Waxman fumes

Waxman (below) gets a nostril out of joint. He resents public exposure of the fact that the effect of a "cost saving" trick by the Democrats is actually going to be a large cost increase, as companies dump their drug benefit recipients onto Medicare Part D.

Henry is flaring with resentment over another demonstration that only a resident of Cloud Cuckoo Land could take this administration's cost projections for ObamaCare seriously. The bond markets are not so gullible, and they will pay no attention whatever to Waxman and his ilk.

We can now see the general model for how the Federalization of the health system will occur, even though the new law famously contains no "public option": Think of Medicare and Medicaid as Pac Men, growing larger and larger as they inexorably gobble everything else up. Someone might argue that it's a wash, because employee health care costs that were in the price we pay for products will now simply be paid as taxes instead. To believe that, you have to believe that Government bureaucracies are as efficient as private industry, which means we're back in Cloud Cuckoo Land.

Byron


Washington Examiner:

On Capitol Hill and in the White House on Monday, Democrats were fuming over a series of announcements that started Friday from Fortune 500 firms saying their bottom lines will take huge negative hits because of changes in tax law mandated by Obamacare. That hit in turn means lower profit projections. Caterpillar estimates, for example, that Obamacare will cost it $100 million; John Deere faces expenses of $150 million; 3M, $90 million; AK Steel, $31 million; Valero, $20 million. And then there's AT&T, which is marking its balance sheet down by a whopping $1 billion. All in all, the Wall Street Journal estimated a $14 billion haircut for these corporations.

Under post-Enron accounting rules, the corporations were required to revise their projections to account for the effect of Obamacare on their bottom lines. The effect is negative because Democrats, in their zeal to raise revenues and improve Obamacare's claimed effect on the federal deficit outlook, took away a tax break these companies needed in order to supply prescription drugs to their retirees. The tax subsidy, itself a government accounting ruse crafted in 2003 by the Bush administration to dissuade corporations from dumping their retiree drug benefit programs on the then-new Medicare Part D, becomes taxable under Obamacare.

According to the American Spectator, top White House advisers reacted with angry phone calls to the corporations in question. House Energy and Commerce Committee Chairman Henry Waxman, D-Calif., issued harassing document requests and demanded that the chief executive officers appear before his committee next month to answer for their sins. These corporations, which legally owe an honest reckoning to their shareholders, are only doing their duty by restating projections. By contrast, Waxman and many of his fellow Democratic leaders in Congress have used every government accounting and budget gimmick at their disposal to deceive Americans for the last year about the true costs of Obamacare. These Washington politicians have no business lecturing CEOs on honesty in accounting.