Joe Biden tells Americans that he's helping them by building "from the bottom up and the middle out." …
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Image of the Day: Americans' Shrinking Earnings Under Joe Biden

Joe Biden tells Americans that he's helping them by building "from the bottom up and the middle out."  But the numbers don't lie, and the ugly reality is that he's only dragging us all toward the bottom.  Throughout his presidency, wage gains (green) have been consistently exceeded by inflation (blue), meaning loss in real earnings (red):

[caption id="" align="alignleft" width="455"] Bidenomics Means Lost Earnings[/caption]…[more]

May 19, 2024 • 11:05 PM

Liberty Update

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Obama Admin Caves to Union Pressure, Proposes Tax Exemption Print
By Ashton Ellis
Wednesday, November 13 2013
[T]he sleazy months-long pressure campaign by the Change to Win unions and the semi-secret capitulation offered by the Obama administration virtually guarantees future perversions of the law.

After demanding payback for supporting Democratic candidates and the passage of ObamaCare, an influential group of labor unions is getting a special exemption from one of the health law’s most onerous taxes.

But will it be enough to save them?

Buried in a complicated regulatory announcement last week, the Department of Health and Human Services (HHS) broke the news in the least transparent way possible. Only careful sleuthing by Kaiser Health News spotted the language saying that HHS will propose that “certain self-insured, self-administered plans” be exempted from paying ObamaCare’s reinsurance tax in 2015 and 2016.

In practice, such “self-insured, self-administered plans” will surely include so-called Taft-Hartley plans operated by unions representing an estimated 20 million part-time workers and their dependents. 

The HHS announcement is the latest in a long-running negotiation between the Obama administration and its labor union patrons.

The pressure campaign started back in June when a group of unions representing part-time workers called Change to Win complained that compliance with ObamaCare’s mandates would make their union-run health insurance plans financially unsustainable.

To compensate, Change to Win demanded that the White House rewrite the law in order to make two significant carve outs. The first would make Taft-Hartley plans eligible for ObamaCare exchange subsidies, even though the plans would be the only subsidy-receiving entity that could turn away applicants.

The second would exempt the employers of union members in Change to Win from paying the law’s controversial reinsurance tax. This tax is projected to net $25 billion from 2014 through 2016, and will be levied on employers on a per employee basis to help insurance companies recoup the cost of absorbing ObamaCare’s expensive new mandates.

In both cases, Change to Win argues that compliance with ObamaCare as written will convince employers to cease participating in union-run Taft-Hartley plans. The cheaper alternative will be to dump workers on either a state or federal ObamaCare exchange. That shift would eliminate Taft-Hartley plans, and with it the most important reason to be a member of a Change to Win union.  

Even before the litany of problems with surfaced, Change to Win pulled out all the stops to shield their members from losing their insurance. 

Joseph T. Hansen, the current chairman of Change to Win, was one of the first supporters to remind President Obama of his fallacious promise that, “Nothing in this plan will require you to change your coverage or your doctor.”

A month later, Hansen was joined by James Hoffa and other Change to Win members in a joint letter to Democrats in Congress demanding payback: “Congress wrote this law; we voted for you. We have a problem, you need to fix it.”

For good measure, the AFL-CIO passed resolutions at its September convention calling on the Obama administration to extend subsidies to Taft-Hartley plans, along with exempting them from ObamaCare’s reinsurance tax.

The Obama administration has thus far resisted pressure to qualify Taft-Hartley plans for ObamaCare subsidies, correctly arguing that the purpose of a subsidy is to offset some of the increased costs associated with insurance plans bought on an ObamaCare exchange. But in order to sell plans on an exchange, an insurance company cannot turn away any applicant. Union leaders want to keep the right to cover only their own members.

Now HHS is throwing Change to Win and its member unions a lifeline; albeit one that may not be long enough to save them.

By proposing to exempt Taft-Hartley plans from ObamaCare’s reinsurance tax, the Obama administration is trying to save them from a crippling expense. If HHS’s proposal is implemented, Taft-Hartley employers would not have to pay the $42 in 2015 and $26 in 2016 per insurance plan member required of all other employers. The tax is phased out in 2017.

Taft-Hartley employers must, however, pay the $63 per plan member fee for 2014.

Without an open and transparent process, it is impossible to know why HHS thinks Taft-Hartley unions will be pleased with its split-the-baby approach. Perhaps employers will go along with the initial financial hit knowing they won’t have to keep paying like everyone else in 2015 and 2016. Or maybe the Obama administration is looking for a way to force more people onto ObamaCare exchanges to increase the nationwide enrollment count, while appearing to throw a bone to a key constituency.

Either way, the sleazy months-long pressure campaign by the Change to Win unions and the semi-secret capitulation offered by the Obama administration virtually guarantees future perversions of the law. 

The only solution to the increasing use of gangster government is to vote out the offenders and repeal the law that gives them an incentive to operate.

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