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The Big Lie

Wednesday, October 26, 2016 9:38
% of readers think this story is Fact. Add your two cents. / by Karl Denninger / 2016-10-26 06:00

Read this one carefully folks:

“Wait a second,” Emanuel said. “If you listen to the full thing that he said, I think he has a point, which is that for Americans between 250 percent of the poverty line and 400 percent of the poverty line, roughly $50,000 to $100,000, we need to bolster the subsidies in the individual market.”

Emanuel went on to say most of those people get insurance through their employer, and he criticized companies for placing burdensome health care costs on the employees.

There is no such thing as “placing a cost on an employer.”

Each employee has a cost and salary (or hourly wage) is just a part of it.  The rest are taxes, fees, overhead (e.g. the space you occupy and the machinery you use), and government mandates.  This all adds up to a figure.

If you increase one of those numbers then one of the others must decrease.  Overhead is typically not possible to decrease to make up for such a cost increase since a business will already seek to make that number as low as it can while still allowing you to do your job; reducing it further probably compromises your productivity (that is, they could buy you a slower computer for your desk but you’d get less work done; it therefore is not worth doing so since output would drop by more than the additional cost of the faster machine.)

If you attempt to force costs, such as health care, on the employer then salaries and wages will be decreased on a dollar-for-dollar basis since none of the others are under the employer’s control.  That is, taxes, fees and overhead are all numbers the employer cannot reduce.


The post The Big Lie appeared first on Silver For The People.


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