Tuesday, October 29, 2013

The Coming Obamacare Recession

I'm going to go out on a limb and predict a recession in the near future. First, there's this.
WASHINGTON—A drop in auto purchases weighed on U.S. retail sales last month, though underlying figures show that consumers picked up the pace of spending on electronics, eating out and some other nonessentials.

Retail sales fell a seasonally adjusted 0.1% in September from a month earlier, the Commerce Department said Tuesday. Economists surveyed by Dow Jones had forecast a 0.1% rise.
The analysis at the end of the article has this to say.
(M)ore recently job creation has stalled and consumer confidence has taken a hit, raising concerns that spending could fall off. The Thomson-Reuters/University of Michigan consumer-sentiment index fell for the second straight month in September. This month it dropped again, falling to its lowest level since December 2012.

Consumer attitudes soured as Washington gridlock worsened, leading to a government shutdown that ran from Oct. 1 through Oct. 16. It's not yet clear if that darker mood will translate into less spending.
Millions of people losing their health insurance and almost everyone having to pay more than they used to is going to necessarily lead to less consumer spending and less consumer confidence. In an already weak economy that is driven by consumer spending, that sure looks like a recipe for a recession.

These Ivy League, society-reshaping ideas never work out the way they did in the faculty lounge bull sessions.

H/T: Flopping Aces


Moxie D. Hoxie said...

I posted this comment over at a couple of other blog comments:

I fully suspect that we will soon be paying income tax on our employer contribution to our health insurance. Why else list it on the W2 form? If it was MERELY a matter of verifying compliance with the @&#* law, a simple check box would’ve been sufficient. Nope, taxing us on our employer contribution will get a lot of people to beg off getting health insurance through their employer, in order to get it for themselves through the Exchange. Because when you BUY YOUR OWN health insurance, you get a tax break.

Let’s say someone is earning (I like to work with small numbers, it’s easier) $30K/year and contributes $100/mo towards theirinsurance while their employer contributes $150/mo. Now their income is considered to be $31,800/ year, and they get a tax break on the $1200 they spend for their contribution. But, if they get NO employer contribution, and shell out the whole $250/mo towards their insurance, their adjusted income is now $27,000 per year for tax purposes. Of course, the adjustment will only be as much s a “bronze plan”-anyone buying platinum with get screwed…

I am sure this is buried somewhere in those 3000 pages. I just can’t find the WHOLE 3000 pages to search for it!!!

Anyhow, this is another one of the ways this @#* “law” is designed to screw up health insurance in the US and lead us down the garden path to Socialize Health “care.”

Very Depressed Employer said...

As an employer, Obama Care is destroying my business. I employ 15 people, all of which are full time. I have ahd to cut their hours down to 25 a week to ensure they do not go above 30 because there just isn't enough money to provide these people with benefits (and pay additional taxes to offer such). Hiring new people to work the difference has been miserable; constant confusion on duties not to mention shifts. The problems are further destroying business.

And, with so many of our customers terrified over Obama Care and how they will afford it, business as a whole is now down 70%!

This program doesn't work for ANY OF US. The employees are unhappy, I am unhappy, the customers suffer and that leads to no employee bonuses, no company trips, no perks and new employees now make minimum wage with zero vacation time.