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Topics: Obamacare

Morning Examiner: The Schumer-Rubio-Obamacare tax on employing Americans

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Politics,Beltway Confidential,Conn Carroll,Morning Examiner,Taxes,Immigration,Obamacare,Fiscal Policy

“A foreign worker will never be hired to undercut an American worker’s wage,” Sen. Chuck Schumer, D-N.Y., claimed on the Senate floor yesterday in his opening statement in support of his Schumer-Rubio immigration reform bill. But as The Washington Examiner‘s Phil Klein explained yesterday, this is surely false:

Under the existing Senate immigration bill, immigrants who have been in the United States illegally can obtain a provisional legal status after paying fines and meeting certain preconditions. But this population would have to wait at least 13 years to be able to obtain full citizenship, and it isn’t until then that they could qualify for government benefits such as Obamacare.

The problem arises when this rule interacts with another provision of Obamacare – the employer mandate. Starting in January, businesses with 50 or more employees who don’t offer workers health insurance that the federal government deems acceptable must pay a penalty if at least one of their workers obtains insurance on a new government-run exchange. The penalty is up to $3,000 per worker.

This means if the immigration bill becomes law, some employers could effectively face incentives of hundreds of thousands of dollars to hire newly legalized immigrants over American citizens, because the immigrant workers would not qualify for Obamacare benefits.

With many American employers already moving employees from full-time to part-time status to avoid paying the employer mandate, we know businesses are looking for any way possible to mitigate the harm to their bottom line from Obamacare. If hiring an amnestied immigrant saves them $3,000 a year, many will do so.

A forgotten issue
But so far, conservative opponents of amnesty on Capitol Hill are not making this, or any argument that amnesty will hurt American workers. Yesterday, the National Review published a set of anti-Schumer-Rubio talking points produced by conservative Senate aides. Among the 12 reasons listed for opposing the bill are, “Fails to secure the border, “Unfairly grants legal status to millions of illegal immigrants ahead of those following laws,” and “Threatens to bankrupt our entitlement system.” There is even a “Contains earmarks that benefit specific states, industries, and interest groups,” section.

But at no point does the memo make the economic case that granting amnesty to 11 million illegal immigrants and doubling the flow of guest workers into the country will make it harder for many working-class current Americans to find jobs and lower their wages when they do. As Harvard economist George Borjas has thoroughly documented, increased immigration does boost the economy, but only for the immigrants and the wealthy. Working class Americans suffer higher unemployment and lower wages. Obamacare only magnifies this effect.

Conservatives shouldn’t be afraid to make this case.

From The Washington Examiner

Editorial: More government equals less economic, technological progress
Tim Carney: Farming vs. capitalism
Phil Klein: Immigration and Obamacare’s employer mandate
Conn Carroll: DeMint vs Rubio – The Heritage Foundation goes all in against amnesty
Joel Gehrke: George W. Bush’s favorability reaches post-presidency high
Noemie Emery: The Clinton Effect may not help Obama
Sean Higgins: Big Labor unprepared to battle new right-to-work laws

In Other News
The Wall Street Journal, Global Tumult Grips Markets: The tectonic plates of the world economy are shifting, raising the question of whether markets are experiencing a bumpy return to a new normal or new period of volatility.
The Washington Post, Three of four Americans oppose race-based college admissions: Americans overwhelmingly oppose race-based college admissions and support extending federal benefits to same-sex couples, according to a new Washington Post-ABC News poll that finds broad public agreement on issues awaiting Supreme Court decisions this month.
CBS News, Most disapprove of gov’t phone snooping of ordinary Americans: In the wake of the recent disclosure of two classified U.S. surveillance programs, most Americans disapprove of the government collecting the phone numbers of ordinary Americans, but approve of its monitoring those suspected of terrorist activity, according to a new CBS News poll.

Lefty Playbook
Sarah Kliff reports that Obama didn’t change his mind on Plan B, Justice changed its legal strategy.
Fred Kaplan calls for Director of National Intelligence to be fired.
Chris Cillizza on Democratic plans to win in 2014 by turning Ted Cruz into Todd Akin.

Righty Playbook
James Pethokoukis explains why there will be no tax reform this year or this decade.
Glenn Reynolds on Obama’s continued abuse of power.
Andrew Stiles on a new study showing collective bargaining is causing education stagnation.

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