- Calamity #1 - Let's start with the easiest one. Several months ago we reported and discussed the fact that within a year of passing the Obama Care legislation, the Health and Human Services Department within the Federal government had already allowed over 1,000 waivers to the early requirements of Obama Care. We made the case then, and still do, that this could not have been a well written and well researched piece of legislation if the government was issuing about three exemptions or waivers everyday to its requirements.
Well, its a few months later and recent news reports indicate that the number of exemptions being issued has not slowed down as some supporters of the legislation predicted it would. The news reports indicate that the number of company waivers and exemptions is fast approaching 1,500, keeping it on track for the same daily rate as of a few months ago. Again, how good is this piece of legislation if nearly 1,500 companies and other entities have already been exempted from its requirements, at least temporarily? If 1,500 exemptions have been granted, I cannot imagine the number that have been applied for in order to get out from under Obama Care's requirements.
- Calamity #2: About two years ago, Obama spoke to a joint meeting of Congress to press for the passage of Obama Care. During a particular part the President's speech, Congressman Joe Wilson shouted out "You lie," an outburst that he quickly apologized for and an apology that was quickly and graciously accepted by the President. However, then Speaker of The House, Nancy Pelosi, was to have none of this apology business and prompted House Of Representative action against Wilson for his behavior.
However, it turns out that Wilson may have actually been right and Pelosi may have moved for sanctions against him under false pretenses. Wilson yelled out "you lie" when the President stated: "The reforms I am proposing would not apply to those what are here illegally." In other words, no part of Obama Care would use American taxpayer money to support the health care needs of illegal aliens in the country.
Turns out, this is not the case. Recent news reports and statements from Wilson's office assert that over $8 million of Obama Care funding, which is within a larger budget of a $28.8 million budget given to community health care centers, has been specially set aside to help seasonal and migrant farm workers. These heath care centers/clinics have been explicitly told not to ask for immigration status when serving these workers.
Thus, was it a lie when the President stated two years ago that no part of Obama Care funding would be used for "those that are here illegally" or did the situation change and no one in the White House got around to updating the country on this change? In either case it looks like Wilson was right, although his venue and approach for pointing out this potential lie was not appropriate.
The Congressman makes a good point when discussing this calamity. The country is going broke, the country has a mountain of national debt, our limited funds need to be used to support Americans' health care needs, not the health care needs of illegal aliens. At the very least, Pelosi owes the Congressman an apology since the basis for forcing sanctions on Congressman Wilson was baseless.
- Calamity #3: Yesterday, over 409,000 Americans filed for first time unemployment claims, continuing a 400,000 weekly trend that seems to have been going on forever. Unemployment is still stuck around 9% or so. Recent testimony in front of Congress by Andy Puzder, the CEO of CKE restaurants (CKE operates or franchises almost 3,200 Carl's Jr. and Hardee restaurants around the world), described how some of the requirements of Obama Care is putting the brakes on his company's abilities to hire more unemployed Americans:
- Obama Care requires restaurants such as CKE's to post the caloric content of their food on menu boards in all of their restaurants. Puzder testified that this new requirement will cost $1.5 million to implement. He did not discuss how much it would cost to change the signage everytime the menu changed. This $1.5 million is about 17% of what CKE invested in new restaurants last year.
- Thus, as a result of this sign requirement, fewer restaurants will be opened and fewer new people will be hired since the mandatory expense of $1.5 million has to come from somewhere. The saddest part of this whole story is that this component of Obama Care is unlikely to have any positive impact on America. Market research that was carried out on people who ate at similar restaurants New York City after the city implemented the same menu board requirement found that very few people noticed the caloric signs, even fewer people read the signs, and even fewer people, a very, very small percentage, changed their eating habits as a result of the signs.
His views are consistent with others in the food industry. Scott Womack, who operates a company that owns 12 IHOP restaurants in Indiana and Ohio, testified that the legislation will have dramatically negative effects on his business. By the beginning of 2014, he believes that he will have to provide health insurance coverage for all of his full time employees.
Given the relatively thin business margins in the food industry, he does not know how he will be able to comply. He estimates the cost of complying will be 50 percent greater than his company's earnings. Even if he finds a way to comply with these additional costs, it will certainly hinder his ability to expand, adding new restaurants, hiring more people, paying contractors and builders to construct his new restaurants, pay advertising people to promote his new locations, and purchasing products to serve at his new locations. Many of these latter functions provide employment beyond his direct hiring of people for his company.
Adding insult to injury, Puzder and Womack have not been able to obtain waivers to Obama Care requirements while their competitors, McDonalds and Jack-In-The-Box have received waivers. Not only is Obama Care adding a heavy cost burden to their operations, it is unfairly tilting the competitive playing field by providing a large cost advantage to their competitors. Thus, Obama Care supporters can not even make the claim that all parts of America and the businesses within America will be playing under the same rules under Obama Care. Pathetic.
It might justify all of these calamities if Obama Care had a chance at working. However, more times then I care to remember, we have gone through the myriad of reasons in this blog why this legislation is doomed to failure. The writers and supporters never understood the root causes of our escalating health care costs and without understanding those root causes, our political class has virtually no chance of solving the problem.
Obama tried to solve a public health crisis (i.e. Americans eat too much, Americans eat too much of the wrong kind of food, Americans smoke too much, Americans on average are getting older), a legal crisis (our health care industry needs signficant tort reform and a lack of competition crisis (our health care industry needs to allow cross state lines competition between health care insurers), by developing a huge, expensive, cumbersome and unfair monstrosity that deals with virtually none of these root causes/crises. As a result, we see restaurants cutting back on expansion and hiring, large companies (e.g. AT&T, John Deere, and others looking to eliminate their health insurance programs because Obama Care makes it less expensive to NOT offer health care than to offer it), and the national debt exploding under Obama Care because of its poor planning and understanding of the problem.
Groucho Marx said it best many decades ago when explaining how Obama Care came into being: "Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly, and applying the wrong remedies." I could not have said it better when it comes to this legislative disaster. I can hardly wait to see what falls apart next week.
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