Yet Another Little Noticed Provision Of Health Care Reform

In yet another little noticed provision of the recently passed health care law that will have the effect of stiffling job growth, small businesses , which have historically been the source of most jobs in this country, will now have little incentive to grow. The provisions found within the new law provides a 50% tax credit to those small companies offering health insurance coverage that employ less than 10 workers, and who on the average, earn less than $25,000 a year. This new tax credit is reduced on a sliding scale as more employees are hired.

“If a business can make a decision to substitute capital for labor – say, contract the procedure out or automate it – I believe [losing the tax credit] will play an important part in the reluctance to hire,” Villarreal said, adding, “It’s puzzling that we have this perverse incentive not to have businesses grow by not encouraging them to hire additional workers.”

This will have a very chilling effect upon small businesses that have been the engine for economic growth in America. That chilling effect will mean far fewer new hiring and far fewer jobs. Thanks Mr. Obama, thanks for killing off our chances of getting the economy back on track...or was that his objective after all?

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