The fact is [Obamacare] is very good for small business. It’s incredibly good for small business,” former Democratic National chairman Howard Dean said.
In a recent interview, the one-time Democratic presidential candidate and doctor said he believes Obamacare will boost job creation for small business.
“Most small businesses are not going to be in the health insurance business anymore after this thing goes into effect,” he added. “That’s going to be the biggest boost to small business that has been done in years and years and years,” he added, predicting that Obamacare will create 80 percent of all initial new jobs.
It sounds good. But it’s just not true.
Costly Tax Hikes. Curtis Dubay writes that Obamacare imposes numerous new taxes, fees and penalties, transferring more than $500 billion over 10 years from hardworking American workers and their families to Congress. That’s money that could be spent in the private sector for companies to take out new loans, expand businesses and hire new workers. Instead, bureaucrats in Washington will use it pay for new entitlements and costly subsidies.
Employer Mandate Fines and Compliance Costs. Labor expert James Sherk points out that businesses with more than 50 workers must pay for the rising costs of health care coverage for their workers or face a penalty. Not only does this discourage smaller companies from expanding, but it also places mid-size businesses in uncertain territory. With the Health and Human Services Department still mulling what benefits must be covered in any health plan, companies have little idea how high health care premiums will go up in the next five years, making any business planning difficult. Additionally, the new administrative complexities from Obamacare will require many companies to incur more accounting and consulting expenses just to stay compliant with the law.
Less Opportunity for Low-Income Workers. Heritage analysts also note that many Americans earning close to the minimum wage will likely see less hiring opportunities as employers are required to offer them costly health coverage. In fact, research by Katherine Baicker and Helen Levy found workers earning within $3 of the minimum wage have a higher risk of losing their jobs because of the employer mandate.
On February 10, 2011, CBO Director Doug Elmendorf testified before the House Budget Committee that Obamacare will result in an estimated 800,000 fewer U.S. jobs. What is it going to take for President Obama and others to believe that the new taxes, penalties, and fees resulting from Obamacare will be negative and far-reaching on the economy?
We want to hear from small business owners. How do you think Obamacare will impact your business? Share your thoughts in the comments section below.