Health Care Reform
Floor Speech
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Mr. CASSIDY. Thank you, Dr. Gingrey. You know, I like the focus of this conversation. And if you will, I want to point out that oftentimes when we speak about losing a job, unless you've lost your job, you assume it's someone else that is losing their job. But I think it's important for the American people to understand that this has the potential to affect people at all strata.
Let's start off with the tax on Medicare, the increased Medicare tax. This is going to be on the people who earn over $200,000 a year. Many of these folks don't consider themselves wealthy. If they're small business people, he or she is trying to make a payroll and expand a business, and this is going to hit them. And inevitably, when you tax, you are going to lose money that would otherwise be available to create jobs.
One of our famous Chief Justices said that the power to tax is the power to destroy. When you increase taxes on these folks that are job creators, you destroy their ability to create jobs. Now, folks say, well, that doesn't relate to me because those are the folks who are small business people, and I'm not a small business person. Well, as it turns out, let's go to the other end of the spectrum. As it turns out, this plan levies a $2,000 penalty upon an employer whose employees will get a tax credit from the Federal Government. Now, the Congressional Budget Office--not the Republicans, not the Democrats, but the objective arm of Congress, the Congressional Budget Office--says that because of this there will be less hiring of lower-income people. When you are a small business person hiring entry-level wage earners and you are levied a tax of $2,000 per person, you're not going to hire. You're going to find a way to increase productivity where you don't have to hire those folks.
I caught a fellow who owns a string of Taco Bells, and he has 20 employees per place. He said, if I have to put a $2,000 tax on each of my employees--he has about 500 total--in a very price-sensitive market where someone makes a decision to buy or not to buy fast food depending on price, I'm going to have to lay people off. So now we have the small business person who is going to pay the increased tax. Therefore, it destroys the ability to create as many jobs, and now we have the tax, if you will, the employment tax on the person who is at the entry-level job.
Let's go to a different person, someone who works for a large corporation. Well, again, in the effort to grab enough revenue to look like this is cost neutral, there is now a tax levied upon medical device makers. There was a great article in realclearmarkets.com where they kind of go through what you're posing here, that the health care bill that we just passed is going to be terrible for the job market. So in this bill there is levied a 2.9, I think, percent tax on medical devices. Well, it turns out you can ship those things to Ireland, according to this article, and you're still taxed. It isn't just those that are being marketed in the United States, but, rather, it's those that you would be selling overseas, incredibly competitive market where people in Ireland, China, the United States are all manufacturing these devices.
Well, if you manufacture it here, there is a tax apparently even if you export. But if you manufacture it
in another country, you are only taxed on those that you bring to the United States. So let's say your shop is in India and you're producing artificial hips and you send 100 to the United States. Well, there is a little bit of tax in that hundred; but if you send 1,000 elsewhere in the world, there is no tax whatsoever. If you build those same artificial hips in the United States, you are taxed wherever they go. So if you're working in the manufacturing unit of that medical equipment maker, you lose your job. If you are the person designing it, they're going to offshore it to another country. If you're the owner, you may say, why am I doing my manufacturing here and taking a 3 percent hit on whatever I do? Why don't I set up my shop in another country and only pay the tax if I import it to the United States?
Again, in a desperate desire for revenue to make this look neutral, we've taxed jobs. And going back to what Supreme Court Justice John Marshall said, the power to tax is the power to destroy. When you raise $500 billion of taxes in the economy, you are going to destroy jobs.
I yield back.
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