Tag Archives: Jobs

News

Obamacare causing local governments to eliminate jobs and cut back on worker hours

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This is the top article on Investors Business Daily at the time of writing.

Excerpt:

[W]hile private companies are getting all this unwelcome and hostile attention, local governments across the country have been quietly doing exactly the same thing — cutting part-time hours specifically so they can skirt ObamaCare’s costly employer mandate, while complaining about the law in some of the harshest terms anyone has uttered in public.

The result is that part-time government workers — many of them low-income — face pay cuts that can top $3,000 a year, and yet will still be left without employer-provided benefits.

Here is just a small sampling of local news reports about what local government officials are saying about ObamaCare, and the steps they’re taking to avoid or minimize its costs.

[…]Dearborn, Mich.: “If we had to provide health care and other benefits to all of our employees, the burden on the city would be tremendous,” said Mayor John O’Reilly, explaining why the city is cutting its more than 700 part-time and seasonal workers down to 28 hours a week. “The city is like any private or public employer having to adjust to changes in the law.”

Indiana: “What I’m seeing across the state is school districts, unfortunately, having to reduce the hours that they are having some of their folks work, primarily so they don’t have to worry about the (ObamaCare) penalties, or they don’t have to provide them health insurance, which would be very, very costly,” said Dennis Costerison, executive director of the Indiana Association of School Business Officials. Ft. Wayne Community Schools, for example, are cutting yours for nearly three-quarters of its part-time aides.

Omaha, Neb.: “The biggest problem is everyone said that ObamaCare is only going to help cut costs. Nothing could be further from the truth,” said Mike Kennedy , who serves on the board of Millard Public Schools, just outside the city, and figures ObamaCare will raise its costs by $400,000. A neighboring school district is reducing hours for up to 281 part-time employees to avoid $2.5 million in new costs, which will result in pay cuts of up to $3,300.

Long Beach, Calif.: “We are in the same boat as many employers,” said Tom Modica, Long Beach’s director of government affairs. “We need to maintain the programs and service levels we have now.” So the city is going to cut hours for 200 part-time workers so it doesn’t have to pay $2 million to provide health benefits.

Salt Lake City, Utah: “With new provisions in the Affordable Care Act, there was going to be a significant burden upon Granite School District and our taxpayers to offset the cost of benefits,” said spokesman Ben Horsley. He says covering the district’s part-time workers would cost about $14 million, and so about 1,000 will have their hours cut to 29 a week.

[…]Virginia: “The Commonwealth of Virginia is grappling with the same issues that many businesses in the private sector are as they struggle to deal with the costs imposed by the Affordable Care Act,” Paul Logan, a spokesman for Gov. McDonnell, said. The state is requiring that about 7,000 part-time government workers put in no more than 29 hours a week.

Texas: “The Affordable Care Act has added so much complexity and administrative burden that there is nothing affordable about it,” said Jared Pope, who is consulting with Texas municipal governments on ObamaCare. Dallas expects its health costs to climb $2.1 million next year. Plano is cutting hours to avoid $1 million in new costs.

Kern County, Calif.: “It will affect multiple departments, a majority of departments,” said the county’s deputy administrative officer Eric Nisbett, explaining that unless the county cut worker hours for 800 employees, ObamaCare would cost it up to $8 million a year.

Allegheny County, Pa.: “There’s frustration and anger and sadness and resentment, you know, but you don’t have a voice,” said adjunct English professor Clint Benjamin in the wake of the Community College of Allegheny County’s decision to cut hours for about 400 adjunct faculty and other employees so it wouldn’t have to pay $6 million in ObamaCare-related fees next year.

Medina, Ohio: “We feel bad as a city administration and as a council in having to cut hours from 35 to 29,” Medina Mayor Dennis Hanwell said. “We have the budget to pay the people, but we do not have the budget to pay for the health care.” If they hadn’t made that cut, the city faced up to $1 million in new health costs courtesy of ObamaCare.

It’s not just private companies who are cutting back on hours in order to escape being forced to pay for health insurance. I think I can pretty much guarantee that no one on the left thinks about where money comes from when they are giving these speeches about how much they care about everyone and how they will give everyone free money. The truth is that if you have a job, you are paying for people who don’t have jobs so that they can have the same life that you have without having to work. That’s what progressivism means. Equality regardless of wisdom and prudence.

News

Niall Ferguson argues that government is making it harder to run a business

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In the Wall Street Journal.

Excerpt:

Seven years of data suggest that most of the world’s countries are successfully making it easier to do business: The total number of days it takes to carry out the seven procedures has come down, in some cases very substantially. In only around 20 countries has the total duration of dealing with “red tape” gone up. The sixth-worst case is none other than the U.S., where the total number of days has increased by 18% to 433. Other members of the bottom 10, using this metric, are Zimbabwe, Burundi and Yemen (though their absolute numbers are of course much higher).

Why is it getting harder to do business in America? Part of the answer is excessively complex legislation. A prime example is the 848-page Wall Street Reform and Consumer Protection Act of July 2010 (otherwise known as the Dodd-Frank Act), which, among other things, required that regulators create 243 rules, conduct 67 studies and issue 22 periodic reports. Comparable in its complexity is the Patient Protection and Affordable Care Act (906 pages), which is also in the process of spawning thousands of pages of regulation. You don’t have to be opposed to tighter financial regulation or universal health care to recognize that something is wrong with laws so elaborate that almost no one affected has the time or the will to read them.

[…]Each year, the World Economic Forum publishes its Global Competitiveness Index. Since it introduced its current methodology in 2004, the U.S. score has declined by 6%. (In the same period China’s score has improved by 12%.) An important component of the index is provided by 22 different measures of institutional quality, based on the WEF’s Executive Opinion Survey. Typical questions are “How would you characterize corporate governance by investors and boards of directors in your country?” and “In your country, how common is diversion of public funds to companies, individuals, or groups due to corruption?” The startling thing about this exercise is how poorly the U.S. fares.

In only one category out of 22 is the U.S. ranked in the global top 20 (the strength of investor protection). In seven categories it does not even make the top 50. For example, the WEF ranks the U.S. 87th in terms of the costs imposed on business by “organized crime (mafia-oriented racketeering, extortion).” In every single category, Hong Kong does better.

At the same time, the U.S. has seen a marked deterioration in its World Governance Indicators. In terms of “voice and accountability,” “government effectiveness,” “regulatory quality” and especially “control of corruption,” the U.S. scores have all gone down since the WGI project began in the mid-1990s. It would be tempting to say that America is turning Latin, were it not for the fact that a number of Latin American countries have been improving their governance scores over the same period.

Whatever the root causes of the deterioration of American institutions, smart people are starting to notice it. Last year Michael Porter of Harvard Business School published a report based on a large-scale survey of HBS alumni. Among the questions he asked was where the U.S. was “falling behind” relative to other countries. The top three lagging indicators named were: the effectiveness of the political system, the K-12 education system and the complexity of the tax code. Regulation came sixth, efficiency of the legal framework eighth.

Asked to name “the most problematic factors for doing business” in the U.S., respondents to the WEF’s most recent Executive Opinion Survey put “inefficient government bureaucracy” at the top, followed by tax rates and tax regulations.

The troubling thing to me is that the private sector has to make a profit in order to fund government, and I don’t see that the private sector will be able to producing the profits needed to fund our government’s lavish spending. Nothing that I see about the next generation causes me to believe that they understand economics enough to vote to improve the business climate. They seem to be very much anti-business. One wonders where they expect to find jobs.

News

One-third of recent college graduates say they should have skipped college and gone to work

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From Forbes magazine, a word of caution to young people, especially to young men who intend to marry and have children.

Excerpt:

Here’s an indication of how burdensome student loans have become: About one-third of millennials say they would have been better off working, instead of going to college and paying tuition.

That’s according to a new Wells Fargo study which surveyed 1,414 millennials between the ages of 22 and 32. More than half of them financed their education through student loans, and many say the if they had $10,000 the “first thing” they’d do is pay down their student loan or credit card debt.

That’s no surprise when you consider student borrowing topped the $100 billion threshold for the first time in 2010, and total outstanding loans exceeded $1 trillion for the first time in 2011.  Student loan debt now exceeds credit card debt in the U.S. which stands at about $798 billion.

The problem sometimes is that not all college educations are worth their cost since they can’t guarantee a high-paying job to help pay off that student debt. A report from the National Association of Consumer Bankruptcy Attorneys says the rising student debt problem can have a bad impact on the economy. Even in the best of economic times when jobs are plentiful, young people with considerable debt burdens end up delaying life-cycle events such as buying a car, purchasing a home, getting married and having children.

There’s nothing wrong with a good education in a trade school or community college.

The actual number for outstanding student loan debt is about $600 billion, and it’s gone up a lot under Obama.

Excerpt:

The outstanding balance for all of the direct student loans the federal government has issued topped $600 billion in April, according to newly released data from the U.S. Treasury.

The total balance hit $600.457 billion by the end of April, says the Treasury, up from $592.142 billion at the end of March.

The Federal Direct Student Loan Program already has built-in debt forgiveness plans for people who end up earning low incomes or for those who entered lines of work preferred by the government.

In January 2009, when Obama was inaugurated, the balance was $119.803 billion and has since increased more than fivefold.

The $480.654 billion increase since January 2009 in what is owed to the Treasury in direct student loans represents a climb of about 250 percent in just over four years.

Before Obama’s first term, federally guaranteed student loans were made both by the government directly and by private lenders using their own capital through what was called the Federal Family Education Loan program. Language inserted into the the Obamacare law signed in March 2010, however, abolished the latter type of federally guaranteed student loan, giving the U.S. Treasury a monopoly over those loans.

As the Congressional Research Service has described it, this Obamacare provision made the U.S. Treasury the exclusive “banker” for federally guaranteed student loans. Thus, U.S. taxpayers essentially own these loans.

The troubling thing is that since the schools have spent all the time teaching children about global warming and the proper use of contraceptives, it’s unlikely that they will be able to find real jobs in order to pay off their loans. They aren’t learning how to manage money in school, and parents aren’t taking the responsibility to teach kids about money at home. The sad thing is that they have been taught by their teachers to keep voting for more politicization of education and more government spending on fashionable causes. But at least they feel superior about it. For now.