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Jewish World Review July 30, 2009 / 9 Menachem Av 5769 Pay-or-play means more lost jobs By Glenn Garvin http://www.JewishWorldReview.com | I've heard of whistling while you work, but I think Max Baucus takes it too far. Baucus, the Montana Democrat who heads the Senate Finance Committee and will have a lot to say about the final shape of any health-care reform, says the new taxes Democrats are contemplating to pay for it are "interesting, they're creative, some are kind of fun." I guess, if you think bankruptcy, layoffs and unemployment are kicky. Those are the inevitable results if Congress goes ahead with the main idea being kicked around: the so-called play-or-pay provision that would require almost all businesses to either provide health insurance for their employees or pay a tax penalty of up to 8 percent of their payroll. Much of the debate around health-care reform has floated in the philosophical stratosphere — whether it amounts to socialized medicine, whether it will lead to rationing, whether it's moral to force young, healthy workers into insurance plans to bring down premiums for everybody else. But before we even get to that, shouldn't we ask a more fundamental question? At a time when American businesses are going bankrupt at a rate of 240 a day, when the unemployment rate is 9.5 percent and headed north, does it make sense to impose any new taxes on business? What if play-or-pay leads to a third option: taking your ball and going home? Play-or-pay encourages just that — and worse yet, the burden is likely to fall on the workers that health-care reform was presumably intended to help, those at the bottom of the economic food chain. Consider some numbers: Last year, according to the Kaiser Family Foundation, the average annual premiums for family coverage in employer-sponsored health insurance was $12,680. Under a play-or-pay law, a business would have to pay about 70 percent of that cost, or around $8,900. That's nearly the entire annual wages of a minimum-wage worker, which last year were $10,712. If the cost of employing a worker were to suddenly double, a business would have to do something. One possibility is to raise prices — not likely in this economy. Another is to stop hiring and let attrition eat away at your workforce. (Obama's next campaign slogan: Recovery in 2013!) And a third is to fire him. That's hardly an empty threat; companies are already dumping workers at a staggering rate. From December 2007 (which the government counts as the official start of the current recession) to June 2009, the Bureau of Labor Statistics has recorded almost 40,000 layoffs that have put 4.1 million employees on the street. It will be sadly ironic (or, I guess, "kind of fun" to Sen. Baucus) if several hundred thousand more join them as part of health-care reform. But when businesses realize it's cheaper to insure machines than people, that's what will happen. How many receptionists will be replaced with voice-mail systems? How many graphic-designers and bookkeepers will step aside for computer software? How much more often will you call customer service and find yourself speaking with somebody in New Delhi? For that matter, how many low-skill service jobs will simply disappear, the way gas-station attendants and milkmen and elevator-operators did? That's why the low-ball estimate of jobs lost to play-or-pay is 300,000 the first year; some economists predict it could be double that. And assuming the cost of health-insurance premiums continues to rise — a good bet; Kaiser says they've gone up four times faster than wages over the past decade — jobs will keep disappearing. Sorry, Sen. Baucus, but at the moment I don't think we can afford your kind of fun. Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here. Comment by clicking here. Glenn Garvin is a columnist for the Miami Herald Previously: 07/16/09: OAS turns a blind eye to violations by left 07/02/09: Nothing so shocking about this coup 06/22/09: Libs' darling strikes out 06/03/09: Yes, America should read Sotomayor's speech in context 05/20/09: ‘Bloody’ mission goes awry 05/07/09: The problem is they aren't just goofin' 04/30/09: Why can't students say ‘guns’ in school? 04/08/09: When non-U.S. citizens vote 03/2e/09: Of course the AIG bonus boys — the ‘best and the brightest‘ — deserve their loot 03/12/09: No choice in Free Choice Act © 2009, The Miami Herald Distributed by McClatchy-Tribune Information Services

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