To understand impact of Dem’s health care tax bill, read what options will be left to small businesses

[Emphasis in bold is the author’s.]

They can force us to pay for health care, and fine us if we don’t, but they can’t prevent us from firing workers or lowering wages
by Small Business Against Big Government
Friday, October 30, 2009

We’ve been having a lot of conversations with Small Business owners about how they will change their businesses if Congress passes their monstrous, prosperity-killing Health Care Bill.

We are also small business owners and employees ourselves, and what is emerging from these conversations frightens us and should frighten all American workers.

The consensus? “They can force us to pay for health care, and fine us if we don’t, but they can’t prevent us from firing workers or lowering wages.”

When you change incentives, you change behaviors, and if this bill passes, Small Businesses are incentivized to lay off workers and lower wages.

As the health care bill in the house currently stands, employers will be forced to provide health insurance to all workers. Since health insurance is a compensation cost, employers are reviewing which employees are most important to them, or give them the most hours, and are making plans to fire employees who do not give them enough value to justify providing insurance.

If small businesses choose to not provide health insurance, they’re going to be levied an 8% of payroll fine. Since that just means total compensation costs go up by 8%, businesses will offset that by lowering wages (or firing people).

In fact, some businesses we’ve talked to are getting ready to lay off workers and then hire new people who have been laid off elsewhere, but paying a lower wage than they did for the same work before – but, hey, the employee will have mandated health insurance (even if her standard of living drops in every other area)!

In an era of 10% unemployment, massive deficits, an enormous national debt burden, and growing unfunded liabilities for Social Security and Medicare/Medicaid, the government is about to do something that will kill wage growth and increase unemployment.

Oh, and it will mean less doctors who want to practice medicine, punishment of all companies that innovate in the medical industry, all while increase demand for medical services. Rationing, here we come.

We were right about Cash for Clunkers. And we’re right about this.

Our only hope is that someone in Washington wakes up. And soon. Because we’re at the precipice.

If you haven’t made a call to your representative recently, now would be a good time to make a last minute push.

Please email this to your friends, family members, and co-workers who work for small businesses, and let them know about this imminent danger.

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