Tag Archives: Business

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Real personal income for Americans falls 3.2% during Obama’s term

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Story from the Washington Times. (H/T ECM)

Excerpt:

Real personal income for Americans – excluding government payouts such as Social Security – has fallen by 3.2 percent since President Obama took office in January 2009, according to the Commerce Department’s Bureau of Economic Analysis.

For comparison, real personal income during the first 15 months in office for President George W. Bush, who inherited a milder recession from his predecessor, dropped 0.4 percent. Income excluding government payouts increased 12.7 percent during Mr. Bush’s eight years in office.

“This is hardly surprising,” said Douglas Holtz-Eakin, an economist and former director of the nonpartisan Congressional Budget Office. “Under President Obama, only federal spending is going up; jobs, business startups, and incomes are all down. It is proof that the government can’t spend its way to prosperity.”

According to the bureau’s statistics, per capita income dropped during 2009 in 47 states, with only modest gains in the other states, West Virginia, Maine and Maryland. But most of those increases were attributed to rising income from the government, such as Medicare and unemployment benefits.

And tax hikes are right around the corner, because his massive spending requires it.

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More companies announce massive losses as a result of Obamacare

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From Associated Press. (H/T Ace of Spades via ECM)

Excerpt:

Insurer Prudential Financial Inc. said Monday that it will take a $100 million charge in the first quarter in relation to the recent health care overhaul legislation.

The life insurance and annuities provider said in a regulatory filing that it will take the charge against earnings in the first quarter.

Prudential joins a growing list of companies that have said they will take accounting charges because of the health care bills. AT&T said last week it would take a $1 billion charge in the first quarter. AK Steel Corp., 3M Co., Caterpillar Inc., Deere & Co. and Valero Energy have also said they would take smaller charges.

Prudential said in a filing with the Securities and Exchange Commission that the health bill signed into law by President Barack Obama last week and a companion measure he is expected to sign Tuesday will reduce its tax deduction for retiree health care costs beginning in 2013.

Companies that provide prescription drug benefits for retirees have been getting subsidies covering 28 percent of eligible costs but could deduct everything they spent on the benefits — including the federal money — from their taxable income.

Normally I oppose subsidies, but this one one was keeping the elderly off the even more wasteful Medicare prescription drug plan. (I hate that plan – it was a huge mistake made by an otherwise good president). These companies are going to dump the pensioners onto Medicare and it will cost EVEN MORE to have an inefficient government run the program, with all the waste and fraud that plagues Medicare now.

Ace writes:

That subsidy was to induce companies to keep retirees on their own corporate plans rather than dump them into taxpayer-funded Medicare. Now that they’ve cut the subsidy, not only is it costing these businesses money, but many are thinking of giving up the subsidy and dumping them into government health care.

Remember, if you like your insurance, you get to keep your insurance.

And Henry Waxman is going to drag these CEOs in front of his committee, to harass and threaten them, and badger them into answering why they’re bound to accurately account for additional new tax costs.

In fact, Waxman doesn’t want an answer to that; what he wants is for companies to hide these new, embarrassing costs illegally, so that Democrats don’t have to answer questions about them. And he figures harassment and the threat of punitive legislative action should be enough to give other companies the hint.

Preemptive Strike? Rich Lowry says it’s part of the Democrats’ plan to claim that all negative consequences of this bill are due to a conspiracy between evil corporations.

Meanwhile, National Review has a related story from PRNewswire. (H/T ECM)

Excerpt:

Illinois Tool Works Inc. (NYSE: ITW) today announced that as a result of certain provisions in the recently enacted Patient Protection and Affordable Health Care program, future Medicare prescription drug subsidies received by the Company for retiree prescription drug coverage will now be taxable.  As a result, the Company expects to record a discrete tax adjustment of $22 million, or 4 cents of diluted income per share from continuing operations, in its 2010 first quarter results to reflect this change in tax treatment.  This discrete tax adjustment was not included in the Company’s March 15, 2010 revised earnings forecast.

Wow. We’re in freaking North Korea now. Next time, don’t vote for the radical socialist. Socialism makes jobs go away. This is not a surprise to anyone on the right. We know these things because we’re grown ups. We know how the world works. Happy talk doesn’t grow the economy.

Related: Other companies take massive losses after Obamacare passes.

News

Who knows more about economics? Obama or people who run businesses?

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Consider this article from The American Spectator, which talks about the Obammunist response to companies losing massive amounts of money because of Obamacare. (H/T ECM)

Excerpt:

By last Friday, AT&T, Caterpillar, Deere & Co., and AK Steel Holding Corp. had all announced that they were taking the one-time charges on their first-quarter balance sheets. More companies were expected to make similar announcements this week.

[…]On Friday White House chief of staff Rahm Emanuel and Obama senior advisor Valerie Jarrett were calling the CEOs and Washington office heads of the companies that took the financial hits and attacked them for doing so. One Washington office head said that the White House calls were accusatory and “downright rude.”

[…]”Most of these people [in the Administration] have never had a real job in their lives. They don’t understand a thing about business, and that includes the President,” says a senior lobbyist for one of the companies that announced the charge. “My CEO sat with the President over lunch with two other CEOs, and each of them tried to explain to the President what this bill would do to our companies and the economy in general. First the President didn’t understand what they were talking about. Then he basically told my boss he was lying. Frankly my boss was embarrassed for him; he clearly had not been briefed and didn’t know what was in the bill.”

[…]”We had memos on these issues, but none of our people, we think, looked at them,” says  a staffer. “When they saw the stories last week about the charges some of the companies were taking, they were genuinely surprised and assumed that the companies were just doing this to embarrass them.  They really believed this bill would immediately lower costs. They just didn’t understand what they were voting on.”

And more from National Review, where the CEO of Aetna was interviewed. (H/T Ace of Spades via ECM)

Excerpt:

Will insurance premiums go up?

The answer is yes, and some of the things that will drive those premiums are significant additional taxes the industry will ultimately have to pay in the first year.

The President said that this bill would not have any impact on people who already had coverage, that it was about the uninsured, that there would be no change. Will this legislation change the coverage of people who are already paying for it?

My perception is, yes, things will change. You might not have a plan that includes the exact same doctors. You might have plans that have richer benefits, and therefore you’re going to pay more for benefits you may or may not want. It would have been a better message to say, we’re going to make certain you maintain your eligibility.

The “Robin Hood” intention of giving to the unproductive by taking from the productive seldom pays off, since the productive are the ones who give people jobs. And a lot of people are going to lose their jobs because of Obama’s economic ignorance. Either that, or companies will raise their insurance premiums, so that the poor will have to pay more for health care. Obama doesn’t know what he is doing, he probably thinks that communism has made Cuba rich. He’s just trying to help poor America reach the opulence of communist North Korea.