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How the Pelosi Plan Kills Jobs

Posted By Conn Carroll On November 6, 2009 @ 9:55 am In Obamacare | Comments Disabled

Today the Bureau of Labor and Statistics reported that despite all of the Obama administration’s job creation claims [1], unemployment has risen to 10.2%. Instead of focusing on job creation, the left in Congress continues to pursue other priorities like their $1.5 trillion health care plan [2] which is partially finance by job killing employer mandates [3]. See chart below:

mandatetax [4]

A recent study by the Kaufman Foundation [5] found that small businesses have led America out of its last seven recessions, generating about two of every three new jobs during a recovery. [6] But as Heritage’s John Ligon explains [3], Pelosi care discourages small business hiring at a time when government should be getting out of the way:

Health care reform cannot ignore how such legislation’s employer coverage mandates would negatively impact small businesses. The Pelosi plan eliminates the exemption for businesses with 25-49 workers created in the Baucus plan, and it would also impose new marginal penalties on small firms with 25 or fewer workers. This creates a punitive cost for firms, which significantly raises the costs for businesses on the margin.

Establishing disincentives for small firms to grow would lead to a slower, less robust economy–and labor market. Altering these incentive structures is harmful to small businesses and the way they allocate labor. Federal health care reform legislation, therefore, should avoid creating steep new marginal costs relating to business growth–particularly in terms of wages and worker compensation.


Article printed from The Foundry: Conservative Policy News from The Heritage Foundation: http://blog.heritage.org

URL to article: http://blog.heritage.org/2009/11/06/how-the-pelosi-plan-kills-jobs/

URLs in this post:

[1] despite all of the Obama administration’s job creation claims: http://www.foundry.org/2009/11/06/morning-bell-10-unemployment-shows-objective-failure-of-obama-stimulus/

[2] $1.5 trillion health care plan: http://www.foundry.org/2009/11/03/the-true-cost-of-the-house-health-bill-15-trillion/

[3] job killing employer mandates: http://www.heritage.org./Research/HealthCare/wm2683.cfm

[4] Image: http://www.heritage.org./Research/HealthCare/images/wm2683_table1.gif

[5] Kaufman Foundation: http://www.kauffman.org/Section.aspx?id=Entrepreneurship

[6] small businesses have led America out of its last seven recessions, generating about two of every three new jobs during a recovery.: http://online.wsj.com/article/SB124753106668435899.html

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