Healthcare or Healthscare?

Alright let’s get down to some business. The Democrats celebrated a “victory” last night when the House of Representatives barely passed the largely Senate version of the healthcare reconciliation bill. Not a single republican voted for the bill, so all the benefits and repercussions of the bill can be directly pinned on the democrats. The main response that you get from this bill in the conservative camp, and this is what I consider the sane conservative camp, is that all the ways that we expect to pay for this bill will fall through, but not only that, the ways that wouldn’t fall through are just taxes on people and businesses. An interesting, even though optimistic, thought that comes to mind is “What if this bill actually saves more money and cuts the deficit more than expected?” I doubt anyone would actually say that, and the reasons are probably pretty solid to lean toward the conservative prediction, but I still find the possibility amusing. If it came true, it would be like winning the World Series, if the World Series happened only once every fifty years.

There was an argument about how big a business has to be to no longer be considered a small business because of the provisions in the bill that help small businesses. It seems to be the exact same argument against heavily taxing the highest tax brackets. A reminder to those who forgot, if we increase the tax on higher brackets, particularly those making over $250k a year, then no one will want to make more than $250k a year. They apply the same argument to small business. You are considered a small business if you have fifty or fewer employees, therefore business owners will never higher that fifty-first employee and we will get a stagnation of business. The counter to this argument is that most businesses actually fit this criterion, just like most people fit the criterion of making less than $250k a year. And furthermore, just like most people would strive to go from making $30k to making $250k, most entrepreneurs would still want to start a small business, and then take that business from hiring five to 7 people and expand it to fifty.

Do you have any idea how big a business has to be to accommodate fifty employees? It seems like a small number in the grand scheme of things, but you have to think about all the office space you need to comfortably fit all those people. You also have to consider how much money the company has to be making to afford to pay all these people. And the fact that most businesses actually have fewer than fifty employees means that when a business has to decide between increasing to sixty employees and taking the tax increase or remaining at fifty, that ten employees won’t amount to much. Honestly, I find it hard to believe that a business with fifty employees would stay at fifty forever, even if they have the opportunity to expand to maybe seventy. In my limited experience and insight, I have seen that businesses generally don’t expand that slowly. They pick up a big investment and expand a significant amount, hiring a team of people to be a part of this expansion. There will, of course, be those businesses with fifty employees that desperately need that one specialist and will have to make some tough choices, but I feel that’s far too rare to really be a significant problem.