and rapidly growing federal subsidies that are unlikely to be sustainable, fiscally or politically,” said the authors.

Obama would also require all but small businesses to make a “meaningful” payment for health coverage of their workers or contribute a percentage of payroll toward the cost of the public plan offered through the exchange. The authors said that either way, job losses or pay cuts would result.

The journal subjected the plans to a sort of devil’s advocate analysis. Once the unsolicited review of McCain’s plan was reviewed and accepted, the journal sought out economists who would take a similarly tough look at the Obama plan. The reviewers of the Obama plan included Gail Wilensky, an unpaid adviser to the McCain campaign.

Personally, I would like to see a health care plan that provided businesses with tax incentives to provide coverage for employees and their families, and have health coverage that could not be cut off if a worker lost his job (provided he or she continued to pay the same premiums as the employer had paid).  In other words, just because you are no longer working for a particular employer does not mean you should lose your medical coverage.

In my view, the two biggest problems with health care are 1) soaring costs and 2) transferability.

Socialized medicine has failed everywhere it’s been tried, and the larger the population, the more horrendous the failure.  It invariably results in long waits and rationing of care.  But the privatized system we have now – which historically depends upon employers to pick up the tab – fails to provide suitable controls to limit the skyrocketing costs (i.e., since you are not paying for your own health care, there is no incentive to keep the costs of your health care down).

John McCain’s plan imperfectly tries to deal with these two fundamental problems with our current system by attempting to sever the unhealthy relationship between employees, employers, and health care.  But even though it is ultimately inadequate, it is a FAR cry better than the Obama plan which would send costs soaring and result in a loss of jobs as employers are forced to cut costs.