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Thursday, November 15, 2012

Economy Reaction To Obama Reelection Update

--posted by Tony Garcia on 11/15/2012
Obama won his re-election and what was easy to predict for years is coming to fruition: labor cutbacks directly attributed to Obamacare.

The health care overhaul and nationalizing takeover will go into full effect as a result of Obama winning the White House in 2008. While repeal was a very remote possibility had Romney won (people believing either way that the election would have a direct say in repeal or not were easily fooled and undereducated on how the system works), there was a chance of delay or having court challenges to the bill not be defended against by the Romney administration.

But Obama won. There is not any chance of any delay or partial defeat of the onerous and freedom-hating bill being implemented. At least the guess work is gone...it will happen. It already is happening.

Business are laying people off. Businesses are reducing full time equivalents and cutting hours. This was all predicted and I imagine the only ones who are surprised are the Obamacare supporters who don't run their own business that have employees to provide health care for. Business owners should not be surprised that many companies are finding it necessary for survival to reduce their workforce and reduce their employees' hours. People against Obamacare are not surprised by the reaction.

The latest in the line is Wal-Mart having to increase the employee share of the group health premium.
Wal-Mart Stores increased the share employees pay for its medical coverage programs 8% to 36%, depending on hours worked and pay, saying it expects health costs to continue rising.

Like other large employers, Wal-Mart is trying to manage costs while at the same time preparing to meet strict rules mandated in President Obama's health care overhaul, commonly called ObamaCare.
Don't undersell the significance of this.
Wal-Mart, the world's largest private employer with some 1.4 million employees globally, said in a mailing to employees that for its most popular plan, which covers individuals, the bi-weekly paycheck deduction would increase 13% to 23%, or $2 to $11 per paycheck.
That is the world's largest private employer responding to such drastic measures (increasing employees share of costs to up to 36%) as the initial response.
Nearly two-thirds of Wal-Mart's employees sign up to cover only themselves.

But the company said because of offsetting cost reduction moves the average rate employees pay will only rise about 4.4% in 2013, vs. an estimated 9% average increase for all U.S. workers, according to human resources firm Aon Hewitt.
The new law also mandates that parents ensure coverage for their kids well into their 20's. This will result in a lot of parents being forced to add their deadbeat children onto their health plans. The stat of 2/3 of Wal-Mart employees covering only themselves will drop. More employees will have family coverage which costs more. If it costs more to the company it will cost more to the employees in both premiums, slower wage increases (already 1/2 of the national average) and in hours reductions (meaning even more people will be dropped to below hours requirements that will give them benefits).

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