In the continuing story of ObamaMart’s still incomplete (!) backend, the part of the Web site that takes the citizen’s input and sorts it, collates it with other government information, and then passes it on to other relevant parties—the health plan providers, for instance, and the IRS—there’s this:
Because of complicated connections between the new health care law and income taxes, the Department of Health and Human Services must send out millions of new tax forms next year.
The forms are called 1095-As, and list who in each household has health coverage, and how much the government paid each month to subsidize those insurance premiums. Nearly 5 million people have gotten subsidies through HealthCare.gov.
The Obama administration’s standard reaction to technological innovation has been to block change via regulation….
Federal regulators are also putting the brakes on self-driving cars, which are closely related to the Uber innovation—enabling riders to order a car service using their smartphone app. If fast-moving technology hadn’t collided with slow-moving regulators, this might have been the last summer you’d have to drive your own car.
US regulators won’t let car manufacturers go much beyond what Mercedes now offers [active cruise control, automatic braking and lane-keeping technologies]. That means car makers can’t roll out technologies they already have, and auto makers in Europe, which has fewer regulations limiting technology, have surpassed their US competitors.
No police department should get federal funds unless they put cameras on officers, Senator Claire McCaskill (D, MO) said today.
“It seems to me that before we give federal funds to police departments, we ought to mandate that they have body cams,” McCaskill said.
Body cameras on cops may, in fact, be a good idea. However, that’s a thing to be determined by the locals for themselves. This is another example of how the Federal government seeks to control State and local governments in the place of the State’s citizens and the local community members.
Burger King Worldwide Inc is in talks to buy Canadian coffee-and-doughnut chain Tim Hortons Inc, a deal that would be structured as a so-called tax inversion and move the hamburger seller’s base to Canada.
After all, Canada’s corporate tax rate is competitive even with Ireland’s 12.5% rate, at least from the lofty perspective of our own 35% top corporate rate: Canada’s rate is 15%. This inversion isn’t just the fiscally sound thing to do, it satisfies the company management’s fiduciary duty to control costs and maximize profits for the company’s owners.
The results are starting to come in, via three independently done polls by three separate Federal Reserve Banks.
The Federal Reserve Bank of Philadelphia:
78.8% of businesses in the district have made no change to the number of workers they employ as the specific result of ObamaCare
3% are hiring more
18.2% are cutting jobs and employees
18% shifted the composition of their workforce to a higher proportion of part-time labor
88.2% of the roughly half of businesses that modified their health plans as a result of ObamaCare passed along the costs through increasing the employee contribution to premiums, an effective cut in wages
With this attitude, we’re not going to have much of a drug development or production industry—to the detriment of our drug market.
“A big part of our concern is not just Sovaldi [a new, and so still very expensive, drug with a near-perfect cure rate for Hepatitis C], but all the other specialty drugs,” said Mario Molina, the CEO of Molina Healthcare that runs Medicaid and ObamaCare plans in nine states, on a July earnings call. He added: “I think that the government needs to step in here and make sure that the market is rational. If we as a health plan want a rate increase, we have to go to our regulators and get it approved. There’s no such thing going on in the pharmaceutical market.
Walgreen Co looked hard at doing one of these—buying an overseas company and then reincorporating in that overseas jurisdiction to lower its US tax bill, a bill flowing from a world-leading 35% tax rate. Indeed, Barclay’s had estimated that Walgreen would save $797 million a year in taxes if it carried through. They were brow-beaten out of the move, though, by the Federal government.
Now, Senator Chuck Schumer (D, NY) and his Senate cronies are looking at getting in the way of inversions generally.
The proposal…would restrict the practice of earnings stripping, where US companies borrow money from overseas parents and deduct the interest expense on US taxes.
Here is an argument for not doing business with the Federal government at all. It’s rapidly becoming not worth the cost—in hassle, in dollars, in business’ ability to control over their own operations. This is another of President Barack Obama’s barrage of Executive Orders, and this is how The Wall Street Journaldescribed it over the weekend:
Under the order signed last week, contractors and subcontractors who receive more than $500,000 in federal money will be obliged to report to government agencies any labor-law violations going back three years. The order covers violations of everything from family and medical leave to federal wage and hour laws in the three years before applying for a contract.
Ilan Brat and Giada Zampano wrote, in a recent Wall Street Journal piece, about job protections and their effects on the prospects of today’s children and young adults in Europe. The whole article is well worth the read for its specifics, but from my perspective, the following is the money quote, from one of those young adults, Ms Serena Violano, a 31-year-old still sharing a room with her older sister in their parents’ home:
For our parents, everything was much easier. They had the opportunity to start their own life. Instead, we don’t have any guarantees for our own future.
Secretary of the Treasury Jack Lew originally (originally: three weeks ago, in mid-July) acknowledged he had no authority to alter the tax implications of US businesses reincorporating overseas in order to reduce their US tax burden.
Now he’s looking at (not for) ways to “meaningfully reduce the tax benefits after inversions take place” because reducing a company’s cost structure, the legally and fiscally required behavior of any company’s managers, by making use of this “unpatriotic tax loophole” is unpatriotic. I’ll ignore the fact that what’s unpatriotic here is the usurious tax rates charged American companies and the zeal with which this administration attacks American companies for worrying about their bottom line more than they worry about government imperatives in order to get to a different point. As The Wall Street Journalput it,