The IUSB Vision Weblog

The way to crush the middle class is to grind them between the millstones of taxation and inflation. – Vladimir Lenin

Its Starting Already – John Deere: We will take $150 million hit from healthcare reform; Caterpillar: We will take $100 million hit just this year. UPDATE AT&T says ObamaCare bill will cost $1 billion per year! – UPDATED!

Posted by iusbvision on March 26, 2010

UPDATE – Government using thug tactics to silence companies telling the truth about the new taxes, new laws and economy. These are publically held companies and by law they have to put out these forcasts. Democrats making accusitory phone calls to CEO’s, summoning documents for fishing expeditions. – LINK

How many jobs will this cost? We are witnessing the de-industrialization of America. Think too many things are made in China now…wait till this gets fully implemented.

Yahoo News:

NEW YORK (Reuters) – Farm equipment maker Deere & Co (DE.N) expects after-tax expenses to rise by $150 million this year as a result of the healthcare reform law President Barack Obama signed this week.

Most of the higher expense will come in Deere’s second quarter, the company said on Thursday. The expense was not included in the company’s earlier 2010 forecast, which called for net income of about $1.3 billion.

Caterpillar Inc (CAT.N) said on Wednesday it would take a $100 million after-tax charge to earnings in the first quarter because the new law will lower its tax deductions.

Obama on Tuesday signed the most sweeping U.S. social policy legislation in decades into law, putting his name on a healthcare bill that will help shape his legacy. Designed to revamp the $2.5 trillion U.S. healthcare industry, the law will extend health insurance to 32 million Americans who currently have none.

The law could raise expenses for large U.S. employers. Industrial companies, which typically have large numbers of retirees, may be among those facing the biggest bill. Caterpillar had argued before the legislation passed that health reform would put it at a disadvantage against global competitors.

UPDATE II – Surprise the NYT left out some of the details of what AT&T has to do to deal witrh the billion dollart a year hit –

The rolling back of pay and benefits begins. BusinessWeek:

A change in the tax treatment of Medicare subsidies triggered the non-cash expense, and the company will consider changes to the benefits it offers current and retired workers, Dallas-based AT&T said today in a regulatory filing.

AT&T, the biggest U.S. phone company, joins Caterpillar Inc., AK Steel Holding Corp. and 3M Co. in recording non-cash expenses against earnings as a result of the law. Health-care costs may shave as much as $14 billion from U.S. corporate profits, according to an estimate by benefits consulting firm Towers Watson. AT&T employed about 281,000 people as of the end of January.

 

UPDATENY Times:

The telecommunications giant AT&T said on Friday that it would take a $1 billion noncash accounting charge in the first quarter because of the health care overhaul and might cut benefits it offers.

The charge is the largest disclosed so far. Earlier this week, the AK Steel Corporation, Caterpillar, Deere & Company and Valero Energy announced similar accounting charges, saying the health care law that President Obama signed Tuesday would raise their expenses. On Friday, the 3M Company said it would take a charge of $85 million to $90 million.

All five are smaller than AT&T, and their combined charges are less than half of the $1 billion that AT&T is planning. The $1 billion is a third of AT&T’s most recent quarterly profit. In the fourth quarter of 2009, the company earned $3 billion on revenue of $30.9 billion.

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