Re: CASH FOR CLUNKERS - Unintended consequences?

On Aug 22, 12:23 pm, "Jeff Strickland" <crwlrj...@xxxxxxxxx> wrote:
"Jeff" <jeff....@xxxxxxxxx> wrote in message

news:318b8cb9-9188-463c-bb00-71eed2c59385@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
On Aug 21, 10:22 pm, "Jeff Strickland" <crwlrj...@xxxxxxxxx> wrote:



"Jeff" <jeff....@xxxxxxxxx> wrote in message

news:da668c03-d819-4291-aad8-71100a66061f@xxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
On Aug 21, 7:33 pm, ByTor <By...@xxxxxxxxxxx> wrote:

In article <2888-4A8F21BD-...@xxxxxxxxxxxxxxxxxxxxxxxxxxxx>,
ImpartialObser...@xxxxxxxxx says...

Sorry, no reward or stimulus for being good or doing the right thing.

If you made all your mortgage payments on time, took out only a loan
you
felt you could actually afford, made regular payments on your credit
cards, paid other bills when due, made enough money to pay income
taxes,
already drive a fuel-efficient car or in any other way ACTED
RESPONSIBLY
in recent years - YOU GET NOTHING, except for maybe higher taxes to
pay
for the stimulus benefits given to others who were not so responsible.

In short, NO SOUP FOR YOU, SUCKER! JM

Don't forget soon to be paying for free healthcare.......No wait, it
will be free? WOW!

Who do you think pays for the healthcare for the police in NY? The
taxpayers of NY. Who do you think pays for the healthcare of people
who work in the US for Microsoft? The people who buy Windows and
Office. Wod o you think pays for the healthcare of the retirees and
employees of Ford? The people who buy Ford cars and parts. So, we're
already paying for a lot of people's healthcare. What I don't see is
why employers should pay for healthcare. I understand how employer-
paid healthcare evolved (a benefit from companies during the '40s
because it was not a good idea to raise wages during war), but, I
don't see how it should be tied to employment any more.

Jeff

<JS>
Whoa!

Employers pay for health care of employees because they use the benefit as
a
draw to attract those employees. When the employer pays for the benefits
they provide, they do it with proceeds of sales.

That's like saying we don't pay the salaries of the employees, either.
Well, healthcare costs are a large part of many companies' payrolls.
It is a huge cost center for Ford, GM and Chrysler. While we don't
directly pay those costs, those costs are passed on to us. Why do you
think that Honda and Toyota want to keep the cost of health care down
(and GM, Ford and Chrysler, too)?

You and I do not pay those
costs. We might or might not buy the goods and services, and the proceeds
of
those transactions go to paying lots of things the employer does.

And if the employers had to pay less for health insurance, the
employer could sell the cars for less. Or, they could give their
owners (i.e., stockholders) more dividiends, the management more money
or develop new and better products (e.g., cars from Chrysler that get
good mileage and that don't fall apart too soon).

<JS>
You're in a false economy. Using the car sale example, automakers sell tens
of thousands of cars a month worldwide. The health benefits they pay per car
is such a small number that it isn't a consideration in the grand scheme of
things.

Health care benefits adds perhaps a dollar or two to the price of your iPod.

Surely if the health costs were shifted from the employer to the government,
your taxes would cost more than added costs to the goods and services you
buy.

</JS>

Employer paid health care is not paid with our dollars. Government paid
health care IS paid with our dollars.

Actually, because employer-paid health care is paid with dollars from
the employers, that is one reason why employers like to move off-
shore. THey don't have to pay health-care for their employees in
Germany, India and China.

Jeff

<JS>
They move offshore for a variety of reasons, most of them having to do with
wages and environmental regulations rather than employee benefits that are
not a wage.

Just pulling a round number or two from my ass to illustrate the point, if a
technology sector worker makes $30 per hour and buys into the health care
plan for his family, the company pays about $450 of the cost and the
employee picks up the remaining $150 for his family's coverage and the
various options he might select. A typical company will offer its employees
an allowance and a menu of health care options. The company will pay up to
the allowance amount. If the employee is single and his health care options
fall below the allowance, the company pays in full and the employee does not
get to keep the amount the company is willing to allow but does not have to
pay. If the employee selects options that exceed the allowance, he pays the
extra amount. So, the company's cost are set at the $450 figure for all
employees. A full-time employee working 40 hours gets 2080 hours per year,
divided by 12 equals 173 hours per month. $450 / 173 = $2.60 per hour per
employee for health care.

If the technology company can move offshore for $15 per hour in wages, they
aren't going to be motivated by the $2.60 savings in health care benefits
because they will save $15 per hour in wages and can absorb even higher
health care costs if they exist elsewhere.

You can dispute the $450 per month in health care allowances, but the cost
per hour of health care is not going to move very far from the $2.60 figure
that results from dividing the annual cost of the care by the number of
hours. Even IF a company paid $600 per month, the hourly cost is less than
$3.50. If a company can find workers that will do the job for half of the
salary and double the health care cost, the company still saves loads of
money.

Throw in the cost of environmental impact fees and other costs of doing
business based within in the USA, and moving offshore starts to make lots of
sense for hundreds of reasons that have nothing at all to do with health
care costs.

Assuming the company pays $600 per month, $3.50 per hour in health care
costs, and they make a product that takes 12 hours to build, the heath care
cost of that product is $42. If there are three workers, the cost is $126..
If the product is mass produced by hundreds of workers, the number changes,
but all you have to do is the math. If a hundred workers are on a line
building 100 units in 12 hours, the cost is still $42 per unit. If the unit
has a retail price of $12,000, $42 isn't going to change it enough to sway
your decisoin to buy or not, and if the government takes on the services
that $42 buys, then that service will cost $84 at a minimum.

You, sir, are in a false economy.

</JS>

$3.50 per hour for someone who makes $10.00 per hour is a lot of
money. It 35% of the base salary. And even for someone who makes
$35.00 per hour, it is still 10% of the base salary. Those nickels and
dimes add up.

That also means that in a school with 20 teachers and staff members,
that $3.50 per hour works out to $70 per hour for health insurance.
WIth that $70 per hours, two more staff members (teachers, aids,
whatever) could be hired, decreasing the student to teacher ratio,
providing better after school programs, whatever.

The fact is that these costs are already being paid by society. The
question is how do we address the costs so that the costs are paid
more appropriately and so that everyone gets health insurance?

Jeff
.

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