Topics: Obamacare

Yes, WaPo, the $3,000 Schumer-Rubio penalty on hiring Americans does exist

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Beltway Confidential,Congress,Conn Carroll,Immigration,Obamacare,Jobs,Marco Rubio,Senate,The Washington Post,Health Care,Chuck Schumer,Analysis

Last week, Sen. Ted Cruz, R-Texas, tweeted out: “If Gang of 8 bill passes, those newly legalized are exempted from Obamacare. HUGE incentive for employers to hire them instead of Americans.”

The Washington Post’s Fact Checker, Glenn Kessler took issue with this tweet, claiming: 1) there is no penalty; 2) even if there is a penalty it would only apply to a small number of jobs; and 3) even if there is a penalty and it applies to lots of jobs, it is illegal for employers to take advantage of it.

Kessler is dead wrong on all three counts, and he has even admitted he is wrong on the first one.

First of all, Schumer-Rubio absolutely creates a large financial incentive for employers to hire newly amnestied immigrants over Americans. This is not a partisan observation. Here is Investor Business Daily’s Jed Graham making the point. And here is The New Republic’s John Judis. And below is The Washington Examiner‘s own Phil Klein:

Under Obamacare, businesses with over 50 workers that employ American citizens without offering them qualifying health insurance could be subject to fines of up to $3,000 per worker. But because newly legalized immigrants wouldn’t be eligible for subsidies on the Obamacare exchanges until after they become citizens – at least 13 years under the Senate bill – businesses could avoid such fines by hiring the new immigrants instead.

When the immigration bill interacts with Obamacare’s employer mandate, it functions as a reverse tariff against hiring American citizens. It would be like subjecting Americans to a $3,000 tax on purchasing American cars, while allowing them to avoid that tax by purchasing cars from Germany, Japan, or any other country other than America. That’s not free trade. That’s government rigging the game against American citizens.

Kessler first denied this penalty against hiring American workers even existed, but when he was called out by his own commenters he admitted he had completely misunderstood the issue. But instead of retracting his attack on Cruz, Kessler doubled down, claiming that very few jobs would be affected. “Only 0.2 percent (about 10,000 businesses out of 6 million) would be affected by the employee shared responsibility provision. That’s because it only affects companies that employ more than 50 people — and 96 percent of companies have less than 50 people,” Kessler wrote.

Kessler appears to have pulled this talking point straight from a White House Obamacare fact sheet which reads, “The law specifically exempts all firms that have fewer than 50 employees – 96 percent of all firms in the United States or 5.8 million out of 6 million total firms – from any employer responsibility requirements.” But Kessler failed to note that that same White House fact sheet also noted that, “These 5.8 million firms employ nearly 34 million workers.”

Thirty-four million workers may sound like a lot, but there are more than 110 million private sector workers in the U.S. economy. That means, by Kessler’s own numbers, about 75 million Americans may be affected by this Schumer-Rubio job penalty.

Finally Kessler claims that federal law prevents employers from asking a prospective employee about their citizenship status. But as Cruz’s press secretary Catherine Frazier notes, “There is nothing to prevent an employer from legally finding out one’s legal status during the application process.”

Kessler has already made a partial retraction of his original attack on Cruz. He should review the facts from the beginning and think about a full retraction.

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