They Said Health Care Wouldn’t Impact Business

Well, the told us not to worry about how the HC reform would impact business – because it was going to be a good thing.  “Give it time” they told us, we would learn to like it.  Maybe even love it.

Now, take a look at AT&T announcing they will post 1Billion dollar profit loss.  And not just Ma-Bell, but Catepiller, Verizon, #3M, and I’m pretty sure, by the end of the week, we’ll hear about others.

First, we’re going to hear how Ma-Bell can afford this – but never mind that they only post 3b per Quarter, and this is in effect a 1/3 loss for the quarter.  Never mind, the same people who tell us MaBell can absorb it, are the very ones who don’t understand how Profit-Loss sheets work when it comes to forcasting what you can do next year.

See, 1Billion is a lot of money.  Profits mean pay raises.  Profits mean equipment upgrades.  Profits is not an evil word (unless you’re a Progressive hellbent on tearing down capatilism). 

And already AT&T is talking about maybe having to change their retirement package.  Well, I sure  hope you didn’t put in 30 years for Ma-Bell and then voted for Snowbama, because now we’re going to start seeing the true impact. 

Oh yeah, there will even be those who say all AT&T lost was a tax-credit, not real money.  First, anyone who refers to a tax-credit as anything other than the positve gain on the profit-loss sheet, is definitely not someone you want to have as a CPA.  Do they understand what a tax-credit is?  It’s money you get to keep.  And why does the government give the tax credit?  To encourage you to do something for 28 cents on the dollar it would cost them to do it.  In other words, the tax-credit is actually a way for the government to save money.

And when you are AT&T, and you’ve an agreement with your retirees to provide certain aspects of medical care, but now you find you still have to pay for it, and no longer get the partial re-imbursment you were counting on, guess what? Very good chance you’re not going to want to keep doing that, because now, the package you offer others is going to cost more money. 

Won’t change your health care if you already have it, they told us.  Looks like that is about to change as well.

And sure, some blooming fool is going to tell us this is “big buisness” and the typical small business didn’t have those tax credits.  To you, I say this – remember, AT&T still has to recover that 1B cost – and I’m sure there are a lot of small businesses who are vendors/suppliers for AT&T.  Not big, but probably going to end up on the chopping block when it comes for Big Blue to figure out how to cut costs.

Also, most small business don’t have an army of CPAs working for them.  It’s not as if most small businesses have even had time to figure out how the 2,900 pages will affect them.  But since they pay taxes quarterly, I’m sure the CPAs they do hire won’t take long to figure out what AT&T is already figuring out, and then inform their clients.

This is just the beginning.  And with Verizon, Catepillar and 3M already saying the same thing, it won’t be long before there are more businesses saying the same thing, than there are words in this post.

Old-Man-Tex

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