Obama ran on a platform of higher taxes and got re-elected because he was able to convince voters that only ‘other’ people would be affected by his tax increases; that he was the candidate of the poor and middle class, and Romney, the out-of-touch candidate of the rich. The voters bought it. When the most basic economic concepts were presented, Obama called it “trickle down Economics,” convincing voters that the idea that raising taxes on businesses actually hurts the middle class, was some sort of myth.
It’s going to be interesting to see the voters actually feel the effect of their decision. Here is a short list of some of the companies that have announced their plans for layoffs as a result of the ObamaCare provisions that were conveniently set to take effect after the election:
- Smith & Nephew – 770 layoffs
- Abbott Labs – 700 layoffs
- Covidien – 595 layoffs
- Kinetic Concepts – 427 layoffs
- St. Jude Medical – 300 layoffs
- Hill Rom – 200 layoffs
Medical device manufacturer Stryker, just confirmed it is laying off 1,000 people. It cited the 2.3% excise tax on medical device manufacturers in ObamaCare as the reason. This tax is on medical device companies’ total revenue, meaning even if they don’t make a profit, they still have to pay the government.
The company “expects to owe approximately $100 million in the first year alone, equating to over 20 percent of our annual, global R&D investments,” said [CEO Kevin] Lobo.
“We would rather put this money towards jobs, innovation, clinical research and priorities that will create value-added medical technology for patients while helping us partner with hospitals to deliver cost-effective solutions,” [CEO Kevin A. Lobo] said.
This is just one example of what medical device manufacturers are having to deal with. There are others. “The 2.3 percent tax will be imposed on gross sales of products from elastic bandages to pacemakers to imaging systems.”
With health care costs already as high as they are, how Obama and his administration thought it would be a good idea to raise taxes on medical device manufacturers is beyond me. If he weren’t such a “likable guy,” I would think he were purposely trying to destroy the economy.
Medical device manufacturers are just one example. Pennsylvania’s Community College of Allegheny County (CCAC) is slashing the hours of 400 adjunct instructors, support staff, and part-time instructors to dodge paying for ObamaCare.
ObamaCareWatch.org explains what the big deal is with the ObamaCare mandates on employers:
For firms which do not offer insurance, have more than 50 employees, and have at least one employee receiving insurance subsidies, they must pay a tax of $2000 per subsidized employee. The tax is applied to all of a firm’s employees (after excluding the first 30), not just those that are subsidized. For example a firm with 51 employees would pay $42,000 in new annual taxes, and an additional $2,000 tax for every new hire.
It seems to me that the health insurance mandate actually hurts poor workers the most, doesn’t it? If you work for a large company that already offers health insurance, that particular mandate doesn’t affect you. It does affect those unskilled workers employed by franchises like Papa Johns, Burger King, McDonald’s, Quiznos, who barely make enough to support themselves. Now many of them will lose their job, as these companies are figuring out that in many cases, they are better off not hiring.
Also, as ObamaCareWatch.org explains, “ObamaCare provides incentives for companies to avoid hiring workers from low-income households:”
Eligibility for subsidized insurance in the exchanges is based on household income, and firms can be penalized if one of their workers gets subsidized coverage in an exchange. Thus, firms have a strong incentive to find workers who won’t qualify for subsidized coverage, which may also lead to invasions of privacy. For instance, a restaurant might find it better to hire young waiters from upper-income neighborhoods, as opposed to low-income areas, because they would be less likely to qualify for subsidized insurance in the exchanges. ObamaCare therefore is penalizing the very households it was supposedly passed to help.
And here they thought Obama was the candidate of the poor.
Proponents of ObamaCare still don’t get it. Many of them are angry at these companies for laying off workers and speaking out against ObamaCare. Apparently, they think businesses should hire people even if it means they will lose money as a result. They don’t see anything wrong with this as a business plan, and why would they? In the fantasy world in which they live, debt and deficits don’t matter. They supported Obama who has increased the national debt by $6 trillion in four years.
The solution to too much spending is apparently more spending. And the solution to the job shortage is apparently to take money away from those who create the jobs.
Brace yourselves. Proponents of ObamaCare are about to get a lesson in Economics, the hard way. Too bad the rest of us will pay for it, and in the end, they will still blame the rich and the free market.
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