Skip to comments.Video: New York small business owner on expansion, job creation: “It’s just not worth it”
Posted on 02/27/2014 11:39:47 AM PST by SeekAndFind
Quick — someone check to see if the Koch Brothers have bought Time Warner Cable News! Harry Reid needs to know, after all, because all of these “horror stories” about ObamaCare are just lies. Actually, we may need to see if the Kochs have bought all of New York, because small-business owners are discovering that Reid’s law does anything but “bend the cost curve downward” (via Daniel Halper):
“Everything is on hold. We won’t grow. We won’t reach that threshold. It is not worth it for us,” says pet store owner Matt Sames.
The reporter adds, “He says he scrapped his plans because of the Affordable Care Act. Opening two more locations would increase his company’s employee size to 50, making it mandatory for him to provide health care for all his workers.”
“If we wouldn’t cover those 50 employees, I think there’s a $2,000 penalty per employee. So that is a $100,000 bill,” says the owner.
Yes, that’s what happens when one does the math on ObamaCare’s employer mandate. We’ve made this argument a number of times since the debate first began on this part of the ACA. In order for small businesses to grow past the 50-employee mark, the return on that staffing investment has to exceed not just the base compensation of those employees (as it always must), but also the added costs of either health insurance or a penalty for each existing employee as well. That provides a huge disincentive to expansion, so it’s hardly surprising that business owners are choosing to avoid the risks of expansion and job creation altogether and staying put at current size.
The rest of the small business owners in the clip are making the same point. The costs outweigh the risks in expansion now, so they’re not expanding. That means the economy won’t grow, jobs won’t be created, and investors will look for ways to protect their capital rather than put it to use. These are some of the same disincentives noted by the CBO in its projection that ObamaCare will result in a net decline of the equivalent of 2.5 million full-time jobs from what would have existed without the law over the next decade, which will result in a net decline of a trillion dollars in compensation.
This is the real job lock — the lock on innovation and expansion thanks to the heavy cost overhang of ObamaCare on small businesses, and business in general. But don’t tell Harry Reid, because math is un-American.
Update: More on Reid from my friend Peter Wehner at Commentary: “At least Joe McCarthy wasnt majority leader.” Be sure to read it all, and then wait to see if the media covers Reid’s demagoguery with anything close to the same energy as the Ted Nugent story.
While there are exceptions, basically Obama’s kill-the-American economy program has been working incredibly well. To give the d—— his due.
The reason in a nutshell why Socialism is bankrupt and always will be. It robs people of incentive and opportunity.
Harry Reid told me this was all lies from the Coke Brothers.
The only real bright spot in the economy is the innovation in hydraulic fracturing techniques that led to an energy boom. I shudder to think where we would be without it, and the government would love to put the throttle on fracking, too.
Does he have to swear to the IRS that his decision not to expand was due to Obamacare?
Why not just start a new business (cloning the existing one) consisting of two stores? Each business would then have less than 50 employees.
RE: Does he have to swear to the IRS that his decision not to expand was due to Obamacare?
So far, not expanding a business is not under Obamacare regulation. Only laying off workers is. But give it time, they’ll get to that too...
RE: The only real bright spot in the economy is the innovation in hydraulic fracturing techniques that led to an energy boom.
Here in NY, we have the Marcelus Shale that is ripe and ready for fracking. Neighboring Pennsylvania has been doing it for years. The NY town bordering PA is one of the few places doing quite well economically.
The past two governors have been studying the environmental impact of fracking to death even when the EPA has already pronounced it safe.
So, NO JOBS on this front in the Empire state.
If you own a flower shop and a golf club and a B&B and have a total of over 50 employees you are on the hook for O(don't)Care.
I thought it was against the rules to think about not hiring to avoid the obamacare shaft.
... under penalty of perjury, companies will need to tell the government that any downsizing they underwent was not due to Obamacare.
LOL. The LIVs probably would spell it that way, and believe the brothers own the evil Coca-Cola BIG CORPORATION.
job creation, what a farce! You hire, you have to pay an increase in minimum wage, sicktime and obamacare so it will cost you more to hire than not to. These despciable politicians keep feeding us the same vomit and they expect us to eat it time and time again. FU