About This Blog
Trying to make left wingers understand that their policies depress economic growth, inhibit job creation, shrink wages, and raise prices is no easy task. It requires some heavy lifting. Left wingers are so focused on providing feelgood direct assistance to the "little guy" that they miss the larger implications of their economic policies, which ironically harm the little guy the most. I suppose this is what happens when emotions trump logic in decision-making, and it's why I refer to left wingers as Level One thinkers on economic matters. They desperately need to get to Level Two. Perhaps then people like Nancy Pelosi (D-CA) won't go around saying ridiculous thinkgs, like how unemployment is such a big economic stimulus (correct answer - EMPLOYMENT is a big economic stimulus). I try to keep hope alive, but it ain't easy when so much iNANity is being spouted.
In my ongoing public service efforts to educate liberals about economic matters, I turn today to ObamaCare and it's effect on business. The New York Times attempted a case study on ObamaCare's impact on one small business, a bakery called Baked In The Sun. Here's what ObamaCare will do to this business:
The company is one of thousands of small businesses that employ more than 50 full-time employees and thus will be required to offer health insurance to their workers — or pay into a government fund — beginning Jan. 1. Rachel Shein and Steve Pilarski, the married owners of the bakery, which employs 95 people, estimate this could cost their business up to $108,000, and they are weighing their options as the date approaches. “Our revenues are about $8 million, but the food business is a low-margin industry so cutting $108,000 out of our profits, which are just over $200,000, is a big deal,” said Ms. Shein, who is the chief executive. They are evaluating different ways to comply with the new law and finance the expense. The company is one of thousands of small businesses that employ more than 50 full-time employees and thus will be required to offer health insurance to their workers — or pay into a government fund — beginning Jan. 1. Rachel Shein and Steve Pilarski, the married owners of the bakery, which employs 95 people, estimate this could cost their business up to $108,000, and they are weighing their options as the date approaches. “Our revenues are about $8 million, but the food business is a low-margin industry so cutting $108,000 out of our profits, which are just over $200,000, is a big deal,” said Ms. Shein, who is the chief executive. They are evaluating different ways to comply with the new law and finance the expense.
For those of you with math skills, ObamaCare took away 56% of the profits of Baked In The Sun. Before you lefties out there start cheering like socialist jackals about how Obama is grabbing the profits of those evil capitalists, stop and think about the larger implications here - this successful business will no longer be able to a) pay it's employees as much, b) keep it's prices as low, c) remain as competitive as it was before, or d) grow and create more jobs. Thus, this left wing policy of Lord Obama and the Democrat Whizbangs will, as I stated in the first sentence of this post...depress economic growth, inhibit job creation, and raise prices. And who is hurt the worst by fewer jobs, lower wages, and higher prices ? Drumroll, please.....THE LITTLE GUY !!! Good going, left wingers. You've hurt the very people you are trying to help. Then, after ruining this successful company's ability to compete and pay decent wages/benefits, braindead lefties would no doubt try to "help people" some more by forcing the company to pay higher wages, thus causing more job losses and harm to the business. Lefties would then pat themselves on the back for how compassionate they are in helping the little guy when they are accomplishing the exact opposite.
Baked In The Sun and the thousands of companies like it across the nation do have different options they can pursue in response to ObamaCare. All the options are basically negative. I already described the effect of Option One above. Here are the other options:
Option Two is to not offer health insurance and let employees find coverage elsewhere, perhaps on one of the new government exchanges. Under this option, the company will probably have to pay the mandated “employer shared responsibility payment” to the government.
The cost to the business would be $2,000 per employee a year, but the law exempts the first 30 employees, so the total would be $130,000 per year for a 95-person company. One benefit of this option is that the company would not have to take on the burden or expense of managing the insurance plan, which Ms. Shein estimates would take $10,000 of staff time.
One way to cover the costs associated with the new law would be to raise the price of each item sold about 4 percent and pass the costs along to buyers. “It’s ironic that our success meant we could grow,” Ms. Shein said, “and now we will be competing against smaller companies, with 50 employees or fewer, who will be able to charge less per item because they don’t have the financial burden of health insurance.” Prices are currently similar among local competitors, Ms. Shein said, and she says she believes the increase in her prices could affect her sales, possibly significantly.
Ms. Shein is considering a third option: outsourcing certain jobs to reduce the staff, because businesses with 50 or fewer employees will be exempt from the penalty. “We can outsource the cleaning and make the drivers independent contractors,” she said, “and we can cut the least profitable delivery routes, least profitable accounts or reduce the variety of items we create.”
Each option raises prices, depresses wage, causes job and/or benefit losses, destroys company growth, or does some combination of all these things...all thanks to Obama and the Whizbangs.
Thanks again for all your "help", lefties. 2014 should be one heckuva year.